Unproved income in motor accident claims must be assessed using prevailing minimum wages.

In brief

The question

Whether the Tribunal correctly assessed the deceased’s monthly income in the absence of documentary or other cogent proof of actual earnings

The court held

The appeal was partly allowed and the award was modified. The claimants were granted enhanced compensation of ₹10,88,820, in addition to the Tribunal’s original award, with interest at 9% per annum from the date of filing of the claim petition until realization

It also directed

Respondent No. 3, the insurer, was directed to deposit the awarded amount, including the enhancement, within six weeks of receiving the order. The Tribunal was directed to disburse the amount to the claimants after verification and deduction of any deficit court fee

The statutory deposit, if any, was directed to be transmitted to the Tribunal; there was no order as to costs

01Facts

On 4 March 2023, Jinabhai Arjanbhai Chavda was travelling as a pillion rider on a motorcycle when a truck allegedly driven rashly and negligently from the wrong side collided with the motorcycle. He sustained serious injuries and died during treatment

¶ 2(i)

His dependants claimed that he was 37 years old and earned ₹20,000 per month as a labourer

¶ 2(ii)

The Motor Accident Claims Tribunal, Bhavnagar at Mahuva, partly allowed M.A.C.P. No. 14 of 2023 and awarded ₹12,79,600 with interest at 9% per annum from the date of filing of the claim petition

¶ 1, 3

The claimants preferred the present appeal seeking enhancement of compensation on the ground of quantum

¶ 4

02Issues

i.Whether the Tribunal correctly assessed the deceased’s monthly income in the absence of documentary or other cogent proof of actual earnings

¶ 6, 9

ii.Whether the claimants were entitled to enhancement towards future prospects, loss of dependency, loss of consortium, loss of estate and funeral expenses

¶ 6, 8–15

iii.What amount of enhanced compensation and interest should be awarded to the claimants

¶ 15–17

03Law Applied

The Court applied the motor accident compensation principles governing assessment of “just compensation.” In the absence of cogent evidence of actual income, the income of a deceased labourer may be assessed with reference to the applicable minimum wages prevalent on the date of the accident

¶ 9

Relying on National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, the Court added 40% towards future prospects for a deceased below 40 years of age and applied the appropriate multiplier of 15

¶ 10, 12

Applying Magma General Insurance Co. Ltd. v. Nanu Ram alias Chuhru Ram, (2018) 18 SCC 130, it granted consortium to each of the seven legal representatives

¶ 13

The conventional amounts for loss of estate and funeral expenses were also aligned with the principles in Pranay Sethi

¶ 14

04Reasoning

The Court found that the claimants had not established the deceased’s asserted income of ₹20,000 per month by cogent evidence. However, the Tribunal’s assessment of ₹6,000 per month was below the Gujarat Government’s minimum wage for a skilled worker applicable on the accident date. The Court therefore reassessed the monthly income at ₹9,887

¶ 9

Since the deceased was 37 years old, it added 40% for future prospects, resulting in a monthly income of ₹13,842

¶ 10

As the deceased left seven legal representatives, the Court deducted one-fifth towards personal expenses and assessed the monthly dependency at ₹11,074

¶ 11

Applying the multiplier of 15, loss of dependency was calculated at ₹19,93,320

¶ 12

It further awarded ₹3,38,800 towards consortium at ₹48,400 for each of the seven legal representatives, and ₹18,150 each for loss of estate and funeral expenses

¶ 13–14

The total compensation was consequently recalculated at ₹23,68,420, against which the Tribunal’s award of ₹12,79,600 was deducted

¶ 15