Unproved income warrants notional assessment, with future prospects included in motor-accident compensation.

The appeals arose from a road accident on 1 January 2017 involving a motorcycle ridden by Gaddeppa, with Virupakshappa as pillion rider, and a car insured by the first respondent.

Both claimants sustained injuries and sought compensation under Section 166 of the Motor Vehicles Act, 1988.

The Tribunal partly allowed their claims, awarding ₹3,10,800 to Gaddeppa in MVC No. 287/2017 and ₹2,10,960 to Virupakshappa in MVC No. 422/2017.

Each claimant appealed, seeking enhancement.

Whether Gaddeppa, claimant in MVC No. 287/2017, was entitled to enhancement of compensation, including for loss of future earning capacity.

Whether Virupakshappa, claimant in MVC No. 422/2017, was entitled to enhancement of compensation, including for loss of future earning capacity.

The claims were brought under Section 166 of the Motor Vehicles Act, 1988, and the appeals under Section 173(1) of that Act.

In assessing loss of future earning capacity, the Court applied the multiplier method and added 40% future prospects, relying on Erudhaya Priya v. State Express Transport Corporation Ltd., 2020 SCC OnLine SC 601.

It assessed income notionally where the claimants failed to prove their asserted earnings, and considered functional disability in relation to the effect of the injuries on earning capacity.

Neither claimant substantiated the asserted monthly income of ₹24,000 with reliable employment records; Gaddeppa also failed to produce a driving licence.

The Court therefore adopted a notional monthly income of ₹11,000 for 2017 for each claimant.

It found no sufficient basis to disturb the Tribunal’s functional-disability assessments of 10% for Gaddeppa and 7% for Virupakshappa, and recalculated future loss using those percentages, a multiplier of 18, and 40% future prospects.

It also enhanced pain-and-suffering awards to reflect the nature of each claimant’s injuries, while allowing other amounts for treatment-related expenses, amenities and temporary loss of income as appropriate.

The Court enhanced Gaddeppa’s compensation to ₹5,22,640 and Virupakshappa’s to ₹3,59,848, with interest at 9% per annum from the respective claim-petition dates until deposit.

The insurer was directed to deposit the enhanced sums with interest within six weeks, after which the enhanced amounts were to be released to the respective claimants electronically.