Unproven income in motor accident claims must be assessed using applicable minimum wages.

Ramkishun Kaushik, aged 56 years, died in a motor-vehicle accident on 3 May 2023 involving motorcycle No. CG-10/AH-0713.

His widow and three sons filed a claim petition before the Motor Accident Claims Tribunal.

By award dated 4 September 2024 in Claim Case No. 967/2023, the Tribunal assessed the deceased’s monthly income at ₹8,060 and awarded total compensation of ₹9,46,146.

The claimants appealed under Section 173 of the Motor Vehicles Act, 1988, seeking enhancement on the ground that the deceased was earning ₹20,000 per month and, at minimum, his income should have been assessed according to the applicable minimum wages of ₹9,960 per month.

The High Court condoned the 120-day delay, admitted the appeal, and heard it finally with the consent of the parties.

1. Whether the deceased’s monthly income should be reassessed at ₹9,960, being the applicable minimum wage for an unskilled labourer, instead of ₹8,060 assessed by the Tribunal.

2. Whether, upon such reassessment, the claimants were entitled to enhancement of the compensation awarded by the Tribunal.

The appeal was decided under Section 173 of the Motor Vehicles Act, 1988, which permits an aggrieved party to challenge an award of the Claims Tribunal.

In determining just compensation, the Court applied National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, concerning addition for future prospects; Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, concerning deductions for personal expenses and the applicable multiplier; and Magma General Insurance Co. Ltd. v. Nanu Ram, (2018) 18 SCC 1304, concerning compensation under conventional heads.

In the absence of documentary proof of the claimed income, income may be assessed on the basis of the applicable minimum-wage notification.

The Court found that the claimants had not produced documentary evidence establishing the asserted income of ₹20,000 per month.

However, the Tribunal’s assessment of ₹8,060 was below the minimum wage of ₹9,960 prescribed by the Chhattisgarh Labour Commissioner for unskilled labour.

The Court therefore reassessed the annual income at ₹1,19,520, added 10% for future prospects, deducted one-fourth towards the deceased’s personal expenses, and applied a multiplier of nine.

This resulted in a loss-of-dependency compensation of ₹8,87,436.

Applying the principles in Pranay Sethi, Sarla Verma, and Magma General Insurance, the Court retained compensation of ₹2,28,000 under conventional heads, resulting in total compensation of ₹11,15,436.

The compensation was enhanced from ₹9,46,146 to ₹11,15,436.

After deducting the amount already awarded, the claimants became entitled to an additional ₹1,69,290, carrying interest at 6% per annum from the date of filing of the claim application until realization.

The remaining terms of the Tribunal’s award were left undisturbed.

The Registry was directed to communicate the enhanced amount to the claimants in Hindi Devanagari, with assistance from paralegal workers if necessary.