Court’s Decision
The Telangana High Court partly allowed the appeal filed by the claimants, enhancing the compensation awarded by the Motor Accident Claims Tribunal from ₹6,18,000 to ₹7,01,800. The Court held that the Tribunal erred by not adding future prospects and not applying correct amounts under the heads of consortium and other conventional heads in light of the principles laid down in Pranay Sethi. The Court directed that the compensation shall carry interest at 9% per annum from the date of the claim petition until realization and must be deposited within eight weeks.
Facts
The claimants had filed a petition seeking compensation of ₹12,00,000 for the death of the deceased in a road accident that occurred on 22 March 2014 near Reddy’s Laboratories, Bachupally, Hyderabad. The Tribunal had awarded ₹6,18,000 with 9% interest per annum. Aggrieved by the inadequate compensation, the appellants approached the High Court for enhancement.
Issues
- Whether the Tribunal erred in calculating the income of the deceased as ₹70,000 per annum instead of ₹15,000 per month.
- Whether future prospects, consortium, and other conventional heads were correctly applied in light of Pranay Sethi.
Petitioner’s Arguments
The appellants argued that the deceased, a steward working in a hotel at DRL Project under Compass Group India Services Ltd., earned ₹15,000 per month. They contended that the Tribunal erroneously considered his income to be ₹70,000 per annum without proper evidence. Additionally, they challenged the Tribunal’s assessment of the deceased’s age as 52 years and claimed that adequate amounts under the heads of consortium and future prospects were not awarded.
Respondent’s Arguments
The respondent insurance company countered that the Tribunal correctly assessed the deceased’s income and age based on available records. It was argued that the deceased was a contract employee (canteen boy), and no credible documentary evidence supported the claim of ₹15,000 per month income. They also defended the Tribunal’s method of calculating compensation.
Analysis of the Law
The High Court relied on National Insurance Co. Ltd. v. Pranay Sethi (2017) 16 SCC 680 and Sarla Verma v. DTC (2009) 6 SCC 121. The Court reiterated that even in cases of notional income, future prospects must be added as per the guidelines in Pranay Sethi. The Tribunal had not awarded future prospects or appropriately considered consortium for both wife and daughter of the deceased. The Court also relied on Section 58 of the Indian Evidence Act, 1872, to uphold the admitted age of the deceased as 52 years.
Precedent Analysis
- Pranay Sethi (2017) 16 SCC 680: Held that future prospects must be added to the income while computing compensation even for notional income cases. The Court applied a 10% increase considering the deceased was 52 years old.
- Sarla Verma (2009) 6 SCC 121: Provided the applicable multiplier based on age, which was accepted as 11 for the deceased aged 52 years.
These judgments formed the backbone of the High Court’s recalculation.
Court’s Reasoning
The Court noted that although the wife of the deceased claimed his income was ₹15,000 per month, there was no documentary proof. Given the police record described him as a canteen boy, a notional income of ₹6,000 per month was accepted. A 10% increase for future prospects was added, bringing the monthly income to ₹6,600 and the annual income to ₹79,200. After deducting one-third for personal expenses, the contribution to the family was fixed at ₹52,800 annually. Applying the multiplier of 11, the loss of dependency came to ₹5,80,800. Under consortium and funeral expenses, the Court recalculated based on Pranay Sethi and awarded an additional ₹1,21,000, bringing the total to ₹7,01,800.
Conclusion
The High Court enhanced the compensation from ₹6,18,000 to ₹7,01,800 with 9% interest from the date of petition till realization. The amount is to be deposited within eight weeks and disbursed to the claimants without security.
Implications
This judgment reinforces that:
- Future prospects must be factored even in notional income cases.
- Courts will award individual consortium to both spouse and children.
- Admitted facts under the Evidence Act carry weight and can limit challenges to previously stated positions.
The ruling strengthens claimants’ rights to fair compensation and holds Tribunals accountable for applying binding precedents.
FAQs
1. Can future prospects be added to notional income in accident compensation cases?
Yes, the Supreme Court in Pranay Sethi has mandated adding future prospects even in cases involving notional income, as reaffirmed by the Telangana High Court in this judgment.
2. How is the age of the deceased determined in the absence of documentary proof?
The Court upheld the age mentioned in the affidavit by the wife of the deceased, stating that admitted facts under Section 58 of the Evidence Act do not require further proof.
3. What are the updated amounts for consortium and funeral expenses?
Following Pranay Sethi, the Court awarded ₹44,000 each to wife and daughter for consortium and ₹33,000 for funeral expenses and loss of estate with a 10% enhancement.
Cases Referred and Their Relevance
- National Insurance Co. Ltd. v. Pranay Sethi (2017) 16 SCC 680: Mandated addition of future prospects to income and revised amounts under conventional heads like consortium and funeral expenses.
- Sarla Verma v. Delhi Transport Corporation (2009) 6 SCC 121: Provided guidelines for selection of multiplier based on age of the deceased.
