Bom HC | In absence of documentary evidence, can monthly income of deceased be determined as notional income for purpose of determining compensation under MV Act? Explained

Bombay High Court: Noting that the Motor Accident Claims Tribunal Member did not properly determine just and proper compensation, V.M. Deshpande, J., while partly allowing the appeal enhanced compensation.

Instant appeal was filed by the claimants for enhancement of compensation.

Factual Matrix

Appellants were the widow, sons and daughters of the deceased. Deceased when proceeding to his house on foot after closing his shop was crushed to death by the offending vehicle. The offence was registered against the driver of the offending vehicle.

Further, the appellants had approached the Motor Accident Claims Tribunal by filing a petition under Section 166 of the Motor Vehicles Act. In the said petition, it was averred by the claimants that when the deceased met an untimely death, he was 40 years old and a self-employed person.

Claimants added that the monthly income of the deceased was Rs 10,000 and the aggregate compensation claimed was Rs 5,00,000 with interest at 12% pa from the date of the accident.

MACT passed the judgment and award holding that the claimants were entitled to total compensation of Rs 1,89,500/- inclusive of no-fault liability amount of Rs 50,000/- along with interest at the rate of 7.5% per annum from the date of filing of petition.

On being dissatisfied with the compensation amount that was awarded, present appeal was filed.

Issue

According to the counsel for the appellant, the Tribunal committed an error in determining the monthly income of the deceased as Rs 15000/-. She submitted that in any case, the income of the deceased was not less than Rs 10,000/- per month. She also submitted that the judgment of tribunal cannot stand to the scrutiny of law inasmuch as nothing is granted in favour of the claimants under the head of future prospects. Along with this, Tribunal had wrongly deducted 1/3rd amount towards personal expenses.

Did member of the MACT grant just and adequate compensation to the claimants?

Analysis, Law and Decision

In Court’s opinion, Member of the Tribunal had rightly reached the conclusion that at the time of the death, the age of the deceased was 45 years.

Adding to the above analysis, Court stated that there was no documentary evidence that could throw light on the daily income of the deceased.  However, from the evidence of the widow, it was clear that the deceased was engaged in repairing tubes and tyres of various vehicles and not the bicycles. In that view of the matter, the Judge had determined the daily income of the deceased on very lower side.

Once it is established that the deceased was not unemployed and he was engaged in the business of vulcanization, without there being any documentary proof about his income, his monthly income will have to be determined as notional income.

Moving further, High Court elaborated stating that in absence of any documentary evidence and keeping aside the exaggeration in respect of earning per month income of the deceased, looking to the nature of self-employment of the deceased, the Court reached the conclusion that monthly income of deceased was Rs 5,000.

Claimants were entitled to 25% towards future prospects.

In Court’s opinion, the Tribunal committed an error in deducting 1/3rd income. Seven persons were dependent on the deceased. Therefore, a proper deduction would be 1/5th.

The inadequate amount was granted in favour of the claimants on account of loss of consortium for which they were entitled at the rate of Rs 44,000/- per dependent in view of the law laid down in Magma General Insurance Co. Ltd v. Nanu Ram, (2018) 18 SCC 130. Similarly, less compensation was granted to the claimants in respect of the loss of estate and future expenses which appellants will be entitled. Therefore, the claimants were surely entitled to enhancement.[Sahana Khatoon v. New India Assurance Co. Ltd., 2021 SCC OnLine Bom 3695, decided on 28-10-2021]


Advocates before the Court:

Ms Mitisha Kotecha, Advocate for appellants.

Mr M. B. Joshi, Advocate for respondent 1.

None for respondents. 2 and 3, though served.

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