Supreme Court directs fresh computation of compensation in motor accident case, fixes notional income at Rs.10,000 per month

A bench of Justice Sanjay Karol and Justice Manmohan heard an appeal by the claimant-appellant against the judgment of the High Court of Punjab and Haryana in FAO No.4651 of 2014 (O&M) challenging the quantum of compensation awarded in a motor accident claim arising from an accident on 12 October 2012. The primary issue before the Court concerned the proper basis for fixing notional income for the injured claimant (a student) and whether reliance on minimum wages of an unskilled worker was appropriate for computation of future loss of earnings.

The Court allowed the appeal, held that the High Court erred in equating the notional income of a student to minimum wages, and directed recomputation of compensation on the basis of a notional monthly income of Rs.10,000. The Court accepted the appellant’s submission and placed reliance on this Court’s earlier decision in Navjot Singh v. Harpreet Singh, noting that “we do not think that the notional income of a student undergoing a Degree course in Engineering from a premier institute should be taken to be equivalent to the minimum wages admissible to an unskilled worker.” The Court, in its reasoning, observed: “13. But we do not think that the notional income of a student undergoing a Degree course in Engineering from a premier institute should be taken to be equivalent to the minimum wages admissible to an unskilled worker. Students recruited through campus interviews are atleast offered a sum of Rs.20,000/- per month. Even if we do not go on the said basis, the High Court could have fixed the notional income atleast at Rs.10,000/- per month. 14. Therefore, in the facts and circumstances of the case, and by exercising our power under Article 142 of the Constitution of India, we take the notional monthly income of the appellant as Rs.10,000/ per month.” The Court recomputed the compensation and awarded a total of Rs.34,56,110 along with interest at 7.5% per annum from the date of filing of the claim petition before the Tribunal, excluding 642 days of delay in preferring the appeal.

Background The claimant-appellant Deepak (alias Deepak Chauhan) and his friend Bhagwan Singh were riding a motorcycle when they collided with a Scorpio driven rashly and from the wrong side; Bhagwan Singh died on the spot and Deepak sustained grievous injuries. FIR No.213 was registered on 13 October 2012 under Sections 279, 337, 304A and 427 IPC. The claimant filed a petition before the Motor Accident Claims Tribunal, Gurgaon (MACT), which partly allowed the petition and awarded Rs.7,09,303 as compensation with interest @7.5% per annum, directing that respondents (driver, owner and insurer) were jointly and severally liable and that the insurer would pay the amount.

The claimant challenged the quantum before the High Court, which enhanced the award to Rs.23,90,719 while leaving interest undisturbed, relying on this Court’s decision in Raj Kumar v. Ajay Kumar and on medical evidence including the testimony of Dr. Arvind Mehra (PW6) and discharge summaries. Before this Court the claimant contended that the High Court erred in using minimum wages as the notional income benchmark for a student and relied on this Court’s subsequent order in Navjot Singh v. Harpreet Singh. The Supreme Court found merit in that submission, applied the notional monthly income of Rs.10,000, and recomputed heads of loss (including loss of income, medical expenses, attendant charges, loss of amenities/prospects of marriage, pain and suffering, special diet and enhancement) to arrive at the award of Rs.34,56,110. The appeal was allowed, delay was condoned and leave was granted; pending applications stood disposed of accordingly.

Case Details: Case No.: SLP(C)D.No.236/2024 Case Title: Deepak Singh alias Deepak Chauhan v. Mukesh Kumar & Ors. Appearances: For the Petitioner(s): [Counsel not indicated in judgment] For the Respondent(s): [Counsel not indicated in judgment]