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2025 Supreme(SC) 1663

SUPREME COURT OF INDIA
K. VINOD CHANDRAN, N.V. ANJARIA, JJ.
Smt. Manjula & Ors. – Appellants
Versus
The Branch Manager, Oriental Insurance Company Ltd. Bijapur & Anr. – Respondents
Civil Appeal No. 11425 Of 2025 (@ Special Leave Petition (Civil) No. 1733 of 2021)
Decided On : 09-09-2025

Advocates appeared:
For the Appellant(s) : Mr. Preetam Shah, Adv. Mr. K. Krishna Kumar, AOR
For the Respondent(s): Mr. Arvind Gupta, AOR Mr. Anil Kumar Sahu, Adv. Mr. Kanav Bhardwaj, Adv. Mr. Rahul Raj, Adv. Mr. Ashish Kumar Sinha, Adv. Mrs. Binita Jaiswal, Adv.

Headnote:(A) Motor Vehicles Act, 1988 - Compensation - Appeals for enhancement of compensation regarding a vehicular accident with fatalities - The Tribunal's determination of monthly income was reduced without basis by the High Court. The deceased, despite lack of concrete proof, is deemed to have an assumed income of Rs.12,000/- in light of qualifications and familial responsibilities - The court emphasized corroborating future prospects and applied the correct multiplier. (Paras 2, 5, 6, and 7)

(B) Compensation Quantum - Principles guiding the assessment of compensation in vehicular accidents where loss of life is involved, emphasizing the need to consider future prospects and family structure in evaluating damages. (Paras 5 and 6)

Facts of the case:
Four friends traveling to Shirdi were killed in an accident caused by a negligent goods lorry driver. Four claim petitions were filed for compensation enhancement after a reduction by the High Court; disagreement focused on the deceased's income determination.

Findings of Court:
Monthly income should be considered at Rs.12,000/-, with a total award calculated at Rs.20,80,000/-, with payment to be made timely.

Issues: The focus was on the appropriate income assessment and the justifications for compensation enhancements.

Ratio Decidendi: The court ruled that the assessment of income and compensation ought to reflect the deceased's qualifications and obligations to the family, correcting the High Court's arbitrary reduction of income.

Result: Appeals allowed.

Table of Content
1. overview of the car accident and claim background. (Para 1)
2. dispute regarding income assessment of the deceased. (Para 2 , 3)
3. court's scrutiny of evidence on income claims. (Para 4 , 5)
4. determination of compensation based on legal precedents. (Para 6)
5. orders for payment of compensation and appeal decision. (Para 7 , 8 , 9)

JUDGMENT :

K. VINOD CHANDRAN, J.

Four friends from Bijapur were on a pilgrimage to Shirdi when the car in which they were travelling, driven by one of them, was hit by a goods’ lorry driven rashly and negligently coming from the opposite direction on the NH-13 Bijapur-Horti Road. All the persons travelling in the car died on the spot. Four claim petitions were filed before the Tribunal and four appeals were filed seeking enhancement of compensation, to which appeals cross objections were filed by the Insurance Company. The appellate order which is impugned in the present appeal by the claimants in one of the claim petitions seek enhancement of income and a better award than that granted by the Tribunal, since the High Court reduced the quantum of income without any reason.

2. There is absolutely no dispute with respect to the negligence being mulcted on the driver of the lorry, which is also covered by a valid insurance policy. The challenge is only to the quantum and though in the judgment of the Tribunal from which the present appeal arises, the deceased-husband of the first claimant was found to have a monthly income of Rs.6,000/-, without any reasoning and without reliance to any material, the High Court reduced it to Rs.5,500/-. The total amount was enhanced, since addition was made to the future prospects in tune with the Constitution Bench judgment in National Insurance Co. Ltd. v. Pranay Sethi , (2017) 16 SCC 680.

3. The dispute is raised on the income determined which according to the learned Counsel for the appellants; vehemently asserted before us, was Rs.2,25,000/-. The deceased was a multifaceted personality having several irons in the fire; proprietor of a medical shop, partnership in a pharmaceutical distributorship and Director of a Cooperative Bank. The learned Counsel appearing for the Insurance Company, however, pointed out that none of these tall claims were substantiated.

4. As we noticed, the High Court has not referred to any material in fixing the monthly income. The trial court on the other hand, in the subject claim petition has referred to the various documents produced by the claimants. It has been proved that the deceased had a diploma in Pharmacy. The claim of running a medical shop was not proved since his licence was cancelled on 11.02.2008 while the accident took place on 25.07.2010. The distributorship run through a partnership was proved, but not the income since the various documents produced were found by the Tribunal to be not authenticated; nor were the alleged partners examined. The claim of Directorship in a Cooperative Bank and monthly sitting fees obtained, was also not fully substantiated. It was in this situation that the Tribunal adopted a monthly income of Rs. 6,000/- which the High Court reduced, without any basis, to Rs.5,500/-.

5. We cannot but notice that this Court has in Ramachandrappa v. Royal Sundaram Alliance Insurance Co. Ltd. , (2011) 13 SCC 236 found that in the year 2004 even a Coolie would be earning an amount of Rs.4,500/- in a month. If incremental increase is made of Rs.500/- per year, it can be safely assumed that a Coolie in the year 2010, when the subject accident occurred, would have obtained an income of Rs.7,500/-. The deceased herein has been proved to have a diploma in Pharmacy though the exact remuneration is not substantiated. He is found to be in a partnership of pharmaceutical distributorship and associated with a Cooperative Bank. The deceased was also running a medical shop, though prior to the date of the accident the licence stood cancelled. Considering the overall circumstances, it can be safely assumed th

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