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2025 Supreme(HP) 161

IN THE HIGH COURT OF HIMACHAL PRADESH SHIMLA
SATYEN VAIDYA, J.
Oriental Insurance Company Ltd. - Appellant 
Versus 
Smt. Rama Thakur & Ors. – Respondents
FAO No. 488 of 2017
Decided On : 08-04-2025

Advocates Appeared:
For the Appellant :Dr. Lalit K. Sharma, Advocate.
For the Respondents:Mr. Kanwar Bhupinder Singh, Advocate, Mr. Jeevesh Sharma, Advocate.

The court upheld the Tribunal's compensation assessment based on realistic income parameters, emphasizing that minimum wages serve as a guideline rather than a strict limit.

Headnote:

(A) Motor Vehicles Act, 1988 - Section 166 - Appeal against award of compensation for death in an accident - The Tribunal awarded Rs.16,65,000/- with interest @ 9% per annum, assessing the deceased's income at Rs.10,000/- per month and applying a multiplier of 17 - The insurer contested the income assessment as excessive, arguing for minimum wage rates instead. (Paras 6, 9, 12, 15, 17)

(B) Compensation Assessment - The Tribunal's assessment of income based on realistic parameters and evidence presented was upheld, with adjustments for future prospects and personal expenses considered. (Paras 12, 15, 17)

Facts of the case:
The appeal arises from a claim petition filed by the mother of the deceased Karan Singh, who died in an accident while working as a labourer. The Tribunal awarded compensation based on assessed income and dependency calculations. (Paras 2-4)

Findings of Court:
The assessment of monthly income at Rs.10,000/- was deemed reasonable, and the total compensation was modified to Rs.15,12,000/- with interest. (Paras 17-18)

Issues: The main issues included the appropriateness of the income assessment and the application of the multiplier for calculating compensation. (Paras 9, 15)

Ratio Decidendi: The court affirmed that while minimum wages can guide income assessment, realistic parameters based on evidence should prevail, and adjustments for future prospects are warranted. (Paras 12, 15)

Result: Appeal partly allowed; the award modified to Rs.15,12,000/- with interest.

JUDGMENT :

(Satyen Vaidya, J.)

The instant appeal has been filed against the award dated 01.08.2017 passed by the learned Motor Accident Claims Tribunal-II, Shimla, H.P. in MAC Petition No. 24-S/2 of 2015.

2. The appellant herein is the insurer of vehicle No. HP-03B-3103 which was involved in an accident on 25.05.2015 resulting in death of deceased Karan Singh. The vehicle was used for transportation of debris and deceased Karan Singh was occupying the same as a labourer and as an employee of the owner for the purpose of loading and unloading.

3. Deceased Karan Singh was aged 26 years at the time of accident/death. He was survived by his mother Smt. Rama Thakur, who preferred a claim petition under Section 166 of the Motor Vehicles Act for grant of compensation.

4. The vehicle was owned by respondent NO.2 herein (hereinafter referred to as the owner) and was being driven by respondent No.3 herein (hereinafter referred to as driver).

5. The cause of death of deceased Karan Singh was attributed to the rash and negligent driving of the driver.

6. The owner, driver and insurer contested the petition. Learned Tribunal vide impugned award has allowed the petition and claimant has been held to be entitled to Rs.16,65,000/- as compensation with interest @ 9% per annum from the date of filing of the petition till actual realization. Liability to satisfy the award has been fastened upon the insurer.

7. Learned Tribunal has assessed the income of deceased at Rs.10,000/- per month. It has been held that the deceased was getting Rs.7500/- per month from his employer and in addition, he was also earning Rs.2,500/- per month from the agriculture. An addition of 50 % has been made on account of loss of future prospects and after deducting an amount of 50% on account of personal expenses, the deceased’s monthly dependency has been assessed at Rs.7,500/-. Multiplier of 17 has been applied and in this manner, the total dependency has been assessed at Rs.15,30,000/- In addition, Rs.1,00,000/- has been awarded under the head “loss of love and affection”. Further, Rs.25,000/- and Rs. 10,000/- have been awarded under the heads “funeral charges” and “loss of estate”, respectively.

8. I have heard learned counsel for the parties have have also gone through the entire record carefully.

9. Dr. Lalit K. Sharma, learned counsel representing the insurer/appellant has fairly conceded that he will confine his challenge to the impugned award on the ground of being excessive. He would submit that minimum wages payable to the labourer in the year 2015, was Rs.180/- per day. Thus, the learned Tribunal was not justified in assessing the income of the deceased at Rs.10,000/- per month. He has also submitted that there was no convincing evidence on record to suggest that the deceased was earning Rs.2,500/- per month from agriculture.

10. On the other hand, Shri Bhupinder Singh Kanwar, learned counsel for the claimant has supported the award. He has submitted that the award was passed by applying the realistic parameters.

11. Learned Tribunal has based its findings on the statement of the claimant and of the owner of the vehicle, who was also the employer of the deceased. To challenge such findings, learned counsel for the insurer has contended that since there was no document on record to prove the income of the deceased, the wages fixed under the Minimum Wages Act were liable to be considered. As per him, since the minimum wages of a labourer in the year 2015 was only Rs.180/- per day, the monthly income of the deceased could not have been assessed to be more than Rs.5400/-.

12. No doubt, the prescribed minimum wages under the Minimum Wages Act can be used as a guiding factor but it cannot be the sole determinative criteria. Some amount of guess work based on realistic parameters is permissible, which definitely will depend on the facts of each case.

13. It is proved in the case in hand that the deceased was working as a labourer and was employed by the owner, who has made a de

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