Supreme Court affirms enhanced compensation using Rs.9,500 monthly income and multiplier of 14 in motor accident claim

A bench of Justices K. Vinod Chandran and N.V. Anjaria heard appeals arising from a motor accident claim and addressed challenges to the quantum of compensation awarded for the death of a 43‑year‑old mason. The appeals were filed by the claimants and the insurer against the tribunal's and High Court's assessments of income, multiplier and heads of compensation.

The Court allowed the appeals with specified modifications and upheld the High Court’s approach to assess notional income and apply an appropriate multiplier and additions. It accepted the reasoning that, in the absence of documentary proof of exact earnings for a mason, a notional monthly income could be adopted by reference to earlier precedents. The Court, in its reasoning, observed: The Court also noted the award for loss of consortium, recording that "All the claimants are entitled to Rs. 40,000/- each for loss of consortium."

Background The dispute arose after the death of the sole breadwinner, a mason, in a motor accident. The appellants (claimants) contended that the deceased earned Rs. 400 per day. The Motor Accident Claims Tribunal found no documentary proof supporting that claim and adopted a daily income of Rs. 189; the High Court accepted that figure as the accepted daily wage at the time but, applying Supreme Court precedents, proceeded to compute compensation on a notional monthly income. Relying on Ramachandrappa v. Royal Sundaram (2011) and adjusting for yearly increments, the courts treated Rs. 9,500 per month as a safe notional income for 2014. The High Court applied a multiplier of 14 for the 43‑year‑old deceased, added 25% for future prospects, and deducted one‑fourth for personal expenses.

The High Court awarded compensation under conventional heads: loss of future income, loss of consortium for the wife and three minor children at Rs. 40,000 each (following New India Assurance Co. v. Somwati), loss of estate and funeral expenses. The final computation resulted in a total award of Rs. 16,86,250, broken down as Rs. 14,96,250 for future income (calculated as Rs.9,500 x 12 x 14 x 125% x 3/4), Rs. 1,60,000 for loss of consortium (Rs.40,000 x 4), and Rs. 15,000 each for loss of estate and funeral expenses.

The Supreme Court directed that the awarded amounts were payable after deducting any amounts already paid and with interest at 6% per annum from the date of application until payment. The appeals were allowed with the above modifications; pending applications, if any, were disposed of.

Case No.: 2025 INSC 1220 (Civil Appeal Nos. _____ of 2025 @ Special Leave Petition (C) Nos.5687-88 of 2020) Case Title: Smt. Chandra Kala & Ors. v. ICICI Lombard Motor Insurance Company Limited & Ors. Appearances: For the Petitioner(s): Not indicated in the order For the Respondent(s): Not indicated in the order