The High Court reaffirmed that compensation under the Motor Vehicles Act must include “future prospects” in addition to actual income, following the Supreme Court’s judgment in Pranay Sethi. This decision upholds settled law and serves as binding authority for subordinate courts addressing death compensation claims for salaried decedents.
Summary
| Category | Data |
|---|---|
| Case Name | MAC/451/2024 of JOGANTI BAI Vs PREM SAI |
| CNR | CGHC010076962024 |
| Date of Registration | 04-03-2024 |
| Decision Date | 17-10-2025 |
| Disposal Nature | DISPOSED OFF |
| Judgment Author | HON’BLE SHRI JUSTICE RAKESH MOHAN PANDEY |
| Court | High Court of Chhattisgarh |
| Precedent Value | Binding on subordinate courts within Chhattisgarh |
| Overrules / Affirms | Affirms Supreme Court ruling in National Insurance Co. Ltd. v. Pranay Sethi (2017) |
| Type of Law | Motor Accident Claims / Compensation |
| Questions of Law | Whether failure to add “future prospects” in compensation computation for deceased salaried individuals is correct under prevailing Supreme Court guidelines? |
| Ratio Decidendi |
The High Court held that exclusion of “future prospects” in determining compensation is not in accordance with the law laid down by the Supreme Court. Relying on Pranay Sethi, the Court ruled that future prospects (15%) should be mandatorily added to the annual income of the deceased, even when the Tribunal omits it. Compensation awarded was thus recalculated to include this component. The decision binds subordinate courts in the computation of compensation under the Motor Vehicles Act where the deceased was an employee. |
| Judgments Relied Upon | National Insurance Company Ltd. v. Pranay Sethi, (2017) 16 SCC 680 |
| Logic / Jurisprudence / Authorities Relied Upon by the Court | The Court relied on the Pranay Sethi ruling, which mandates inclusion of “future prospects” (a percentage of annual income) to ensure just compensation to claimants. |
| Facts as Summarised by the Court |
The deceased, employed as a Carrier Man with South Eastern Coalfields Ltd., died in a road accident involving a stationary, unlit truck. The wife and children of the deceased sought enhanced compensation. The Tribunal had awarded compensation based on actual income but omitted “future prospects”. The High Court examined whether future prospects should be mandatorily included, recalculating the award accordingly. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts within Chhattisgarh |
| Persuasive For | Other High Courts adjudicating similar compensation matters |
| Follows | National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680 |
What’s New / What Lawyers Should Note
- Reinforces that “future prospects” component must be mandatorily added to compensation calculations in motor accident death claims of salaried individuals, as per Pranay Sethi.
- The omission of future prospects by the Tribunal is reversible error; High Court intervention is justified even on appeal limited to quantum.
- The judgment quantitatively applies the 15% “future prospects” increment for the deceased’s category, providing a model calculation for reference.
- Lawyers should ensure Tribunals follow this computation and rely on this judgment to challenge awards omitting the future prospects component.
Summary of Legal Reasoning
- The Court first considered the Tribunal’s finding, which computed compensation excluding “future prospects”.
- The High Court reviewed the Supreme Court’s decision in National Insurance Co. Ltd. v. Pranay Sethi, which held that “future prospects” must be a part of just compensation, set at 15% of annual income for the relevant category in this case.
- On applying Pranay Sethi, the Court recalculated annual income by adding 15% for future prospects, after deducting tax and relevant personal expenses, then applied the multiplier and added conventional heads.
- Found the Tribunal erred in not including the future prospects; therefore, the award was enhanced accordingly.
- Directed the Insurance Company to pay the recalculated compensation within 60 days, failing which higher interest would apply.
Arguments by the Parties
Petitioner (Appellants / Claimants):
- The Tribunal assessed the deceased’s notional income too low.
- Insufficient amounts were awarded under conventional heads.
- No amount was awarded towards future prospects.
- Requested modification of the award to include these components.
Respondents:
- None appeared, though served with notice.
Factual Background
The deceased, Lakhanlal, worked as a Carrier Man in South Eastern Coalfields Ltd. and died on 23.04.2020 in a road accident after his motorcycle struck a stationary, unlit truck parked on the road. His family (wife and children) filed a compensation claim, which the Tribunal allowed, but without accounting for “future prospects”. The claimants appealed, seeking recalculation in light of Supreme Court guidelines.
Statutory Analysis
- The Court examined Section 173 of the Motor Vehicles Act, 1988 regarding appeal against Tribunal awards.
- Applied principles set out in Supreme Court rulings on compensation calculation under the Motor Vehicles Act for fatal accidents, especially the mandate for adding “future prospects” to income for determining “just compensation”.
Alert Indicators
- Precedent Followed – The judgment explicitly follows and applies the binding precedent of the Supreme Court in Pranay Sethi regarding computation of compensation in motor accident claims, ensuring “future prospects” are mandatorily added.