Allahabad High Court
SMT. USHA DEVI AND 6 OTHERSversusCHANDRA BHUSHAN UPADHYAY AND 2 OTHERS
- Decided
Holding
The High Court modified the Tribunal's award, increasing the compensation to Rs.14,42,600, after correcting the income assessment, deduction rate, and adding future prospects and a revised loss‑of‑consortium amount.
Summary
The Allahabad High Court heard an appeal by the claimants seeking enhancement of compensation awarded by the Motor Accident Claims Tribunal in a 2014 road accident that killed a 37‑year‑old daily labourer. The Tribunal had fixed the deceased's annual income at Rs.36,000, applied a 1/4 deduction for personal expenses, and awarded a total of Rs.4,15,000. The appellants argued that the income should be based on the Minimum Wages Act at Rs.6,000 per month, the deduction should be 1/5th given seven dependants, and that future prospects and a higher loss‑of‑consortium amount should be included. The respondents contended that the Tribunal's assessment was proper and that no future‑prospects addition could be granted. The Court held that the Tribunal erred on the income assessment, the deduction rate, and the omission of future prospects, and recomputed the award to Rs.14,42,600 with interest at 7% per annum, directing the insurer to pay the enhanced amount. The appeal was therefore partly allowed.
Issues considered
- The correctness of the Tribunal's assessment of the deceased's annual income
- Whether the deduction for personal and living expenses should be 1/5th instead of 1/4th
- Whether an addition for future prospects is permissible
- Whether the loss of consortium award should be recomputed
- Whether the overall quantum of compensation should be enhanced
Legislation cited
- Minimum Wages Act
- Motor Vehicles Act
- U.P. Motor Vehicles Rules — s. Rule 220-A
Subjects
- motor accident compensation
- quantum of damages
- future prospects
- loss of consortium
- Minimum Wages Act
- Multiplier method
- interest under Rule 220-A
- High Court appeal
Judgment
Reserved on 1.7.2026
Delivered on 18.9.2026
HIGH COURT OF JUDICATURE AT ALLAHABAD
FIRST APPEAL FROM ORDER No. - 4292 of 2017
Smt. Usha Devi And 6 Others
.....Appellant(s)
Versus
Chandra Bhushan Upadhyay And 2 Others
.....Respondent(s)
Counsel for Appellant(s) : Ashok Kumar Singh
Counsel for Respondent(s) : Om Prakash Mishra
Court No. - 54
HON'BLE ANIL KUMAR-X, J.
1. This appeal, at the instance of the claimants seeking enhancement of
compensation, challenges the judgment and award dated 9.11.2016 passed
by the Motor Accident Claims Tribunal hereinafter referred to as the
"Tribunal") in M.A.C.P. No. 372 of 2014 (Smt. Usha Devi and Ors. vs.
Chandra Bhushan Upadhyay and Ors.), whereby a sum of Rs.4,15,000/-
has been awarded to the claimants.
2. The occurrence of the accident is not in dispute. The finding of
negligence recorded by the Tribunal has also not been challenged. The
only issue that arises for consideration in the present appeal is the
quantum of compensation awarded by the Tribunal.
3. The accident took place on 08.03.2014. The deceased, Baijnath, was
about 37 years of age at the time of the accident and was stated to be
working as a labour under MNREGA Scheme. The Tribunal assessed the
income of the deceased at Rs.36,000/- per annum as per notional income,
deducted 1/4th towards personal and living expenses, applied the
multiplier of 15, awarded Rs.5000/- towards loss of consortium, Rs.
5000/- towards funeral expenses. The Tribunal consequently awarded a
total compensation of Rs.4,15,000/-.
4. Shri Ashok Kumar Singh, learned counsel for the appellants submitted
that the Tribunal has erred in assessing the income of the deceased at
FAFO No. 4292 of 2017
2
Rs.36,000/- per annum, whereas it ought to have been assessed at
Rs.6000/- per month as per Minimum Wages Act, as the deceased was
working as a labour. It was submitted that deduction towards living
expenses should be one-fifth instead of one-fourth as the deceased left
seven dependants, including wife, children and mother. It was further
submitted that the Tribunal failed to make any addition towards future
prospects. It was contended that the amount awarded under the
conventional heads is on the lower side and deserves enhancement in the
light of the decisions in National Insurance Co. Ltd. v. Pranay Sethi
and Others, 2017 LawSuit (SC) 1093; Sarla Verma v. Delhi
Transport Corporation, (2009) 6 SCC 121; Magma General
Insurance Co. Ltd. v. Nanu Ram, 2018 (4) TAC 345 (SC); and New
India Assurance Co. Ltd. v. Urmila Shukla, 2021 SCC OnLine SC
822. It was submitted that, in view of the aforesaid decisions, the
compensation awarded by the learned Tribunal requires recomputation.
5. Per contra, Shri Om Prakash Mishra, learned counsel for the
respondent-Insurance Company submitted that the income assessed by the
Tribunal is just and proper, as no documentary evidence regarding the
income of the deceased was produced. It was contended that no addition
towards future prospects could be made, as the accident occurred prior to
the decision of the Hon'ble Supreme Court in National Insurance Co.
Ltd. v. Pranay Sethi and Others, 2017 LawSuit (SC) 1093. It was also
submitted that the deduction towards personal and living expenses made
by the Tribunal is proper and hence no interference is required.
6. Having heard learned counsel for the parties and upon perusal of the
record, this Court is of the view that the Tribunal has erred in assessing
the income of the deceased at Rs.36,000/- per annum. The deceased was
daily labour and as per Minimum Wages Act, the monthly income would
be Rs.6000/- The submission advanced on behalf of the respondent is that
no addition towards future prospects can be granted. This submission
cannot be accepted. Even prior to the decision in Pranay Sethi (supra), the
Courts had been awarding compensation towards future prospects, though
by adopting different methods of computation. Considering the number of
dependants, deduction towards living expenses should be one-fifth instead
of one-fourth.
FAFO No. 4292 of 2017
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7. So far as the issue of consortium is concerned, it is relevant to note that
deceased had left seven dependants, out of which, there are four children,
one wife and a mother. If consortium as per decision of Magma General
Insurance Co. Ltd. (supra). is applied, then the said awarded amount
under the loss of consortium itself will be exorbitant. Law is settled that
compensation awarded under the Motor Vehicles Act should be just and
proper and should not be as bonanza. Hence, a lump sum consortium to
all dependants is determined at Rs.2,00,000/- which will be apportioned
equally among them. The appellants shall be entitled to Rs.16,500/-
towards loss of estate, and Rs.16,500/- towards funeral expenses, after
granting the enhancement of 10%, in terms of the decisions of the Hon'ble
Supreme Court in Pranay Sethi (supra) and Magma General Insurance
Co. Ltd. (supra).
8. Hence, upon recalculation and re-assessment of the award, the total
compensation payable to the appellants is computed herein below:
Particulars Amount (Rs.)
Monthly income 6000/-
Addition towards future prospects @ 40% 2400/-
Total annual income (8400 x 12) 1,00,800/-
Deduction towards personal and living expenses 20160/-
(1/5th)
Loss of dependency 80640/-
Multiplier of 15 (age 37 years) 12,09,600/-
Loss of consortium (lump sum) 2,00,000/-
Loss of estate @ Rs. 15,000/ increased by 10% after 16,500/
every 3 years
Funeral expenses @ Rs. 15,000/ increased by 10% 16,500/
FAFO No. 4292 of 2017
4
after every 3 years
Total Compensation 14,42,600/-
9. In view of the above, appellants/claimants are entitled to a total
compensation of Rs.14,42,600/- along with rate of interest at the rate of
7% per annum in terms of Rule 220-A of U.P. Motor Vehicles Rules,
which shall be indemnified by the insurer of the offending vehicle.
10. Accordingly, the appeal is partly allowed. The impugned award
passed by the learned Tribunal is modified to the aforesaid extent.
11. It is further directed that if any amount has already been paid by the
Insurance Company pursuant to the award of the learned Tribunal, the
same shall be adjusted towards the total amount payable under this
judgment. The Insurance Company shall deposit the enhanced amount of
compensation before the concerned Tribunal within a period of two
months from the date of this order; it shall further be released by the
learned Tribunal within four weeks after the deposit of the said amount in
favour of the claimants and be disbursed in same proportion as has been
held by the Tribunal in its impugned award.
(i) The claimants are hereby directed to provide their savings bank
account details, having R.T.G.S. facility, within four weeks from today to
the learned Tribunal.
(ii) The said amount shall be transferred to the savings bank accounts of
the claimants by way of passing a judicial order, so that the differential
amount may be transferred directly from the account of the Tribunal to
the accounts of the claimants, after completing the necessary formalities,
if any.
(Anil Kumar-X,J.)
September 18, 2026
SK
Digitally signed by :-
SUSHEEL KUMAR
High Court of Judicature at Allahabad
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