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Ramilaben Chinubhai Parmar v. National Insurance Co.

Civil Appeal · Neutral citation not assigned (Civil Appeal Nos. 6091-6092 of 2011)Decided 23 Apr 2014
Civil Appeal Nos. 6091-6092 of 2011
Chief Justice P. Sathasivam · Justice Ranjan Gogoi · Justice N.V. Ramana

Background

The family of a 46-year-old employee killed in a road accident sought compensation for loss of its sole breadwinner. The Tribunal awarded ₹22.10 lakh, but the High Court reduced it to ₹13.90 lakh using a lower income assessment and multiplier. The claimants appealed, pointing to his remaining twelve years of service and prospects of increased pay and promotion.

Decision Breakdown

The Supreme Court allowed the appeals and fixed total compensation at ₹29.30 lakh with 7.5% annual interest. On the particular evidence of remaining service, benefits and possible advancement, it assessed potential monthly earning capacity at ₹30,000. After deducting one-third for personal expenses, it calculated dependency at ₹20,000 per month and applied a multiplier of twelve, producing ₹28.80 lakh. It added ₹50,000 under conventional heads. The Court did not endorse all the Tribunal's earlier reasoning but held that the High Court had failed properly to account for future prospects.

Lesson Learnt

Dependants' compensation should reflect the deceased worker's evidenced future earning prospects as well as present salary. The figures adopted here depended on this record and do not prescribe the income or multiplier for every worker of the same age.

Official source (sci.gov.in)View Judgment (PDF)

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