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S. Vasanthi vs. M/S Adhiparasakthi Engg. College

Civil Appeal · 2022 INSC 1062Decided 11 Oct 2022
Civil Appeal No. 7180 of 2022
B.R. Gavai · C.T. Ravikumar · B.V. Nagarathna

Background

In May 2010, S. Sathiyanarayan, a 23-year-old engineering graduate pursuing an MBA, was riding his motorcycle in Tambaram, Tamil Nadu, when a bus owned by Adhiparasakthi Engineering College struck him from behind and dragged him under its wheels, killing him instantly. His parents, as his only heirs, sought Rs. 30 lakh compensation from the Motor Accident Claims Tribunal. The Tribunal awarded only Rs. 7,48,052 (fixing his notional income at just Rs. 7,000/month since he was still a student), and the Madras High Court raised this only modestly to Rs. 16,27,000 (income fixed at Rs. 10,000/month). The parents appealed to the Supreme Court seeking a much higher figure.

Decision Breakdown

The Supreme Court held that both the Tribunal and High Court had ignored unrebutted evidence that two of the deceased's classmates from the same course were already earning Rs. 39,869 and Rs. 44,588 per month at reputed companies: evidence the parents had placed on record via affidavit and salary certificates. Given the deceased's young age, his engineering-plus-MBA qualifications, and this comparable employment evidence, the Court held his likely income was grossly underestimated and fixed his notional monthly income at Rs. 30,000, then applied the standard 40% future-prospects addition and 50% personal-expense deduction (since he was unmarried) as per the Sarla Verma/Pranay Sethi formula, along with an 18x multiplier for his age. This produced a total compensation of Rs. 46,11,000, meaning an enhancement of about Rs. 29.84 lakh over the High Court's award, payable with 7.5% interest within three months.

Lesson Learnt

In motor accident claims involving young, unemployed but qualified victims, courts must give real weight to concrete comparative evidence (like classmates' actual salaries) rather than assigning an arbitrarily low "notional income": compensation should reflect realistic future earning potential, not just present unemployment.

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

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