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Shaikh Sadik Shaikh Rafique v. Reliance General Insurance Company Ltd.

Civil Appeal · 2025 INSC 673Decided 13 May 2025
C.A. No.-006640-006640 - 2025
Justice Sudhanshu Dhulia · Justice K. Vinod Chandran

Background

The appellant, a 25-year-old man, was left completely bed-ridden and 100% disabled after the truck of his employer in which he was travelling collided with another vehicle. The Motor Accident Claims Tribunal awarded him Rs.16,00,000, and the High Court later enhanced this to Rs.25,83,600 after adjusting his income, disability level and future prospects. The appellant appealed to the Supreme Court seeking further enhancement of the compensation.

Decision Breakdown

The Supreme Court held that, applying the incremental-income principle from the Constitution Bench ruling in National Insurance Co. v. Pranay Sethi, the appellant's claimed monthly income of Rs.9,000 could reasonably be accepted for an unskilled worker as of the 2015 accident date, and that a multiplier of 18 (for a 25-year-old) should apply instead of 17 as used by the High Court. Recalculating loss of future income, medical expenses, and a consolidated amount for pain, suffering and loss of amenities, the Court raised the total award to Rs.35,91,600, to be paid with 8% interest per annum within two months after adjusting amounts already paid.

Lesson Learnt

In motor accident compensation cases, courts must apply the settled formulas from Pranay Sethi (age-appropriate multiplier, future-prospects addition, and incremental income) consistently, and an appellate court can further enhance an award if these formulas were not correctly applied below.

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

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