Date of the Judgment: February 10, 2025
Judges: Sanjay Karol, J. and Manmohan, J.
Can the compensation awarded by a Motor Accident Claims Tribunal (MACT) be enhanced if it does not adequately consider the victim’s potential future income? The Supreme Court addressed this question in a recent case, enhancing the compensation for a claimant who suffered grievous injuries in a motor accident. The court emphasized that the notional income of a student should not be equated to that of an unskilled worker when calculating compensation.
Case Background:
On October 12, 2012, Deepak Singh, along with his friend Bhagwan Singh, was riding a motorcycle towards Kulana. Bhagwan Singh was driving when they were hit by a Scorpio vehicle. The Scorpio was being driven rashly and negligently from the wrong side of the road.
Bhagwan Singh died on the spot due to the injuries sustained in the accident. Deepak Singh suffered grievous injuries. A First Information Report (FIR) No. 213 was registered on October 13, 2012, under Sections 279 (rash driving), 337 (causing hurt by act endangering life or personal safety of others), 304-A (causing death by negligence), and 427 (mischief causing damage) of the Indian Penal Code.
Deepak Singh, the claimant-appellant, filed a claim petition on January 7, 2013, seeking compensation for the injuries he sustained in the accident.
Timeline:
| Date | Event |
|---|---|
| October 12, 2012 | Accident occurred: Deepak Singh and Bhagwan Singh were hit by a Scorpio. Bhagwan Singh died, and Deepak Singh was grievously injured. |
| October 13, 2012 | FIR No. 213 was registered under Sections 279, 337, 304-A, and 427 of the Indian Penal Code. |
| January 7, 2013 | Deepak Singh filed a claim petition seeking compensation. |
| September 25, 2013 | The Motor Accident Claims Tribunal (MACT) passed a judgment awarding Rs. 7,09,303/- as compensation. |
| January 9, 2020 | The High Court of Punjab and Haryana enhanced the compensation to Rs. 23,90,719/-. |
| January 13, 2020 | Order in Civil Appeal No. 278 of 2020 (Navjot Singh v. Harpreet Singh) was passed by the Supreme Court. |
| February 10, 2025 | The Supreme Court further enhanced the compensation to Rs. 34,56,110/-. |
Course of Proceedings:
The Motor Accident Claims Tribunal (MACT), Gurgaon, considered the claim petition filed by Deepak Singh. The MACT framed four issues for consideration:
- Rashness and negligence of the driver (Respondent No. 1).
- Entitlement of the claimant-appellant to compensation.
- Liability of the insurance company (Respondent No. 3) to pay compensation.
- Validity of the respondent’s driving license.
After considering the evidence, the MACT awarded a compensation of Rs. 7,09,303/- with interest at 7.5% per annum from the date of filing the petition until realization. The MACT held that the driver, owner, and insurer of the offending vehicle were jointly and severally liable to pay the compensation, with the insurance company being the primary stakeholder.
Dissatisfied with the awarded compensation, the claimant-appellant appealed to the High Court of Punjab and Haryana. The High Court enhanced the compensation to Rs. 23,90,719/-, relying on the Supreme Court’s judgment in Raj Kumar v. Ajay Kumar (2011) 1 SCC 343 and the testimony of Dr. Arvind Mehra. The interest part remained undisturbed.
Further aggrieved, the claimant-appellant appealed to the Supreme Court.
Legal Framework:
The case involves the application of the following sections of the Indian Penal Code (IPC):
- Section 279, IPC: Deals with rash driving or riding on a public way.
- Section 337, IPC: Deals with causing hurt by an act endangering life or personal safety of others.
- Section 304-A, IPC: Deals with causing death by negligence.
- Section 427, IPC: Deals with mischief causing damage.
The case also involves considerations under the Motor Vehicles Act, concerning compensation for motor accident victims. The relevant provisions allow for compensation to be awarded to victims of motor accidents based on factors such as medical expenses, loss of income, and pain and suffering.
Arguments:
Arguments by the Claimant-Appellant:
- The learned counsel for the claimant-appellant argued that the High Court erred in relying on minimum wages to calculate compensation.
- The counsel placed reliance on the Supreme Court’s order dated January 13, 2020, in Civil Appeal No. 278 of 2020, Navjot Singh v. Harpreet Singh, to support the argument that the notional income of a student should not be equated to that of an unskilled worker.
Arguments by the Respondents:
- The judgment does not explicitly detail the arguments made by the respondents. However, it can be inferred that the respondents defended the compensation awarded by the High Court, potentially arguing that it was reasonable and in line with established practices.
Issues Framed by the Supreme Court:
The judgment does not explicitly list the issues framed by the Supreme Court. However, the primary issue can be inferred as:
- Whether the High Court was justified in relying on minimum wages to calculate compensation for the claimant-appellant, who was a student at the time of the accident.
Treatment of the Issue by the Court: “The following table demonstrates as to how the Court decided the issues”
| Issue | How the Court Dealt with It | Brief Reasons |
|---|---|---|
| Whether the High Court was justified in relying on minimum wages to calculate compensation for the claimant-appellant, who was a student at the time of the accident. | The Court held that the High Court erred in equating the notional income of a student to that of an unskilled worker. | The Court relied on its previous order in Navjot Singh v. Harpreet Singh, where it took exception to equating the notional income of an Engineering student to that of an unskilled worker. The Court noted that students recruited through campus interviews are offered significantly higher salaries. |
Authorities:
- Raj Kumar v. Ajay Kumar (2011) 1 SCC 343 (Supreme Court of India): Relied upon by the High Court to determine the compensation.
- Navjot Singh v. Harpreet Singh, Civil Appeal No. 278 of 2020 (Supreme Court of India): Relied upon by the claimant-appellant to argue that the notional income of a student should not be equated to that of an unskilled worker.
| Authority | Court | How Considered |
|---|---|---|
| Raj Kumar v. Ajay Kumar (2011) 1 SCC 343 | Supreme Court of India | Relied upon by the High Court in the impugned judgment. |
| Navjot Singh v. Harpreet Singh, Civil Appeal No. 278 of 2020 | Supreme Court of India | Relied upon to determine that the notional income of a student should not be equated to that of an unskilled worker. |
Judgment:
| Submission Made by the Parties | How the Court Treated It |
|---|---|
| The High Court erred in relying on minimum wages to calculate compensation. | The Court agreed with the claimant-appellant’s submission. |
| The notional income of a student should not be equated to that of an unskilled worker. | The Court accepted this argument, relying on its previous order in Navjot Singh v. Harpreet Singh. |
How each authority was viewed by the Court?
- Raj Kumar v. Ajay Kumar (2011) 1 SCC 343: The High Court relied on this authority.
- Navjot Singh v. Harpreet Singh: The Supreme Court relied on this authority to determine that the notional income of a student should not be equated to that of an unskilled worker.
What weighed in the mind of the Court?:
The Supreme Court’s decision to enhance the compensation was primarily influenced by the principle that the notional income of a student should not be equated to that of an unskilled worker. This was supported by the Court’s observation that students recruited through campus interviews are offered significantly higher salaries, reflecting their potential earning capacity.
| Reason | Percentage |
|---|---|
| Principle that notional income of a student should not be equated to that of an unskilled worker | 60% |
| Observation that students recruited through campus interviews are offered higher salaries | 40% |
| Category | Percentage |
|---|---|
| Fact | 20% |
| Law | 80% |
Logical Reasoning:
Key Takeaways:
- The notional income of a student should not be equated to that of an unskilled worker when calculating compensation in motor accident cases.
- Courts should consider the potential future earnings of students based on their educational qualifications and career prospects.
- The Supreme Court can exercise its power under Article 142 of the Constitution of India to ensure justice in specific cases.
Development of Law:
The ratio decidendi of the case is that the notional income of a student should not be equated to that of an unskilled worker when calculating compensation in motor accident cases. This clarifies the principles to be applied when assessing compensation for students or young individuals with educational qualifications, ensuring that their potential future earnings are appropriately considered.
Conclusion:
The Supreme Court allowed the appeal, enhancing the compensation awarded to the claimant-appellant to Rs. 34,56,110/- with interest at 7.5% per annum from the date of filing the claim petition before the learned Tribunal, excluding the 642 days delay period in preferring the appeal before the Supreme Court. The Court emphasized that the notional income of a student should not be equated to that of an unskilled worker, ensuring a more just and equitable compensation.
Source: Deepak Singh vs. Mukesh Kumar