Motor accident compensation: notional income, future prospects and dependency deduction must reflect a just and realistic assessment.

In motor accident compensation claims, notional income must be fixed on a just and realistic basis from the evidence and surrounding circumstances, rather than by adopting the lowest unskilled wage. On the facts stated, the skilled worker minimum wage in Haryana was the proper basis, and a 40% addition towards future prospects was allowable even where income was assessed notionally. The deduction towards personal expenses was also corrected to 1/4th instead of 1/3rd, reflecting the larger dependency base of the deceased's family. The compensation awarded by the High Court was therefore enhanced, while the remaining components and apportionment were maintained.

---

---

Issues: (i) Whether deduction towards personal expenses should be 1/4th instead of 1/3rd in the computation of motor accident compensation. (ii) Whether the deceased's income should be assessed at the skilled worker minimum wage in Haryana and whether 40% addition towards future prospects was payable.

Issue (i): Whether deduction towards personal expenses should be 1/4th instead of 1/3rd in the computation of motor accident compensation.

Analysis: The compensation claim crystallises at the time of the accident, and subsequent changes in dependency do not ordinarily affect the award. The deceased left behind two minor children and elderly parents, and the family circumstances showed a larger dependency base than that taken into account by the lower courts. In such a setting, a higher deduction would not reflect a just and fair assessment of loss of dependency.

Conclusion: The deduction towards personal expenses was required to be 1/4th, not 1/3rd.

Issue (ii): Whether the deceased's income should be assessed at the skilled worker minimum wage in Haryana and whether 40% addition towards future prospects was payable.

Analysis: The absence of proof of actual earnings did not justify adoption of the lowest unskilled wage. The evidence and surrounding circumstances indicated that the deceased was comparatively better qualified and skilled, and therefore the skilled minimum wage in Haryana was the proper basis for notional income. On future prospects, the law stood settled that even self-employed or fixed-salary earners below 40 years are entitled to an addition of 40% to established income, and that principle applies equally where income is determined notionally. The award of just compensation must account for inflation and the realistic rise in earnings over time.

Conclusion: The skilled minimum wage in Haryana had to be applied, and 40% addition towards future prospects was allowable.

Final Conclusion: The compensation awarded by the High Court was enhanced by revising the income base, allowing future prospects, and correcting the deduction for personal expenses, while the remaining components and apportionment were maintained.

Ratio Decidendi: In motor accident compensation claims, notional income must be fixed on a just and realistic basis from the evidence and surrounding circumstances, and future prospects are payable even on notional income where the deceased was below the relevant age threshold.

---