Allowed

Sher Mohd. & Anr. v. Tayyub & Ors.

Punjab & Haryana HC12 Mar 2026FAO/942/2003

Case brief

AI extract

What is this about?

This judgment faculty an appeal against a Motor Accident Claims Tribunal award. The High Court intervened to replace the arbitrary lump-sum award with a calculated compensation based on notional income. Applying structured principles including multiplier method and deduction for personal expenses, the court enhanced the compensation payable to the claimants.

What did the court decide?

The compensation was enhanced to ₹3,38,000, rounded from ₹3,38,036, payable along with 7.5% per annum interest.

Sher Mohd. & Anr. Vs Tayyub & Ors. — Insurance | Punjab & Haryana HC (2026)

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

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********

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260

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FAO-942-2003 Date of Decision.:12.03.2026

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Sher Mohd. and another Tayyub and Others

Vs.

…..Appellants

.….Respondents

CORAM:HON'BLE MR. JUSTICE DEEPAK GUPTA

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Present:Mr. Arun Kumar Singal, Advocate for the appellants.

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Mr. D.K. Dogra, Advocate for respondent No.3.

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Mr. Arjun Kundra, Advocate for respondent No.6.

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DEEPAK GUPTA, J. (ORAL)

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The present appeal has been filed by the claimants seeking enhancement of the compensa(on amount awarded by the learned Motor Accident Claims Tribunal.

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The brief facts emerging from the record are that on 30.05.2000, Mushtaq, an unmarried boy aged about 16 years, died in a motor vehicular accident caused by a head-on collision between jeep No. HR-28-5282 and jeep No. HR-28-5188. The parents of the deceased filed a claim pe((on under Sec(on 166 of the Motor Vehicles Act, 1988 seeking compensa(on from the respec(ve drivers, owners and insurers of both the vehicles.

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Upon apprecia(on of the evidence, the learned Tribunal vide award dated 04.12.2001 held that the accident occurred due to the negligence of the drivers of both the vehicles and consequently held them

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NEETIKA TUTEJA 2026.03.13 12:18 I attest to the accuracy and integrity of this document

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FAO-942-2003

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equally responsible for causing the accident. The Tribunal awarded a lumpsum compensa(on of ₹1,50,000/-, holding the drivers, owners and insurers of both the vehicles jointly and severally liable.

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The present appeal has been filed only on the issue of quantum of compensa(on.

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Learned counsel for the appellants submits that the Tribunal assessed the compensa(on arbitrarily without applying the structured formula or mul(plier method, which is now well recognised in determining compensa(on under the Motor Vehicles Act. It is contended that the deceased was running a tyre puncture repair shop and was earning approximately ₹3,000/- per month, and therefore, the compensa(on awarded by the Tribunal is wholly inadequate.

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Learned counsel appearing for the respec(ve Insurance Companies (respondent Nos.3 and 6) fairly concedes that the compensa(on ought to be assessed in accordance with the se>led principles laid down by the Hon’ble Supreme Court. However, it is submi>ed that there is no reliable evidence on record regarding the alleged income of the deceased.

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Having heard learned counsel for the par(es and perused the record, this Court finds merit in the conten(on that the Tribunal assessed the compensa(on on a lump-sum basis without adop(ng the se>led principles governing the determina(on of compensa(on.

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Although the appellants claimed that the deceased was earning ₹3,000/- per month, no documentary or oral evidence has been produced to substan(ate the said asser(on. Therefore, the income of the deceased has to be determined on a no(onal basis.

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Ld. Counsel for the appellants submits that the minimum wages payable to an unskilled worker at the relevant (me were ₹1,905/per month, which posi(on has not been disputed by learned counsel for

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FAO-942-2003

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the Insurance Companies. Taking guidance from the said minimum wages, the no(onal monthly income of the deceased can reasonably be assessed at ₹1,905/- per month, i.e. ₹1,905 × 12 = ₹22,860/- per annum

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In terms of the law laid down by the Hon’ble Supreme Court in Na�onal Insurance Company Limited v. Pranay Sethi and ors., (2017) 16 SCC 680, addi(on towards future prospects is required to be made even in cases of no(onal income.

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By adding 40% towards future prospects, the annual income works out to be ₹22,860 + 40% = ₹32,004/- per annum

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Since the deceased was unmarried, the principles laid down by the Hon’ble Supreme Court in Smt. Sarla Verma and ors. v. Delhi Transport Corpora�on and anr., (2009) 6 SCC 121, would apply. In such circumstances, 50% of the income is required to be deducted towards personal and living expenses of the deceased.

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AFer applying the said deduc(on, annum loss of dependency will be ₹32,004 ÷ 2 = ₹16,002/-

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Considering the age of the deceased, the appropriate mul(plier applicable as per Sarla Verma’s case is 18.

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Thus the loss of dependency works out to be ₹16,002 × 18 = ₹2,88,036/-.

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The claimants are also en(tled to compensa(on under conven(onal heads. Since the deceased was unmarried, both the parents are en(tled to compensa(on towards loss of parental consor(um. Considering that the accident occurred in the year 2000, a sum of ₹20,000/each is awarded to the parents under this head and so, Loss of parental consor(um is ₹40,000/-

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In addi(on, the claimants are en(tled to compensa(on towards loss of estate and funeral expenses, which are assessed at ₹5,000/-

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FAO-942-2003

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each.

Thus the compensa(on is computed as follows:

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� Loss of dependency	– ₹2,88,036
Loss of parental consor(um	– ₹40,000
Funeral expenses	– ₹5,000
Loss of estate	– ₹5,000
� Total	= ₹3,38,036

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Same is rounded off to ₹3,38,000/-

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Since the Tribunal had already awarded ₹1,50,000/-, the enhanced compensa(on payable to the appellants comes to ₹1,88,000/-.

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The appellants shall be en(tled to the enhanced amount along with interest at the rate of 7.5% per annum from the date of filing of the claim pe((on (ll realiza(on. The liability of the respondents shall remain the same as determined by the learned Tribunal.

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It is further clarified that out of the enhanced compensa(on, ₹20,000/- along with propor(onate interest shall be payable to the fatherclaimant Sher Mohd., and the remaining enhanced compensa(on along with propor(onate interest shall be payable to the mother-claimant Smt. Maimuna, being the primary dependent of the deceased.

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With the aforesaid modifica(on in the quantum of compensa(on, the present appeal stands disposed of accordingly.

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(DEEPAK GUPTA) JUDGE

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March 12, 2026

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Nee(ka Tuteja

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Whether Speaking/reasoned Yes/No Whether Reportable Yes/No

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NEETIKA TUTEJA 2026.03.13 12:18 I attest to the accuracy and integrity of this document

Sher Mohd. & Anr. v. Tayyub & Ors.

Case brief

What is this about?

What did the court decide?

Sher Mohd. & Anr. v. Tayyub & Ors.

Case brief

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