2 decades on, HC corrects ‘wholly unrealistic’ Rs 6,000 assessment in student’s fatal accident, raises compensation from Rs 5.76 lakh to Rs 40.70 lakh
The ruling is significant as it addresses a recurring legal issue: how to assess the future earning capacity of students who had not yet entered the workforce but were clearly on a defined professional path
When a student secured admission in Mechanical Engineering at Punjab Engineering College, Chandigarh, there was no reason to imagine that years later, the worth of his yet-to-begin career would be capped at Rs 6,000 a month following his death in a motor accident.
Nearly two decades after the 2006 accident, the Punjab and Haryana High Court has stepped in to correct that assessment, enhancing the compensation from Rs 5.76 lakh to Rs 40.70 lakh and holding the earlier fixation of income to be noticeably insufficient and “wholly unrealistic”.
The accident had occurred on November 27, 2006, while the motor accident claims tribunal passed its award in 2009. Taking up the matter, Justice Sudeepti Sharma recalculated his notional monthly income at Rs 30,000, before directing the respondents to deposit the enhanced amount with interest within two months.
The ruling is significant as it addresses a recurring legal issue: how to assess the future earning capacity of students who had not yet entered the workforce but were clearly on a defined professional path. The high court in its ruling has now significantly revised the compensation to align it with the student’s academic record and likely career trajectory.
Justice Sharma observed the victim was a third-year student of Mechanical Engineering at Punjab Engineering College, Chandigarh, and had not yet entered gainful employment as his appointment was contingent upon the completion of his course.
However, the tribunal failed to properly appreciate the material evidence on record. “The deceased was pursuing his studies in one of the premier engineering institutions of the country and possessed an impeccable academic record, as is evident from the Marks cards. Notwithstanding these cogent indicators of his future earning potential, the Tribunal, by resorting to conjecture, assessed his notional Rs monthly income at 6,000, which, in the considered view of this Court, is manifestly inadequate and wholly unrealistic,” Justice Sharma observed.
Referring to precedent pronouncements and taking into consideration the victim’s academic standing and career trajectory, Justice Sharma asserted: “The Court is of the considered opinion that even a conservative estimation of his notional income ought to be fixed at Rs 30,000 per month. Such determination would better subserve the object of awarding ‘just compensation’ as contemplated under the Motor Vehicles Act and rectify the patent inadequacy in the assessment made by the Tribunal.”
The High Court also pointed to multiple legal errors in the tribunal’s award, including failure to grant compensation under established heads and incorrect application of settled principles. “Further perusal of the award shows that the learned Tribunal has failed in not awarding any amount for future prospects, loss of estate, funeral expenses and loss of consortium,” Justice Sharma observed.
