Notifications under the Minimum Wages Act can be used to assess monthly income even without evidence, according to the Supreme Court, which has increased compensation for motor accidents.

The Supreme Court awarded over Rs 20 lakh to a laborer as compensation for a motor accident and emphasized that notifications under the Minimum Wages Act can help determine monthly income when no other evidence is available. The appeal was made against a decision from the Madhya Pradesh High Court, which itself was based on a ruling from the Motor Accident Claims Tribunal in Indore. The Division Bench, led by Justice Sanjay Karol and Justice Prashant Kumar Mishra, stated, “Regarding his functional disability, this Court acknowledges that the amputation of his right hand greatly affects his ability to work as a laborer. Thus, to ensure justice, we find it right to raise the functional disability percentage to 80%.”

AOR Praveen Swarup represented the appellant. The incident occurred in 2016 when the 25-year-old claimant was using a thresher machine on a tractor owned by Respondent No.1. The tractor driver recklessly reversed the vehicle, causing the claimant’s hand to get caught in the thresher, resulting in severe injuries to his hand, shoulder, head, near the ear, and other areas. His hand was later amputated below the elbow. An FIR was filed against the tractor driver, Respondent No.2, under various sections of the Indian Penal Code. The claimant sought Rs.20 lakh in compensation under the Motor Vehicle Act, 1988, claiming he earned Rs.9,000 per month at the time of the accident.

The Tribunal decided that the insurance company must pay Rs 3,76,090 plus interest, based on a 20% permanent disability of the Appellant, who had an assumed income of Rs. 60,000 per year. The High Court later raised the compensation for the Claimant-Appellant to Rs. 6,61,690 and increased the disability percentage to 40%. Unsatisfied with this, the appellant took the case to the Apex Court.

The Bench disagreed with the Tribunal and High Court regarding the Appellant’s income and disability level. It referenced a previous case, stating that Minimum Wages Act notifications can help determine monthly income when no evidence is available. The Bench noted that the minimum wage for unskilled workers in the area was Rs. 6,850. Considering the appellant’s significant loss of ability to work as a laborer due to the amputation of his right hand, the Bench raised the functional disability percentage to 80%. The Civil Appeal was allowed, and the compensation was increased to Rs. 20,55,452, modifying the previous award from the Motor Accident Claims Tribunal.

Cause Title: Jitendra v. Sadiya & Ors. (Neutral Citation: 2025 INSC 166)
Appearance:
Appellant: AOR Praveen Swarup, Advocates N. K. Mody, Ishita M. Puranik, Prabuddha Singh Gaur, Jigish Agarwal, Karan