The Madhya Pradesh High Court held that dependants cannot be denied pecuniary loss suffered by them due to the demise of the earning member in a motor accident, merely because the pathology establishment the deceased was associated with was continued by another family member. [2026 LiveLaw (MP) 401]

The bench of Justice Ramkumar Choubey further rejected the presumption that the dependants were receiving income after the demise of the earning member, merely because the establishment continued to exist. 

"In a claim arising out of the death of an earning member, what is relevant is the pecuniary loss suffered by the dependants on account of the death of that particular earning member. The subsequent continuation of the establishment by another family member cannot, by itself, wipe out the loss of the personal earning capacity of the deceased. The widow and children, who were dependent upon the deceased, cannot be presumed to have continued to receive the income which the deceased personally earned merely because the business or establishment itself continued to exist". 

A miscellaneous appeal was filed under Section 173(1) of the Motor Vehicles Act, 1988 by an insurance company. The appeal was against the order of the Motor Accident Claims Tribunal that granted compensation of ₹12.90 Lakhs in favour of the claimants.

The claimants are the children, wife, and mother of the deceased, who was in a vehicle crash. The accident occurred on January 2, 2009, when the deceased was travelling in a van and dashed against the dumper from behind. 

The Tribunal, after examining the evidence, found that he was earning his income from his occupation and his monthly income was assessed at ₹10,000. The Tribunal treated the wife and children as dependent and did not treat the mother of the deceased as dependent. Accordingly, the total award compensated was ₹12.90 Lakhs. 

The counsel for the appellant challenged the award on the ground that the Tribunal had no basis for assessing the income as ₹10,000 per month. The counsel argued that the establishment of Guru Pathology continued to operate even after the demise of the deceased, and therefore there was no corresponding loss of income from the said establishment. 

It was further argued that the deceased himself hit the dumper from behind and therefore should have been held guilty of contributory negligence. 

The court noted that the income was assessed based on the evidence relating to his income associated with Guru Pathology. Further, the bench noted that merely because the pathology establishment continued to function after the death of the deceased, it cannot be said that he had no personal income from the same during his lifetime. 

The bench further noted that the fact that the establishment was being managed by his brother would not be a primary factor, as it cannot be automatically treated as income available to the widow and children of the deceased. 

Further, the court noted that the appellant failed to show any evidence that the income assessed by the Tribunal was perverse or materially illegal. 

Regarding the contention of contributory negligence, the court held

"the mere fact that a vehicle proceeding behind another vehicle has collided with it from the rear cannot, in every case and in isolation, be treated as conclusive proof of contributory negligence on the part of the driver of the vehicle coming from behind. The surrounding circumstances and the evidence available on record have to be considered".  

Regarding the appellant's objection to the calculation of compensation, the court held that the Tribunal made the assessment after considering the age, income, number of dependents and applicable multiplier. 

Further, referring to the fact that the Tribunal did not consider the mother as a dependent, the bench stated that the conduct demonstrates that the Tribunal did not treat every claimant as dependent but examined the question of dependency separately. 

Thus, the bench held that there was no ground for interference with the order of the Tribunal and dismissed the appeal. 

For Appellant: Advocate T.S.Lamba