2021 (1) TMI 1123 - SC - Indian Laws

Claim for compensation on death of dependency - Re-computation is sought of compensation for loss of dependency - HELD THAT - The United Nations Committee on the Elimination of Discrimination against Women adopted General Recommendation No. 17 on the Measurement and quantification of the unremunerated domestic activities of women and their recognition in the gross national product' in 1991. The General Recommendation affirmed that the measurement and quantification of the unremunerated domestic activities of women, which contribute to development in each country, will help to reveal the de facto economic role of women - It is worth noting that the above General Recommendation is passed in furtherance of Article 11 of the Convention on the Elimination of All Forms of Discrimination against Women which relates to ending discrimination against women in the field of employment, a Convention that India has ratified. The issue of fixing notional income for a homemaker, therefore, serves extremely important functions. It is a recognition of the multitude of women who are engaged in this activity, whether by choice or as a result of social/cultural norms - Returning to the question of how such notional income of a homemaker is to be calculated, there can be no fixed approach. Grant of compensation, on a pecuniary basis, with respect to a homemaker, is a settled proposition of law - Taking into account the gendered nature of housework, with an overwhelming percentage of women being engaged in the same as compared to men, the fixing of notional income of a homemaker attains special significance. It becomes a recognition of the work, labour and sacrifices of homemakers and a reflection of changing attitudes. It is also in furtherance of our nation's international law obligations and our constitutional vision of social equality and ensuring dignity to all - The granting of future prospects, on the notional income calculated in such cases, is a component of just compensation.

Issues Involved:
1. Deduction for Personal Expenses
2. Assessment of Monthly Income
3. Addition of Future Prospects
4. Other Heads and Division of Compensation
5. Notional Income of Homemakers and Future Prospects

Detailed Analysis:

I. Deduction for Personal Expenses:
The court emphasized that at the time of the accident, there were four dependents, and the subsequent death of one should not reduce the compensation. Legal liabilities crystallize at the time of the accident, and subsequent changes should not affect the proceedings. The court cited Director of Elementary Education v. Pramod Kumar Sahoo, reinforcing that advocates cannot waive legal rights or make arrangements contrary to law. The appropriate deduction for personal expenses for both deceased should be 1/4th, not 1/3rd, considering the dependents' needs, including two toddler daughters and the deceased's unborn child at the time of the accident.

II. Assessment of Monthly Income:
The court noted the lack of documentary evidence for Vinod's income but rejected the adoption of the lowest-tier minimum wage. The court highlighted the importance of preserving the deceased's family's standard of living, referencing R.K. Malik v. Kiran Pal. The minimum wage applicable to skilled workers in Haryana during April 2014, amounting to ?6197, was deemed appropriate for Vinod.

III. Addition of Future Prospects:
The court found it unfair for the Respondent-insurer to contest future prospects, especially given their previous submission pending the Pranay Sethi case. The law, as settled in National Insurance Co. Ltd. v. Pranay Sethi, mandates a 40% addition for future prospects for those below 40 years, even if they are not permanent employees. The court cited Hem Raj v. Oriental Insurance Co. Ltd., asserting that both situations—positive evidence of income and minimum income determined on guesswork—stand on the same footing for future prospects.

IV. Other Heads and Division of Compensation:
The court found no need to alter the compensation under other heads such as funeral charges, loss of estate, and love and affection. The High Court's use of an age-multiplier of 17, the award of 9% interest, and the division of compensation were deemed appropriate. The revised compensation was increased to ?33.20 lakhs, with the enhanced amount to be paid within two months along with 9% interest from the date of filing the Detailed Accident Report.

V. Notional Income of Homemakers and Future Prospects:
The concurring opinion emphasized the importance of recognizing the economic value of homemakers' contributions. The court discussed methods to determine notional income, including the opportunity cost, partnership method, and replacement method. It highlighted the gender disparity in unpaid domestic work, citing the 2011 Census and the Time Use in India-2019 report. The court underscored the need to award just compensation, considering inflation and the quest for better circumstances. Future prospects should be granted even for notional income, recognizing the evolving skills and contributions of homemakers.

Conclusion:
The appeals were allowed in part, increasing the total compensation to ?33.20 lakhs. The enhanced amount, along with interest, was to be paid within two months and apportioned as per the Tribunal's terms. The concurring opinion reinforced the significance of recognizing homemakers' contributions and the necessity of awarding just compensation, including future prospects.

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