The Madhya Pradesh High Court has delivered a significant ruling that expands the definition of “permanent job” beyond government employment in the context of motor accident compensation claims. Justice Achal Kumar Paliwal, in his judgment on Miscellaneous Appeal No. 2423 of 2018, clarified that employees in private sectors receiving regular salary increments should be considered as holding permanent jobs for the purpose of calculating future prospects in compensation claims.
Case Background
The case, titled “Smt. Anjum Ansari and Others vs. R. Rajesh Rao and Others,” was an appeal filed by the claimants under Section 173(1) of the Motor Vehicles Act, 1988. They sought enhancement of compensation awarded by the 5th Additional Member to First Additional M.A.C.T., Bhopal, in Claim Case No.62/2017.
The deceased, an Assistant Professor at the Corporate Institute of Science and Technology in Bhopal, had been involved in a fatal accident. The claimants argued that the deceased held a permanent job and thus 15% should have been added as future prospects instead of the 10% awarded by the tribunal. They also contended that consortium compensation should have been awarded to all appellants, not just the first.
Court’s Decision and Key Observations
Justice Paliwal, relying on the Supreme Court’s landmark judgment in National Insurance Company Ltd. vs. Pranay Sethi (2017), made a crucial observation:
“If a person is in such a job wherein his salary is increased periodically/receives annual increment etc., then, such person would be treated as being in ‘permanent job’. Hence, in view of principle of law laid down in Pranay Sethi (Supra), it is not correct that only government servant would be treated as being in ‘permanent job’.”
The court rejected the insurance company’s argument that only government employees should be considered as holding permanent jobs. It noted that the deceased’s salary was subject to periodic revision/hike, as evidenced by salary certificates Ex. P/12 and P/13.
Enhancement of Compensation
Based on this interpretation, the court recalculated the compensation:
1. It added 15% as future prospects instead of the earlier 10%.
2. Awarded Rs. 40,000 as consortium to appellants No. 2 to 4.
3. Enhanced the total compensation from Rs. 34,23,000 to Rs. 36,95,260, an increase of Rs. 2,72,260.
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The appellants were represented by Shri R.P. Mishra, while Shri Gulab Chand Sohane appeared for Respondent No.3. The appeal was partly allowed, with the enhanced compensation to be paid after the appellants clear the deficit court fees.
