Extending “Future Prospects” to Self-Employed Foreign Nationals
A Detailed Commentary on Kulwinder Kaur & Ors. v. Parshant Sharma & Anr. (2025 INSC 950)

1. Introduction

On the intervening night of 31 August 2007, a road accident at Nirmal Kutia Chowk, Karnal (Haryana) took the life of Rajinder Singh Mihnas, a 31-year-old United States national of Indian origin, employed as an owner-operator driver with “West End Express Inc.” in the USA. His wife Kulwinder Kaur, their two children and the deceased’s parents claimed compensation under Section 166 of the Motor Vehicles Act, 1988 (MVA).

While the Motor Accident Claims Tribunal (MACT) awarded ₹7.8 lakh by treating the monthly income as a modest ₹5,000, the Punjab & Haryana High Court drastically enhanced the compensation to ₹1,17,20,200 by relying on U.S. wage standards. However, the High Court refused to add the component of future prospects—additional income that the deceased would probably have earned in the future—on the premise that the deceased was self-employed.

Dissatisfied, the claimants approached the Supreme Court, seeking incorporation of future prospects and a higher multiplier. The core legal question was thus straightforward yet significant:

• Does the principle laid down in National Insurance Co. v. Pranay Sethi (2017) 16 SCC 680, mandating addition of 40% for future prospects for a self-employed person below 40 years, apply even when the deceased was self-employed outside India?

2. Summary of the Judgment

The Supreme Court partly allowed the appeal. Key directives are:

1. Income Assessment: The High Court’s finding of ₹78,300 per month (computed at U.S. minimum wages of USD 7.25 per hour × 8 hours × 30 days, converted to INR) stands undisturbed.
2. Future Prospects: Following Pranay Sethi, the Court applied a 40% addition to the established income because the deceased was 31 years old and self-employed.
3. Multiplier: The Court retained the multiplier of 16 (not 17) corresponding to the age-group 31–35 years.
4. Conventional Heads: Amounts updated to ₹40,000 each for loss of consortium per dependant, ₹15,000 for loss of estate, and ₹15,000 for funeral expenses.
5. Revised Compensation: ₹1,60,15,280 (an enhancement of ₹42,95,080) with 6% interest from the date of claim petition.
6. Payment Direction: The insurer must deposit the enhanced sum within four weeks before the MACT for disbursement to the claimants.

3. Analysis

3.1 Precedents Cited and Their Influence

1. National Insurance Co. v. Pranay Sethi (2017) 16 SCC 680
   The Constitution Bench standardised compensation under the MVA, prescribing:
   • Addition of 40% of income for future prospects where the deceased was below 40 and self-employed or on a fixed salary.
   • Uniform figures for conventional heads (loss of estate, consortium, funeral expenses).
   • Multiplier table based on age of the deceased (per Sarla Verma).
   This Judgment is the fulcrum for the present decision; the Supreme Court explicitly applied its ratios.
2. Chikkamma v. Parvathama (Civil Appeal No. 3409/2017, decided 28-02-2017)
   An earlier division‐bench view denying future prospects to self-employed persons, used by the High Court. The Supreme Court overruled its applicability after noting it was pre-Pranay Sethi and not binding post the Constitution Bench’s authoritative pronouncement.
3. Sarla Verma & Ors. v. Delhi Transport Corp. (2009) 6 SCC 121
   Provided the multiplier chart and deduction for personal expenses (one-fourth when dependants are 4–6). The Court relied on this for choosing multiplier 16 and one-fourth deduction.

3.2 Legal Reasoning

Justice N.V. Anjaria reasoned that the economic realities in a foreign jurisdiction should not deprive dependants of statutorily recognised benefits, especially when no specific evidence contradicts probable income escalation. The Court observed:

• A self-employed person, whether in India or abroad, aspires to and generally does raise earnings over time—human endeavour is dynamic, not static.
• Absence of granular foreign economic data cannot eclipse the normative uplift mandated by Pranay Sethi; otherwise, compensation becomes unfair and inequitable.
• Where the insurer neither filed cross-objections nor produced contrary evidence, the High Court’s income finding was accepted.
• Multiplier 16 was correct as per age-based table; claimant’s request for 17 was contrary to precedent.
• Updated figures for conventional heads were obligatory, those in the High Court award being outdated.

3.3 Impact of the Judgment

The decision breaks new ground in two respects:

1. Geographical Neutrality of Future Prospects: It explicitly extends the 40% addition to self-employed persons working outside India, thereby making compensation calculations uniform irrespective of the geographical locus of employment.
2. Deterrent Clarity for Insurers & Tribunals: MACTs and High Courts can no longer deny future prospects merely on the ground that the deceased was self-employed abroad. Insurers must prepare for higher exposure where sufficient proof of foreign income is adduced.

Consequently, the ruling not only aligns domestic jurisprudence with international employment realities but also safeguards the legitimate expectations of NRI/OCI dependants injured by road accidents in India.

4. Complex Concepts Simplified

• Future Prospects: An assumed increase in the deceased’s income had they lived, quantified as a fixed percentage (40% when below 40 years) of the proven income.
• Multiplier: A number reflecting the number of years the income would have supported dependants, derived from age-based tables (e.g., 16 for ages 31–35).
• Loss of Consortium: Compensation for loss of companionship, affection and aid; payable separately to spouse, children and parents.
• Conventional Heads: Standard fixed sums for non-pecuniary losses—loss of estate, funeral expenses, etc.—to ensure uniformity.
• Self-Employed: Individuals who work for themselves, not under salaried employment—e.g., freelancers, small business owners, owner-drivers.
• Dependants vs. Legal Heirs: Dependants rely financially on the deceased; legal heirs are succession beneficiaries. In MACT cases, focus is on dependants.

5. Conclusion

Kulwinder Kaur v. Parshant Sharma reaffirms and expands the Pranay Sethi architecture by holding that:

• The 40% future prospects addition is universally applicable to self-employed victims below 40, irrespective of the country of employment.
• Uniform amounts under conventional heads must be strictly followed.
• Where income evidence, though foreign, remains uncontested, tribunals shall accept it rather than resort to arbitrary low proxies.

The Judgment enhances legal certainty for cross-border employment scenarios, deters undue parsimony by tribunals, and fortifies the compensatory goal of the Motor Vehicles Act. Going forward, it will serve as a persuasive precedent across Indian jurisdictions whenever motor accidents involve expatriate or NRI breadwinners.