Family of deceased housewife wins Rs 6 lakh in SC; homemaking not a valid ground for low payout to accident victim

Losing a homemaker could be a big traumatic experience for any family. However, when it comes to calculating the financial loss for awarding compensation, the contribution of a housewife is often underestimated. The recent judgement by the Supreme Court gives the much-needed financial dignity to the duties performed by a housewife. When the mother of two children died in a motor accident in 2006, her husband and two children, who were students at that time, demanded compensation for such a big loss to their family. However, they were offered only a meagre sum of Rs 2.5 lakh as compensation at the Motor Accident Claims Tribunal (MCAT). The family found the compensation was very low and hence they rejected it and decided to file an appeal against it in the high court.

However, the proceedings were not easy for them as they suffered a setback as the high court rejected their appeal. Despite the odds, the family went on to escalate the fight to the Supreme Court where they finally got a favourable order. The court increased the compensation by Rs 3.5 lakh to Rs 6 lakh in total. The Supreme Court observed that a lower compensation is not justified just because the deceased was a homemaker.

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Why did the family have to approach the court for compensation?

Sushma Pandey, a 50-year-old homemaker, died when her car lost control, skidded off, and fell into a ditch on June 26, 2006. She left behind her husband and two children who were still studying at that time. Although this is a sad incident, what’s even more sad is the fact that the vehicle did not have valid insurance at that time, so the insurance company was not liable to pay any money.

Why did the family initially get Rs 2.5 lakh as compensation?

Initially, the family approached the Motor Accident Claims Tribunal (MCAT) for compensation of Rs 16.85 lakh but that was dismissed. Then, the family approached the high court, and the high court asked the tribunal to again hear the case. In this second hearing, the tribunal deemed that the family should get Rs 2.5 lakh compensation and hence ordered the same. Rejecting this compensation, the husband of the deceased homemaker filed an appeal in the high court. Later that appeal was dismissed by the court.Also read: Husband fights for 13 years for life insurance claim against SBI Life Insurance and wins.

Supreme Court does justice by passing a favourable order

When the matter reached the Supreme Court, the apex court ruled in favour of the family and also underlined the importance of a homemaker in a family. In its judgement, the apex court opined that the contribution of a housewife cannot be measured in tangible income terms. “The activities performed by a homemaker, if counted one by one, there will hardly be any doubt that the contribution of a homemaker is of a high order and invaluable. In fact, it is difficult to assess such a contribution in monetary terms. We are constrained to observe that the impugned order passed by the High Court is full of factual as well as legal errors,” said the Supreme Court in an order dated February 16, 2024.

The Supreme Court further criticised the high court

“The High Court misread the facts while observing that the deceased was travelling in the bus, while actually, she was travelling in the car. Similarly, the High Court has committed a patent error in observing that the appellants are not dependent on the deceased. The High Court overlooked the fact that the deceased was about 50 years old and not 55 years old,” said the Supreme Court.

How did the Supreme Court calculate the compensation amount

Although the Supreme Court admitted that calculating the monetary value of a homemaker is highly difficult, the reference wages of a daily wage worker were taken for determining the compensation.

“Taking into consideration all the attending circumstances, it appears to us that the monthly income of the deceased, at the relevant time, could not be less than Rs.4,000/- p.m. or so. However, instead of calculating the compensation under different heads, and also keeping in mind the fact that the appellants and the respondents are closely related, and the delinquent vehicle was not insured, we deem it appropriate to allow this appeal in part to the extent that the appellants are granted a lump sum compensation of Rs 6,00,000/- (Rupees six lakhs),” said the Supreme Court in the order.

“One of the major reasons for the compensation being granted by the Supreme Court is due to the finding that the contribution of a homemaker is invaluable, and her direct/indirect income could not be less than the wages admissible to a daily wager in the State of Uttarakhand under the Minimum Wages Act. The factual error of not recognizing the appellants to be dependent on their deceased mother also impacted the computation of the compensation awarded,” says Ankur Mahindro, Managing Partner, Kred Jure, a law firm.