MV Act Compensation to parents of child died is at different footing than disabled child

Compensation under motor vehicle Act to parents of child died attract a less multiplier than from that of a claim filed by a disabled child.

In a recent judgment, Hon’ble Supreme Court has held that compensation under motor vehicle Act by parents of child died would definitely attract a less multiplier from that of a claim filed by a disabled child, destined to live the rest of his/her life with a debilitating condition of mental retardation and severe incontinence.

ABCAUS Case Law Citation:
4936 (2025) (12) abcaus.in SC

In the instant case, a 14-year-old boy with his classmates who was going to school was hit by a truck driven rashly and negligently which ended their tender lives. The first child died a day after, in the hospital while the other two school mates died on the spot. 

The parents of the child filed a claim under Motor Vehicle Act before the Motor Accident Claims Tribunal but were awarded a meagre amount of compensation with interest. On appeal, the Hon’ble High Court enhanced the compensation with interest.

Before the Hon’ble Supreme Court the appellant (parents of the deceased child) argued that there was sufficient evidence produced before Court with respect to the earning of persons, who studied along with the deceased, his contemporaries, who went on to take up different gainful employments. The criteria adopted by the High Court is grossly inadequate, is the contention raised. 

It was also submitted that a multiplier of 18 has to be adopted as per the judgment of the Division Bench of the Hon’ble Apex Court wherein a seven-year-old child had suffered grievous injuries and was rendered disabled wherein the multiplier of 18 was adopted. 

On the other hand the Insurance company submitted that it had no objection with respect to the minimum wages being adopted but the multiplier has to be kept at 15 as has been laid down in another judgment of the Hon’ble Supreme Court.

The Hon’ble Supreme Court opined that the facts of the case relied upon by the Petitioner were quite distinct from the present case. In the instant case, the child died and the claim of compensation by the parents would definitely stand on a different footing from that of a claim filed by a disabled child, destined to live the rest of his/her life with a debilitating condition of mental retardation and severe incontinence.

The Hon’ble Supreme Court opined that the monthly notional income can be adopted as per the Minimum Wages Act, 1948, which both parties agreed. A 40% increase had to be adopted for future prospects and the multiplier is 15 as held in the judgment relied upon by the respondent.

Accordingly, the appeal was disposed. 

Download Full Judgment Click Here >>

• Appeal withdrawn against rejection u/s 12AB as assessee was availing benefit u/s 10(23C)(iiiad)
• When delay not mala fide, right of hearing on merit not to be rejected – ITAT
• Exemption u/s 54 allowed despite failure to deposit in Capital Gains Accounts Scheme
• No addition to be made in hands of assessee solely on basis of uncorroborated loose-sheet
• Claim of Leave Encashment exemption u/s 10(10AA)(ii) dismissed beyond Rs. 3 lakhs