Motor Accident Claims: SC Says ₹5,000 Monthly Income for Child is Reasonable

The Supreme Court has ruled that there is no fixed formula for determining the income of a child in cases of injury or death in a motor vehicle accident while deciding compensation.

The Bench of Justice K. Vinod Chandran and Justice N.V. Anjaria was hearing an appeal filed by parents challenging the Madurai Bench of the Madras High Court’s decision, which reduced the compensation granted for the death of their 10-year-old son in a road accident.

The boy was hit by a bus while cycling to school. The Tribunal had fixed his income at ₹5,000 per month, applied a multiplier of 18, and deducted two-thirds for personal expenses, awarding ₹8,55,000 in total compensation, which included amounts for love and affection, funeral costs, transportation, and damage to clothes and the bicycle.

However, the High Court reduced the compensation to ₹5,80,000, adopting an annual income of ₹30,000 as per Schedule II of the Motor Vehicles Act, 1988, applying a multiplier of 15, and removing certain amounts granted by the Tribunal.

The Supreme Court disagreed with the High Court, stating that the ₹5,000 monthly income adopted by the Tribunal was reasonable and that there should be no deduction for personal expenses in such cases. It also restored compensation for transportation, clothing, and bicycle damage, while adjusting the amounts for loss of love and affection and funeral expenses as per legal guidelines.

The Court concluded that the rightful compensation should be ₹8,70,000 and restored the Tribunal’s award. It directed the respondent to pay the balance amount within one month, after deducting any sum already paid.

Case Title: Thangavel & Ors. vs. The Managing Director, Tamil Nadu State Transport Corporation Limited