The Supreme Court clarified that in claims under Section 166 of the MV Act, a notional income for a deceased child need not be limited to the figures in Schedule II (for Section 163-A claims). It reinstated the Tribunal’s calculation, confirming no deduction for personal expenses is required in such cases.
Facts Of The Case:
The case originated from a motor accident involving a 10-year-old boy who was fatally struck by a bus owned by the Tamil Nadu State Transport Corporation while he was cycling to school. The parents of the deceased child filed a claim petition before the Motor Accidents Claims Tribunal. The Tribunal, acknowledging the undisputed negligence of the bus driver, awarded a total compensation of ₹8,55,000. This calculation was based on attributing a notional monthly income of ₹5,000 to the child, applying a multiplier of 18, and deducting two-thirds for personal expenses, alongside conventional heads like loss of love and affection and funeral expenses.Dissatisfied, the respondent Corporation appealed to the Madurai Bench of the Madras High Court. The High Court substantially reduced the compensation to ₹5,80,000. It held that the income should be strictly derived from the structured formula under Schedule II of the Motor Vehicles Act, which prescribes a lower annual income, and also reduced the multiplier to 15 based on the mother’s age. It further slashed the conventional heads. The aggrieved parents then appealed to the Supreme Court, contesting this reduction and arguing for the restoration of the Tribunal’s award on quantum.
Procedural History:
The legal journey of this case began with the parents filing a claim petition before the Motor Accidents Claims Tribunal (MACT) following their son’s death. The MACT ruled in their favour, awarding compensation of ₹8,55,000. The respondent, the Tamil Nadu State Transport Corporation, then appealed this decision to the Madurai Bench of the Madras High Court. The High Court allowed the appeal in part, significantly reducing the compensation amount to ₹5,80,000. This reduction prompted the aggrieved parents to file a civil appeal before the Supreme Court of India, challenging the High Court’s judgment on the quantum of compensation, which ultimately led to the present ruling.
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Court Observation:
In its observations, the Supreme Court clarified a critical legal distinction, holding that the structured formula under Schedule II of the Motor Vehicles Act is exclusively applicable for claims made under Section 163-A, which operates on the principle of “no fault liability.” The Court found the High Court’s application of this schedule to a claim preferred under Section 166, where negligence was already established, to be a fundamental error. It affirmed the Tribunal’s adoption of a just and reasonable notional income of ₹5,000 per month for the deceased child, stating it was perfectly in order. Furthermore, the Court authoritatively ruled that in cases involving the death of a child, no deduction for personal and living expenses is permissible from the calculated future earnings, as a child is considered a full dependency on the parents.
Final Decision & Judgement:
The Supreme Court allowed the appeal and set aside the impugned judgment of the High Court. The Court restored the compensation awarded by the Tribunal, effectively granting a total of ₹8,55,000 to the appellants. It was directed that this amount, after deducting any sums already paid or deposited, be paid to the claimants within one month from the date of the order, along with interest as originally awarded by the Tribunal. All pending applications, if any, were disposed of as part of this final judgment.
Case Details:
Case Title: Thangavel & Ors. vs. The Managing Director, Tamil Nadu State Transport Corporation Limited Criminal/Civil Appeal No.: Civil Appeal No. 3595 of 2024 Date of Judgement: August 08, 2025 Judges/Justice Name: Justice K. Vinod Chandran and Justice N.V. Anjaria
Download The Judgement Here