Compensation Enhanced in Road Accident Case: Court Directs Higher Payout for Victim

The Supreme Court of India has ruled in favor of an accident victim, Madivalappa, by enhancing the compensation awarded due to injuries sustained in a road accident. The case revolved around a bus operated by the Maharashtra State Road Transport Corporation (MSRTC) that negligently caused the accident, leading to significant injuries for the appellant. The judgment increased the compensation from Rs. 3,05,200/- to Rs. 3,83,920/-, acknowledging the application of correct legal principles regarding future prospects and the multiplier method.

Background of the Case

The incident occurred on July 11, 2009, when a bus belonging to MSRTC, bearing registration number MH12CH7027, was involved in a collision due to the driver’s rash and negligent driving. The victim, Madivalappa, then 27 years old, suffered grievous injuries and required extensive medical treatment. Seeking justice, he filed a compensation claim before the Motor Accident Claims Tribunal (MACT), requesting Rs. 23,50,000/- in damages.

Initial Tribunal Award

The MACT initially granted Rs. 2,60,200/- as compensation, categorizing the damages as follows:

Pain and Suffering: Rs. 10,000/-
Medical Expenses: Rs. 70,000/-
Attendant, Nourishment, and Conveyance: Rs. 3,000/-
Loss of Earnings During Treatment: Rs. 4,000/-
Loss of Future Earnings (Multiplier of 17): Rs. 1,63,200/-
Loss of Amenities: Rs. 10,000/-

Appeal to the High Court

Unsatisfied with the compensation, Madivalappa appealed to the Karnataka High Court, which slightly increased the amount to Rs. 3,05,200/-, adding:

Rs. 30,000/- to medical expenses
Rs. 15,000/- for loss of earnings during the treatment period

Petitioner’s Arguments Before the Supreme Court

Madivalappa, through his counsel, argued that:

The multiplier of 17 used in the previous rulings was incorrect; it should have been 18 as per the precedent set in Sarla Verma v. Delhi Transport Corporation (2009).
The MACT and the High Court failed to consider a 40% addition for future prospects, as mandated in National Insurance Company Ltd. v. Pranay Sethi (2017).
The revised calculation for loss of future earnings should be Rs. 2,41,920/- instead of Rs. 1,63,200/-.

The petitioner’s counsel stated, “The lower courts erred in not considering the multiplier of 18 and in failing to account for future prospects, which are settled principles of law.”

Respondent’s Absence

Despite valid notice, the Maharashtra State Road Transport Corporation did not appear before the Supreme Court to contest the appeal. The Court took note of this absence and decided to impose costs on the respondent.

Supreme Court’s Ruling

The Supreme Court, comprising Justices Sudhanshu Dhulia and Ahsanuddin Amanullah, ruled in favor of the appellant, increasing the total compensation to Rs. 3,83,920/-. The Court made key observations:

“The High Court and MACT have not correctly applied the multiplier. Since the appellant’s age was assessed as 24 years, the appropriate multiplier should be 18, as per Sarla Verma.”

On future prospects, the bench stated:

“The decision in Pranay Sethi clearly establishes that a 40% increase for future prospects should be applied. The appellant is entitled to this benefit.”

Final Compensation Breakdown

Pain and Suffering: Rs. 10,000/-
Medical Expenses: Rs. 1,00,000/-
Attendant, Nourishment, and Conveyance: Rs. 3,000/-
Loss of Earnings During Treatment: Rs. 15,000/-
Loss of Future Earnings (Multiplier of 18 with Future Prospects): Rs. 2,41,920/-
Loss of Amenities: Rs. 10,000/-

Additional Penalties on the Respondent

Given the MSRTC’s failure to appear in court, the Supreme Court imposed a penalty of Rs. 50,000/-, payable to the appellant within 30 days. The Court warned:

“Failure to comply with this order will result in additional interest of 8% on both the principal and interest for the period of delay.”

Final Judgment

The Supreme Court modified the High Court’s ruling and directed:

The revised compensation of Rs. 3,83,920/- to be paid within 30 days.
Interest at 6% per annum from the date of filing of the claim.
An additional penalty of Rs. 50,000/- on the respondent.

The Registry was directed to send a copy of the judgment to the Managing Director of MSRTC for compliance.

Petitioner Name: Madivalappa.
Respondent Name: Maharashtra State Road Transport Corporation.
Judgment By: Justice Sudhanshu Dhulia, Justice Ahsanuddin Amanullah.
Place Of Incident: Gulbarga, Karnataka.
Judgment Date: 17-03-2025.

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