Case Name: Gayatree Pattnaik for Shreejita Pattnaik v. Arundhati Sahoo and Anr.
Petition No: Civil Appeal No. 7067 of 2026
Neutral Citation: 2026 INSC 785
Date of Judgement: 03.08.2026
Coram: Hon’ble Mr. Justice Ujjal Bhuyan and Hon’ble Mr. Justice N.V. Anjaria
Relevant Statutes and Provisions: Section 168 of the Motor Vehicles Act, 1988, Second Schedule to the Motor Vehicles Act, 1988

(The judgment concerns the quantum of ‘just compensation’ payable to a minor child who suffered 90% permanent physical disability in a motor vehicular accident.)

In this judgment, the Court was called upon to determine whether the compensation awarded to a six-month-old accident victim, even after enhancement by the High Court, satisfied the standard of ‘just compensation’ under the Motor Vehicles Act, 1988 (MV Act). The Court answered it in the negative, and proceeded to substantially enhance the award by correcting the multiplier applied, recognising the distinction between physical and functional disability, adopting the correct notional income, and applying the multiplier method to attendant charges, in line with the recent line of authority on child victims of catastrophic injuries.

FACTS

The claim arose out of a motor vehicular accident that occurred on 16.06.2015, when the minor claimant Shreejita Pattnaik, then about six months old, was travelling with her parents in a car that was violently struck by a tanker being driven rashly and negligently. The claimant suffered severe spinal cord and neurological injuries and, after prolonged treatment at several specialised institutions, was diagnosed with post-traumatic myelopathy with paraplegia, resulting in permanent locomotor disability assessed at 90%. The Motor Accident Claims Tribunal (MACT), Cuttack awarded compensation of Rs. 30,12,960 with interest at 6% per annum. On appeal, the High Court of Orissa enhanced the compensation to Rs. 45,40,800, while reducing the multiplier applied by the MACT from 18 to 15, but enhancing several non-pecuniary heads. The claimant, through her mother and natural guardian, approached the Supreme Court by special leave seeking further enhancement.

ISSUES

1. Whether the compensation awarded by the High Court even after enhancing the compensation awarded by the MACT meets the requirement of ‘just compensation’ within the meaning of the Motor Vehicle Act, 1988?
2. Whether having regard to the nature of injuries suffered by the claimant and the lifelong consequences flowing therefrom, the appellant is entitled to further enhancement of compensation? 
3. Whether the notional income, attendant charges, and non-pecuniary damages payable to a child victim suffering catastrophic and permanent disability were correctly computed by the court?

CONTENTIONS OF THE APPELLANT

• The appellant contended that the compensation awarded, even after enhancement by the High Court, fell short of ‘just compensation’ having regard to the severity and permanence of the disability suffered by a claimant who was only six months old at the time of the accident.
• It was argued that the High Court erred in applying a multiplier of 15 instead of 18, In Baby Sakshi Greola and Hansraj v. Mukesh Nath, the Court considered the young age of the injured children (7 and 14 years) and applied a multiplier of 18.
• The Court emphasised that compensation for children suffering catastrophic permanent disability must be assessed realistically and through a welfare-oriented approach, considering their long-term loss of earning capacity and future needs, as recognised in Kajal v. Jagdish Chand, (2020) 4 SCC 413, and R. Halle v. Reliance General Insurance Co. Ltd., 2026 SCC OnLine SC 433. 
• The appellant submitted that the award towards future attendant charges was nominal and failed to account for the lifelong burden of constant care and supervision that the child would require.
• It was further contended that both the MACT and High Court failed to adequately factor in the mental agony and trauma suffered by the child and her parents, the loss of a normal childhood, and the destruction of marriage prospects and future life expectations.
• The appellant also challenged the rate of interest awarded, submitting that 6% per annum was inadequate and that interest at 9% per annum was necessary to achieve complete and effective compensation.

CONTENTIONS OF THE RESPONDENTS

• The insurer (Respondent No. 2) contended that the High Court had already substantially enhanced the compensation from Rs. 30,12,960 to Rs. 45,40,800, adequately accounting for the nature of the disability on the basis of the evidence on record.
• It was submitted that assessment of compensation necessarily involves judicial discretion and approximation, and that interference by the Supreme Court is unwarranted unless the award is shown to be manifestly inadequate or contrary to settled principles.
• The insurer argued that the High Court had carefully examined the medical evidence and the future consequences of the injury before enhancing compensation under various non-pecuniary heads, including future life expectations, marriage prospects, and attendant charges.
• Accordingly, it was contended that the enhanced compensation already constituted ‘just compensation’and that the appeal ought to be dismissed.

JUDGMENT ANALYSIS

• Principles Governing ‘just compensation’ Under Section 168 MV Act:   Section 168 of the Motor Vehicles Act, 1988 requires the Claims Tribunal to determine the amount of compensation which is ‘just’ in the circumstances of each case. The provision reflects the beneficial object of the Act and therefore requires a liberal, fair and purposive approach rather than a rigid or purely mathematical assessment. In Divisional Controller, KSRTC v. Mahadeva Shetty, (2003) 7 SCC 197, the Court recognised that compensation must be fair and reasonable; in Raj Kumar v. Ajay Kumar, (2011) 1 SCC 343, it emphasised a realistic assessment of the actual impact of disability; and in Kajal v. Jagdish Chand, (2020) 4 SCC 413, the Court adopted a welfare-oriented approach, particularly in cases involving children with severe disabilities. Thus, the Court held that ‘just compensation’ must be fair, reasonable and equitable, neither a windfall nor a pittance. 
• Child Victims Suffering Catastrophic Disability as a Distinct Category: The Court held that children who suffer permanent, catastrophic disability form a special category, since the consequences of such injury alter the child’s entire future rather than merely causing a physical impairment. Relying on Kajal, Master Ayush v. Reliance General Insurance Company Limited(2022) 7 SCC 738, Baby Sakshi Greola v. Manzoor Ahmed Simon(2024) SCC OnLine SC 3692, Divya v. National Insurance Company Limited(2024) 12 SCC 436, and Hitesh Nagjibhai Patel v. Bababhai Nagjibhai Rabari 2025 SCC OnLine SC 3446,  the Court emphasised that a child cannot be treated as a non-earning individual merely because she had not entered employment at the time of the accident, and that courts must adopt a compassionate, realistic and welfare-oriented approach that accounts for the child’s lost future rather than her status on the date of the accident.
• Selection of Appropriate Multiplier for Minor Claimants: In Abhimanyu Partap Singh v. Namita Sekhon, (2022) 8 SCC 489, the Court considered the appropriate multiplier for determining compensation in the case of a child. It noted that 18 is the highest multiplier prescribed under Schedule II of the Motor Vehicles Act, and that it is specifically provided for the age groups of 15-20 years and 21-25 years. Since the victim in the case was below 15 years of age, an age group for which Schedule II did not prescribe a specific multiplier, the Court adopted the highest available multiplier of 18. This approach ensured that the compensation reflected the long-term financial consequences and loss of future earning capacity suffered by the child. 
• Physical Disability versus Functional Disability: The Court relied on Raj Kumar v. Ajay Kumar (2011) 1 SCC 343, S. Ettiappan v. D. Kumar (2026) 1 TAC 84, and Shankar Dutt v. United India Insurance Co. Ltd. 2026 SCC OnLine SC 1193, and explained the conceptual distinction between medically certified physical disability and functional disability, i.e., the real-world impact of the impairment on the claimant’s capacity to live a normal life and earn a livelihood. Applying this distinction, the Court held that although the claimant’s certified physical disability was 90%, her functional disability given that she would be unable to engage in any avocation to earn a livelihood  was total, i.e., 100%.
• Notional Income of a Child Claimant: The Court then considered the appropriate basis for determining the notional income of an injured child. Referring to Baby Sakshi Greola and Kajal v. Jagdish Chand, it held that merely adopting a conventional notional income may not be appropriate where a child suffers permanent disability. Instead, the minimum wages applicable to a skilled workman in the concerned State should be considered, as this represents a reasonable minimum estimate of the income the child could have earned upon attaining adulthood. 
• Attendant Charges: The Court held that attendant charges for a child requiring lifelong care must also be computed using the multiplier method rather than a lump-sum approach, since the multiplier system accounts for inflation, interest, longevity and the uncertainty of life. Applying these principles, the Court re-determined the compensation across all heads, raising the total award to Rs. 83,38,360, together with interest enhanced from 6% to 9% per annum from the date of filing of the claim petition till realisation. 

Therefore, Supreme Court allowed the appeal and enhanced the total compensation payable to the minor claimant from Rs. 45,40,800 to Rs. 83,38,360, together with interest at 9% per annum from the date of filing of the claim petition till realisation. The Court held that the correct multiplier for a child claimant in the relevant age group is 18, that functional disability rather than mere certified physical disability must guide computation of loss of future earnings, that notional income must be based on the minimum wages of a skilled workman, and that attendant charges must be computed by applying the multiplier method. The insurer was directed to deposit the enhanced compensation with accrued interest before the Tribunal within six weeks, with no order as to costs.