The Supreme Court has substantially enhanced the compensation payable to a child who suffered catastrophic permanent injuries in a road accident at the age of six months and increased the compensation from ₹45.40 lakh, as awarded by the Orissa High Court, to ₹83.38 lakh along with 9% annual interest, emphasizing that claims involving permanently disabled children demand a compassionate, welfare-oriented, and realistic approach rather than a narrow mathematical assessment.
The bench of Justice Ujjal Bhuyan and Justice N.V. Anjaria held that when a child suffers lifelong disability in a motor vehicle accident, courts must assess not merely the physical impairment but the irreversible destruction of the child’s future, dignity, independence, and quality of life.
The case arose from a tragic motor vehicle accident that occurred on 16 June 2015. The six-month-old child, Shreejita Pattnaik, was travelling with her parents in a Hyundai i10 when a tanker, allegedly being driven rashly and negligently, swerved into their lane and collided head-on with their vehicle. Both the child’s father and the infant sustained grievous injuries.
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Following the accident, the child underwent prolonged treatment at multiple hospitals, including Apollo Hospital, Bhubaneswar, AIIMS Bhubaneswar, NIMHANS Bengaluru and several rehabilitation centres. Medical evidence established that she suffered severe spinal cord and neurological injuries resulting in post-traumatic myelopathy with paraplegia and permanent locomotor disability assessed at 90%. Doctors further opined that she would require lifelong treatment, medication, supervision and assistance for day-to-day activities.
The Motor Accident Claims Tribunal (MACT) initially awarded compensation of ₹30.12 lakh with 6% interest. On appeal, the Orissa High Court enhanced the compensation to ₹45.40 lakh but reduced the multiplier applied for calculating future income from 18 to 15. Dissatisfied with the quantum, the claimant approached the Supreme Court seeking further enhancement.
The principal question before the Supreme Court was whether the compensation awarded by the High Court satisfied the statutory requirement of “just compensation” under Section 168 of the Motor Vehicles Act, particularly where the victim was a child rendered permanently disabled with lifelong dependence on others.
The Court observed that the Motor Vehicles Act is a beneficial welfare legislation intended to provide meaningful financial security to accident victims and their families. Consequently, compensation must be fair, realistic and humane rather than merely symbolic.
Referring to several landmark precedents including Kajal v. Jagdish Chand, Raj Kumar v. Ajay Kumar, Pranay Sethi, Baby Sakshi Greola, Master Ayush, Divya, Hitesh Nagjibhai Patel and Hansraj, the Bench reiterated that compensation in cases involving permanently disabled children cannot be restricted to conventional heads alone. Courts must account for the lifelong deprivation suffered by the child, including loss of childhood experiences, education, independence, marriage prospects, dignity, and normal social life.
The Court observed that children suffering catastrophic injuries constitute a distinct category because the consequences of their disabilities extend throughout every stage of life.
Although the disability certificate assessed the child’s permanent physical disability at 90%, the Supreme Court held that her functional disability was effectively 100%.
The Bench explained that while medical disability measures bodily impairment, functional disability assesses the actual impact of those injuries on a person’s ability to earn a livelihood and live independently. Since the child would remain dependent on others throughout her life and could never engage in gainful employment, the Court treated her loss of earning capacity as complete.
The Supreme Court disagreed with the High Court’s decision to reduce the multiplier from 18 to 15.
Relying on recent judicial precedents involving child victims, the Court held that multiplier 18 should be applied for young children in catastrophic disability cases. It observed that the multiplier method remains the most realistic mechanism for arriving at just compensation while accounting for future uncertainties and inflation.
The Court also clarified that compensation for injured children should not be calculated on the basis of unskilled labour wages.
Instead, following earlier precedents, it held that the minimum wages payable to a skilled worker in the relevant State should be treated as the notional future income since a child cannot automatically be regarded as a non-earning person for compensation purposes. Applying the relevant Odisha wage notifications, the Court recalculated the future earning loss accordingly.
One of the most significant enhancements concerned attendant charges.
The Supreme Court held that the High Court’s award of ₹1.30 lakh under this head was wholly inadequate considering that the child would require continuous assistance throughout her life.
Applying the multiplier method and estimating the cost of two attendants, the Court enhanced compensation under this head to ₹25.92 lakh, observing that lifelong dependency must be realistically compensated.
The Court also enhanced compensation under several other heads: Loss of future earnings: ₹17.46 lakh, Attendant charges: ₹25.92 lakh, Pain, suffering, loss of amenities and marriage prospects: ₹25 lakh, Medical expenses: ₹3 lakh, Future medical treatment: ₹10 lakh, and Conveyance and special diet: ₹2 lakh.
The total compensation consequently stood enhanced to ₹83,38,360. The Court also increased the rate of interest from 6% to 9% per annum, payable from the date of filing of the claim petition until realization.
The Supreme Court directed New India Assurance Company Limited to deposit the enhanced compensation together with accrued interest before the Motor Accident Claims Tribunal, Cuttack within six weeks.
The Tribunal was directed to disburse the amount to the claimant in accordance with law after following the prescribed procedure.Â
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