In a significant ruling, the Supreme Court of India has clarified that the right to claim compensation in motor accident cases does not end with the death of the injured person. On September 26, 2025, a bench of Justices K. Vinod Chandran and N.V. Anjaria delivered this judgment while deciding the appeal filed by the legal heirs of Dhannalal alias Dhanraj, who had been rendered 100% disabled in a road accident but passed away during the pendency of the case.
Background
Dhannalal, injured in a serious motor accident back in 2013, had initially been awarded compensation by the Motor Accident Claims Tribunal. Dissatisfied with the amount, he sought an enhancement. The High Court slightly raised the sum but did not fully accept his claim of higher earnings. Before the matter could be concluded in the Supreme Court, Dhannalal died in April 2024, leading the insurance company to object that his heirs had no right to continue the appeal.
The insurer cited older rulings, including a Full Bench judgment of the Madhya Pradesh High Court, which had held that claims for personal injury did not survive after the victim’s death. They also invoked Section 306 of the Indian Succession Act, which restricts the survival of certain personal claims.
Court’s Observations
The bench, however, took note of a 2019 amendment to the Motor Vehicles Act. This amendment inserted subsection (5) in Section 166, making it clear that the right to compensation for injury survives to the legal heirs, “irrespective of whether the death is related to the accident or not.”
“The right to claim compensation for the injuries caused in a motor vehicle accident hence survives on the legal representatives of the injured even if the injured dies in the course of the proceedings,” the bench observed. It rejected the insurer’s preliminary objection and emphasized that compensation, once due, becomes part of the estate of the injured, which legal heirs can rightfully inherit.
On the issue of income assessment, the Court disagreed with the Tribunal’s drastic reduction of Dhannalal’s monthly income to just ₹4,030. Instead, relying on earlier precedents, the Court fixed his income at ₹9,000 per month, adding a 25% increment for future prospects. “We are of the opinion that ₹9,000 can be safely accepted as his monthly income at the time of the accident,” the judgment stated.
The Court also noted that since the victim lived only 11 years after the accident in a vegetative state, the usual multiplier of 14 (based on age) should be reduced to 11, reflecting his actual survival period.
Decision
Ultimately, the Supreme Court enhanced the compensation to ₹20,37,095, inclusive of medical costs, pain and suffering, and loss of income. Importantly, it ruled that interest at 9% must be paid from the date of filing the claim petition until actual payment, overturning the High Court’s restriction. The insurer has been directed to pay the balance within three months, after deducting any sums already released.
With this verdict, the Supreme Court has reinforced the rights of victims’ families in motor accident cases, ensuring that compensation does not lapse merely because of the injured’s demise during litigation.
Case Title: Dhannalal Alias Dhanraj (Dead) Through Legal Representatives vs. Nasir Khan & Others
Case Number: Civil Appeal No. 2159 of 2024
Date of Judgment: 26 September 2025