[2025] 11 S.C.R. 487 : 2025 INSC 1293

Preetha Krishnan & Ors. v.

The United India Insurance Co. Ltd. & Ors.

(Special Leave Petition (Civil) No(s). 9753-56 of 2025)

06 November 2025

[Sanjay Karol* and Prashant Kumar Mishra, JJ.]

Issue for Consideration

Grievance of the claimant-appellants is w.r.t the application of split multiplier by the High Court, causing a significant reduction in the total compensation, as awarded by the Tribunal, vis-à-vis, the High Court.

Headnotes†

Motor Vehicles Act, 1988 - Motor Accident Claim - Compensation - Calculation of - Application of split multiplier - Impermissibility - Deceased, an Assistant Engineer in the PWD, aged 51 years died in a car accident - Appellants (wife and children of the deceased) sought compensation of Rs.60,00,000/-, stating that the deceased earned Rs.47,860/- p.m - Tribunal awarded Rs.44,04,912/- to the appellants with interest @ 7.5% p.a - High Court inter alia reduced the compensation under the head of loss of dependency from Rs.42,29,712/- to Rs.35,10,144/-, by applying a split multiplier considering the post-retirement reduction in the income of the deceased, thereby deducting the excess amount of Rs.7,19,568/- - Review petitions rejected by High Court - Challenge to:

Held: Split multiplier is a concept foreign to the Motor Vehicles Act, 1988 and is not to be used by the Tribunal and/or Courts in calculation of the compensation - The income as on the date of death is to be taken to calculate the compensation - A split multiplier is not to be adopted, as a matter of course, and is only to be used in the exceptional circumstances, with such circumstances being recorded - Superannuation from service hardly qualifies as such an exceptional circumstance, which would justify the use of split multiplier - It is only a natural progression that a person who

* Author

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enters service must also exit at some point in time - The same cannot be taken as a negative circumstance against the deceased person or a person injured severely, leading to incapacitation or permanent disability - High Court failed to comply with the directives issued in Pranay Sethi i.e., granting 10% enhancement, every three years under the conventional heads - Multiplier of 11 applied, compensation payable to the appellants enhanced to Rs.47,76,794/- - Impugned Award passed by the Tribunal, as modified by the High Court vide the impugned judgment; and judgement in review petitions, modified accordingly. [Paras 17-20]

Directions by Supreme Court - Motor Vehicles Act, 1988 - Motor Accident Claim - Compensation - Calculation of - Application of split multiplier - Divergent opinion of High Courts:

Held: Split multiplier is a concept foreign to the Motor Vehicles Act, 1988 and is not to be used by the Tribunal and/or Courts in calculation of the compensation - A split multiplier is not to be adopted, as a matter of course, and is only to be used in the exceptional circumstances, with such circumstances being recorded - Directions issued to apply prospectively and the conclusions arrived at regarding the split multiplier, shall not affect the judgments of the High Courts noticed - A copy of this order to be circulated to the Registrars General of all the High Courts for necessary information and compliance and also to the Tribunals. [Para 22]

Case Law Cited

National Insurance Co. Ltd. v. Pranay Sethi [2017] 13 SCR 100 :

(2017) 16 SCC 680 - followed.

Sarla Verma v. DTC [2009] 5 SCR 1098 : (2009) 6 SCC 121; N.

Jayasree & Ors. v. Cholamandalam MS General Insurance Co.

Ltd. [2021] 6 SCR 1001 : (2022) 14 SCC 712; Sumathi v. National Insurance Co. Ltd., 2021 SCC Online SC 3697 - relied on.

K.R. Madhusudhan v. Administrative Officer [2011] 2 SCR 1061 :

(2011) 4 SCC 689; Puttamma v. K.L. Narayana Reddy & Ors. [2013] 16 SCR 83 : (2013) 15 SCC 45 - referred to.

List of Acts

Motor Vehicles Act, 1988.


List of Keywords

Split multiplier; Application of split multiplier; Calculation of compensation; Reduction in total compensation; Post-retirement reduction in income of deceased; Superannuation from service not an exceptional circumstance.

Case Arising From

CIVIL APPELLATE JURISDICTION: Special Leave Petition (Civil) No(s). 9753-9756 of 2025

From the Judgment and Order dated 28.06.2024 and 27.11.2024 of the High Court of Kerala at Ernakulam in MACA Nos. 210 and 1219 of 2015 in RP Nos. 1187 and 1165 of 2024

Appearances for Parties

Advs. for the Petitioners: Bijo Mathew Joy, Ms. Gifty Marium Joseph.

Advs. for the Respondents: Pradeep Gaur, Amit Gaur, Ms. Sweta Sinha, Rameshwar Prasad Goyal.

Judgment / Order of the Supreme Court

Judgment

Sanjay Karol, J.

Time taken for disposal of the claim petition by the MACT

Time taken for disposal of the appeals by the High Court

Time taken for disposal of the appeals in this Court

1 year 3 months 22 days 9 years 2 months and 20 days 8 months 23 days

Leave granted.

These appeals are directed against the judgment and order dated 28th June 2024, passed in MACA No.210 and 1219 of 2015; and

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Judgment and order dated 27.11.24 in R.P.Nos.1165 and 1187 of 2024 by the High Court of Kerala at Ernakulam, which, in turn, were preferred against the order dated 2nd April 2014 in O.P. (M.V.) No.1105/2012, passed by the Motor Accidents Claims Tribunal, Pala1.

The brief facts giving rise to these appeals are that on 3rd August 2012, the deceased, namely, T.I. Krishnan, aged 51 years, was driving his car, bearing registration No.KL-5/M-1062 through the Pala-Thodupuzha Road. A bus bearing registration No.KL-38/B-1833, driven in a rash and negligent manner, collided with the car of the deceased. As a result of the incident, the deceased sustained severe injuries and died on his way to the hospital.

A claim petition was filed on behalf of the claimant-appellants (the wife and children of the deceased) under Section 166 of the Motor Vehicles Act, 1988, before the Tribunal, on 11th December 2012 seeking compensation to the tune of Rs.60,00,000/-, stating therein that the deceased used to earn Rs.47,860/- per month, by working as an Assistant Engineer in the Public Works Department.

The Tribunal vide its order dated 2nd April 2014, awarded an amount of Rs.44,04,912/- to the claimant-appellants along with an interest @ 7.5% per annum from the date of filing the claim petition. The Tribunal, considering the evidence on record, determined the income of the deceased to be Rs.45,408/- per month (post deduction of Rs.2,453/- per month payable as taxes). Since the deceased was aged 51 years, future prospects of 15% was applied to his income. A deduction of 1/4th of the income was made towards living expenses and a multiplier of 9 (considering the facts that one of the petitioners is a government employee and other is a doctor) was applied. Further, the Tribunal awarded Rs.1,00,000/- towards loss of consortium; Rs.25,000/- towards funeral expenses; Rs.40,000/- for loss of love and affection; and Rs.5000/- for loss of estate.

Aggrieved by the compensation awarded by the Tribunal, the insurer as well as the claimant-appellants filed MACA Nos. 210 of 2015 and 1219 of 2015 respectively, before the High Court.

The High Court, vide the impugned judgment, partly allowed the appeals and reduced the compensation under the head of loss of dependency from Rs.42,29,712/- to Rs.35,10,144/-, by applying

1 Hereinafter referred as 'Tribunal'


a split multiplier considering the post-retirement reduction in the income of the deceased, thereby deducting the excess amount of Rs.7,19,568/-. The Court further enhanced the compensation under the heads - loss of consortium and loss of love and affection to Rs.1,60,000/-. The amount awarded towards funeral expenses was reduced to Rs.15,000/-, while the amount under the head loss of estate was enhanced to Rs.15,000/-. The High Court also directed the Tribunal to disburse the amount to claimant-appellants Nos.1 to 4 (Appellants in MACA No. 1219 of 2015) in the ratio of 70:10:10:10.

Aggrieved by the judgment and order passed by the High Court, the claimant-appellants filed RP No.1165 of 2024 arising from MACA No.210 of 2015 and RP No.1187 of 2024 arising from MACA No.1219 of 2015. The High Court, however, rejected these applications for review, stating that if reasons are recorded, split multiplier would be possible.

Dissatisfied with the judgment dated 28th June 2024 and final orders passed in RP Nos.1165 of 2024 and 1187 of 2024 by the High Court, the claimant-appellants are now before us.

10. The point of challenge taken is that the High Court erred in applying split multiplier without considering the possibility of the deceased continuing to earn even after retirement. It is further contended that the Courts failed to appreciate the educational qualification and professional experience of the deceased, which could have secured him a placement in the construction sector, even after his retirement.

11. We have heard the learned counsel for the parties.

12. The main grievance of the claimant-appellants is the application of split multiplier by the High Court, causing a significant reduction in the total compensation, as awarded by the Tribunal, vis-à-vis, the High Court. We find force in this point of challenge. The reasoning adopted by the High Court in applying a split multiplier is that the deceased would have shortly superannuated from service. Thereafter, there would have been a 50% (approx. reduction) in his monthly take-home pay.

13. We find that there are divergent views of the High Courts regarding the use of split multiplier. Some judgments support its application while others explicitly reject the same. Below is a tabular representation, illustrative in nature, of certain judgments accepting the use of split multiplier, while others passed by the same Court rejecting it.

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The common factor to be noted, in all these judgments is that the person involved in the accident or the person who passed away as a result of the accident, were employed in jobs that had a definite retirement age.

SJ: Single Judge

DB: Division Bench

Split Multiplier Applied Split Multiplier not Applied

Delhi High Court

(SJ) Usha Grover v. HDFC Ergo General Insurance Co. Ltd., 2012 SCC OnLine Del 3760

(SJ) Bajaj Allianz General Insurance Co.

Ltd. v. Neeru Sain, 2012 SCC OnLine Del 2472

Bombay High Court

(SJ) United India Insurance Co. Ltd. v.

Shakuntala Babasaheb Dhaktode, 2015 SCC OnLine Bom 6842

Gauhati High Court

(SJ) Ranjita Seal v. Lal Chand Sharma, 2022 SCC OnLine Gau 250

Karnataka High Court

(DB) Branch Manager v. Mallamma, 2023 SCC OnLine Kar 219

(DB) New India Assurance Co. Ltd. v.

Tappa Sujatha, 2025 SCC OnLine Kar 11321

(DB) IFFCO Tokio GIC Ltd. v. A.S.

Mohan Sunder, 2020 SCC OnLine Kar 1776

(DB) Suvarna v. Kishan, 2024 SCC OnLine Kar 2578


(SJ) Senior Divisional Manager v.

Jyotiba Appaji Shigate, 2019 SCC OnLine Kar 3908

(SJ) Sundaramma v. N.D.

Chandrashekar, 2024 SCC OnLine Kar 13379

(DB) Sayeda v. P. Murgan, 2016 SCC OnLine Kar 777

(DB) Gouramma v. A.V.V. Bhadra Rao, 2018 SCC OnLine Kar 1892

(DB) Yashodamma v. Ravindra, 2014 SCC OnLine Kar 9592

(DB) Reliance General Insurance Company Ltd. v. M.

Jayalakshmamma, 2017 SCC OnLine Kar 6507

Kerela High Court

(SJ) National Insurance Company Limited v. J.C. Bose, 2020 SCC OnLine Ker 6564

(SJ) United India Insurance Co. Ltd. v.

Preetha Krishnan, 2024 SCC OnLine Ker 3526

(DB) Vinod K.Y. v. Sunny Kurien, 2017 SCC OnLine Ker 39482

(SJ) Baby Girija v. Thameem R.C., 2022 SCC OnLine Ker 4088

(DB) Oriental Insurance Co. Ltd. v.

Noorjahan M., 2017 SCC OnLine Ker 34559

(SJ) Oriental Insurance Co. Ltd. v. R.

Jenova, 2020 SCC OnLine Ker 6562

(DB) K. Ramanathan v. Jayan Poulose, 2017 SCC OnLine Ker 36615

(SJ) Oriental Insurance Company Limited v. Lucy, 2018 SCC OnLine Ker 13107

(DB) Special Grade Secretary v.

Maniammal, 2017 SCC OnLine Ker 20075

Madras High Court

(SJ) M. Valarmathi and Others ν. T.S.

Rajan and Another 2019 SCC OnLine Mad 5490

(DB) Branch Manager, Royal Sundaram Alliance Insurance Co. Ltd ν. Alli and Others 2021 SCC OnLine Mad 1178

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(DB) Branch Manager, National Insurance Co. Ltd. ν. M. Arulmozhi 2013 SCC OnLine Mad 3416

(SJ) The Branch Manager, SETC TVL Limited, ν. Sethu 2015 SCC OnLine Mad 12761

High Court of Orissa

(SJ) Puspalata Sahu v. Jagdish Prasad Mohanty, 2012 SCC OnLine Ori 16

(SJ) Bajaj Allianz General Insurance Co.

Ltd. v. Samita Maharana, 2022 SCC OnLine Ori 1994

High Court of Punjab and Haryana

(SJ) Birmati v. Mukesh Kumar, 2016 SCC OnLine P&H 19759

(SJ) Slier Singh v. Naresh Kumar, 2019 SCC OnLine P&H 6835

Rajasthan High Court

(SJ) United India Insurance Co. Ltd. v.

Santosh, 2014 SCC OnLine Raj 1652

High Court of Allahabad

(SJ) Tata A.I.G. General Insurance Co.

Ltd. v. Amar Kaur, 2022 SCC OnLine All 1809

14. As can be seen from the above table, there is diverging opinion on the application of split multiplier. While certain High Courts have differences intra-court, there also exists inter-court difference. What is more concerning to us, is the former. Given that there was no uniformity of opinion within a single Court, the Tribunal below is left bereft of guidance leading to differences in compensation awarded for no justifiable reason. This also creates a concerning situation for judicial discipline. We have found instances where a division bench has applied the concept, but a learned single Judge has refused to


do so, subsequently. Further, when there are differences of opinion in benches of equal strength, it is incumbent upon the Court to seek to resolve by referring the issue to a bench of larger composition.

15. There can be no gainsaying that the judgment of this Court in Sarla Verma v. DTC2 represented the coming of a much more structured, uniform method of calculation of compensation in motor accident cases insofar as the multiplier to be applied is concerned.

In this judgment itself, it was observed that the practice of applying multiplier which is equivalent to the number of years the deceased or the injured person had left in service, is the confusion that has to be avoided.

"41. ... Some tribunals, as in this case, apply the multiplier of 22 by taking the balance years of service with reference to the retiring age. It is necessary to avoid this kind of inconsistency. We are concerned with cases falling under Section 166 and not under Section 163-A of the MV Act.

In cases falling under Section 166 of the MV Act, Davies method [Davies v. Powell Duffryn Associated Collieries Ltd., 1942 AC 601 : (1942) 1 All ER 657 (HL)] is applicable.

42. We therefore hold that the multiplier to be used should be as mentioned in Column (4) of the table above (prepared by applying Susamma Thomas [(1994) 2 SCC 176 : 1994 SCC (Cri) 335] , Trilok Chandra [(1996) 4 SCC 362] and Charlie [(2005) 10 SCC 720 : 2005 SCC (Cri) 1657] ), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years."

16. It has been held time and again by this Court that a split multiplier is not to be adopted, as a matter of course, and is only to be used in the exceptional circumstances, with such circumstances being recorded.

(2009) 6 SCC 121

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[See Sarla Verma and Ors. vs. DTC and Ors.3] Reference may be made to N. Jayasree & Ors. v. Cholamandalam MS General Insurance Co. Ltd.4, this Court held that the application of a split multiplier in a case involving a 52-year-old Assistant Professor of Mathematics was not justified. It was observed in reference to National Insurance Co. Ltd. v. Pranay Sethi5 that the Rule of Thumb of adding 15% of the salary as future prospects in cases where the deceased was between the age of 50 and 60 was not to be deviated from.

17. Superannuation from service hardly qualifies as such an exceptional circumstance, which would justify the use of split multiplier. It is only a natural progression that a person who enters service must also exit at some point in time. The same cannot be taken as a negative circumstance against the deceased person or a person injured severely, leading to incapacitation or permanent disability.

The position, in our considered view, is evidently clear from what stood observed by this Court in Sumathi v. National Insurance Co. Ltd.6, as under :

'....it is clear that in normal course, the compensation is to be calculated by applying the multiplier, as per the judgment of this Court Sarla Verma2. Split multiplier cannot be applied unless specific reasons are recorded. The finding of the High Court that the deceased was having leftover service of only four years, cannot be construed as a special reason, for applying the split multiplier for the purpose of assessing the compensation. In normal course, compensation is to be assessed by applying multiplier as indicated by this Court in the judgment in Sarla Verma2.

As no other special reason is recorded for applying the split multiplier, judgment1 of the High Court is fit to be set aside by restoring the award of the Tribunal.'

(Emphasis supplied)

(2009) 6 SCC 121

(2022) 14 SCC 712

(2017) 16 SCC 680

6 2021 SCC Online SC 3697


18. The judgment referred to by the learned Single Judge in the impugned judgment, i.e., K.R. Madhusudhan v. Administrative Officer7 and Puttamma v. K.L. Narayana Reddy & Ors.8, in our considered view, does not support the use of a split multiplier. In both these judgments, this Court has held that there have to be cogent reasons recorded for its use. As already observed above, retirement from service is not 'out of the ordinary', 'exceptional' and 'cogent' for the same to qualify. It is also, a matter of considerable difficulty to conceive what such cogent or exceptional circumstances may be. In any event, the Constitution Bench in Pranay Sethi (supra) had, in para 59.7 observed that the age of the deceased is the criterion to be utilized for multiplier. It does not provide for any other possibilities. This, in our considered view, does not even leave open the possibility of employment of split multiplier, whatsoever. As such, when dealing with a beneficial legislation which relies on just compensation as its bedrock, it is most prudent to tread the path of certainty, insofar as practicable. This is more so important in the context of age which is the primary basis for computation of compensation. In other words, split multiplier is a concept foreign to the Motor Vehicles Act, 1988 and is not to be used by the Tribunal and/or Courts in calculation of the compensation.

19. Concluding the issue of income, we hold that the income as on the date of death is to be taken to calculate the compensation. We further notice that the High Court failed to comply with the directives issued in Pranay Sethi (supra) i.e., granting 10% enhancement, every three years under the conventional heads. In accordance with the above discussion, the compensation now payable to the claimant-appellant is as under:

CALCULATION OF COMPENSATION

Compensation Heads Amount Awarded In Accordance with:

Monthly Income Rs.45,408/-

Yearly Income Rs.5,44,896/-

(2011) 4 SCC 689

(2013) 15 SCC 45

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Future Prospects (15%) (Age being 51 years)

5,44,896 + 81,734

= Rs.6,26,630/-

National Insurance Co. Ltd. v. Pranay Sethi

(2017) 16 SCC 680

Para 37, 39, 41, 42 and 59.4

Deduction (1/4) 6,26,630 - 2,08,876

= Rs.4,17,754/-

Multiplier (11)

4,17,754 X 11

= Rs.45,95,294/-

Loss of Income of the Deceased Rs.45,95,294/-

Loss of Estate Rs.18,150/- National Insurance Co. Ltd. v. Pranay Sethi

(2017) 16 SCC 680

Para 59.8

L o s s o f F u n e r a l Expenses Rs.18,150/-

Loss of Consortium

48,400 X 3

= Rs.1,45,200/-

National Insurance Co. Ltd. v. Pranay Sethi

(2017) 16 SCC 680

Para 59.8

United India Insurance Co. Ltd.

v. Satinder Kaur,

(2021) 11 SCC 780

Para 37.12

Rajwati alias Rajjo and Ors v. United India Insurance Company Ltd. and Ors.

2022 SCC Online

SC 1699

Para 34

Total Rs.47,76,794/-


Thus, the difference in compensation is as under:

MACT High Court This Court

Rs.44,04,912/- Rs.35,10,144/- Rs.47,76,794/-

20. The Civil Appeals are allowed in the aforesaid terms. The impugned Award dated 2nd April 2014 passed in O.P.(MV) No. 1105 of 2012 by the Tribunal, as modified by the High Court of Kerala, vide the impugned judgment dated 28th June 2024, passed in MACA Nos.210 of 2015 and 1219 of 2015; and judgement and order dated 27.11.24 in R.P.Nos.1165 and 1187 of 2024 shall stand modified accordingly.

Interest on the amount is to be paid as awarded by the Tribunal. In the end, we may only record our surprise regarding the approach adopted by the High Court despite clear observations in Sumathi (supra).

21. The amount be directly remitted into the bank account of the claimantappellants as directed by the High Court. The particulars of the bank accounts are to be immediately supplied by the learned counsel for the appellant to the learned counsel for the respondent. The amount be remitted positively before 30th November, 2025.

22. We clarify that the directions issued by this order shall apply prospectively and the conclusions arrived at regarding the split multiplier, shall not affect the judgments of the High Courts noticed by us above. That was done only for the purpose of demonstrating the difference of opinion prevalent on this issue as also shedding light on the situation which comprises judicial propriety. A copy of this order is directed to be circulated by the Registrar (Judicial) of this Court to the learned Registrars General of all the High Courts for necessary information and compliance. It is requested that an e-copy of the order be also circulated to the Tribunals forthwith.

Pending application(s), if any, shall stand disposed of.

Result of the case: Appeals allowed.

†Headnotes prepared by: Divya Pandey