### Amended Section 163A applies retrospectively, entitling claimants to statutory compensation of five lakh rupees.

In brief

The question

Whether the Tribunal erred in its quantum of compensation and if the 2018 amendment to the Second Schedule of the Motor Vehicles Act applies retrospectively to pending appeals

The court held

The High Court allowed the appeal and modified the Tribunal’s award

It also directed

It held that the appellants are entitled to an enhanced compensation of ₹5,00,000 (instead of ₹1,54,500) with interest at the rate of 8% per annum from the date of the claim petition until realization

Respondent No. 2 (United India Insurance Co. Ltd.) was directed to deposit the enhanced amount within six weeks, and the Tribunal was instructed to disburse the funds to the claimants after deducting any unpaid Court Fees

01Facts

The appellants (original claimants) filed a claim petition under Section 163A of the Motor Vehicles Act, 1988, following a fatal accident on June 22, 2003, involving the deceased, Hareshbhai Jashmatbhai Vora

p. 6

The Motor Accident Claims Tribunal (Main), Rajkot, vide judgment dated August 12, 2013, awarded a compensation of ₹1,54,500 with 8% interest per annum

p. 2

The claimants appealed to the High Court seeking enhancement of compensation, primarily relying on subsequent legislative amendments and judicial precedents

p. 3

02Issues

i.Whether the Tribunal erred in its quantum of compensation and if the 2018 amendment to the Second Schedule of the Motor Vehicles Act applies retrospectively to pending appeals

p. 6

03Law Applied

The Court applied Section 163A of the Motor Vehicles Act, 1988, which provides for compensation on a structured formula basis without requiring proof of negligence

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It specifically referenced the Notification dated May 22, 2018, which amended the Second Schedule to increase the fixed compensation for fatal accidents to ₹5,00,000

p. 3

Furthermore, the Court relied on the precedent set by the Hon’ble Supreme Court in *K.R. Jagdish and another v. National Insurance Company Limited and Another (2025 ACJ 1881)*, which established that the Motor Vehicles Act is beneficial legislation and the 2018 amendment should be applied retrospectively to pending proceedings

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Provisions in the judgment · 3 · Linked ones open on LawLens

Motor Vehicles Act, 1988 Section 173 Section 163 Section 2

04Reasoning

The Court noted that the involvement of the vehicle and the liability of the Insurance Company were uncontroverted as no cross-appeals were filed by the respondents

p. 6

The central legal determination hinged on whether the fixed compensation amount should be governed by the law existing at the time of the accident (2003) or the amended law (2018)

Following the Supreme Court's reasoning in *K.R. Jagdish*, the Court observed that since the appeal was pending when the 2018 amendment came into force, the claimants were entitled to the enhanced statutory benefit

p. 7

The Court held that beneficial legislation intended to provide social security must be interpreted liberally in favor of the claimants, thereby justifying the shift from the structured formula of the old schedule to the flat ₹5 Lakhs prescribed by the new amendment

p. 7