Answer

Introduction

Compensation under the Motor Vehicles Act (MVA) is traditionally determined by the “multiplier method,” which calculates payouts based on the victim’s age and income. While intended to restore the family to their prior economic status, this market-linked logic creates a hierarchy of human value in a welfare state.

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Equity and Dignity: Issues under Articles 14 and 21

• Discrimination in Value: Linking compensation to income creates a constitutional paradox where the life of a high-earner is deemed legally more “valuable” than a laborer.
  Eg: Differential payouts violate Article 14’s promise of equality before the law by treating human life as a market commodity.
• Marginalization of Unpaid Labour: Homemakers and children are often assigned a “notional income,” which fails to account for their actual social and emotional contribution.
  Eg: The Supreme Court in Kirti v. Oriental Insurance (2021) emphasized that a homemaker’s work adds significant economic value to the nation.
• Dignity vs. Arithmetic: Reducing a human life to a statistical calculation of earning capacity erodes the intrinsic dignity guaranteed under Article 21.
  Eg: Courts have noted that “just compensation” must go beyond pecuniary loss to include “dignity damages” for emotional trauma.
• Comparative Anomaly: Unlike the road sector, the Railways Act (1989) and Carriage by Air Act provide uniform compensation regardless of the victim’s socio-economic status.
  Eg: Rail victims receive a fixed ₹8 lakh, highlighting the lack of a standardized “Right to Safety” across transport modes.

Suggested Reforms for ‘Just Compensation’

• Standardized Base Compensation: Implementing a high mandatory floor for “no-fault” liability to ensure every citizen receives a dignified minimum, irrespective of income.
• Valuing Domestic Care: Formally integrating the “opportunity cost” and “service value” of non-earning victims into the MVA’s schedule to ensure gender-just payouts. 
• Automatic Inflation Adjustment: Periodic and mandatory revision of “notional income” slabs and conventional heads (funeral, loss of estate) to keep pace with the cost of living. 
• Comprehensive Cashless Support: Prioritizing immediate medical relief and trauma care over long-term litigation to protect the “Right to Health.”
  Eg: The Cashless Treatment Scheme 2025 provides up to ₹1.5 lakh for the “Golden Hour,” ensuring life-saving equity regardless of wealth.

Conclusion

A welfare state must ensure that the “arithmetic of loss” does not override the “morality of justice.” Transitioning toward a hybrid model that combines a uniform, high base payout with additional income-linked supplements would align the Motor Vehicles Act with the constitutional vision of treating every life as inherently and equally precious.

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