The Centre has finally proposed a long-awaited compensation scheme for road accident victims, offering ₹2 lakh for deaths and ₹1 lakh for grievous injuries from insurance providers, more than three years after Parliament passed the enabling legislation.
The Supreme Court, which had pulled up the government in April for the delay, will now review the draft scheme submitted last month by the ministry of road transport and highways (MoRTH).
The scheme implements Section 164A of the Motor Vehicles Act, amended in 2019 to provide "interim relief" to accident victims. Though the law was notified on April 1, 2022, the government failed to frame the implementation scheme until advocate Kishan Chand Jain moved the apex court.
Justice JB Pardiwala's bench had granted the Centre four months to finalise the scheme -- a deadline that expired on August 28. MoRTH filed the draft proposal with an affidavit on August 29.
During a September 1 hearing, the court adjourned the matter until October, giving Jain and senior advocate Gaurav Agarwal, who is assisting the court as amicus curiae, time to examine the proposal.
The draft scheme restricts interim relief to claimants who have approached Motor Accidents Claims Tribunals (MACT) and covers only future accidents occurring after the scheme's notification. Payments will be made by the insurance companies of offending vehicles within 15 days of application approval through a government portal.
The interim amount will later be adjusted against the final compensation awarded by MACT.
However, Jain has criticised the proposal as inadequate. He argues that the interim compensation should match the full amounts specified under Section 164 -- ₹ 5 lakh for deaths and ₹ 2.5 lakh for grievous injuries. The advocate also highlighted a significant gap: the scheme fails to address accidents involving uninsured vehicles.
The absence of an interim relief mechanism has created substantial hardships for accident victims' families, particularly when the deceased was the sole breadwinner. Agarwal had earlier told the court that families struggle to meet basic expenses like rent and school fees while waiting years for final compensation from tribunals.
MoRTH has shared the draft with the finance ministry, department of legal affairs, and Insurance Regulatory and Development Authority of India, seeking their comments by September 8.
India recorded approximately 460,000 road accidents in 2024, resulting in around 106,000 deaths and 202,000 cases of grievous injuries, according to government data submitted to the court.