Explainer · Motor Accident Claims · MV Act

Motor Vehicles Act 1988 Section 163a: Structured Formula Compensation (2026)

Updated for 2026 · Claw Editorial

Section 163A of the Motor Vehicles Act, 1988 was the no-fault compensation provision. It let the family of a person killed, or a person permanently disabled, in a motor accident claim a fixed amount worked out on a formula in the Second Schedule, without proving that anyone was at fault. There is one crucial update. Section 163A has been omitted. From 1 April 2022 it is replaced by Section 164, which pays a fixed sum without proof of fault. This explainer sets out what Section 163A did, how the formula worked, and what applies to accidents today. Last verified October 2026.

01Important update on Section 163A

Before you rely on Section 163A, note that it has been removed from the Act. The Motor Vehicles (Amendment) Act, 2019 omitted Section 163A, and the change was brought into force on 1 April 2022. The Second Schedule, which carried the compensation formula, was omitted along with it.

In its place, the Act now has Section 164, a fixed-sum no-fault payment. So for accidents governed by the amended law, a claimant uses Section 164, not Section 163A.

02What Section 163A did

Section 163A gave a victim a quicker, certain route. Its key features were:

• it applied to death or permanent disablement from a motor accident;
• compensation was paid on a structured formula in the Second Schedule, based on the age and annual income of the victim; and
• the claimant did not have to prove wrongful act, neglect or default of anyone.

Because fault did not have to be proved, the amount was usually lower than a full fault claim, but it came faster and with less dispute. The Supreme Court held a claimant could not pursue both a Section 163A claim and a fault claim for the same accident at the same time.

03The Second Schedule formula

The Second Schedule set out a table. It took the annual income of the deceased or injured person, applied a multiplier based on age, and made deductions for personal expenses, to arrive at the compensation. It also fixed amounts for general damages such as funeral expenses and loss of consortium.

04Section 163A against Section 166

Under the old law, a claimant chose between two routes. The choice is still useful to understand, because the same logic now runs between Section 164 and Section 166.

For how a full fault claim is filed, see how to file a MACT claim, and for how the figure is worked out, see how MACT compensation is calculated.

05What Section 164 does now

Section 164, which replaced Section 163A from 1 April 2022, keeps the no-fault idea but drops the formula. It pays a fixed amount:

• a set sum in the case of death; and
• a set sum in the case of grievous hurt,

without the claimant having to prove wrongful act, neglect or default. The figures are set by the rules and are simpler to apply than the old Second Schedule. A separate scheme also covers hit and run cases; see the hit and run compensation scheme.

06Which law applies to your claim

The rule of thumb is the date. For accidents and claims governed by the law as it stood before 1 April 2022, Section 163A and the Second Schedule can still be relevant, and courts have applied the revised schedule to some pending claims. For the amended regime, the route is Section 164.

Because this is a transition area with live litigation, the date of the accident, the date of the claim, and any court order on which schedule applies all matter. If an award is too low or wrongly rejected, see how to appeal a MACT award in the High Court.

07Where Claw fits

Claw is an all-in-one legaltech platform for Indian advocates, law firms, and corporate legal teams, combining AI-based case search, an AI legal assistant (Legal GPT), case management, and compliance automation across all Indian courts and tribunals.

Because Section 163A, the Second Schedule and the move to Section 164 are a live transition, the right amount often depends on how tribunals and High Courts have treated similar claims and dates. Claw lets you search more than 30 crore judgments and orders, with results in under 5 seconds, so you can see how courts applied the old formula and how they read the shift to Section 164. Reported authority runs from Supreme Court rulings of 1950 and High Court rulings of 1990 to recent orders. You can also track a live MACT matter, with its orders and hearings, by party or vehicle number across 9,102 courts, benches and forums. Claw does not use the documents you upload to train its AI models.

Create a FREE Claw account to track your motor accident claim and its hearings, and use case search across Indian courts to find awards in similar cases. You can also track a MACT case status by party name.

08Sources and further reading

• India Code (Motor Vehicles Act, 1988 bare text): indiacode.nic.in
• Ministry of Road Transport and Highways: morth.nic.in
• eCourts (case status of district courts and tribunals): ecourts.gov.in
• Claw: clawlaw.in

This explainer is general information, not legal advice. The law changes through amendments and judgments, so check the current text and take advice from an advocate before you act.

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