Why in News? 

The tragic crash of Air India Flight AI171 near Ahmedabad, killing over 260 people, has sparked a nationwide call for judicial intervention.  

• A petition filed before the Supreme Court seeks suo motu action to ensure fair compensation, systemic aviation reforms, and support for affected families. 

What was the Background of Air India Flight Crash? 

• Air India Flight AI171, a Boeing 787 Dreamliner, crashed tragically just minutes after takeoff from Ahmedabad airport, resulting in one of India's most catastrophic aviation disasters.  
• This devastating incident has claimed the lives of more than 260 people and caused unprecedented collateral damage throughout the surrounding area 
• The crash occurred on a London-bound international flight, which subjects the incident to international aviation law and conventions. 
• The aircraft involved was a Boeing 787 Dreamliner operated by Air India on its London-bound international route, making it subject to international aviation conventions and compensation frameworks.  
• The crash occurred at the B.J. Medical College Hostel's mess area in Ahmedabad, resulting in over 260 fatalities including passengers, crew members, and ground victims. 
•  The collateral damage included direct impact on young medical students residing in the hostel, significant property damage to nearby residential and commercial areas, complete destruction of medical college hostel infrastructure, and major disruption to medical education and healthcare services in the region. 
• The incident has triggered what is anticipated to be India's largest aviation liability case, with total estimated damages exceeding ₹1,000 crores across multiple categories.  
• These damages encompass passenger compensation under international law frameworks, ground fatalities compensation under domestic tort law, extensive property damage claims from affected institutions and individuals, and aircraft hull loss valued between ₹1,040-1,450 crores during acquisition. 
• Dr. Saurav Kumar and Dr. Dhruv Chauhan have submitted a formal letter to the Chief Justice of India, seeking immediate judicial intervention through suo motu action by the Supreme Court.  
• The petition states the unprecedented nature of the disaster requiring extraordinary judicial response, with both petitioners being medical professionals who have a direct understanding of the impact on the medical community. 

Should the Supreme Court Proactively Intervene to Ensure Justice, Compensation, and Reform in the Wake of the Aviation Disaster? 

• The petitioners want the Supreme Court to take suo motu (on its own) cognizance without waiting for formal cases to be filed, emphasizing the urgency of the mass casualty situation and need for proactive judicial oversight to prevent prolonged legal battles. 
• Compensation Framework: 
  • Interim Relief: ₹50 lakhs immediate compensation per victim family, covering all categories including passengers, crew, medical personnel, ground casualties, and support staff. 
  • Final Compensation: Argues that Montreal Convention limits (~USD 200,000) are inadequate for Indian conditions, seeking compensation based on Indian living standards, dependency ratios, and economic factors, with parity between air and ground victims. 
• Expert Committee Formation Requests establishment of a High-Level Expert Committee including retired Supreme Court and High Court judges, aviation safety experts, actuaries, and economists to assess final compensation, ensure uniformity across victim categories, and develop standardized guidelines for future disasters. 
• Airline Obligations Demands Air India expedite claim settlements without bureaucratic delays, eliminate procedural hurdles, avoid forcing families into litigation, provide transparent communication, and establish dedicated support systems. 
• Government Responsibilities Seeks direction for immediate financial support beyond airline liability, comprehensive rehabilitation programs, employment opportunities for family members, educational scholarships for victims' children, and healthcare. 

What Compensation Principles Did the Supreme Court Establish in Triveni Kodkany v. Air India Ltd.,(2020)? 

Case Background: 

• An Air India Express flight crashed at Mangalore airport on 22nd May, 2010, killing a Regional Director of GTL Overseas. 
• The deceased's family filed a complaint before NCDRC claiming Rs 13.42 crores compensation. 
• Air India had already paid Rs 4 crores to the family and Rs 40 lakhs to the parents. 

Court Observations: 

• The judgment considered and applied the compensation calculation principles established by the Constitution Bench in National Insurance Company Ltd. v. Pranay Sethi (2017). 
• The entire Cost to Company (CTC) should be considered as annual income for compensation calculation. 
• Allowances like telephone or transport should not be deducted from total CTC. 
• Additional benefits like ESOPs cannot be included without evidence of guaranteed entitlement. 
• Personal expense deduction should be one-fourth when there are four dependents, not one-fifth. 

Court Directions: 

• The Supreme Court awarded Rs 7,64,29,437 as compensation - the largest individual amount for this air crash. 
• The Court applied 30% addition for future prospects since the deceased was a confirmed employee. 
• Interest at 9% per annum was directed on the same basis as awarded by NCDRC. 
• The balance amount must be paid within two months of receiving the certified copy of the order. 

What is the Law on Victim Compensation in Aviation Disasters? 

• International flights are governed by the Montreal Convention 1999, which establishes liability rules for passenger death or injury, with India ratifying this convention in 2009 through the Carriage by Air (Amendment) Act. 
• Airlines face strict liability for passenger deaths and injuries up to 100,000 Special Drawing Rights (SDR) per passenger, meaning compensation must be paid without requiring proof of negligence on the carrier's part. 
• Current compensation amounts to approximately Rs. 1.54 to 1.82 crores per passenger based on the updated SDR value of 128,821 to 151,880 as of October 2024, with 1 SDR equaling roughly Rs. 120. 
• Ground fatalities and collateral damage fall outside the Montreal Convention's scope and are instead governed by domestic tort law and may trigger class-action lawsuits treating all victims equally regardless of whether they were passengers or ground casualties. 
• Additional compensation beyond the SDR limit is possible if negligence is proven, and Indian courts have awarded significantly higher amounts in individual cases, such as Rs. 7.64 crores to the heirs of a Regional Director killed in an air crash. 
• Indian courts calculate compensation using the Pranay Sethi guidelines, which consider factors like the deceased's age, employment status, and number of dependents, with future income prospects enhanced by 15-50% depending on age brackets. 
• Airlines can make advance payments to meet immediate economic needs of victims' families without admitting liability, and such payments can be offset against final settlement amounts as demonstrated by TATA Group's announcement of Rs. 1 crore per passenger. 
• Mass aviation disasters may trigger absolute liability principles similar to the Bhopal Gas tragedy, where enterprises engaged in inherently dangerous activities owe an absolute, non-delegable duty to prevent harm regardless of reasonable care taken. 
• All compensation claims under the Montreal Convention must be filed within two years of the incident, though aviation-related investigations and settlements typically take years to resolve due to their complex nature.