Days after the devastating Air India crash in Ahmedabad, which killed at least 274 people, challenges loom over compensation distribution and victim identification. While Tata Sons and Air India have announced interim payouts — Rs 1 crore and Rs 25 lakh per victim, respectively — questions remain over the adequacy of these amounts, delays in DNA-based identification, and the varying claims from families of passengers versus ground victims.However, this is not the final compensation the families of the victims will get. According to the law, since Air India was an international flight, compensation to victims of the crash will be covered under the Montreal Convention, 1999. This excludes any travel insurance, personal insurance, and other benefits the victims are owed. Though, if negligence is proved, families of those who died, or the injured will be entitled to a higher amount. Also Read: AI Images Of Air India Crash Flood Social Media After TragedyLegal Framework: The Montreal Convention ExplainedIndia, in June 2009, became the 91st country to ratify the Montreal Convention, 1999 or MC99. This means airlines operating international flights from countries that have signed the treaty will pay compensation according to the established guidelines.According to the revised limits of liability established under Articles 21 and 22 of MC99, Air India is liable to pay out 1,51,880 Special Drawing Rights (SDR) for each deceased passenger. The compensation is the same regardless of a passenger’s nationality. According to the International Monetary Fund (IMF), the value of Special Drawing Rights (SDRs) is based on a basket of the world's five leading currencies — the US dollar, Euro, Yuan, Yen and the UK pound.This SDR is then converted to one’s local currency. Airlines must pay this compensation regardless of fault.Understanding Air India CompensationShortly, after the crash, Tata Sons announced an ex gratia compensation of Rs. 1 cr to those who died in the crash – passengers, cabin crew/pilot and the bystanders on the ground.This compensation is different from what Air India will shell out under MC 99. If one calculates the SDR in Indian rupees, as of June 18, 2025 (1 SDR is equal to Rs 117.603), the compensation amounts to an upper limit of Rs. 1.8 crores. Since Air India already announced an interim compensation of Rs. 25 lakhs, this amount is likely to be adjusted towards the final compensation under MC99.The final compensation will be calculated based on a formula set out in the Supreme Court’s Pranay Sethi judgment which looked at future prospects to decide costs in motor accident claims. This means a minor who died in the crash will be entitled to a different compensation amount as compared to a stay-at-home mom, a working individual with dependents or non-dependents, a dependent, and various other factors. It is further clarified airlines will make the payout under MC99 to the passengers only. Pilots and the cabin crew will mostly be covered by their employment contract, workers’ compensation laws, or aviation-specific insurance policies which apply to on-duty airline staff. Those who died when Air India crashed and destroyed buildings of a medical college will have to move courts to claim compensation from the airline or any other relevant agency.What Is The Cost Of A LifeFormer Chief Justice of India DY Chandrachud said in accident cases when an adult loses their life, there is a cost to their value. CJI Chandrachud was part of the five-judge Constitution Bench in the Pranay Sethi—a landmark case—which laid guidelines on the computation of how compensation will be calculated. “The aim is to achieve an acceptable degree of proximity to arithmetical precision on the basis of materials brought on record in an individual case. The conception of ‘just compensation’ has to be viewed through the prism of fairness, reasonableness and non-violation of the principle of equitability,” the judgment read.The top court clarified that In a case of death, the legal heirs cannot expect a “windfall”, though simultaneously, “the compensation granted cannot be an apology for compensation”. “It cannot be a pittance,” the Supreme Court had said.The judgment said a person’s value would depend on his age, employment status, future prospects, whether he is salaried or self-employed, number of dependents among other factors. “Taking into consideration the cumulative factors, namely, passage of time, the changing society, escalation of price, the change in price index, the human attitude to follow a particular pattern of life, etc., an addition of 40% of the established income of the deceased towards future prospects and where the deceased was below 40 years an addition of 25% where the deceased was between the age of 40 to 50 years would be reasonable,” the Pranay Sethi judgment read.In March 2020, CJI Chandrachud authored the Supreme Court's Triveni Kodkany judgment which directed the largest-ever compensation payout in an...