Tribunals must exercise discretion in releasing compensation amounts and avoid rigid adherence to fixed deposit rules, considering individual circumstances of claimants.

JUDGMENT :

The petitioner met with a road accident on 14.10.2019 and filed a claim petition as O.P.(MV)No.247 of 2020 before the Motor Accidents Claims Tribunal, Kottayam (hereinafter referred to as the 'Tribunal'). The Tribunal, by Ext.P1 award, awarded a sum of Rs.13,75,955/- with 7% simple interest from the date of petition till realisation and further directed that, out of the compensation amount, a sum of Rs.7,00,000/- shall be retained as fixed deposit for a period of five years. The petitioner filed I.A.No.5/2024 before the Tribunal seeking release of the amount in fixed deposit. According to the petitioner, the amounts were required for the purpose of settling a loan liability of the petitioner. The Tribunal, by Ext.P3 order dated 27.01.2025, directed to release only a part of the amount, prompting the petitioner to approach this Court by filing this Original Petition.

2. The learned counsel appearing for the petitioner submits that the amount directed to be released by the Tribunal may not be sufficient to settle the liability of the petitioner. It is submitted that since no minors' claim is involved and since the petitioner is fully capable of looking after her affairs, there was no justifiable reason for the Tribunal to issue an order directing the retention of the amount in question as fixed deposit.

3. Having heard the learned counsel for the petitioner, I am of the opinion that this writ petition can be disposed of without notice to the respondent, as no order prejudice to the respondent is being issued by this Court. In Padma v. Venugopal [2012 (1) KLT 546 (SC)] the Supreme Court held as follows;

“5. Thus, sufficient discretion has been given to the Tribunal not to insist on investment of the compensation amount in long term fixed deposit and to release even the whole amount in the case of literate persons. However, the Tribunals are often taking a very rigid stand and are mechanically ordering in almost all cases that the amount of compensation shall be invested in long term fixed deposit. They are taking such a rigid and mechanical approach without understanding and appreciating the distinction drawn by this Court in the case of minors, illiterate claimants and widows and in the case of semi- literate and literate persons. It needs to be clarified that the above guidelines were issued by this Court only to safeguard the interests of the claimants, particularly the minors, illiterates and others whose amounts are sought to be withdrawn on some fictitious grounds. The guidelines were not to be understood to mean that the Tribunals were to take a rigid stand while considering an application seeking release of the money. The guidelines cast a responsibility on the Tribunals to pass appropriate orders after examining each case on its own merits. However, it is seen that even in cases when there is no possibility or chance of the feed being frittered away by the beneficiary owing to ignorance, illiteracy or susceptibility to exploitation, investment of the amount of compensation in long term fixed deposit is directed by the Tribunals as a matter of course and in a routine manner, ignoring the object and the spirit of the guidelines issued by this Court and the genuine requirements of the claimants. Even in the case of literate persons, the Tribunals are automatically ordering investment of the amount of compensation in long term fixed deposit without recording that having regard to the age or fiscal background or the strata of the society to which the claimant belongs or such other considerations, the Tribunal thinks it necessary to direct such investment in the larger interests of the claimant and with a view to ensure the safety of the compensation awarded to him. The Tribunals very often dispose of the claimant’s application for withdrawal of the amount of compensation in a mechanical manner and without proper application of mind. This has resulted in serious injustice and hardship to the claimants. The Tribunals app