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2026 Supreme(Online)(P&H) 82517

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Sudeepti Sharma, J
Oriental Insurance Company Limited – Appellant
Versus
Vidyawati – Respondent
FAO-3420-2013 | FAO-4639-2013



Advocates:
For the Appellants/Petitioners: Ashwani Talwar, Rohan Sachdev, Vaishnavi Sikka
For the Respondents: Preeti Singh, Sandhya Saini

The amount received by dependants as ex-gratia compassionate assistance from an employer upon the death of a government employee is deductible from the compensation awarded under the Motor Vehicles Act to avoid double benefit, but disbursed amounts are generally not recoverable from claimants.

Headnote:(A) Motor Vehicles Act, 1988 - Sections 140 and 166 - Haryana Compassionate Assistance to the Dependants of Deceased Government Employees Rules, 2006 - Compensation for death in motor accident - Double benefit - Claimants receiving ex-gratia assistance from employer - Amounts received as compassionate assistance are deductible from total compensation award to avoid double benefit - Deduction upheld in accordance with precedent. (Paras 9, 10, 11, 12, 14)

(B) Compensation - Quantum - Determination - Income assessment - Court held Tribunal erred in assessing take-home salary instead of gross salary and failing to account for future prospects correctly based on age - Recomputation performed for just compensation. (Paras 13, 14)

(C) Recovery - Once amount is disbursed to claimants, particularly if a significant portion has been paid, courts may direct that the amount already disbursed shall not be recovered from them to avoid undue hardship, while allowing adjustment against pending sums. (Paras 15, 16, 17, 18)

Facts of the case:
The appellant insurance company challenged the award of the Motor Accident Claims Tribunal, arguing that the tribunal failed to deduct the compassionate assistance paid to the dependants of the deceased employee by the employer. The claimants, in turn, sought enhancement of the compensation awarded.

Findings of Court:
The court upheld the requirement to deduct the compassionate assistance received under the government rules to prevent double recovery. It recomputed the compensation based on the gross monthly income, added future prospects, applied standardized deductions for personal expenses, and awarded consortium for spousal, filial, and parental categories. It further directed that disbursed funds should not be recovered from the claimants.

Issues: Whether compensation under the Motor Vehicles Act should be reduced by the amount of compassionate assistance received by dependents under specific state rules, and the correct methodology for computing the total compensation amount.

Ratio Decidendi: Compensation must be just and fair, fulfilling the twin objectives of non-arbitrariness and the prevention of windfall gains; hence, double benefits from the same cause (death in harness) are impermissible.

Result: Appeal allowed; award modified.

Table of Content
1. court jurisdiction and scope of appeal regarding compensation. (Para 1 , 2)
2. contentions regarding mitigation of compensation and counter-claims for enhancement. (Para 3 , 4)
3. applicability of supreme court standards for calculating dependency, future prospects, and consortium. (Para 6 , 7 , 8)
4. deductibility of compassionate assistance and correction of income assessment for compensation. (Para 9 , 10 , 11 , 12 , 13 , 14)
5. non-recovery of already disbursed funds from claimants and final modification of award. (Para 15 , 16 , 17 , 18 , 19 , 20 , 21)

SUDEEPTI SHARMA, J.

1. The present appeal has been preferred by Insurance Company against the award dated 23.03.2013 passed by the learned Motor Accident Claims Tribunal, Sonipat (for short, 'the Tribunal’) in the claim petition filed under Section 166 and 140 of the Motor Vehicles Act, 1988 on quantum of compensation granted to the claimants to the tune of Rs.33,46,700/- along with interest @ 7.5 % per annum, on account of death of Joginder in a Motor Vehicular Accident, occurred on 03.02.2012 on the ground that compensation awarded is on higher side.

2. As sole issue for determination in the present appeal is confined to quantum of compensation awarded by the learned Tribunal, a detailed narration of the facts of the case is not required to be reproduced here for the sake of brevity.

SUBMISSIONS OF LEARNED COUNSEL FOR THE PARTIES

3. The learned counsel appearing for the appellant–Insurance Company contends that the learned Tribunal has erred in law by failing to deduct the amount received by the dependants of the deceased under the Haryana Compassionate Assistance to the Dependants of Deceased Government Employees Rules, 2006 . He further contends that in view of the settled legal position, the said amount is liable to be deducted while computing compensation under the Motor Vehicles Act, 1988, and consequently, the awarded compensation deserves to be reduced. Therefore, he prays that present appeal be allowed.

4. Per contra, learned counsel for the respondent Nos.1 to 6 contends that compensation awarded is on the lower side. She furthermore contends that they have preferred separate appeal bearing No.FAO-4639-2013, titled as “Vidyawati and others Vs. Ravinder Kumar and others” seeking enhancement of compensation. She, therefore, prays that the present appeal be dismissed.

5. I have heard learned counsel for the parties and perused the whole record of this case with his able assistance.

SETTLED LAW ON COMPENSATION

6. Hon’ble Supreme Court in the case of Sarla Verma Vs. Delhi Transport Corporation and Another [(2009) 6 Supreme Court Cases 121], laid down the law on assessment of compensation and the relevant paras of the same are as under:-

“30. Though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in Trilok Chandra, the general practice is to apply standardised deductions. Having a considered several subsequent decisions of this Court, we are of the view that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependent family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceeds six.

31. Where the deceased was a bachelor and the claimants are the parents, the deduction follows a different principle. In regard to bachelors, normally, 50% is deducted as personal and living expenses, because it is assumed that a bachelor would tend to spend more on himself. Even otherwise, there is also the possibility of his getting married in a short time, in which event the contribution to the parent(s) and siblings is likely to be cut drastically. Further, subject to evidence to the contrary, the father is likely to have his own income and will not be considered as a dependant and the mot

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