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MACT Cannot Reject Release of Compensation Without Considering Claimant's Need:
The has firmly held that cannot mechanically turn down applications seeking release of compensation kept in fixed deposits, and must instead evaluate the genuine requirements of claimants before deciding on such requests. Justice Anish Dayal, while allowing a plea by a 93% permanently disabled claimant for partial withdrawal of funds, observed that rejecting such pleas without due consideration strikes at the very heart of the .
Case Background and the Claimant's Struggle
The applicant, Sanjay Sachdeva, had been awarded enhanced compensation in a motor accident case, which was deposited before the MACT following a judgment by the High Court in . The Court had directed that a lump sum of ₹5,00,000 be released to him and the remaining amount be kept in fixed deposit receipts (FDRs). Later, Sachdeva sought release of ₹2,50,000 from those FDRs, stating he needed the money to repay loans taken for his treatment and livelihood after suffering 93% permanent disability. However, the MACT rejected his application on the ground that no verifiable material was submitted, despite Sachdeva having placed a promissory note on record.
High Court's Scathing Critique of MACT's Approach
Setting aside the MACT's order, Justice Dayal noted that the Tribunal had adopted a "" and failed to appreciate that the compensation ultimately belongs to the claimant. The Court emphasized:
"It is not within the remit of MACT to undertake a
into the reasons furnished by a claimant, in whose favour compensation has been awarded, which stands confirmed and thereafter, an application seeking release of compensation is filed."
The Court further observed that MACTs are frequently besieging the High Court with similar applications because they reject withdrawal requests for "." Referring to its earlier orders, the Court remarked that MACTs have been mechanically directing funds into annuities or long-term deposits without considering the impact on the claimant's immediate needs.
Legal Precedents Reinforce Claimant-Centric Approach
The judgment relied on two landmark decisions. In , the apex court laid down guidelines for investment of compensation, allowing relaxation for genuine needs like purchasing property or repaying debts. The Court also cited , which cautioned Tribunals against adopting a rigid and mechanical stance, and stressed that the guidelines were meant to safeguard claimants, not to deprive them of their own money.
Justice Dayal clarified that are intended to ensure safe custody and regulated availability of funds, but they should not become instruments of denial.
"There is no reason why a claimant cannot dip into the deposits of compensation, made on his behalf, before the Tribunals/Courts, considering that it is the claimants' money, at the end of the day,"
the Court stated.
Key Observations: A Need for
The Court made several pointed observations about the attitude of MACTs:
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"The undue adopted by the MACTs, in this regard, has to be rationalised, and MACTs are well advised to adopt a much more considerate, sensitive and reasonable approach in dealing with applications for release of amount."
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"Rejecting their plea summarily, without application of mind or without considering the of claimants, is to the whole jurisprudence of motor accidents claims and compensation."
The Court suggested that Tribunals can interact with claimants physically or via video conference to ensure that the funds are not being misused by unscrupulous elements, rather than outright denying access.
Final Decision and Implications
Allowing the application, Justice Dayal directed the release of ₹2,50,000 by liquidating the proportionate number of FDRs in the claimant's account. A copy of the order was directed to be circulated to all MACTs in the Delhi jurisdiction for their information.
This ruling sends a strong message: MACTs must exercise sensitively and cannot hide behind rigid investment schemes to deny claimants access to their own compensation. The judgment is expected to streamline the process for thousands of accident victims who often face bureaucratic hurdles in accessing funds meant for their rehabilitation and survival.
