CMA/982/2023 of MALATHI Vs AZHAGUVEL on 12 October 2026

JUDGMENT

(Judgment of the Court was delivered by M.Dhandapani J.) The claimants are before this Court seeking an enhancement of the award passed by the Motor Accident Claims Tribunal, Principal District Court at Perambalur in M.C.O.P.No.241 of 2010, dated 16.11.2022.

2. The appellants/claimants are the wife, daughters and mother of the deceased R.Selvaraj. On 31.08.2020 at about 4.00 a.m., the deceased was going for a morning walk with torch light in his hand on the Krishnapuram to Perambalur main road, from north to south on the southern side of Krishnapuram – Venpavur junction road opposite to Athiyappan rice mill on the extreme left side of the eastern side road. At that time, the 1st respondent’s car bearing Regn.No.TN-10-AM-7702, which was insured with the 2nd respondent, came in the same direction i.e., behind in a rash and negligent manner, and dashed against the deceased. As a result of which, the deceased sustained fatal injuries all over his body and he took first aid treatment in the Government

Hospital, Perambalur and then took further treatment in the ABC Hospital, Trichy as inpatient for one day and thereafter, inspite of the treatment given, he succumbed to the injuries leading to the registration of Crime No.307/2020 u/s 279, 337 and 304(A) IPC against the driver of the offending vehicle. Therefore, the claimants filed a claim petition claiming compensation of Rs.1,50,00,000/- before the Tribunal in M.C.O.P.No.241 of 2020 for the death of the deceased.

3. Before the Tribunal, the claimants examined 4 witnesses viz., P.W.1 to P.W.4 and marked 22 documents viz., Ex.P.1 to Ex.P.2. No witnesses were examined nor any documents were marked on the side of the respondents. After adjudication, the Tribunal partly allowed the petition and awarded a sum of Rs.26,47,326/- as compensation to the claimants. Not satisfied with the same, the appellants/claimants have preferred the present appeal seeking enhancement.

4. Learned counsel appearing for the appellants/claimants would submit that as per the judgment of the Hon’ble Supreme Court in the case of Sebastiani Lakrs & Ors. Vs. National Insurance Co. Ltd., & Anr. reported in (2019) 7 SCC 465, no deduction can be made from the compensation amount on account pensionary benefits or gratuity of a deceased on the ground that those amounts are paid on account contractual reasons entered by him with others. Therefore, the deduction made by the Tribunal is liable to set aside and the claimants are entitled to receive compensation by taking into consideration the entire salary of the deceased in terms of National Insurance Company Limited Vs. Pranay sethi and others reported in 2017 (16) Supreme Court Cases 680 and Sarla Verma and Ors. v. DTC & Ors. reported in (2009) 6 SCC 121, by adding 15% towards future prospects and deducting 1/3rd towards personal expenses. Further, he would submit that the compensation awarded by the Tribunal under the other heads is on the lower side, which requires to be re-considered by this Court. Accordingly, he prays for appropriate enhancement in favour of the appellants.

5. Per contra, the learned counsel appearing for the 2nd respondent/Insurance Company would submit that the pension and other benefits has to be deducted by considering the age of retirement by relying upon a judgment of the Apex Court in the case of Vishavjit Singh & Ors. Vs. Cholamandalam MS General Insurance Company Limited & Anr. in S.L.P(Civil) No.13442 of 2020 dated 21.05.2025. Hence, the Tribunal has rightly deducted the pension amount from the salary of the deceased, which does not require any interference. Further, he would submit that that by considering all the oral and documentary evidence, the Tribunal has awarded just and reasonable compensation under various heads, which also does not require any enhancement. Accordingly, he prays for dismissal of the appeal.

6. Heard the learned counsel appearing for the appellants and the learned counsel appearing on behalf of the 2nd respondent and perused the materials available on record.

7. The happening of the accident and the travelling of the deceased in his vehicle and the death of the deceased is not in dispute. Therefore, this Court is not entering into the said aspect. Since the present appeal is filed by the claimants seeking enhancement of compensation, there is no necessity for this Court to enter into the aspect of negligence. The issue that arises for consideration in this appeal is whether the Tribunal is right deducting the pension amount from the salary of the deceased by considering the retirement age of the deceased ?

8. The very same issue was already decided by the Hon’ble Apex Court in the case of Sebastiani Lakrs & Ors. Vs. National Insurance Co. Ltd., & Anr. reported in (2019) 7 SCC 465. The relevant portion of the said judgment reads as follows :- “12. The law is well settled that deductions cannot be allowed from the amount of compensation either on account of insurance, or on account of pensionary benefits or gratuity or grant of employment to a kin of the deceased. The main reason is that all these amounts are earned by the deceased on account of contractual relations entered into by him with others. It cannot be said that these amounts accrued to the dependants or the legal heirs of the deceased on account of his death in a motor vehicle accident. The claimants/dependants are entitled to “just compensation” under the Motor Vehicles Act as a result of the death of the deceased in a motor vehicle accident. Therefore, the natural corollary is that the advantage which accrues to the estate of the deceased or to his dependants as a result of some contract or act which the deceased performed in his lifetime cannot be said to be the outcome or result of the death of the deceased even though these amounts may go into the hands of the dependants only after his death. ……

14. As far as the amounts of pension and gratuity are concerned, these are paid on account of the service rendered by the deceased to his employer. It is now an established principle of service jurisprudence that pension and gratuity are the property of the deceased. They are more in the nature of deferred wages. The deceased employee works throughout his life expecting that on his retirement he will get substantial amount as pension and gratuity. These amounts are also payable on death, whatever be the cause of death. Therefore, applying the same principles, the said amount cannot be deducted.”

9. A perusal of the above decision clearly reveals that deductions cannot be allowed from the amount of compensation either on account of insurance, or on account of pensionary benefits or gratuity or grant of employment to a kin of the deceased. All those amounts are earned by the deceased on account of contractual relations entered into by him with others. Furthermore, the Apex Court held that the pension and gratuity are the property of the deceased, which cannot be deducted from compensation benefits. In view of this settled position of law, and as the present case falls squarely within the four corners of the said decision, this Court is inclined to interfere with the impugned award to the extent that it erroneously deducted the pension amount from the calculated income of the deceased. Accordingly, the deduction of the pension amount from the income of the deceased by the tribunal is set aside. The compensation shall be recomputed on the basis of the gross salary of the deceased, without any deductions towards insurance, pension, or gratuity. Hence, by accepting the income fixed by the Tribunal at Rs.80,593/- and by deducting 10% towards income tax, the notional income of the deceased is arrived at Rs.72,534/-, and by adding future prospects at 15%, as has been held by the Constitution Bench in the case of National Insurance Company Limited Vs. Pranay sethi and others reported in 2017 (16) Supreme Court Cases 680, the total income per month is quantified at Rs.83,414/-. Deducting 1/3rd towards the personal expenses of the deceased, the income of the deceased is arrived at Rs.55,609/- per month and the deceased being aged about 57 years, as evidenced from the records, adopting the multiplier of 9 as fixed by the Apex Court in the case of Sarla Verma and Ors. v. DTC & Ors. reported in (2009) 6 SCC 121, the loss of income to the family is arrived at Rs.55,609/- * 12 * 9 = Rs.60,05,772/-, which is worked out as follows :- Loss of Income Amount (in Rs.) Notional income (Per month) 80,593 Less : 10% towards income tax 8,059.3 (Rounded off to) 8,059 72,534 Add: Future Prospects (Rs.72,534/- x 15%) (Per month) 10,880.1 (rounded off to) 10,880 83,414 Less: Personal expenses (Rs.83,414/- x 1/3rd) (Per month) 27,804.6 (rounded off to) 27,805 55,609 Notional income (per annum) (Rs.55,609/- x 12) 6,67,308 Multiplier

Total 60,05,772

10. Further, this Court is of the view that the compensation awarded by the Tribunal under the other heads are just and reasonable and the same does not require any interference, and accordingly, the same are confirmed.

11. In the above circumstances, the compensation awarded by the Tribunal is modified as under :- Heads Awarded by the Tribunal (Amount in Rs.) Awarded by this Court (Amount in Rs.) Annual Loss of dependency 23,39,172/- 60,05,772/- (enhanced) Consortium Parental Consortium (3x40,000) Filial Consortium 40,000/- 1,20,000/- 40,000/- 40,000/- 1,20,000/- 40,000/- Loss of Estate 15,000/- 15,000/- Funeral Expenses 15,000/- 15,000/- Medical bills (Ex.P20 series) 78,154/- 78,154/- Total 26,47,326/- 63,13,926/-

12. Accordingly, the Civil Miscellaneous Appeal is partly allowed and the impugned award is modified, enhancing the compensation amount from Rs.26,47,326/- to Rs.63,13,926/-. The 2nd respondent/insurance company is directed to deposit the modified compensation amount to the credit of M.C.O.P.No.241 of 2020 along with interest at the rate of 7.5% per annum from the date of claim petition till the date of deposit and costs as awarded by the Tribunal, less, the amount, if any already deposited, within a period of six (6) weeks from the date of receipt of a copy of this judgment. The above modified compensation amount shall be apportioned among the appellants/claimants as per the apportionment of the Tribunal. On such deposit being made, the Tribunal is directed to transfer the respective share of the appellants/claimants, directly to their bank accounts, through RTGS within a period of two (2) weeks thereafter upon production of proof with regard to payment of Court fee on the enhanced compensation. The appellants/claimants are directed to pay necessary additional Court fee on the enhanced compensation amount. There shall be no order as to costs in the present appeal. (M.D.I.,J.) (A.D.M.C.,J.) 12-10-2026 Index: Yes/No Speaking/Non-speaking order Neutral Citation: Yes/No sp To The Motor Accident Claims Tribunal, Principal District Court at Perambalur.

M.DHANDAPANI, J. AND DR.A.D.MARIA CLETE, J. sp C.M.A.No.982 of 2023 12-10-2026