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Tuesday, September 27, 2016

“whether the compensation received from the Government under the Haryana Compassionate Assistance to the Defendants of Deceased Governments Employees Rules, 2006 (or otherwise) is to be deducted from the total compensation, which is payable to the dependents of the deceased, who dies in an accident, while computing financial benefits through ex-gratia payments by the Government?” = Section 167 of the Motor Vehicles Act, 1988, which reads thus: “167. Option regarding claims for compensation in certain cases.--- Notwithstanding anything contained in the Workmen’s Compensation Act, 1923 (8 of 1923) where the death of, or bodily injury to, any person gives rise to a claim for compensation under this Act and also under the Workmen’s Compensation Act, 1923, the person entitled to compensation may without prejudice to the provisions of Chapter X claim such compensation under either of those Acts but not under both.” -Indeed, similar statutory exclusion of claim receivable under the Rules of 2006 is absent. That, however, does not mean that the Claims Tribunal should remain oblivious to the fact that the claim towards loss of Pay and wages of the deceased has already been or will be compensated by the employer in the form of ex-gratia financial assistance on compassionate grounds under Rule 5 (1). The Claims Tribunal has to adjudicate the claim and determine the amount of compensation which appears to it to be just. The amount receivable by the dependants / claimants towards the head of pay and allowances in the form of ex-gratia financial assistance, therefore, cannot be paid for the second time to the claimants. True it is, that the Rules of 2006 would come into play if the Government employee dies in harness even due to natural death. At the same time, the Rules of 2006 do not expressly enable the dependents of the deceased Government employee to claim similar amount from the tortfeasor or Insurance Company because of the accidental death of the deceased Government employee. The harmonious approach for determining a just compensation payable under the Act of 1988, therefore, is to exclude the amount received or receivable by the dependents of the deceased Government employee under the Rules of 2006 towards the head financial assistance equivalent to “pay and other allowances” that was last drawn by the deceased Government employee in the normal course. This is not to say that the amount or payment receivable by the dependents of the deceased Government employee under Rule 5 (1) of the Rules, is the total entitlement under the head of “loss of income”. So far as the claim towards loss of future escalation of income and other benefits, if the deceased Government employee had survived the accident can still be pursued by them in their claim under the Act of 1988. For, it is not covered by the Rules of 2006. Similarly, other benefits extended to the dependents of the deceased Government employee in terms of sub-rule (2) to sub-rule (5) of Rule 5 including family pension, Life Insurance, Provident Fund etc., that must remain unaffected and cannot be allowed to be deducted, which, any way would be paid to the dependents of the deceased Government employee, applying the principle expounded in Helen C.Rebello and Patricia Jean Mahajan’s cases (supra). appellants must succeed only to the extent of amount receivable by the dependents of the deceased Government employee in terms of Rule 5(1) of the Rules 2006, towards financial assistance equivalent to the loss of pay and wages of the deceased employee for the period specified.

                                                                (REPORTABLE)


                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                         CIVIL APPEAL No. 9654 /2016
                 (Arising out of SLP (Civil) No. 14312/2013)

Reliance General Insurance Co. Ltd.                         …….Appellant
                            Vs.
Shashi Sharma & Ors.                                         …….Respondents

                                    WITH

C.A. No. 9655  of  2016 @ SLP(C) No. 14377 of 2012, C.A. No. 9657  of   2016
@ SLP(C) No. 14379 of 2012, C.A. No. 9659  of 2016 @  SLP(C)  No.  26344  of
2012, C.A.No. 9661  of  2016 @ SLP(C) No. 11343 of 2014, C.A. No.  9663-9664
 of  2016 @ SLP(C) No. 14995-14996 of 2014, C.A.No. 9666 of  2016  @  SLP(C)
No. 15320 of 2014, C.A.No.      9669 of  2016 @ SLP(C) No.  15343  of  2014,
C.A.No. 9671  of  2016 @ SLP(C) No. 18308 of 2014, C.A.No. 9677  of  2016  @
SLP(C) No. 18574 of 2014, C.A.No. 9674 of  2016 @ SLP(C) No. 19924 of  2014,
C.A.No.       9673 of  2016 @ SLP(C) No. 1539  of  2015,  C.A.No.  9672   of
2016 @ SLP(C) No. 28423 of 2014, C.A.No. 9675  of  2016 @ SLP(C)  No.  28201
 of 2016 @ CC No. 21664 of 2014, C.A.No. 9670  of  2016 @ SLP(C)  No.  29208
of 2014,  C.A. No. 9667-9668 of 2016  @  SLP(C)  No.  25185-25186  of  2015,
C.A.No. 9665  of  2016 @ SLP(C) No.  19592  of  2012,  C.A.No.      9662  of
2016 @ SLP(C) No. 35412 of 2013, C.A. No. 9660  of  2016 @ SLP(C) No.  15870
of 2014,C.A.No. 9658 of  2016 @ SLP(C) No. 1934 of  2016,  C.A.No.  9656  of
2016 @ SLP(C) No. 36135 of 2015, C.A.No.       9676 of  2016  @  SLP(C)  No.
28202 of 2016 @ CC No. 2735 of 2016.



                            J U D G M E N T

A.M. KHANWILKAR,J.

      Delay condoned.

2.    Leave granted.


3.    These matters have been placed before a three Judges’ Bench  in  terms
of order dated 7th  October,  2015.   This  order  has  not  formulated  any
specific question to be answered by the larger Bench.

4.    The leading appeal challenges the judgment of the Single Judge of  the
High Court of Punjab and Haryana at Chandigarh dated February  13,  2013  in
FAO No.503/2012.  That appeal  was  filed  by  the  respondents  (in  appeal
arising from SLP (Civil) No.14312/2013)  against  the  Award  of  the  Motor
Accident Claims Tribunal, Jind, in  MACT  Case  No.136  dated  3rd  November
2011. The said respondents had filed a claim petition  after  the  death  of
Dr. Ashwini Sharma caused due to a motor accident on 24th  October  2010  in
front of Main gate  of  General  Hospital  at  Jind.  He  succumbed  to  the
injuries sustained in that accident. The Tribunal partly allowed  the  claim
petition. A  sum  of  Rs.4,50,000/-  was  awarded  as  compensation  to  the
claimants being  the  dependants  of  deceased  Dr.  Ashwini  Sharma;   with
interest at the rate of 7.5% per annum from the date of filing of the  claim
petition till realization. The  Tribunal  directed  the  appellant-Insurance
Company to pay the compensation amount as determined in  the  award  to  the
claimants. The claimants, being aggrieved by  the  quantum  of  compensation
fixed by the Tribunal and in particular  deduction  of  compensation  amount
received by them from other source, preferred appeal before the High  Court.
The High Court, relying on the decision of Division Bench of the  same  High
Court dated December 21, 2012, in the case  of  Reliance  General  Insurance
Company Ltd. Vs. Purnima & Others,[1]  acceded  to  the  contention  of  the
claimants that the amount receivable  by  the  dependents  of  the  deceased
under  the  Haryana  Compassionate  Assistance  to  the  dependents  of  the
Deceased Government Employees Rules, 2006 (hereinafter  referred  to  “Rules
of 2006”) cannot be deducted from the quantum of compensation fixed  by  the
Tribunal. On that  finding,  the  High  Court  allowed  the  appeal  of  the
respondents in the following terms:
            “In view of the above, a sum  of  Rs.89,24,604/-  (Rs.1,00,957/-
-  15% thereof being Rs.  15,143  =  Rs.85,814/-   -   1/3rd  thereof  being
Rs.28,605/-  = Rs.57,209 x 12 =Rs.6,86,508/- x 13 = 89,24,604) towards  loss
of dependency, Rs.15,000/-towards loss of consortium of the  1st  appellant,
Rs.15,000/- towards loss of estate,  Rs.10,000/-  towards  funeral  expenses
and Rs.5,000/- towards  transportation  expenses,  in  aggregate  a  sum  of
Rs.89,60,604/- with  interest  @  7.5%  for  the  enhanced  portion  of  the
compensation from the date of petition  till  the  date  of  realization  is
awarded. The rate of interest applied and the mode of apportionment done  by
the Tribunal stands confirmed.”


5.    The High Court has adopted the same reasoning  to  disallow  deduction
of compensation amount received by the claimants as per  Rules  of  2006  in
the respective companion  cases  listed  for  analogous  hearing.  The  sole
contention advanced by  the  appellants  -  Insurance  Companies,  in  these
appeals, is that, the High  Court  has  erred  in  law  in  disallowing  the
deduction of amount received by the concerned claimants under the  Rules  of
2006, from the quantum of  compensation  amount  payable  to  the  claimants
under the Act of 1988.

6.    As the High Court has relied on the decision of the Division Bench  of
the same High Court in Purnima’s case  (supra),  it  is  apposite  to  first
advert to that decision. That decision was rendered on a reference  made  to
a larger Bench, on a question which has been canvassed by the  appellants  -
Insurance Companies even in the present appeals, in view of the  conflicting
decisions of Single Judges of the same High Court in the  case  of  Oriental
Insurance Co. vs. Saroj Devi [2] and in the case of New India Assurance  Co.
vs. Smt. Santosh[3].  The question considered by  the  Division  Bench  was:
“whether the compensation received from the  Government  under  the  Haryana
Compassionate  Assistance  to  the  Defendants   of   Deceased   Governments
Employees Rules, 2006 (or otherwise)  is  to  be  deducted  from  the  total
compensation, which is payable to the dependents of the deceased,  who  dies
in  an  accident,  while  computing  financial  benefits  through  ex-gratia
payments by the Government?” The Division  Bench  analysed  the  scheme  and
intent of the Rules of 2006 and held that the said Rules  have  been  framed
by the Governor of Haryana in exercise of powers  conferred  by  proviso  to
Article 309 of  the  Constitution  of  India;  these  Rules  not  only  have
statutory force, but must be treated at par with the Statute enacted by  the
Legislature; these Rules purport to assist the family  of  the  deceased  to
tide over hardship caused as a result of the employee dying in harness  (not
merely because of motor accident) or who goes missing or  whose  whereabouts
are not known, by providing ex-gratia financial assistance to the family  of
the deceased employee; this financial assistance to the  dependents  of  the
employee who dies in harness, has no correlation with the cause of death  of
the employee due to motor accident.  In other words, on mere  death  of  the
employee dying in harness,  be  it  natural  death  or  due  to  illness  or
otherwise the Rules of 2006 would become applicable;  and  as  a  result  of
which the family of the deceased employee is entitled to  receive  financial
assistance from the employer. The Division Bench held  that  the  scheme  of
financial assistance postulated in Rules  of  2006,  is  a  service  benefit
which accrues to the dependents of the deceased and  is  in  the  domain  of
service matter/benefit given to the employee as  a  result  of  the  service
rendered by the deceased employee. The benefit accruing  to  the  dependents
of the deceased is in the nature  of  enhanced  pension  given  as  per  the
provisions of the Pension/Family Pension Scheme, recognizing the  fact  that
the pension is normally given for meritorious, long and faithful service  by
the employee. The Division Bench relying on the exposition  of  two  Judges’
Bench decision of this  Court   in  Helen  C.  Rebello  (Mrs.)  &  Ors.  vs.
Maharashtra State Road Transport Corporation & Anr.[4] and  also  in  United
India Insurance Co. vs. Patricia Jean Mahajan  &  Ors.[5],   held  that  the
tortfeasor or Insurance Companies cannot  get  their  liability  excused  or
reduced because the deceased’s family  would  receive  financial  assistance
from an alternative  source  (employer)  by  reason  of  the  death  of  the
deceased. It  held  that  deductions  are  admissible  from  the  amount  of
compensation in case the claimant receives the benefit as a  consequence  of
injuries sustained which otherwise he would not been entitled to;  and  does
not cover cases when the payment received is not dependent  upon  an  injury
sustained on meeting with an accident.  That the assistance  received  under
Rules of 2006 is not dependent upon the death of an employee arising out  of
a motor accident only. Thus, it has no correlation with the manner in  which
the death occurs. Accordingly, the Division Bench held  that  the  Insurance
Company is not entitled to claim  deduction  of  the  amount  given  to  the
dependents under the Rules  of  2006,  while  calculating  the  compensation
amount payable under the Motor Vehicles Act.
7.    The Insurance Companies,  on  the  other  hand,  have  relied  on  the
decision of two Judges’ Bench of this Court in Bhakra Beas Management  Board
vs. Kanta Aggarwal (Smt.) &  Ors.[6],  to  contend  that  the  plea  of  the
appellant  in  that  case  that  the  claimants  have   received   financial
assistance from other source due to the death of her husband  -  by  way  of
salary amount on account of compassionate  appointment  and  also  residence
provided to her was deductible, has been accepted by this Court; and was  so
deducted while determining a just  compensation  amount  payable  under  the
Motor Vehicles Act.  Reliance is also placed on the dictum of three  Judges’
Bench in Gobald  Motor  Service  Limited  vs.  R.M.K.Veluswami  [7],  which,
according to the Insurance Company, permits deduction of  benefits  such  as
compensation received by the dependents of the deceased from  the  employer.
Reliance is also placed on  two  Judges’  Bench  decision  in  the  case  of
Sheikhupura Transport  Co.  Ltd.  vs.  Northern  India  Transport  Insurance
Co.[8]; another two Judges’ Bench judgment in the case  of  Vimal  Kanwar  &
Ors. vs. Kishore Dan & Ors.[9]. Reliance is then placed on another  decision
of two Judges’ Bench of this Court in Oriental Insurance Co.  Ltd.  vs.  Deo
Patodi and Ors.[10] for the principles to be reckoned to  determine  a  just
compensation payable  under  the  Motor  Vehicles  Act.  In  substance,  the
contention of the Insurance  Companies  is  that  the  claimants  cannot  be
permitted to profiteer and receive double benefit on account  of  the  death
of their family member on the same head of “Loss of income” to them.

8.    Besides the above noted stand of the  Insurance  Companies  the  other
incidental question to be considered is whether there  is  any  conflict  of
opinion between the coordinate Benches (of two Judges’) of  this  Court,  in
the case of Bhakra Beas Management Board (supra) on the one hand,  and  that
of Helen C. Rebelo and Patricia J.Mahajan (supra) on the other.

9.    The decision in the case of  Gobald  Motor  Service  Ltd.  (supra)  of
three  Judges’  Bench  of  this  Court  has  been  carefully  analysed   and
distinguished by the two Judges’ Bench in Helen’s  case  (supra).  In  that,
the dictum in  Gobald  Motor’s  case  was  in  relation  to  the  provisions
regarding quantum of damages payable in terms of Sections 1  and  2  of  the
Fatal Accident Act, 1855, which are held to be materially different. On  the
other hand, the provision of the  Motor  Vehicles  Act,  1939  enlarges  the
scope for computation of compensation amount.  The  Court  in  Helen’s  case
held that the observation in Gobald’s case cannot  be  the  basis  to  claim
deduction of amount receivable  by  the  dependents  of  the  deceased  from
whatever source, in the context of provisions of the Motor Vehicles  Act  as
in force.  Even the decision in the case of  Sheikhupura  Transport  (supra)
has been explained and distinguished on the same lines.

10.   The question is: whether the principle expounded by  the  two  Judges’
Bench in Helen’s case, in  paragraphs  32  to  35,  in  particular,  can  be
doubted? In that case the Court was called upon to answer as to  whether  it
will be permissible to disallow the deduction of amount  receivable  by  the
dependants of the deceased towards “Life Insurance Policy”, from the  amount
of compensation payable under the provisions of Motor Vehicles Act (in  that
case Sections 110B, 92A  and  92B  of  the  Act  of  1939  corresponding  to
Sections 168, 140 and 141 of the Act of 1988).  Paragraphs  32  to  35  read
thus:
      “32.  So far as the general principle of estimating damages under  the
common law is concerned, it is  settled  that  the  pecuniary  loss  can  be
ascertained only by balancing on one hand, the loss to the claimant  of  the
future pecuniary benefits that would have accrued to him but for  the  death
with the “pecuniary advantage” which from whatever source comes  to  him  by
reason of the death. In other words, it is the balancing of  loss  and  gain
of the claimant occasioned by the death. But this has to change  its  colour
to the extent a statute intends to do. Thus, this has to be  interpreted  in
the light of the provisions of the Motor Vehicles  Act,  1939.  It  is  very
clear, to which there could be no doubt that his Act  delivers  compensation
to the claimant only on account  of  accidental  injury  or  death,  not  on
account of any other death. Thus, the  pecuniary  advantage  accruing  under
this Act has to be deciphered, correlating with the  accidental  death.  The
compensation payable under the Motor Vehicles  Act  is  on  account  of  the
pecuniary loss to the claimant by accidental injury or death and not  others
forms of death. If there is natural  death  or  death  by  suicide,  serious
illness, including even death by accident, through  train,  air  flight  not
involving a motor vehicle, it would not be covered under the Motor  Vehicles
Act. Thus, the application of the general principle under the common law  of
loss and gain for the  computation  of  compensation  under  this  Act  must
correlate to this type of injury or death, viz., accidental.  If  the  words
“pecuniary advantage” from whatever source are to  be  interpreted  to  mean
any form of death under this Act, it  would  dilute  all  possible  benefits
conferred on the claimant and would be contrary to the spirit  of  the  law.
If the “pecuniary advantage” resulting from death means pecuniary  advantage
coming under all forms  of  death  then  it  will  include  all  the  assets
moveable,  immovable,  shares,  bank  accounts,  cash   and   every   amount
receivable  under  any  contract.  In  other  words,  all  heritable  assets
including what is willed by the deceased etc. this  would  obliterate  both,
all possible  conferment  of  economic  security  to  the  claimant  by  the
deceased and the intentions of the legislature. By such  an  interpretation,
the  tort  feasor  in  spite  of  his  wrongful  act  or  negligence,  which
contributes to the death, would have in many cases no  liability  or  meager
liability. In our considered opinion, the  general  principle  of  loss  and
gain takes colour of this statute, viz., the  gain  has  to  be  interpreted
which is as a result of the accidental death and the loss on account of  the
accidental death. Thus, under the present Act, whatever pecuniary  advantage
is received by the claimant, from whatever source,  would  only  mean  which
comes to the claimant on account of  the  accidental  death  and  not  other
forms of death. The constitution  of  the  Motor  Accident  Claims  Tribunal
itself under Section 110 is, as the section states:
                  “………for  the  purpose  of  adjudicating  upon  claims  for
compensation in respect of accidents  involving  the  death  of,  or  bodily
injury to,……”


      33.   Thus, it would not include that which the claimant  receives  on
account of other forms of deaths, which he would have  received  even  apart
from  accidental  death.  Thus,  such  pecuniary  advantage  would  have  no
corelation to the accidental death for which compensation is  computed.  Any
amount received or receivable not only on account of  the  accidental  death
but that which would have come to the claimant even otherwise, could not  be
construed to be the “pecuniary advantage”, liable  for  deduction.  However,
where the employer insures his employee, as against injury or death  arising
out of an accident, any  amount  received  out  of  such  insurance  on  the
happening of such incident may be an amount liable for  deduction.  However,
our legislature has taken note of such contingency through  the  proviso  of
Section 95. Under it the liability of the insurer is excluded in respect  of
injury or death, arising out of and  in  the  course  of  employment  of  an
employee.


34.   This is based on the principle that the claimant for the happening  of
the same incidence may not  gain  twice  from  two  sources.   This,  it  is
excluded thus, either through the wisdom of the legislature or  through  the
principle of loss and gain  through  deduction  not  to  give  gain  to  the
claimant twice arising from the same transaction, viz., the  same  accident.
It is significant to record here in both the  sources,  viz.,  either  under
the Motor Vehicles Act or from the employer, the compensation receivable  by
the claimant is either statutory or through the  security  of  the  employer
securing for his employee but in both cases he receives the  amount  without
his contribution.  How  thus  an  amount  earned  out  of  one’s  labour  or
contribution towards one’s wealth, savings, etc either for  himself  or  for
his family which such person knows under the law has  to  go  to  his  heirs
after his death either by succession or under a Will could  be  said  to  be
the “pecuniary gain” only on account of one’s  accidental  death.  This,  of
course, is a pecuniary gain but how this is equitable or could  be  balanced
out of the amount to be received as compensation  under  the  Motor  Vehicle
Act.  There is no correlation between the two amounts.  Not  even  remotely.
How can an amount of loss and gain of one contract  be  made  applicable  to
the loss and gain of another contract.  Similarly, how an amount  receivable
under a statute has any correlation with an amount earned by an  individual.
 Principle of loss and gain has to be on the  same  plane  within  the  same
sphere,  of  course,  subject  to  the  contract  to  the  contrary  or  any
provisions of law.


35.   Broadly, we may examine the receipt of the provident fund which  is  a
deferred payment out of the contribution made  by  an  employee  during  the
tenure of his service.  Such employee or his heirs are entitled  to  receive
this amount irrespective of the accidental death.  This amount  is  secured,
is certain to be received, while the amount under the Motor Vehicles Act  is
uncertain and is receivable only  on  the  happening  of  the  event,  viz.,
accident, which may not take place at  all.  Similarly,  family  pension  is
also earned by an employee for the benefit of his family in the form of  his
contribution in the service in terms of the  service  conditions  receivable
by the heirs after  his  death.   The  heirs  receive  family  pension  even
otherwise than  the  accidental  death.   No  corelation  between  the  two.
Similarly, life insurance policy is received either by the  insured  or  the
heirs of the insured on account of the contract with the insurer, for  which
the insured contributes in the form of premium.  It is  receivable  even  by
the insured if he lives till maturity after paying  all  the  premiums.   In
the case of death, the insurer indemnifies to pay  the  sum  to  the  heirs,
again in terms of the contract for the premium paid.  Again, this amount  is
receivable by the claimant not  on  account  of  any  accidental  death  but
otherwise on the insured’s death.  Death is only a step  or  contingency  in
terms of the contract, to receive the  amount.   Similarly  any  cash,  bank
balance, shares fixed deposits, etc.  though are all a  pecuniary  advantage
receivable by the heirs on account of one’s death  but  all  these  have  no
corelation with the amount receivable under a  statute  occasioned  only  on
account of accidental death. How  could  such  an  amount  come  within  the
periphery of the Motor Vehicles Act to be termed  as  “pecuniary  advantage”
liable for deduction.  When we seek the principle of loss and gain,  it  has
to be on a similar and same plane having nexus, inter se, between  them  and
not to  which  there  is  no  semblance  of  any  corelation.   The  insured
(deceased) contributes his own money for which he receives the amount  which
has no corelation to the compensation computed  as  against  the  tortfeasor
for his negligence on account of the accident.   As  aforesaid,  the  amount
receivable as compensation under the Act is on  account  of  the  injury  or
death without making any contribution towards it, then how  can  the  fruits
of an amount received through contributions of the insured be  deducted  out
of the amount receivable under the Motor Vehicles  act.   The  amount  under
this Act he receives  without  any  contribution.   As  we  have  said,  the
compensation payable under the Motor Vehicles Act  is  statutory  while  the
amount receivable under the life insurance policy is contractual.”

                                          (emphasis                supplied)


11.    This  decision  has  analysed  the  legal  position   regarding   the
application of the  general  principle  for  estimating  damages  under  the
common law.  It has also  noted  the  distinguishing  features  between  the
provisions of Fatal Accidents Act, 1855, before its amendment by Act  (3  of
1951) and thereafter.  It  then  found  that  in  Gobald’s  case  the  Court
decided the issue placing reliance on English decisions - as the  provisions
applicable at that time were similar to  Section  9  of  the  English  Fatal
Accidents Act, 1846. The Court was neither called upon to determine  damages
under the  Motor  Vehicles  Act,  1939  nor  consider  as  to  any  form  of
deductions are justified under the Motor  Vehicles  Act.   The  Court  noted
that the language of Section 110-B of the  Act  of  1939  (corresponding  to
Section 168 of the Act of 1988) is different from Section 1A  of  the  Fatal
Accidents Act, 1855.  It  held  that  Section  110-B  of  the  Act  of  1939
empowers the Tribunal to determine the compensation which appears to  it  to
be “just”.  The  Court  held  that  this  provision  widens  the  scope  for
determination of  compensation,  which  is  neither  permissible  under  the
Indian Fatal Accidents Act, 1855 nor under the English Fatal Accidents  Act,
1846.  The Court then went on to analyse the decisions  of  this  Court  and
held that there is a deliberate departure in the  language  of  the  Act  of
1939, revealing the intent of the legislature to confer wider discretion  on
the Tribunal.  Therefore, the decisions based on the  principles  applicable
to previous law  cannot  be  invoked  while  adjudicating  the  compensation
payable to the claimant under the Motor Vehicles Act.  In Paragraph 28,  the
Court observed thus:
“28. …….. This show  that  the  word  “just”  was  deliberately  brought  it
Section 110 B of the 1939 Act to enlarge the consideration in computing  the
compensation which, of course, would include the question of  deductibility,
if any.  This leads us to an irresistible conclusion that the  principle  of
computation of the compensation both under the English Fatal Accidents  Act,
1846 and  under  the  Indian  Fatal  Accidents  Act,  1855  by  the  earlier
decisions, were restrictive in nature in the absence of  any  guiding  words
therein, hence the courts applied the general principle at  the  common  law
of loss and gain but that  would  not  apply  to  the  considerations  under
Section 110-B of the 1939 Act  which  enlarges  the  discretion  to  deliver
better justice to the claimant, in computing the compensation, to  see  what
is just.  Thus, we find that all the decisions of  the  High  Courts,  which
based their interpretation on the principles of these two  Acts,  viz.,  the
English 1846 Act and the Indian 1855 Act to hold that deductions were  valid
cannot be upheld.  As we  have  observed  above,  the  decisions  even  with
reference to the decision of this Court in Gobald Motor  Service  where  the
question was neither raised nor adjudicated and that case also, being  under
the 1855 Act, cannot be pressed into service.  Thus, these courts by  giving
a restrictive interpretation in computation of  compensation  based  on  the
limitation of the language of the Fatal Accidents Act, fell into  an  error,
as it did not take into account the change of language in the 1939  Act  and
did not consider the widening  of  the  discretion  of  the  Tribunal  under
Section 110-B.  The word “just”, as its nomenclature, denotes  equitability,
fairness and reasonableness having a large peripheral field.  The  largeness
is, of course, not arbitrary; it is restricted by the  conscience  which  is
fair, reasonable and equitable, if it  exceeds;  it  is  termed  as  unfair,
unreasonable, un-equitable, not just.  Thus, this field of wider  discretion
of the Tribunal has to be within the said limitations  and  the  limitations
under any provision of this Act or any other provision having the  force  of
law.”

                                                         (emphasis supplied)



12.   The principle expounded in  this  decision  that  the  application  of
general principles under the  common  law  to  estimate  damages  cannot  be
invoked for computing compensation under the Motor  Vehicles  Act.  Further,
the “pecuniary advantage” from whatever source must correlate to the  injury
or death caused on account of motor accident. The  view  so  taken,  is  the
correct analysis and interpretation of the relevant provisions of the  Motor
Vehicles Act of 1939, and must apply proprio  vigore  to  the  corresponding
provisions of  the  Motor  Vehicles  Act,  1988.  This  principle  has  been
restated in the  subsequent  decision  of  two  Judges’  Bench  in  Patricia
S.Mahajan’s case (supra), to reject the argument of  the  Insurance  Company
to deduct the amount receivable by the dependents of the deceased by way  of
“social security compensation” and “Life Insurance Policy”.

13.   In the case of Bhakra Beas Management Board  (supra),  ostensibly,  it
may appear that a departure has been  made  in  allowing  deduction  of  the
pecuniary advantage received by the claimants from other source  on  account
of death of  her  husband.  However,  on  a  closer  analysis  of  the  said
decision, two aspects  become  prominent.  Firstly,  the  grievance  of  the
appellant Board was that the claimants had filed an appeal before  the  High
Court for enhancement of compensation of amount, which  was  still  pending.
However, the appeal preferred by the Board against  the  same  decision  was
dismissed  by  the  High  Court.   The  grievance  of  the   appellant   was
essentially  about  the  inappropriate  approach  of  the  High   Court   in
dismissing its appeal.  That  can  be  discerned  from  the  observation  in
paragraph 13 of the reported decision. From the observation  found  in  para
14 of the reported decision, it is seen that the  High  Court  judgment  has
been  held  to  be  clearly  unsustainable.   That  must  be  understood  as
disapproving the approach of the High Court in dismissing the  appeal  filed
by  the  appellants,  though  cross  appeal  filed  by  the  claimants   for
enhancement of compensation  amount  was  pending  before  it.   The  second
aspect, is that, the Court, to do complete justice between the  parties  and
for bringing quietus to the  long  pending  litigation  (14  years)  between
them, including to dispose of appeal of the  claimants  pending  before  the
High Court, passed an order for full and final settlement of all the  claims
inter partes. That can be discerned from paragraphs 13 and  14,  which  read
thus:
      “13. Learned counsel for the respondent  supported  the  judgment  and
additionally submitted that appeal of respondent 1  is  pending.  In  normal
course, when two appeals are directed against the common judgment, both  the
appeals should be heard by the same bench of the High  Court.  But  we  find
that the High Court had lost sight of the fact that the benefits  which  the
claimant receives on account  of  the  death  or  injury  have  to  be  duly
considered while fixing the compensation. It is pointed out that  Respondent
1 was getting Rs.4,700/-p.m. and a residence has been provided  to  her  and
actually the compassionate  appointment  was  given  immediately  after  the
accident.
“14.  In view of what has been stated above, the High  Court’s  judgment  is
clearly unsustainable. However, the accident took place more than  14  years
back and it would not be desirable to send the matter back to  the  Tribunal
for fresh consideration. A sum of rupees five lakhs has been deposited  vide
this Court’s order dated 1-11-2004. We are of the considered  view  that  in
view of the background facts, it is just and proper that the sum  of  rupees
five lakhs already deposited shall be  permitted  to  be  withdrawn  by  the
claimants in full and final settlement of the claim relatable to  the  death
of the deceased. It is for the Tribunal to fix the quantum of fixed  deposit
and the amount to be released to the claimants.”
                             (emphasis supplied)


14.   Thus understood, it is not an authority of having taken a contra  view
than the view expressed in Helen  C.  Rebello  and  Patricia’s  case.  As  a
matter of fact, in para 11 of the reported decision, paragraphs 32 to 34  of
Helen C. Rebello’s case has been reproduced in its entirety. No  observation
is found in the entire decision, to have  doubted  the  correctness  of  the
dictum in Helen C. Rebello and Patricia’s case.

15.   Be that as it may, the term compensation has not been defined  in  the
Act of 1988.  By interpretative process, it has been understood to  mean  to
recompense the claimants for the possible loss  suffered  or  likely  to  be
suffered  due to sudden and untimely death  of  their  family  member  as  a
result  of  motor  accident.  Two  cardinal  principles  run   through   the
provisions of the Motor Vehicles Act of 1988 in the matter of  determination
of compensation. Firstly, the measure  of  compensation  must  be  just  and
adequate; and secondly, no  double  benefit  should  be  passed  on  to  the
claimants in the matter of award of compensation. Section 168 of the Act  of
1988 makes the first principle explicit. Sub-section (1) of  that  provision
makes it clear that the amount  of  compensation  must  be  just.  The  word
“just” means - fair, adequate, and reasonable.  It  has  been  derived  from
the Latin word “justus”, connoting right and fair. In para 7  of   State  of
Harayana &  Anr.  vs.  Jasbir  Kaur  &  Ors.[11],  it  has  been  held  that
expression  “just”  denotes  that  the  amount  must  be  equitable,   fair,
reasonable and not arbitrary. In para 16 of Smt.  Sarla  Verma  &  Ors.  vs.
Delhi Transport Corporation & Anr.[12], this Court  has  observed  that  the
compensation “is not intended  to  be  a  bonanza,  largesse  or  source  of
profit”. That however may depend upon facts and circumstances of each  case,
as to what amount would be a just compensation.
16.   The principle discernable from the  exposition  in  Helen  C.Rebello’s
case (supra) is that if the amount “would be due to the  dependants  of  the
deceased even  otherwise”,  the  same  shall  not  be  deductible  from  the
compensation amount payable under the Act of 1988.  At  the  same  time,  it
must be borne in mind that loss of income is a significant head under  which
compensation is claimed in terms of  the  Act  of  1988.  The  component  of
quantum of “loss of income”, inter  alia,  can  be  “pay  and  wages”  which
otherwise would have  been  earned  by  the  deceased  employee  if  he  had
survived the injury caused to him due to motor accident. If  the  dependents
of the deceased employee, however, were to be compensated  by  the  employer
in that  behalf,  as  is  predicated  by  the  Rules  of  2006  -  to  grant
compassionate  assistance  by  way  of  ex-gratia  financial  assistance  on
compassionate grounds to the dependents of the deceased Government  employee
who dies in harness, it is unfathomable that the  dependents  can  still  be
permitted to claim the same amount as a possible or likely  loss  of  income
to be suffered by them to maintain a claim for compensation  under  the  Act
of 1988.
17.    A perusal of  the  scheme  of  Rules  of  2006  would  reinforce  the
position that  the  dependents  of  the  deceased  Government  employee  are
suitably compensated for a specified period by way of  financial  assistance
in the form of ex-gratia payment on compassionate grounds equivalent to  the
pay and other allowances that was last drawn by  the  deceased  employee  in
the normal course without raising a specific claim. Here, we may  advert  to
the recital of the Rules of 2006, which reads thus:
“No. G.S.R. 19/Const./Art.309/2006.-In exercise of the powers  conferred  by
the proviso to article 309 of the Constitution of  India,  The  Governor  of
Haryana  hereby  makes  the  following  rules  to  grant  the  compassionate
assistance  by  way  of  ex-gratia  financial  assistance  on  compassionate
grounds to members  of   the   family   of a  deceased  Government  employee
who dies while in service/missing Government employee, namely:-
(emphasis supplied)

Rule 2 stipulates the objects of the Rules, namely, to assist the family  of
a deceased/missing Government employee of Group C and D category, in  tiding
over the emergent situation, resulting from the  loss  of  the  bread-earner
while in regular service by giving financial  assistance.   Rule  3  of  the
said Rules provides for eligibility to receive  financial  assistance  under
the Rules. As per Rule 4,  the  eligible  family  members  are  required  to
submit an application in Form  A  for  compassionate  financial  assistance.
Rule 5, is of some significance which provides for the extent  of  financial
assistance. The same reads thus:

      “5.(1) On the death of any Government  employee,  the  family  of  the
employee would continue to receive as financial assistance a  sum  equal  to
the pay and other allowances that was last drawn by  the  deceased  employee
in the normal course without raising a specific claim.,-
for a period of fifteen years from the date of death  of  the  employee,  if
the employee at the time of his death had not attained the  age  of  thirty-
five years;

for a period of twelve years or  till  the  date  the  employee  would  have
retired from Government service on  attaining  the  age  of  superannuation,
whichever is less, if the employee at the time of  his  death  had  attained
the age of thirty-five years but had not attained  the  age  of  forty-eight
years;

for a period of seven years  or  till  the  date  the  employee  would  have
retired from Government service on  attaining  the  age  of  superannuation,
whichever is less, if the employee  had  attained  the  age  of  forty-eight
years.

(2) The family shall be eligible  to  receive  family  pension  as  per  the
normal rules only after the period during which he  receives  the  financial
assistance as above is completed.
(3) The family of a deceased Government employee who was in occupation of  a
Government residence would continue to retain the residence  on  payment  of
normal rent/license fee for a period of one year from the date of  death  of
the employee.
(4) Within fifteen days from the date of death of a Government employee,  an
ex-gratia assistance of twenty five thousand rupees  shall  be  provided  to
the family of the deceased employee to meet the immediate needs on the  loss
of the bread earner.
(5) House Rent Allowance shall not be a part of allowance for  the  purposes
of calculation of assistance.”


18.   Rule 6 pertains to pending cases of ex-gratia assistance,  with  which
we  are  not  concerned  in  the  present  appeals.   But  to  complete  the
narrative, we may refer to  the  said  provision.  It  postulates  that  all
pending cases of ex-gratia assistance shall be covered under the  new  Rules
(i.e. Rules of 2006). Further, the calculation of  the  period  and  payment
shall be made to such cases from the date of notification of the new  Rules.
It further provides that the families will have the option to  opt  for  the
lump sum ex-gratia grant provided in the Rules, 2003 or 2005,  as  the  case
may be, in lieu of the monthly financial assistance provided under  the  new
Rules.

19.   Reverting back to Rule 5,  sub-clause  (1)  provides  for  the  period
during which the dependents of the deceased employee may  receive  financial
assistance equivalent to the pay and other allowances that  was  last  drawn
by the deceased employee in the normal course  without  raising  a  specific
claim. Sub-rule (2) provides that the family shall be  eligible  to  receive
family pension as per the normal Rules only after the  period  during  which
they would receive the financial assistance in terms of sub-rule  (1).  Sub-
rule (3) guarantees the family  of  a  deceased  Government  employee  of  a
Government residence in occupation for a period of one year  from  the  date
of death of the employee, upon  payment  of  normal  rent/license  fee.   By
virtue of sub-rule (4), an ex-gratia assistance of 25,000/- is  provided  to
the family of the deceased employee to meet the immediate needs on the  loss
of the bread earner. Sub-rule (5) clarifies that house rent allowance  shall
not be a part of allowance for the purposes of calculation of assistance.

20.   Rule 5 broadly deals with two  aspects.  Firstly,  to  compensate  the
dependents  of  the  deceased  Government  employee  by  granting  ex-gratia
financial assistance on compassionate grounds for the loss of pay and  other
allowances for a  specified  period.  The  second  part  of  Rule  5  is  to
compensate the dependents of the deceased  Government  employee  by  way  of
allowances and concessions -  of  retaining  occupation  of  the  Government
residence on specified terms, of family  pension  and  other  allowance.  As
regards the second part, it deals with income from other  source  which  any
way is receivable by the dependants of  the  deceased  Government  employee.
That cannot be deducted from the claim amount, for determination of  a  just
compensation under the Act of 1988.

21.   The claimants are legitimately entitled to claim for the loss of  “pay
and wages” of the deceased Government employee  against  the  tortfeasor  or
Insurance Company, as the case may be, covered by the first part of  Rule  5
under the Act  of  1988.   The  claimants  or  dependents  of  the  deceased
Government employee (employed by State of Haryana), however, cannot  set  up
a claim for the same subject falling under the first part of Rule 5  -  “pay
and allowances”, which are receivable by them from  employer  (State)  under
Rule 5 (1) of the Rules of 2006. In that, if the deceased  employee  was  to
survive the motor accident injury, would have  remained  in  employment  and
earned his regular pay and allowances. Any other interpretation of the  said
Rules would inevitably result in double payment towards  the  same  head  of
loss of “pay and wages” of the deceased  Government  employee  entailing  in
grant of  bonanza,  largesse  or  source  of  profit  to  the  dependants  /
claimants. Somewhat similar situation has been spelt out in Section  167  of
the Motor Vehicles Act, 1988,  which reads thus:
“167.  Option  regarding  claims  for  compensation  in  certain   cases.---
Notwithstanding anything contained in the Workmen’s Compensation  Act,  1923
(8 of 1923) where the death of, or bodily injury to, any person  gives  rise
to a claim for compensation under this Act  and  also  under  the  Workmen’s
Compensation Act, 1923, the person  entitled  to  compensation  may  without
prejudice to the provisions of  Chapter  X  claim  such  compensation  under
either of those Acts but not under both.”
                                  (emphasis supplied)



22.   Indeed, similar statutory exclusion  of  claim  receivable  under  the
Rules of 2006 is absent. That,  however,  does  not  mean  that  the  Claims
Tribunal should remain oblivious to the fact that the claim towards loss  of
Pay and wages of the deceased has already been or  will  be  compensated  by
the employer in the form of ex-gratia financial assistance on  compassionate
grounds under Rule 5 (1). The Claims Tribunal has to  adjudicate  the  claim
and determine the amount of compensation which appears to  it  to  be  just.
The amount receivable by the dependants / claimants  towards  the   head  of
pay  and  allowances  in  the  form  of  ex-gratia   financial   assistance,
therefore, cannot be paid for the second time to  the  claimants.   True  it
is, that the Rules of 2006 would come into play if the  Government  employee
dies in harness even due to natural death. At the same time,  the  Rules  of
2006 do not expressly enable  the  dependents  of  the  deceased  Government
employee to claim similar amount from the tortfeasor  or  Insurance  Company
because of the accidental death of the  deceased  Government  employee.  The
harmonious approach for determining a just compensation  payable  under  the
Act of 1988, therefore, is to exclude the amount received or  receivable  by
the dependents of the deceased Government employee under the Rules  of  2006
towards  the  head  financial  assistance  equivalent  to  “pay  and   other
allowances” that was last drawn by the deceased Government employee  in  the
normal course.  This is not to say that the amount or payment receivable  by
the dependents of the deceased Government employee under Rule 5 (1)  of  the
Rules, is the total entitlement under the head of “loss of income”.  So  far
as the  claim  towards  loss  of  future  escalation  of  income  and  other
benefits, if the deceased Government employee had survived the accident  can
still be pursued by them in their claim under the Act of 1988.  For,  it  is
not covered by the Rules of 2006. Similarly, other benefits extended to  the
dependents of the deceased Government employee in terms of sub-rule  (2)  to
sub-rule (5) of Rule 5 including family pension, Life  Insurance,  Provident
Fund etc.,  that  must  remain  unaffected  and  cannot  be  allowed  to  be
deducted, which, any way would be paid to the  dependents  of  the  deceased
Government employee, applying the principle  expounded  in  Helen  C.Rebello
and Patricia Jean Mahajan’s cases (supra).

23.   A Priori, appellants  must  succeed  only  to  the  extent  of  amount
receivable by the dependents of the deceased Government  employee  in  terms
of Rule 5(1) of the Rules 2006, towards financial assistance  equivalent  to
the loss  of  pay  and  wages  of  the  deceased  employee  for  the  period
specified.

24.   As no other point arises for consideration, the appeals  must  succeed
in part to the extent indicated above.

25.   Accordingly, the appeals are partly allowed in the  above  terms  with
no order as to costs.




                                            ………………………………..J.
                                             (Ranjan Gogoi)



                            ………………………………..J.
                                             (Prafulla C.Pant)



                            ………………………………….J.
                                             (A.M.Khanwilkar)
New Delhi,
23rd September, 2016


                       IN THE SUPREME COURT OF INDIA
                       CIVIL APPELLATE JURISDICTION

                 SPECIAL LEAVE PETITION (CIVIL) NO. 26882/2013

National Insurance Co.Ltd.
….Petitioners

                                       Vs.
Ramrajsinh Zala & Ors.                             …..Respondents


WITH C.A.No.8867/2012

                            O R D E R

            The issue involved in these matters is not similar to the  issue
decided in the appeals disposed of by a separate judgment today,  concerning
the effect of benefit derived under the Haryana Compassionate Assistance  to
the  Dependents  of  Deceased  Government  Employees  Rules,  2006  by   the
dependants of the deceased Government  employees.  Hence,  delinked.  To  be
listed before an appropriate Bench.
                                       …………………………………..J.
                                       (Ranjan Gogoi)


                                       ……………………………………J.
                                       (Prafulla C.Pant)


                                       ……………………………………J.
                                       (A.M.Khanwilkar)
New Delhi,
23rd September, 2016
-----------------------
[1]
      [2] F.A.O No.1322 Of 2010
[3]
      [4] 2012 (1) PLR 761
[5]
      [6] 2010 (4) PLR 780
[7]
      [8] 1999 (1) SCC 90
[9]
      [10] 2002 (6) SCC 281
[11]
      [12] 2008 (11) SCC 366
[13]
      [14] 1962 (1) SCR 929 = AIR 1962 SC 1,
[15]
      [16] 1971 (1) SCC 785
[17]
      [18]  2013 (7) SCC 476
[19]
      [20] 2009 (13) SCC 123
[21]
      [22] (2003) 7 SCC 484
[23]
      [24] (2009) 6 SCC 121

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