NATIONAL INSURANCE CO. LTD. versus REKHABEN & ORS.

Citation: [2017] 2 S.C.R. 691 · Decided: 07-03-2017 · Supreme Court of India · Bench: S.A. BOBDE · Disposal: Dismissed

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Judgment (excerpt)

[2017] 2 S.C.R. 691 
NATIONAL INSURANCE CO. LTD. 
v. 
REKHABEN & ORS. 
(Civil Appeal No. 8867 of2012) 
MARCH 07, 2017 
[S. A. BOBDE AND L. NAGESWARA RAO, JJ.] 
Motor Vehicles Act, 1988: 
ss.163A, 166, 168 - Compensation - Salary received by the 
claimants from compassionate appointment whether deductible from 
the award of compensation made in favour of the claimants - Held: 
Compensation is awarded on the basis of the entire loss of income 
of the deceased or in a case of injury, for the loss of income due to 
the injury - The income from compassionate appointment offered 
to the dependants of the deceased or the injured. by ihe e111ployer 
of the deceased/ Injured, who is not the tort feasor, cannot be 
deducted from the· compensation receivable by him on account of 
the accident from the tort feasor - The source from which 
compensation on account of the accident is claimed and the source 
from which the compassionate employment is offered, are completely 
separate and there is no co-relation between these two sources -
Since the tort feasor has not offered the compassionate appointment, 
an amount which a claimant earns by his labour or by offering his 
services, whether by reason of compassionate appointment or 
otherwise is not liable to be deducted from the co111pensation which 
the claimant is entitled to receive from a tort feasor under the Act. 
Compensation - Determination of - Relevant factors - Held: 
The income of the deceased or the injured, which the claimants 
have lost due to death of the deceased or inability of the injured to 
earn is a relevant factor for determining the amount of compensation 
A 
B 
• 
c 
D 
E 
F 
- The income of the dependant-claimant in case of death of earning 
G 
member is generally not a relevant factor in determining 
compensation primarily because the law takes no cognizance of 
the claimant's situation, though in case of an injury, the income of 
the claimant who is injured is relevant. 
H 
691 
692 
SUPREME COURT REPORTS 
[2017] 2 S.C.R. 
A 
B 
c 
D 
E 
F 
H 
Dismissin~ the appeals, the Court 
HELD: 1.1 The liability to pay the amount of compensation 
under Section 163A of the Motor Vehicles Act, 1988, is imposed 
on the owner of the motor vehicle or the authorized insurer, in 
the case of death or permanent disablement due to accident arising 
out of the use of motor vehicle. It is payable to the legal heirs or 
the victim, as the case may be. In other cases, an award may be 
made in respect of the claim arising out of the accident under 
Section 168 of the Act. The Tribunal may make an award 
• determining the amount of compensation "which appears to it to 
be just", specifying the person.or persons to whom compensation 
shall be paid and in making the award, the Tribunal shall specify 
the amount which shall he paid by the insurer or owner or driver 
of the vehicle involved in the accident or by all or any of them, as 
the case may be. In these cases, compensation is claimed against 
the tort feasor wh_o may be the driver or owner of the vehicle or 
the insurer. In respect of an accident in which the tort feasor is 
found to be liable, the owner or the driver of the vehicle or the 
insurer, as the c~se may be, may alone be held responsible for 
the payment of such compensation since the accident has resulted 
in the injury or death which gives rise to the claim of the claimants. 
No other party is involved in it. And certainly not the employer 
who may offer compassionate appointment to the dependants of 
the injured/ deceased. [Paras 10, 11] [697-A-EJ 
1.2 While awarding compensation, amongst other things, 
the Tribunal takes into account the income of the deceased and 
calculates the loss of such income after making permissible 
deductions to compensate the injured claimant for the loss of · 
earning capacity in case of an injury, and to compensate the 
claimants dependent on him in case of deat.h. Thus, the into.me 
of the deceased or the injured, which the ctaiman_ts.have· lost due 
to the inability of the deceased or the injured to earn or to provide 
for them is a relevant factor which is always taken into 
consideration. The salary or the income of the claimant in case of 
death is generally not a relevant factor in determining 
compensation primarily because the law takes no cognizance of 
the claimant's situation. Though in case ·of an injury, the income 
of the claimant who is injured is relevant. [Para 12) [697-E-GJ 
NATI,QNAL INSURANCE CO. LTD. v. REKHABE

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