Motor Accident Claims Tribunal Has Discretion To Release Compensation Amount In Full Or In Part : Supreme Court
The Supreme Court of India clarified that the Motor Accidents Claims Tribunal (MACT) has the discretion to release compensation all at once or in parts.
“it is for the Tribunal in a given case to make a decision as to whether the entire amount has to be released or if it is to be released in part. Suffice it is to state that the Tribunal is expected to give its own reasoning while undertaking such an exercise”, the Court clarified.
A bench of Justice MM Sundresh and Justice Aravind Kumar was dealing with a petition contending that Rule 150A of the Central Motor Vehicles (Amendment) Rules, 2022 read with Annexure XIII interferes with the MACT's powers under Sections 168, 169, and 176 of the Motor Vehicles Act, 1988 to award compensation.
Rule 150A outlines the procedure for the investigation of road accidents. According to the rule, investigations must be conducted in accordance with Annexure XIII, which prescribes a detailed process involving the police, MACT, insurance companies, and other stakeholders.
Rule 36 of the Annexure XIII provides that the MACT shall release a portion of the awarded amount as necessary based on the claimants' financial condition and direct the rest to be placed in fixed deposits, to be released in phases per the MACT Annuity Deposit Scheme.
Senior Counsel S Prabakaran for the petitioner submitted that Rule 36 is unnecessary and hinders the claimant from receiving lump-sum payments, especially in cases resolved through mediation.
However, the Court clarified that Rule 36 must be read alongside Rule 35. Rule 35 grants the Tribunal discretion in determining the release mechanism of the award amount.
Amicus curiae N Vijayaraghavan submitted that Rule 150A pertains solely to the procedure for investigating road accidents and does not affect Sections 166, 168, 169, and 176 of the Act.
The Court concurred, noting that Rule 150A should be read in conjunction with the provisions of the Act, which treats accident information as a complaint.
As per Rule 21, the Detailed Accident Report (DAR) filed by the Investigating Officer is to be treated as a claim petition under Section 166(4) of the Act. It includes provisions for cases where the IO cannot produce the claimant(s) on the first hearing, handling separate claim petitions, waiting for the Report under Section 173 of the CrPC, and registering the FAR as a Miscellaneous application.
The Court opined that Rule 21 aligns with the welfare intent of the legislation.
“Therefore, the provisions quoted above are certainly pieces of welfare legislation meant for the benefit of the litigant. Upon material being placed before the Court, a lawyer representing the claimant would be in a better position to seek adequate compensation as the litigant would also get a copy of the DAR Report.”
The Court dismissed the petitioner's argument that Rule 150A contradicts the Act.
With these clarifications, the Supreme Court disposed of the Special Leave Petition.
Case no. – SLP (Crl.) No. 9264/2019
Case Title – The Law Association v. Director General Of Police
Citation : 2024 LiveLaw (SC) 499