Family Pension Can't Be Deducted While Calculating Motor Accident Compensation: Punjab & Haryana High Court

The Punjab and Haryana High Court has held that family pension received by the widow of a deceased cannot be deducted while computing loss of dependency under the Motor Vehicles Act, 1988.

Justice Sudeepti Sharma referring to Mrs. Helen C. Rebello & Ors. v. Maharashtra State Road Transport Corpn. & Anr.[ AIR, 1998 SC 3191], the Court reiterated that, "family pension is also earned by an employee for the benefit of his family in the form of contribution of his services in terms of service conditions, which becomes receivable by the heirs on his demise. There is no co-relation between the family pension, which in any case the family would have got and the amount which is paid on account of accidental death."

Allowing an appeal filed by the claimants, the Court modified the award dated March 1, 2018, which had granted compensation of ₹3,22,000 with 7% interest for the death of Kehar Singh in a motor vehicular accident that occurred on April 23, 2016.

The claim petition was filed under Section 166 of the Motor Vehicles Act on account of the death of Kehar Singh. The Tribunal had deducted the family pension of ₹24,000 per month received by the widow while computing loss of dependency and assessed the notional income of the deceased at ₹6,000 per month.

Aggrieved by the quantum of compensation, the claimants approached the High Court seeking enhancement.

Counsel for the appellants contended that the Tribunal committed a patent illegality in deducting the family pension, which is impermissible in law. It was further argued that the notional income assessed by the Tribunal was arbitrary and contrary to settled legal principles. Reliance was placed on the Supreme Court judgment in Helen C. Rebello v. Maharashtra State Road Transport Corporation.

The Insurance Company opposed the appeal, submitting that the award passed by the Tribunal was just and proper.

The High Court examined the issue in light of Supreme Court judgments including Sarla Verma v. DTC, Pranay Sethi, Helen C. Rebello, Lal Dei, Vimal Kanwar, Sebastiani Lakra, and the recent decision in Hanumantharaju B v. M. Akram Pasha (2025).

The Court reiterated that family pension is earned by the deceased through years of service and is payable irrespective of the cause of death. It has no correlation with compensation payable on account of accidental death and therefore cannot be treated as a pecuniary advantage liable for deduction.

It was observed that permitting such deduction would effectively allow the tortfeasor to benefit from the deceased's service-related entitlements, which is contrary to the object of the Motor Vehicles Act.

Holding the Tribunal's approach to be legally unsustainable, the Court reassessed the compensation by taking the monthly income of the deceased at ₹24,000 and deducting 50% towards personal expenses, considering that the major and married son was not dependent.

Applying a multiplier of 7 and the Court enhanced the amounts under conventional heads, including loss of consortium and the total compensation was reassessed at ₹11,58,000, resulting in an enhancement of ₹8,36,000 over the amount awarded by the Tribunal.

The Court further granted interest at 9% per annum on the enhanced amount, payable from the date of filing of the claim petition till realization.

The Insurance Company was directed to deposit the enhanced compensation along with interest before the Tribunal within two months. The Tribunal was directed to disburse the amount to the claimants in the ratio already determined.

Mr. Balwinder Singh, Advocate, for the appellants.

Mr. Nigam K. Bhardwaj, Advocate,

for respondent No.3-Insurance Company.

Title: Chameli Devi and others v. Sanjeev Kumar and others

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