Family Pension Can't Be Deducted While Computing Loss Of Dependency Of Claimants In Motor Accident Case: Jammu & Kashmir and Ladakh High Court

The Jammu & Kashmir and Ladakh High Court has held that family pension drawn by the Claimant after death of family member in motor accident is not eligible to be deducted while computing the loss of dependency.

The Court was considering an Appeal filed by the Insurance Company against an award passed by Motor Accidents Claims Tribunal whereby Claim Petition of Respondents was allowed.

The Bench of Justice Sanjay Dhar observed,"...the family pension drawn by the claimant Santosh Devi after the death of her deceased husband is not eligible to be deducted while computing the loss of dependency of the claimants due to the death of the deceased. The contention of the appellant-insurance company in this regard is without any merit and deserves to be rejected."

The Appellant was represented by Advocate Himani Uppal while the Respondent was represented by Advocate Jatinder Singh.

Facts of the Case

The Claimant had sought a1.85 crores along with interest on account of death of her husband. As per case of the claimants, the deceased was and when he reached near Gas Plant NHW Bari Brahmana, the Motorcycle was hit by a Swift car travelling on a motorcycle leading to fatal injuries and his ultimate demise.

While assessing the compensation, the Tribunal computed the monthly income of the deceased at Rs. 30,316/- from pension and Rs. 6,000/- per month from business. The total annual income of the deceased was, accordingly taken as Rs. 4,35,792/-. After deducting one-fourth towards the personal and living expenses of the deceased, the annual loss of dependency of the claimants was assessed at Rs.3,26,844/-

It was contended by the Insurance Company that the accident was caused due to rash and negligent driving of the motorcycle by the deceased and not by the rash and negligent driving of the offending vehicle by its driver. It was further contended that the driver of the offending vehicle was not holding a valid and effective driving licence at the time of the accident, as such, there was breach of policy conditions, as a consequence whereof the Insurance Company is exonerated from its liability to indemnify the insured. It was further pleaded that the claimants have sought exorbitant amount of compensation to which they are not entitled. 

The Counsel for the Insurance Company submitted that while computing the income of the deceased, the Tribunal did not take into account the fact that the Claimant is the widow of the deceased and is now receiving family pension after the death of her husband. It was submitted that the amount of pension which the widow is getting, is eligible to be deducted while assessing the loss of dependency to the claimants.

Reasoning By Court

The Court referred to Supreme Court's decision in “Helen C. Rebello (Mrs) and Ors Vs. Maharashtra State Road Transport Corporation & Ors”, (1999) wherein the court considered as to whether the amounts received by the deceased by way of provident fund, pension, life insurance policies or pecuniary advantages received by the heirs on account of death of the deceased are liable to be deducted from the compensation and held that these pecuniary advantages have no co-relation with the compensation receivable by the dependants under Motor Vehicles Act. 

Reference was also made to “Bhakra Beas Management Board Vs. Kanta Aggarwal (Smt) and Ors”, (2008), “Sebastiani Lakra & Ors Vs. National Insurance company Ltd & anr” (2019) and the recent decision in “Hanumantharaju B (Dead) by L.R Vs. M. Akram Pasha & Ors” (2025)

"In the said case, the Supreme Court has held that while computing the loss of income, it would not be permissible to deduct the pensionary amount and that for the purpose of computing the loss of income, the monthly salary has to be accepted without deducting the pension amount", the Court held.

The Appeal was accordingly dismissed.

Cause Title: Reliance General Insurance Co. vs. Santosh Devi & Ors.

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