Amount Received By Claimant Under Mediclaim Or Medical Insurance Policy Not Liable To Be Deducted From Compensation Under Motor Vehicles Act: Bombay High Court
The Bombay High Court was considering the issue of whether the amount received by a Claimant under a Mediclaim Policy or under a Medical Insurance Policy is liable to be deducted from the amount of compensation in proceedings under Section 166 of the Motor Vehicles Act, 1988.
The Bombay High Court has clarified that the amount received by a Claimant under a Mediclaim Policy or a Medical Insurance Policy is not liable to be deducted from the amount of compensation payable to a Claimant under the head “Medical Expenses” under Section 166 of the Motor Vehicles Act, 1988.
The High Court was considering the issue of whether the amount received by a Claimant under a Mediclaim Policy or under a Medical Insurance Policy is liable to be deducted from the amount of compensation payable to a Claimant under the head “Medical Expenses” in proceedings under Section 166 of the Motor Vehicles Act, 1988.
Answering the question in the negative, the 3-Judge Bench of Justice Gauri Godse, Justice Milind N. Jadhav and Justice A.S. Chandurkar held, “Thus, any amount received by a claimant under a mediclaim policy or under a medical insurance policy is not liable to be deducted from the amount of compensation payable to a claimant under the head “medical expenses” in proceedings under Section 166 of the M.V. Act.”
Advocate Deelip R. Mahadik represented the Appellant, while Advocate T.J. Mendon represented the Respondent.
Factual Background
In the First Appeal, a challenge had been raised to the judgment of the Motor Accident Claims Tribunal, Mumbai, awarding monetary compensation to the claimant. One of the grounds of challenge was that the amount awarded by the Motor Accident Claims Tribunal (Tribunal) towards medical expenses could not have been so awarded because the claimant had received these expenses under a Mediclaim Policy from the Insurance Company. The claimant sought to rely upon the decisions in Vrajesh Navnitlal Desai Vs. K. Bagyam and Anr. (2006) and Royal Sundaram Alliance Insurance Co. Ltd., Kolkata Vs. Ajit Chandrakant Rakvi and Anr. (2019) to contend that the amount received under a Mediclaim Policy was not liable to be set-off.
The Single Judge noticed the divergent views in Vrajesh Navnitlal Desai and Royal Sundaram Alliance Insurance Co. Ltd. (supra) on one hand and in New India Assurance Vs. Dineshchandra Shantilal Shah and Ors (2013) on the other. The latter decision did not notice the earlier views on that point. The First Appeal was directed to be placed before the Chief Justice for constituting a larger Bench to decide the said question. Accordingly, the said question was referred to the Full Bench.
Reasoning
Referring to various precedents of the Apex Court in Helen C. Rebello and Ors. Vs. Maharashtra State Road Transport Corporation and Anr., (1999), United India Insurance Co. Ltd. and Ors. Vs. Patricia Jean Mahajan and Ors., (2002), Sebastiani Lakra and Ors. Vs. National Insurance Co. Ltd. and Anr. (2019) the Bench reiterated that the amount received on account of insurance is due to the contractual obligations entered into by the insured with others. Having paid a premium, it becomes clear that the beneficial amount would accrue to the share of the deceased either on maturity of the policy or on death, whatever be the manner of death. The tortfeasor cannot take advantage of the foresight and wise financial investments made by the deceased.
Placing reliance upon the aforesaid decision wherien it has been held that the amount under a mediclaim policy is received in view of a contract entered into by the claimant with the insurance company and the same is received in view of the terms of the contract, the Bech said, “In our considered opinion, a deduction of the amount received under a mediclaim policy by the claimant could not be directed to be so deducted in the light of the law laid down in Sebastiani Lakra and Ors. (supra) after considering the ratio of the decisions in Helen C. Rebello and Patricia Jean Mahajan (supra).” It was further held that the ratio of the decision in Dineshchandra Shantilal Shah and Ors. (supra) does not indicate the correct legal position.
“In our view, in the light of the decision in Sebastiani Lakra and Ors. (supra), the deduction of any amount received by a claimant under a mediclaim policy would not be permissible”, it held.
The Bench also concurred with the view expressed by Justice Dipankar Datta in New India Assurance Company Ltd. Vs. Bimal Kumar Shah and Anr (2019) that money received by an accident victim as return for money invested by him ought not to be comprehended as a benefit received and therefore the question of the victim being doubly benefited did not and could not arise.
Thus, affirming that any amount received by a claimant under a mediclaim policy or under a medical insurance policy is not liable to be deducted from the amount of compensation, the Bench held, “In the light of the foregoing discussion, we are of the considered opinion that the question as framed ought to be answered in the negative.”
“The First Appeal be now placed before the learned Single Judge for its consideration on merit”, it concluded.
Cause Title: The New India Assurance Co. Ltd. v. Mrs. Dolly Satish Gandhi & Anr. (Neutral Citation: 2025:BHC-AS:14458-FB)
Appearance:
Petitioner: Advocates Deelip R. Mahadik, Devendra Joshi
Respondent: Advocates T.J. Mendon, T.R. Kale, Deepak S. Kilaje, Navin Sheth, R.S. Alange, Senior Advocate Vineet B. Naik, Advocates Sukand Kulkarni, Sarthak Diwan,
Amicus Curiae Senior Advocate Gautam Ankhad, Advocates Samridhi Lodha and Minal Thakker
