Punjab & Haryana High Court Reduces Compensation in Motor Accident Case; Orders Deduction of Salary Received Under Haryana Compassionate Assistance Policy
Case Name: Magma HDI General Insurance Co. Ltd. v. Neelam Rani & Others
Date of Judgment: October 31, 2025
Citation: FAO-8656-2015
Bench: Hon’ble Mrs. Justice Sudeepti Sharma
Held: The Punjab & Haryana High Court partly allowed the insurer’s appeal and reduced the compensation awarded to the dependents of deceased Kuldeep Singh, holding that the amount received by the claimants under the Haryana Government Compassionate Assistance Policy, 2006 must be deducted from the total compensation to prevent double benefit. Justice Sudeepti Sharma ruled that the Tribunal erred in not excluding the salary-equivalent benefits already granted under the policy, which provides ex-gratia financial assistance to families of government employees who die in harness.
Summary: The Motor Accident Claims Tribunal, Rohtak, had earlier awarded ₹57,70,000 along with 7.5% annual interest to the claimants for the death of Kuldeep Singh, a government employee, who died in a road accident on June 28, 2014. The insurer appealed, arguing that the Tribunal failed to deduct the amount being paid to the family under the 2006 policy, equivalent to the deceased’s last drawn salary.
The Court referred extensively to Reliance General Insurance Co. Ltd. v. Shashi Sharma (2016) 9 SCC 627 and Krishan Chand v. State of Haryana (2023), reiterating that dependents cannot claim the same benefit twice—once under the government’s compassionate policy and again under the Motor Vehicles Act. It held that the compensation already provided by the employer is “in the nature of pay and allowances” and therefore must be adjusted while determining just compensation.
Reassessing the quantum, the Court recalculated the dependency loss using a 15-multiplier and added amounts for consortium, funeral expenses, and loss of estate, but deducted ₹48,93,120 payable under the Compassionate Assistance Policy. The revised compensation stood at ₹6,60,430, with interest enhanced to 9% per annum from the date of claim filing until realization.
Decision: The appeal was allowed to the extent of deduction, and the Insurance Company was directed to deposit the revised amount with the Tribunal within two months. The claimants were instructed to furnish bank details for disbursal. The statutory amount deposited at the time of appeal admission was ordered to be refunded to the insurer.