# MRS. HELEN C. REBELLO AND ORS v. MAHARASHTRA STATE ROAD TRANSPORT CORPORATION AND ANR

- **Citation:** [1998] Supp. 1 S.C.R. 684
- **Court:** Supreme Court of India
- **Decided:** 1998-09-18
- **Case number:** Civil Appeal No. 1904 of 1989
- **Bench:** K. Venkataswami, A.P. Misra
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/mrs-helen-c-rebello-and-ors-v-maharashtra-state-road-transport-corporation-and-16443
- **Pages:** 30

## Headnote

Motor Vehicles Act, 1939 :
C
Sections 110-B, 95 proviso, 92-A and 92B---Compensation for death in
motor accidents-Computation of-Life insurance amount received by the
legal heirs-Common law p1inciple of adjusting the pecuniwy advantages
coming from whatever source by reason of death-Held, has to be i11te1preted
in such cases as refe11ing to pecwzimy advantages coming on account of
accidental death and not other fo11ns of death-Thus, provident fund, family
D pension, cash balance, shares, fixed deposits etc. ·cannot be tenned as
"pecuniary advantages" for the pwposes of Motor Vehicles Act-Distinction
between the language of Fatal Accidents Act, 1885 on the one ha11d and
Section 110-B and Section 168(1) of the Motor Vehicles Act, 1988 011 the
other hand-Fatal Accidents Act, 1885, Section I-A-Motor Vehicles Act,
1988, Sections 168( 1), 140 and 141.
E
F
G
Compensation "which appears to be just"-Meaning a11d scope
of~Held, scope of computing compensation under Section 110-B is wider
than under Fatal Accidellts Act, 1885 and English Fatal Accidellts Act, 1846.
Words and phrases :
"Pecuniwy advantdges''-Meani11g of-In the c6nto.t of Motor Vehicles
Act, 1939.
"Just''- Meaning of-In the context of Motor Vehicles Act, 1939 and
Fatal Accidents Act, 1885.
Interpretation of Statutes-Beneficial Statutes--Inte1pretation of-Interpretation which subse1ves the object of legislation i.e. benefit to the subject
under such statutes should be accepted.
Practice and Procedure-Appeal before the Supreme Court-Appeal
H filed before the High Co wt was not pressed as it was covered by an earlier
684
MRS. HELEN AND ORS. v. MAHARASHTRASRTC AND ANR.
685
decision of the same High Cowt 011 that point-Objection raised before this
Cowt that High Cowt dismissed the appeal being not pressed-Held, such
appeals are 111ai11tai11able--Co11stitution of Indilr-Alticle 136.
Husband of appellant No. 1 (father of appellants Nos. 2 to 6) was
travelling in a bus belonging to State Transport when it met with an
accident by a bus belonging to another State Transport (respondent No.
A
B
2), due to negligent driving, resulting in his death. In an action for
compensation/damages brought by the appellants, the legal heirs of
deceased, Trial court allowed it. However, the Trial court deducted the
amount of life insurance received by the appellants in view of a Division
Bench judgment of the Bombay High Court. High Court rejected the cross. C
appeals. Hence this appeal.
It was contended by the appellants that the life insurance amount
received by them was not deductible from the compensation computed
under the Motor Vehicles Act.
D
HELD : 1.1. So far as the general principle of estimating damages
under the common law is concerned, the pecuniary loss can be ascertained
only by balancing on· one hand, the loss to the claimant of the future
pecuniary benefits that would have accrued to him but for the death with
the "pecuniary advantage" which from whatever source comes to him by E
reason of the death. In other words; it is the balancing of loss and gain of
the claimant occasioned by the death. But this has to change its colour to
the extent a statute intends to do. The compensation payable under the
Motor Vehicles Act, 1939 is on account of the pecuniary loss to the
claimant by accidental injury or death and not other forms of death.
F
Therefore, the application of the general principle under the common law
G
of loss and gain for the computation of compensation under this Act must
correlate to this type of injury or death, viz. accidental death. If the
"pecuniary advantage" resulting from death means pecuniary advantage
under all forms of death then it will include all the assets movable,
immovable, shares, bank accounts, cash and every amount receivable
under any contract. This would obliterate all possible conferment of
economic security to the claimant by the deceased and the intention of the
legislature. Thus, under the present Act, whatever pecuniary advantage is
received by th

## Text

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A
B
MRS. HELEN C. REBELLO AND ORS.
v.
MAHARASHTRA STATE ROAD TRANSPORT
CORPORATION AND ANR.
SEPTEMBER 18, 1998
[K. VENKATASWAMI AND A.P. MISRA, JJ.]
Motor Vehicles Act, 1939 :
C
Sections 110-B, 95 proviso, 92-A and 92B---Compensation for death in
motor accidents-Computation of-Life insurance amount received by the
legal heirs-Common law p1inciple of adjusting the pecuniwy advantages
coming from whatever source by reason of death-Held, has to be i11te1preted
in such cases as refe11ing to pecwzimy advantages coming on account of
accidental death and not other fo11ns of death-Thus, provident fund, family
D pension, cash balance, shares, fixed deposits etc. ·cannot be tenned as
"pecuniary advantages" for the pwposes of Motor Vehicles Act-Distinction
between the language of Fatal Accidents Act, 1885 on the one ha11d and
Section 110-B and Section 168(1) of the Motor Vehicles Act, 1988 011 the
other hand-Fatal Accidents Act, 1885, Section I-A-Motor Vehicles Act,
1988, Sections 168( 1), 140 and 141.
E
F
G
Compensation "which appears to be just"-Meaning a11d scope
of~Held, scope of computing compensation under Section 110-B is wider
than under Fatal Accidellts Act, 1885 and English Fatal Accidellts Act, 1846.
Words and phrases :
"Pecuniwy advantdges''-Meani11g of-In the c6nto.t of Motor Vehicles
Act, 1939.
"Just''- Meaning of-In the context of Motor Vehicles Act, 1939 and
Fatal Accidents Act, 1885.
Interpretation of Statutes-Beneficial Statutes--Inte1pretation of-Interpretation which subse1ves the object of legislation i.e. benefit to the subject
under such statutes should be accepted.
Practice and Procedure-Appeal before the Supreme Court-Appeal
H filed before the High Co wt was not pressed as it was covered by an earlier
684
MRS. HELEN AND ORS. v. MAHARASHTRASRTC AND ANR.
685
decision of the same High Cowt 011 that point-Objection raised before this
Cowt that High Cowt dismissed the appeal being not pressed-Held, such
appeals are 111ai11tai11able--Co11stitution of Indilr-Alticle 136.
Husband of appellant No. 1 (father of appellants Nos. 2 to 6) was
travelling in a bus belonging to State Transport when it met with an
accident by a bus belonging to another State Transport (respondent No.
A
B
2), due to negligent driving, resulting in his death. In an action for
compensation/damages brought by the appellants, the legal heirs of
deceased, Trial court allowed it. However, the Trial court deducted the
amount of life insurance received by the appellants in view of a Division
Bench judgment of the Bombay High Court. High Court rejected the cross. C
appeals. Hence this appeal.
It was contended by the appellants that the life insurance amount
received by them was not deductible from the compensation computed
under the Motor Vehicles Act.
D
HELD : 1.1. So far as the general principle of estimating damages
under the common law is concerned, the pecuniary loss can be ascertained
only by balancing on· one hand, the loss to the claimant of the future
pecuniary benefits that would have accrued to him but for the death with
the "pecuniary advantage" which from whatever source comes to him by E
reason of the death. In other words; it is the balancing of loss and gain of
the claimant occasioned by the death. But this has to change its colour to
the extent a statute intends to do. The compensation payable under the
Motor Vehicles Act, 1939 is on account of the pecuniary loss to the
claimant by accidental injury or death and not other forms of death.
F
Therefore, the application of the general principle under the common law
G
of loss and gain for the computation of compensation under this Act must
correlate to this type of injury or death, viz. accidental death. If the
"pecuniary advantage" resulting from death means pecuniary advantage
under all forms of death then it will include all the assets movable,
immovable, shares, bank accounts, cash and every amount receivable
under any contract. This would obliterate all possible conferment of
economic security to the claimant by the deceased and the intention of the
legislature. Thus, under the present Act, whatever pecuniary advantage is
received by the claimant, from whatever source, would only mean that
which comes to the claimant on account of other forms of deaths. It would H
686
SUPREME COURT REPORTS [1998] SUPP. 1 S.C.R.
A not include that which the claimant receives on account of other forms of
death, which he would receive even apart from accidental death as such
pecuniary advantage would have no correlation to the accidental death for
which compensation is computed. However, where the employer insures his
employee, as against injury or death, arising out of an accident, any
B
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amount received out of such insurance on the happening of such incident
may be an amount liable for deduction. Legislature has taken note of such
contingency through the proviso to Section 95 of the Act. Under it the
liability of insurer is excluded in respect of injury or death, arising out of
and in the course of employment of an employee. [709·E·H; 710·A·B]
1.2. An employee contributing to a provident fund or his heirs are
entitled to the amount of the fund irrespective of the accidental death.
Similarly the heirs receive family pension even otherwise than the acciden·
tal death. There is no correlation between the two. Similarly, the amount
of life insurance policy is receivable by the claimant not on account of any
D accidental death but otherwise on the insured's death. Death is only a step
or contingency in terms of the contract, to receive the amount. Similarly,
any cash, bank balance, shares, fixed deposits etc., though pecuniary
advantage receivable by the heirs on account of one's death but all these
have no correlation with the amount receivable under a statute occasioned
only on account of accidental death. Such an amount cannot come within
E the periphery of Motor Vehicles Act, to be termed as "pecuniary advantage"
liable for deduction. (711-G·H, 712-A·B]
1.3. The Act, in relation to payment of compensation to the claimant,
is a beneficial legislation. The intention of the legislature is made more
F clearly broughtout under Section 110-B of the 1939 Act. This is also visible
through the provision of Section 168(1) under the Motor Vehicles Act, 1988
and Section 92-A of the 1939 Act which fixes the liability on the owner of
the vehicle even on no fault. Section 92-B of the 1939 Act ensures that the
claim for compensation under Section 92-A is in addition to any other right
to claim compensation in respect thereof under any other provision of this
G Act or of any other law for the time being in force. This clearly indicates
the intention of the legislature which is conferring larger benefit on the
claimant. Interpretation of such beneficial legislation is also well settled.
whenever there are two possible interpretations in such statute, then the
one which subserves the object of legislation, viz., benefit to the subject
H should be accepted. In the present case, two interpretations have been
:t.
MRS. HELEN AND ORS. v. MAHARASHTRA SRTC AND ANR.
687
given evidenced by two distinct sets of decisions of the various High
Courts. Therefore, the set of decisions which applied be principle of no
deduction of the life insurance amount, should be accepted and the other
set, which interpreted to deduct, is to be rejected. [712-E, F, G, H; 713-A-B]
1.4. Thus, the amount received by the claimant on the life insurance
of the deceased is not deductible from the compensation computed under
the Motor Vehicles Act. [692-A]
Jaikwnar Chhaganlal Patni v. Mery Jerome D' Souza, AIR (1978) Born.
239, overruled.
2.1. The language of Section 110-B of the 1939 Act is different from
what is under Section 1-A of the Fatal Accidents Act, 1955, Section 1-A of
A
B
c
the 1955 Act entitles the party to recover damages, whenever dea~h is
occasioned by the wrongful act, negligence or default, which would have
entitled the party injured (if death had not resulted) to maintain au action D
to recover damages iu respect thereof. This provision was interpreted
within the limitation of the words used therein and in the absence of any
guiding words therein. The courts rightly drew the general principle of
common law of loss and gain. But Section 110-B of the 1939 Act empowers
the Tribunal to determine the compensation which appears to it to be just.
Use of the w.vrds "which appears to it to be just" widens the scope of
determination of compensation which is neither under the Indian Fatal
Accidents Act, 1855 nor under the English Fatal Accidents Act, 1846. This
shows that the word "just" was deliberately brought in Section 1111-B of the
1939 Act to enlarge the consideration in computing the compensation
which, of course, would include the question of deductibility, if any. This
leads one to an irresistible conclusion that the principle of computation
of the compensation both under the English Fatal Accidents Act, 1846 and
under the Indian Fatal Accidents Ad, 1855 to be restrictive in nature was
E
F
in the absence of any guiding words therein, hence the courts applied the
general principle at the common law of loss and gain but that would not
apply to the consideration under Section 110-B of the 1939 Act which G
enlarges the discretion to deliver better justice to the claimant, in computing the compensation, to see what is just. The word 'just", as its nomenclature denotes, means equitability, fairness and reasonableness having a
large peripheral field. The largeness is, of course, not arbitrary, it is
restricted by the conscience which is fair, reasonable and equitable; if it H
688
SUPREME COURT REPORTS (1998] SUPP. 1 S.C.R.
A exceeds it is ternied as unfair, unreasonable, unequitable, not just. Thus,
this field of wider discretion of the Tribunal has to be within the said
limitations and the limitations under any provision of this Act or any other
provision having the force of law. [706-E to H; 707-A-D]
B
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D
E
F
G
H
N. Sivammal v. Managing Director, Pa11dian Roadways Corporation,
[1985] 1 sec 18, relied on.
Gobald Motor Se1vice Ltd. v. R.M.K. Veluswami, [1962] 2 SCR 929
and Sheikhupura Tra11sp01t Co. Ltd. v. Northern India Transpolt Insurance
Co., AIR (1971) SC 1624, distinguished.
LIC of India v. Naranbhai Munjabhai Vadhia, (1973) ACJ 226 = AIR
(1973) Guj. 216; Sood and Co. v. Swjit Kaw; (1973) ACJ 414 (P&H); Bhagwanti Devi v. !sh Kumar, (1975) ACJ 56 (Delhi); Union of India v. Sup1iya
Ghosh, AIR (1973) Pat. 129; Sushi/a Devi v. Ibrahim, AIR (1974) MP 181;
Sabita Pati v. Rameshwar Singh, (1973) ACJ 319 (Orissa); Automobiles
Transpon (Rajasthan) (P) Ltd. v. Dewala, AIR (1977) Raj. 121 and Orissa
Road Tra11sp01t Co. Ltd. v. Sibananda Pattanaik, (1976) ACJ 497 : AIR
(1976) Ori. 205, referred to.
Bradum v. Great Westem Rly. Co., [1874- 80] ALL ENGLAND LAW
REP.195; Pany v. Cleaver, [1969] l ALL ENGLAND LAW REP. 555; Dalby
v. India and Lo11don Life Insurance Co., (1854) 15 CB 365: (1843-60); The
Grand Tnmk Rly. Co. of Canada v. Jenni11gs, [1888] 13 AC 800; Davies v.
Powell Duffiy11 Associated Collielies Ltd., (1942) AC 601; Na11ce v. B1itish
Columbia Electlic railway Co. Ltd., [1951] AC 601 and Bregman v. Kress, 81
NYS 1072, referred to.
Fleming: Law of T01ts; T.P. Muklwjee : Law Lexicon, (5th Edn.),
referred to.
2.2. Thus, it has to be concluded that the Tribunal, while computing
the compensation under Section 110-8 of the 1939 Ad, has a wider discretion than what ithad under the 1855 Act. Various provisions of this Act like
Sections 94, 95, 95-AA, 96 and 97 indicate the legi~lature's intent conferring
visible benefit on the claimant by securing compensation through casting
obligation on the tortfeasor and the insurer. All these and such other
provisions are clearly beneficial legislation, hence should be interpreted in
a manner which confers benefit and not that usurps its benefit. [708-B-D]
~ ..
_,
~
~
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·~
. -~
Jllf
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MRS. HELEN AND ORS. v. MAHARASHTRA SRTC AND ANR [MISRA, J.] 689
3. The contention of tl1e respondent that this appeal is not mainA
. tainable as the High Court dismissed the appeal as not pressed, has no
merits. This only reveals that the question of deduction being covered by
the earlier decision of the High Court, the appellants could not press the
point in that appeal in foat court. It is for this reason the appellants
challenged this point before this Court for consideration. (691-8-F]
Jaikumar Chhaganlal Patni v. Mery Jerome D'Souza, AIR (1978) Born.
239, referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1904 of
1989.
-·
From the Judgment and Order dated 9.9.85 of the Bombay High
Court in F.A. No. 1209 of 1981.
Gopal Jain, (Ms. Nandini Gore) for Ms. M. Karanjawala for the
Appellants.
K.R. Nagaraja, K.K. Tyagi, M. Sharda, (R.S. Hegde) for S.K. Agnihotri for the Respondents.
The Judgment of the Court was delivered by
MISRA, J. The question raised in this appeal is of great importance
on which the High Courts in India are divided. Importance of this question
is underlined and revealing since 19th century where there is full debate in
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E
the English Courts having divergent views leading to legislation and amendments to set at rest this controversy. So far as our country is concerned, as
aforesaid, we have divergent views of the various High Courts, but so far
F
this Court, it has not dwelled this question in depth, except passmg
references in a few cases to which we shall be referring later.
The question is, whether the life insurance money of the deceased is
to be deducted from the claimants' compensation receivable under the G
Motor Vehicles Act, 1939? The minimum matrix of the facts to appreciate
the controversy is stated hereunder :
The husband of appellant No. 1, father of appellants Nos. 2 to 6, was
travelling in the Maharashtra State Road Transport Corporation bus from
Rathare Badruk to Pune on 12th April, 1973 at about 4.00 P.M. when this H
690
SUPREME COURT REPORTS [1998) SUPP. l S.C.R.
A bus passed the village Umbraj and came near village Kotri near milestone
No. 89/4, Karnataka State Transport bus was seen coming from the opposite direction, i.e., from Satara side towards Kolhapur. The drivers of the
two buses were not able to control their buses resulting into collision
between the two, seriously injuring the deceased Clement Rebello and Mr.
B Viney John Pereira, in which Mr. Rebello received multiple fractures and
died on the spot. The appellants filed a Special Civil Suit No. 24 of 1975
against the aforesaid two State Road Transport Corporations. It was
avered in the plaint that the deceased was aged about 40 years and was the
sole bread winner of the family. He was a well known boat builder and
businessman of the Bassein. He was doing business in partnership under
C the name and style of Marine Engineering Works. He was a person of great
skill and hard worK'er. He was a person of robust health and sober habits.
His income from the business and other activities was about Rs. 40,000 per
annum. He was assessed for an income of about Rs. 43,000 by the Income
Tax Authorities for the Assessment Year 1971-72. Being the sole bread
D winner, he used to provide the family with the support of Rs. 25,000 per
year. The claim made by the appellants for damages/compensation under
the various admissible heads of damages was for Rs. 4 lacs. The claim of
the appellants was allowed by the Civil Judge, Senior Division, Satara,
holding that the death was caused due to rash and negligent driving on the
part of the driver of respondent No. 2, namely, Karnataka Road Transport
E Corporation. It was also held that the deceased had supported his family
with an amount of Rs. 25,000 per annum. It was found that as the deceased
was of 40 years old at the time of his death and his father had lived upto
the age of 85 years, the normal longevity of his life would have been 25
years from the date of death, but since the claimants had claimed a
F compensation only taking a period of 20 years, the Trial court held that
the appellants were entitled lo a compensation of Rs. 3,80,000 by way of
pecuniary loss and Rs. 10,000 on account of pain and suffering, in total Rs.
3,90,000. However, in view of the Division Bench judgment of the Bombay
Court inlaikwnar Chhaganlal Patni and Others v. Mmy Jerome D'souza and
Others, AIR (1978) Bombay 239, the Trial court deducted the amount of
G life insurance received by the appellants to the tune of Rs. 3,15,067.95p
from the aforesaid compensation calculated and held that only the balance
amount of Rs. 74,939 .05p with interest at the rate of six per cent per annum
is payable by the respondent No. 2 to the claimants.
I
H
Throu.gh the witness Shashikant Dattatraya Kale, Exhibit 67, who was
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MRS. HELEN AND ORS. v. MAHARASHTRA SRTCAND ANR [MISRA, J.] 691
serving in LIC at Bombay, it was elicited that the deceased Clement had A
insured his life under the said policy. The claimants were enti~led to get an
amount of Rs. 4,40,193.65p, out of which an amount of Rs. l,25,125.70p
was deducted by way of estate duty and the remaining amount of Rs.
3,15,067.95p was paid to the aforesaid heirs. It is this amount, as aforesaid,
which was deducted in view of the decision of the Bombay High Court
referred to above. On appeal, preferred both by the appellants and also
the respondents, the High Court rejected the cross appeal of respondent
No. 2, namely, Karnataka State Road Transport Corporation. However, the
appeal (No. 209/81) of the appellants was dismissed as it could not be
pressed in view of the decision of the Bombay High Court, as aforesaid. It
is against this judgment, this appeal has been preferrc:d by the appellants.
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At the outset, learned counsel appearing for the respondents made
a preliminary objection that this appeal is not maintainable since the appeal
in the High Court was dismissed as not pressed. We have no difficulty in
holding that this preliminary objection of the respondents has no merit. We
find that the High Court had rejected the appeal with the following D
observation :
"As regards the other appeal bearing No. 209 of 1981, Mr.
Chaphkar, the learned counsel for the appellants, has urged that
in view of (Full Bench) decision of this Court, he does not press E
the appeal as the same does not survive."
(Full Bench was wrongly recorded for
the Division Bench)
This only reveals that since the question of deduction as aforesaid
F
being covered by the earlier decision of the same court, he could not press
the point in that appeal in that court. It is for this reason the appellants
challenge this point before us for our consideration.
In this case, we are not concerned with the question of compensation G
assessed under the Motor Vehicles Act as the same is not under challenge
before us. This became final, as the cross objections filed by respondent
No. 2 were dismissed by the High Court which challenged the fixation of
the quantum of compensation against which no appeal was preferred by
the respondents. This leaves us to the only question for adjudication, as
aforesaid, whether out pf the compensation amount payable to the appelH
692
SUPREME COURT REPORTS [1998) SUPP. 1 S.C.R.
A !ants under the Motor Vehicles Act 1939, the money received by the
appellants on account of life insurance policy of the deceased, is deductible
or not which has been done in the present case through the impugned
order?
Adverting to the said Bombay High Court decision in the case of
B Jaikumar (supra), we find that it refers to the two sets of decisions of the
various High Courts in India. One set, holding that life insurance money
received by the heirs ought to be deducted and the other set, holding not
to deduct from the compensation payable under the aforesaid Act. The
case of Jaikumar (supra), which is the foundation of the present appellants
C being deprived of the total compensation, the contention therein was,
amount received towards life insurance policy is the pecuniary advantage
received by the claimants by the reason of the death hence liable to be
deducted in terms of the ratio in the case of Gobald Motor case AIR (1962)
S.C. 1. Jaikumar (supra) holds :
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" .... Judicial opinion is also sharply divided on the question
whether life policy amount can be said to have come to the
claimants by reason of the death of the deceased to justify its ·
deduction from the amount of compensation payable to the
claimants towards their pecuniary loss. Our attention was drawn
by Mr. Zaveri the learned advocate for the respondents, to a few
judgments of the High Court of Gujarat in LIC of India v.
Naranbhai Munjabhai, (1973) ACC CJ 226 : AIR (1973) Guj. 216,
High Court of Punjab and Haryana in Sood and Company v. Surjit
Kaur, (1973) ACC CJ 414, as also Delhi High Court in Bhagwanti
Devi v. !sh Kumm; (1975) ACC CJ 56 and several other judgments
of same High Courts, which do support his contention that
amounts so received are not liable to be deducted as the same
cannot be said to have come to the claimants by reason of the
·death of the deceased. Mr. Dwivedee, on the other hand, drew our
attention to the judgments reported in Union of India v. S. Ghosh,
AIR (1973) Pat. 129; Sushi/a Devi v. Ibrahim, AIR (1974) Madh
Pra 181; Sabita Pati v. Rameshwar Singh, (1973) ACC CJ 319
(Orissa High Court) and Automobiles Transport v. Dewalal, AIR
(1977) Raj. 121 and a few other judgments of the same courts
taking the contrary view. We may at once observe that Patna High
Court supports deduction only of such policy amounts as are
( ' .
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MRS. HELEN AND ORS. v. MAHARASHTRA SRTCAND ANR. [MISRA, J.] 693
subscribed to meet accident contingency and not other policy A
amounts. It rather supports Mr. Zaveri's contention and not that
of Mr. Dwivedee, Mr. Zaveri also drew our attention to some other
judgments of Delhi High Court, including in the case of Orissa
Road Transport Co. Ltd. v. Sibananda Pattanaik, (1976) ACC 0
497 : AIR (1976) Orissa W5 which justify deduction only of a
portion and not of the entire policy amounts."
After recording the divergent opinions by the various High Co.urts in
India, the said decision itself records the state of uncertainty in the following terms :
"The answer turns really on whether such policy amount can
be said to be 'pecuniary advantage' that come to the claimants 'by
reason of the death of the deceased'? That such amounts amount
B
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to pecuniary advantage admits of little doubt. Controversy really D
centres round if it comes to the' dependants 'by reason of death'.
Reading of the decided cases only go to show how this very
question can arise under variety of circumstances, giving rise to
different considerations, pregnant with equally different legal implication, and it is by no means easy to lay down any inflexible rule
E
as to which pecuniary benefit can be said to have been received
'by reason of the death.' It is pertinent to note that in the absence
of any provision t.o the contrary such policy amount form part of
the estate of the deceased and come to his heirs or dependants by
way of inheritance, it is sought to be disposed of by deceased
otherwise. Nominee mentioned therein is not necessarily the
F
beneficiary but invariable happens to be merely an authorised
collector thereof for the benefit of all heirs. We are unable to see
ariy ~ifference between this amount, and any other income yieldi~g
estate. That comes to the dependants either by way of inheritance -
!
or pursuant to any will or settlement. The causal connection G
between receipt of such amounts, and death is too apparent and
both really stand on the same footing legally. Donations by the
charitable trusts, or provisions for such dependants by some public
spirite.d institutions, or gifts or contributions by relatives or sympathisers, of course stand on different foo.ting and are clearly H
A
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694
SUPREME COURT REPORTS (1998) SUPP. 1 S.C.R.
distinguishable and can never be treated as advantages or benefits
or having received by reason of the death of the bread winner,
though the death may furnish an occasion for such receipts. We
are ourselves unable to see how and why the policy amount or
other amounts from income yielding assets, such as bank balances
or interests thereon, or on fixed deposits, or dividends from shares
and securities, left or settled by the deceased on the dependants,
cannot be said to have come to the claimants by 'reason of the
death' of the deceased and why it should not be balanced against
the pecuniary losses caused by the death of the bread winner in
terms of Gobald Motor's case (AIR 1962) SC 1 (supra). The
Supreme Court has been at pains in the above quoted passage to
indicate how source of such pecuniary advantage is irrelevant by
words 'from whatever sources'. It should not be forgotten that these
essentially are compensatory and not punitive· damages."
D
It records from the decided cases that there may arise variety of
circumstances giving rise to different consideration and it is by no means
easy to lay down any inflexible rule. In fact, answer to the question raised
in this appeal would mainly depend on defining this 'pecuniary benefit' in
the context of the law under the Motor Vehicles Act with its preceding
E historical facts. The state of fluidity shows writ at large when the court
records while considering the 'pecuniary benefit' by further circumscribing
its periphery which is evident from the follmving :
F
G
" .... It is nobody's case that it was an accident policy entitling
the claimants to such amount, on the death of the deceased only
in such an accident, and the amount could not have been received
by them, had the death been due to otherwise than such an
accident. We express no opinion if this could have made any
difference as there is no unanimity in the decided cases as to the
liability of even such amounts to deduction from compensation."
Leaving this state of affairs so far as Indian courts are concerned,
·f
we may now advert to the courts in England, right from the 19th century
on this issue. It seems that they have also been oscillating with different
interpretations under various facts and circumstances. T~e uncertainty
H went for a long time which was ultimately resolved by making legislation
MRS. HELEN AND ORS. v. MAHARASHTRA SRTCAND ANR. (MISRA, J.) 695
and the statutory amendments to set at rest this question. Now, this A
question is no more res integra there and is settled that life insurance policy
amount is not deductible from the compensation assessed on account of
the death of the deceased. As aforesaid, before this, even in England, this
question, as in Indian courts, varied its interpretation depending on the
facts of each case, one set by strict interpretation deciding against the B
claimant while other based on equity, justice, reasonableness and public.
policy deciding in favour of claimant. In England, the insurance policy ·
amount was initially considered to be such pecuniary advantage, coming to
the dependants on the deceased death, which was held deductible under
the common law from the amount of compensation payable under the Fatal
Accidents Act, 1846. This situation was reversed by the Fatal Accidents C
(Damages) Act of 1908 which was further rendered advantageous to the
claimants by Law Reforms (Personal Injuries) Act of 1948 and finally
altered drastically by the Fatal Accidents Act of 1959 ensuring various
kinds of insurance and pensionary benefits not to be excluded from the
compensation payable by the tortfeasors. In India, first such legislation was D
the Fatal Accidents Act 1855 analogous to English, Fatal Accident Act,
1846. In fact, the interpretation given by the Bombay High Court in
Jaikwnar (supra), which is also the submission by the learned counsel for
the respondents that principle of deduction with reference to the Fatal
Accidents Act, 1855 has to be the same as in the Fatal Accidents Act, 1846.
Thus, Jai Kumar (supra) concludes, it is difficult to find any basis or trace E
for any rationale not to deduct such life policy amounts when on the face
of it, this amounts to the pecuniary advantages and are received by the
heirs by reason of the death of the bread winner. The question that arises,
firstly, whether language of the provisions under 1855 Act and 1846 Act
are the same and even if same, whether language of 1939 Act is similar to
F
1855 Act? So far as the first question is concerned, though something may
be said but since the present case is only under 1939 Act, it is not necessary
to go into this question. In this case, we would be examining, whether
there is difference of language between 1855 Act and 1939 Act or not,
if yes, what difference it would make. Now, we refer to the relevant
provisions both of 1855 Act and 1939 Act. Relevant section of the Fatal G
Accidents Act, 1855 is quoted hereunder :
"(lA) Suit for compensation to the family of a person for loss
occasioned to it by his death by actionable wrong. Whenever the
death of a person shall be caused by wrongful act, neglect, or H
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SUPREME COURT REPORTS [1998] SUPP. 1 S.C.R.
default, and the act, neglect or default is such as would (if death
had not ensued) have entitled the party injured to maintain an
action and recover damages in respect thereof, the party who
would have been liable if death had not ensued, shall be liable to
an action or suit for damages, notwithstanding the death of the
person injured, and although the death shall have been caused
under such circumstances as amount in law to felony or other
crune.
And in every such action, the court may give such damages as
it may think proportioned to the loss resulting from such death to
the parties respectively, for whom and for whose benefit such
action shall be brought, and the amount so recovered, after deducting all costs and expenses, including the costs not recovered from
the defendants, shall be divided amongst the before-mentioned
parties, or any of them, in such shares as the court by its judgment
or decree shall direct."
Similarly Section 110-B of the aforesaid 1939 Act is quoted
hereunder.
110-B Award of the claims Tribunal - On receipt of an application for compensation made under Section 110-A the Claims
Tribunal shall, after giving the parties an opportunity of being
heard, hold an inquiry into the claim and may make an award
determining the amount of compensation which appears to it to be
just and specifying the person or persons to whom compensation
shall be paid; and in making the award the Claims Tribunal shall
specify the amount which shall be paid by the insurer (or owner
or driver of the vehicle involved in the accident or by all or any of
them, as the case may be}."
(Emphasis supplied)
Prima f acie we find that the language of the aforesaid two enactments
are not similar, the later clearly enlarges the scope of computing the
compensatio~ about which we shall be considering later.
H
Returning to the English decision :
-~
•f
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MRS. HELEN AND ORS. v. MAHARASHTRA SRTC AND ANR. [ MISRA, J.] 697
In Bradum v. Great Westem Rail Co., (1874-80) All England Law A
Reports 195, it held :
"Where a plaintiff suffers personal injuries through the
negligence of the defendant, the damages awarded are not to be
reduced because the plaintiff has insured himself against accidental
injury. In such a case the plaintiff is entitled to receive the amount
payable by the insurer in addition to the damages recoverable from
the defendant."
·
In this case, the plaintiff got himself insured against accident by
railway in the railway accident insurance office and on account of the injury
received, he received for his treatment from insurance a sum of 31 pounds.
The jury found a verdict for the plaintiff and assessed the total damage
sustained on account of the accident at 217 pounds, out of which an amount
of 31 pounds was deducted, thus making.the payment of 186 pounds. But
the Court on these facts held :
"Because he has sustained these damages somebody else gave
him 31 pounds, and therefore, it is said he has not been damaged
to the amount of 217 pounds. It is because he has been damaged
to the amount of 217 pounds that he got the 31 pounds; and really
B
c
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it would be the most unreasonable think in the world if he were E
not to be allowed to get it, because a man pays his premiums on
these insurances against accidents with the intention and object of
getting them back again, if he should have the misfortune to meet
with an accident and be injured." ·
In this decision, another earlier decision is also referred, which may
have some relevance, is quoted hereunder :
"It is not worth while to go into it, but the subject of insurances
will be found to have been thoroughly discussed a few years ago
F
in Dalby v. India and London Life Assurance Co., (1854) 15 C.B. G
365 in the Court of Common Pleas. A man pays the premiums
upon these accident policies upon this kind of footing, namely, that
his right to an indemnity in case of an accident shall be an·
equivalent for the mischief or injury that happens to him. He gets
more, no doubt, if the mischief happens than all the premiums H
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SUPREME COURT REPORTS [1998) SUPP. 1 S.C.R.
which he h.as paid would amount to, but he mns the chance that
he will not get anything at all, and therefore it is, I say, that he
ought to have this sum in addition to the damages that he may
have sustained at the hands of the defendants by reason of the
accident itself, for otherwise he would be a loser by insuring against
accidents in a case where the railway company was in the wrong.
I am, therefore, clearly of opinion that the verdict stands at present
for the right amount."
The Grand Tmnk Railway of Canada v. Jennings, (1888) 13 A.C. 800,
held that the Common law, pecuniary benefits from insurance policies,
C whatever the source, and pension schemes whether contributory or noncontributory, were deducted. The various English Courts' decisions reveal
the unsettled state of adjudication regarding the deductions from the
compensation payable under the Fatal Accidents Act, 1846. Various divergent opinions were expressed, some favourable to the claimant to exclude
D
any sum payable on life insurance or pensions from deduction out of the
compensation payable to the claimant and other not to deduct till, as
aforesaid, the matter was set at rest by various legislations culminating into
the Fatal Accidents Act, 1959. Till before this, within the limitation of the
restrictive language of the Act and in the absence of any motivating and
E guiding words under the statute the general principles under the common
law was applied to ascertain the pecuniary loss and gain. Thus, the
'pecuniary advantage' from whatever source comes to the claimant by
reason of the death, was interpreted giving its widest meaning. This
amplitude of large sphere has been the cause of concern of the Courts,
F
Legislative and the Jurists with reference to the insurance, pension, gratuity
etc. whether it is a pecuniary gain deductible, if it is, whether one's
conscience, equity and fairness are eroded, specially if it is applied with
reference to the provisions of Motor Vehicles Act? To salvage from this
onslaught, some decisions declined to interpret for deduction and some
other, even after holding deductible, expressed their conscience in favour
G of the sufferer. This we find both in the English decisions and the Indian
decisions.
In Parry v. Cleaver, (1969) Vol. 1 All England Law Reports p. 555
records uncertainty in England, which is evident from the following
H words:
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MRS. HELEN AND ORS. v. MAHARASITTRA SRTC AND ANR [MISRA, J.] 699
~
"My Lords, the facts of this case are of a pattern becoming A
increasingly common. The appellant was in pensionable employment. By the, negligent driving of the respondent he was disabled
from continuing in that employment. So he received a disablement
pension. How are damages for his financial loss to be assessed?
In particular how is the disablement pension to be dealt with? The
authorities are not consistent with each other, so I find it necessary
to begin by considering general principles."
Two questions were raised for the adjudication, first what did the
appellant lose as a result of the accident? What are the sums which he or
B
his dependants would have received but for the accident but which, by C
reason of the accident, he or his dependants can no longer get? And
second, what :ire the sums which he or his dependants did in fact receive
as a result of the accident but which he or his dependants would not have
received if there had been no accident?
D
The Court while dealing with the second point also felt the same
difficulty, to which we are in, which is recorded hereunder ;-
"None of the noble and learned Lords who took part gave it
more than a passing reference, and I am satisfie,9 that none of
them intended to go out of their way to pronounce on it. Before
E
Gourley's case (1955) 3 All E.R. 796 it was well established that
there was no universal rule with regard to sums which came to the
plaintiff as a result of the accident but which would not have come
to him but for the accident. In two large classes of case such sums
were disregarded - the proceeds of insurance and sums coming to
F
him by reason of benevolence. In Gourley's case (i.e. The Fatal
Accidents Act, 1846) had any bearing on this matter it must have
impinged on these classes. But no one suggest that it had any effect
as regards sums coming to the plaintiff by reason of benevolence,
and I see no reason why it should have made any difference as
regards insurance."
·
G
It further records ;
"The common law has treated this matter as one depending on
justice, reasonableness and public policy.
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SUPREME COURT REPORTS (1998) SUPP. 1 S.C.R.
xxx
xxx
xxx
As regards moneys comings to the plaintiff under a contract of
insurance, I think that the real and substantial reason for disregarding them is that the plaintiff has bought them and that it would be
unjust and unreasonable to hold that the money which he prudently
spent on premiums and the benefits from it should enure to the
benefit of the tortfeasor. Here again I think that the explanation
that this is too remote is artificial and unreal. Why should the
plaintiff be left worse off than if he had never insured? In that case
he would have got the benefit of the premium money, if he had
not spent it he would have had it in his possession at the time of
the accident grossed up at compound interest."
It is true that the aforesaid two English decisions were cases of
injuries, but the principle as spelt out is equally applicable in cases of
D death. The EJiglish Court held that for any money coming under the
contract of insurance, it would be unjust and unreasonable to hold that the
money which he prudently spent on premiums, the benefit from it should
enure to the benefit of the tortfeasor. To this, we fully endorse. Under the
life insurance, in case one lives upto the time of maturity, after paying full
premium he receives the assured money back, based on the terms of the
E contract. In fact, he receives less than the total premium paid. It is for this
gain to the insurer it is obliged to pay to the extent the sum assured, to the
claimant in case of injury or death under the contract. In other words,
payable only on the contingency as referred, if the contingency of injury or
death does not happen, the insurer is the gainer as it receives more under
F premium than to pay on maturity of the policy, and in case contingency
occurs the claimant is the gainer as he receives the amount even before
paying the full prel)liums and the gain is to the proportion of the balance
unpaid premium, whether it is injury or death. A Large number of persons,
under the policy may live upto the maturity of policy by paying full
premium and the contingency of injury or death may not happen.