Court case(2010) 2 SCC 607

The case arose from a claim for compensation for a death in a motor accident that reached the Supreme Court on appeal from the Delhi High Court. In dealing with it, the Court took note of a wider problem in the working of Motor Accidents Claims Tribunals: claimants, often illiterate widows, minors and poor families, waited years for awards, and when large sums were paid in cash they were frequently dissipated, taken by relatives or middlemen, or used up within a short time, defeating the purpose of compensation. The Court also noted the procedure developed by the Delhi High Court under which the police reported accidents to the Tribunal so that claims could be processed without delay.

The Supreme Court issued general directions to Claims Tribunals to safeguard compensation. Ordinarily only a part of the award should be released at once; the rest should be kept in fixed deposits in a nationalised bank. The share of a minor should be kept in deposit until majority, with interest paid periodically for maintenance; widows and illiterate or vulnerable claimants should receive monthly or periodic interest rather than the whole sum; the deposits should not be the subject of loans or advances, nor be withdrawn prematurely, without the Tribunal's permission; and payments should be made into the claimant's bank account rather than in cash. The Court commended the Delhi procedure for the reporting of accidents by the police and the early involvement of insurers to other States.