Smt. Suraj Kaur and Sh. Kanwar Pal Singh and Sh. Sandeep V. Suresh Kumar and Smt. Laduri and IFFCO Tokyo General Insurance Company Ltd.

CMA/324/2020

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The case involves an appeal by the claimants, Smt. Suraj Kaur and her sons, against the judgment of the Motor Accident Claims Tribunal, which awarded them additional compensation following the death of their family member, Sultan Singh, in a vehicular accident. The Tribunal had directed the Insurance Company to deduct TDS from the compensation amount and deposit it with the Income Tax Department. The claimants contested this direction, arguing that they should receive the full amount and handle the tax themselves. The Insurance Company supported the Tribunal's decision, citing legal provisions that require TDS on taxable compensation amounts. The High Court's decision affirmed the Tribunal's judgment, including the TDS deduction and the interest rate applied to the compensation.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 836842 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 12-02-2026
• Assessment Year: misc
• Other Referred Cases: Oriental Insurance Company Limited Vs. Smt. Zarina and Ors., United India Insurance Company Limited Vs. Mitaben Dharmeshbhai Shah and Ors.
• Laws Referred To: Motor Vehicle Act, 1988, Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: VIRENDRA AGARWAL; ANJALI ASSAT; AMIT AGARWAL
• Assessee Lawyers: ATUL SHARMA; NEELAM CHOUDHARY
• Keywords: Compensation; Motor Accident Claims Tribunal; Negligent driving; Rash Driving; TDS Deduction
• Section: 166; 194A(3)(ix); 193A(3)(ix)

Judgement Text

"[2026:RJ-JP:6718] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR S.B. Civil Miscellaneous Appeal No. 324/2020 1. Smt. Suraj Kaur W/o Late Sh. Sultan Singh, aged about 56 Years, R/o Chirunim, Teh. Mundawar, Dist. Alwar (Raj) 2. Sh. Kanwar Pal Singh S/o Late Sh. Sultan Singh, aged about 31 Years, R/o Chirunim, Teh. Mundawar, Dist. Alwar (Raj) 3. Sh. Sandeep S/o Late Sh. Sultan Singh, aged about 27 Years, R/o Chirunim, Teh. Mundawar, Dist. Alwar (Raj) ----Appellants Versus 1. Suresh Kumar S/o Kamal Singh, R/o Chelawas, P.S. Kanina, Dist. Mahendragarh (Haryana) (Driver Of Vehicle No. HR 55 F 7572) 2. Smt. Laduri W/o Leela Ram, R/o Rathiwas, Distt. Gurgaon, At Present R/o Near Govt. Plot Rajpura, Dharuheda, Dist. Rewari (Haryana) (Owner of Vehicle No. HR 55 F 7572) 3. IFFCO Tokyo General Insurance Company Ltd., Office At IFFCO Tokyo Tower, Plot No. 3, Sector 29, Gurgaon (Haryana) Through Its Regional Manager (Insurer of Vehicle No. HR 55 F 7572) ----Respondents For Appellant(s) : Mr. Atul Sharma with Ms. Neelam Choudhary For Respondent(s) : Mr. Virendra Agarwal with Ms. Anjali Assat Mr. Amit Agarwal JUSTICE ANOOP KUMAR DHAND Order 12/02/2026 1. By way of filing the instant appeal, a challenge has been led to the impugned judgment and award dated 11.04.2019 passed by the Motor Accident Claims Tribunal, Kishangarhbas Alwar (for Printed from counselvise.com [2026:RJ-JP:6718] (2 of 6) [CMA-324/2020] short, ‘the Tribunal’) in MAC Case No. 196/2008 by which the additional enhanced compensation of Rs. 3,01,178/- has been awarded to the claimants – appellants (for short, ‘the claimants’) and a direction has been issued for deduction of TDS amounting to Rs.1,90,150/- from the additional enhanced compensation and a further direction has been issued to the respondent-Insurance Company to deposit the aforesaid TDS amount with the Income Tax Department. 2. Feeling aggrieved and dissatisfied by the aforesaid directions issued by the Tribunal, the claimants have approached this Court seeking appropriate directions. 3. Counsel for the claimants submits that on 19.10.2007 the deceased Sultan Singh was travelling to his duty point in a tempo bearing No. HR-55-F-7572 but the driver of the said tempo drove the vehicle in a rash and negligent manner due to which the deceased sustained several heinous injuries and died during treatment on the same day. Counsel submits that a claim petition under Section 166 of the Motor Vehicle Act, 1988 (for short, ‘the Act of 1988’) was submitted before the Tribunal seeking compensation and the said claim petition was partly allowed vide judgment and award dated 17.02.2012 and a direction was issued to the respondent-Insurance Company to pay compensation of Rs.16,70,432/- to the claimants. 4. Aggrieved by the aforesaid judgment and award, the claimants approached this Court by way of filing Civil Misc. Appeal No. 2074/2012 and in the said appeal the matter was remitted to Printed from counselvise.com [2026:RJ-JP:6718] (3 of 6) [CMA-324/2020] the Tribunal and thereafter, the Tribunal has decided the claim petition afresh vide impugned judgment dated 11.04.2019 and an additional amount of Rs. 3,01,178/- has been awarded to the claimants and a further direction has been issued to the respondent-Insurance Company to deduct a sum of Rs. 1,90,150/- as TDS and deposit the same with the Income Tax Department while the rest of the amount has been ordered to be paid to the claimants along with interest @ 6% p.a. Counsel submits that the aforesaid direction should not have been issued and if at all, the Tribunal was of the view that certain TDS is required to be deposited at the instance of the claimants with the Income Tax Department, then this amount should have been given to the claimants. Counsel submits that the claimants could have deposited this amount with the Income Tax Department through PAN Card, hence under these circumstances, interference of this Court is warranted. 5. He further argued that the claimants are entitled to get interest on the full additional amount i.e. 3,01,178/- and not only on the remaining amount after deduction of TDS. Lastly, he argued that when the earlier award was passed, the Tribunal has granted interest @ 9% p.a. but this time, the Tribunal has granted interest @6% p.a only. Hence under these circumstances, the rate of interest is liable to be enhanced by this Court. 6. Per contra, counsel for the respondent-Insurance Company oppose the arguments raised by counsel for the claimants and submits that it is settled proposition of law that whenever any amount of compensation is awarded and the same is taxable then Printed from counselvise.com [2026:RJ-JP:6718] (4 of 6) [CMA-324/2020] under such circumstances, the Insurance Company is required to deposit the TDS of such taxable amount with the Income Tax Department in terms of Section 194A(3)(ix) of the Income Tax Act, 1961. This view has been settled by the Co-ordinate Bench of this Court in the case of Oriental Insurance Company Limited Vs. Smt. Zarina and Ors. while deciding S.B. Civil Misc. Appeal No. 9773/2006 on 06.03.2014. Counsel submits that under these circumstances, the Tribunal has not committed any error in passing the impugned judgment and award dated 11.04.2019, hence, interference of this Court is not warranted. 7. Lastly, he argued that once compliance of the earlier judgment and award of the Tribunal was done by the Insurance Company within the stipulated time, then under such circumstances, the rate of interest @ 6% p.a. decided by the Tribunal was justified while passing the subsequent award dated 11.04.2019. 8. Heard and considered the submissions made at bar and perused the material available on record. 9. The issue involved in this appeal is set at rest by the Co- ordinate Bench of this Court in the case of Smt. Zarina (Supra) after following the judgment passed by the Gujrat High Court in the case of United India Insurance Company Limited Vs. Mitaben Dharmeshbhai Shah and Ors. reported in 2004 ACJ 1996, and it has taken the view that the Insurance Company is liable to deduct the amount of TDS on the amount of interest. The Insurance Company is under an obligation to comply with the statutory provisions of law while making payment of such amount Printed from counselvise.com [2026:RJ-JP:6718] (5 of 6) [CMA-324/2020] which is taxable in the hands of the claimants as per Section 193A(3)(ix) of the Income Tax Act, 1961 and the liability of depositing this amount with the Income Tax Department has been fastened upon the Insurance Company. The claimants after obtaining certificate under Form 16A of the Income Tax Act can pray for refund, in case he does not have any income or his income is not adequate to be taxable and in case, the claimant has any taxable income, then the same needs to be accounted for in accordance with the provisions of the Income Tax Act. 10. In the considered opinion of this Court, the Tribunal has not committed any error in passing such directions to the Insurance Company to deposit a sum of Rs. 1,90,150/- with the Income Tax Department as TDS and in case, the claimants feel that they do not have any taxable income then they can approach the Income Tax Department for claiming the refund of the same as per the provisions of the Income Tax Act. 11. Now, this Court proceeds to deal with the arguments raised by counsel for the claimants. This Court finds substance in the arguments raised by counsel for the claimants that the claimants are entitled to get interest upon the entire additional amount of compensation as awarded by the Tribunal i.e. Rs. 3,01,178/- from the date of passing of the award i.e. 11.04.2019. This Court finds no substance in the arguments raised by counsel for the claimants that they are entitled to get interest @ 9 % p.a. It is at the discretion of the Tribunal to grant interest to the claimants or not. The claimants cannot claim any particular rate of interest as a matter of right. Printed from counselvise.com [2026:RJ-JP:6718] (6 of 6) [CMA-324/2020] 12. With the aforesaid observations and directions, the present appeal stands disposed of. Stay application and all pending application(s), if any, also stand disposed of. (ANOOP KUMAR DHAND),J Ashu/19 Printed from counselvise.com "