ORIENTAL INSURANCE COMPANY LTD. Vs. SATYA DEVI

JUDGEMENT

(1.) Present petition has been filed against direction passed by the Motor Accident Claims Tribunal in execution petition No. 405/6 of 2015 filed by claimants/respondents No. 1 to 4 for payment of balance amount of Rs.60,902.00 which were not paid by the petitioner/Insurance Company to the claimants/respondents but were deducted as TDS for income tax on interest payable to the claimants/respondents on compensation awarded in their favour as Motor Accident Claim and deposited with respondent No. 5 through Income Tax Officer, Ward No. 2, Mandi.

(2.) In execution petition preferred by the claimants/respondents for payment of balance amount of compensation, the Motor Accident Claims Tribunal, vide impugned order, has directed petitioner/Insurance Company to deposit the balance amount of Rs. 60,902.00 within 30 days from the date of order, failing which petitioner company has also directed to pay the interest at the rate of 9% on the said amount w.e.f. date of order till payment/deposit.

(3.) Sec. 194-A of Income Tax Act, 1961, clearly provides that any person, not being an individual or a Hindu undivided family, responsible for paying to a 'resident' any income by way of interest, other than income by way of interest on securities, shall deduct income tax on such income at the time of payment thereof in cash or by issue of cheque or by any other mode. Compensation awarded under Motor Vehicle Act cannot be said to be taxable income. Compensation is awarded in lieu of death of a person or bodily injury suffered in a vehicular accident, which is damage and not income.