In a bid to streamline the disbursement of compensation in motor accident claims, the Supreme Court has directed High Courts and Tribunals to ensure that awarded amounts are directly transferred to claimants’ bank accounts, eliminating procedural delays and inefficiencies.
A bench comprising Justice JK Maheshwari and Justice Rajesh Bindal underscored the need for this reform, stating that claimants should submit their bank details at the outset of the claim process. This would allow tribunals to mandate direct transfers once awards are granted. The Court also emphasized that minors and cases requiring fixed deposits should be managed by banks under tribunal supervision.
The current practice requires insurance companies to deposit compensation with tribunals, after which claimants must file withdrawal applications. This process is not only time-consuming but also carries the risk of administrative lapses and delays in interest accrual. The Supreme Court asserted that direct bank transfers would expedite payments and ensure efficient handling of compensation.
The ruling directs all High Courts and Tribunals to adopt this practice and mandates that the order be circulated through judicial academies and High Court Registrars General. The decision came while adjudicating an appeal for enhanced compensation concerning a claimant who suffered 100% disability from a 2006 accident at the age of 21.
By enforcing direct transfers, the Supreme Court aims to protect claimants from bureaucratic hurdles, ensuring they receive timely financial relief without unnecessary procedural obstacles.