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Madras High Court· 05 August 2026

Must a claim under the Motor Vehicles Act await a Larger Bench reference that does not cover claims against a third party tortfeasor?

Jayanthi v. Soundararajan
CMA.2106/2026 · 2026:MHC:3231 · CMA.No.2106 of 2026
Coram: Justice N.Anand Venkatesh
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Answer

No. The reference made to the Larger Bench does not center around cases where the claim is directed solely against an independent third party vehicle; it pertains to the general applicability of Sections 53 and 61 of the ESI Act and the bar against an employee claiming in that capacity both under the ESI Act and other similar benefits like the one under the MV Act. The reference therefore has no bearing in cases dealt with under the MV Act where the claim is made against a third party tortfeasor by the legal heirs of the deceased in his or her individual capacity, and the via-media arrangement of deduction adopted in the earlier judgment, being more in the nature of an interim arrangement, cannot be construed as a ratio decidendi.

Headnote

Employees' State Insurance Act, 1948 — s.53 — s.61 — Motor Vehicles Act, 1988 — s.166 — Bar against receiving or recovery of compensation under any other law — Employment injury — Claim against a third party tortfeasor — Deduction of ESI benefits — Employees' State Insurance Act, 1948 — s.53 — Ingredients cumulative, not disjunctive — Held: The ingredients of Section 53 are not to be read in a disjunctive manner and have to be understood cumulatively. The actual bar arises only when the claim is made by the insured person as an employee under the ESI Act. (¶19, 20) Employees' State Insurance Act, 1948 — s.53 — Claim against a third party tortfeasor — Held further: Where the accident takes place in a public place, the injury is not an employment injury and the legal heirs claim against a third party tortfeasor in the individual capacity of the deceased, the bar under Section 53 does not operate. (¶24, 27) Employees' State Insurance Act, 1948 — Benefits independent and de hors other Enactments — Held further: The benefits given under the ESI Act are independent and de hors the benefit which a person will be entitled to receive under a different Enactment in a different capacity. They cannot be deducted from the compensation determined under the MV Act. (¶23, 33) Motor Vehicles Act, 1988 — Deduction claimed by the tortfeasor and insurer — Premium on illegality — Held further: A tortfeasor and his insurer cannot seek deduction from the compensation determined under the MV Act only on the ground that benefits were availed under the ESI Act. That would amount to putting a premium on illegality. Appeal allowed and award modified. (¶28, 29, 34)

In the Court's own words
Paragraph 16The actual controversy arose by virtue of the subsequent observations made by me from paragraph 19 of the judgment in C.Alliammal while taking note of the judgment of the Hon’ble Apex Court in Rajkumar Agrawal wherein the Hon’ble Apex Court referred the matter to a Larger Bench with respect to the scope of Section 61 of the ESI Act. In view of the same, this Court directed the claimants therein to receive the compensation fixed by the Tribunal concerned after deducting the pension received by them from the ESI Corporation. This was more in the nature of an interim arrangement and that portion of the judgment cannot be construed as a ratio decidendi in that judgment.
Paragraph 26The reference made to the Larger Bench by the Hon’ble Apex Court does not center around cases where the claim is directed solely against an independent third party vehicle. The reference made to the Larger Bench pertains to the general applicability of Sections 53 & 61 of the ESI Act and the bar against an employee claiming in that capacity both under the ESI Act and other similar benefits like the one under the MV Act.
Paragraph 27In the considered view of this Court, the reference made by the Hon’ble Apex Court will not have any bearing in cases that are dealt with under the MV Act where the claim is made against a third party tortfeasor by the legal heirs of the deceased in his or her individual capacity and not in the capacity as an employee under the ESI Act.
Acts & Sections
s.53 Employees' State Insurance Act, 1948s.61 Employees' State Insurance Act, 1948s.2(8) Employees' State Insurance Act, 1948s.52 Employees' State Insurance Act, 1948s.166 Motor Vehicles Act, 1988s.167 Motor Vehicles Act, 1988s.163A Motor Vehicles Act, 1988Workmen's Compensation Act, 1923

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Also decided in this judgment
Can the amount received under the ESI Scheme be deducted from compensation awarded under the Motor Vehicles Act, 1988?
Plain-language answer prepared by the LexStreak Editorial Desk — verify against the judgment. Source: Madras High Court. Corrections