[MV Act] Kar HC | Will absence of valid and effective DL by the offending driver absolve insurance company to pay compensation? “Pay and Recover” principle applied

Karnataka High Court: Ashok G. Nijagannavar, J., allowed the appeal and enhanced the compensation in light of the “pay and recover” principle.

The facts of the case are such that the deceased was travelling as a Cleaner in the lorry when the driver of the said lorry drove in a rash and negligent manner and dashed against another vehicle consequent to which the deceased sustained grievous injuries and later succumbed to it. The dependents filed a petition for compensation before the Motor Accidents Claims Tribunal i.e. MACT as the deceased was the main earning member of the family and due to his untimely death, the claimants lost financial support. The MACT thereby directed to pay the compensation of Rs 5,71,000 along with interest at the rate of 6% p.a. from the date of petition till its realization. Being aggrieved by the same, the petitioner’s claimants preferred the instant appeal under Section 173(1) Motor Vehicle Act i.e. MV Act for enhancement of compensation.

Counsel for the appellants submitted that on the date of the accident the insurance policy was in force. It was further submitted that as the driver of the offending vehicle had no valid and effective DL, the insurance company is liable to pay the compensation and recover it from the owner of the offending vehicle as per “pay and recover” principle.

Counsel for the respondents submitted that as the driver had no valid and effective DL, hence the insurance company has no liability to pay the compensation.

The Court relied on judgment titled Parminder Singh v. New India Assurance Company Ltd., (2019) 7 SCC 217 and observed that as per pay and recover principle the insurance company is liable to pay compensation to the victim and later recover it from the owner of the offending vehicle.

The Court thus held that the compensation granted vide impugned order is too meagre and disproportionate and in view of the ratio laid in National Insurance Company Limited v. Pranay Sethi, (2017) 16 SCC 680, compensation was enhanced.

In view of the above, petition was allowed and disposed off.[Geetha Bhai v. Amanullah, 2020 SCC OnLine Kar 1878, decided by 21-01-2020]


Arunima Bose, Editorial Assistant has put this story together

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