Case BriefsHigh Courts

Allahabad High Court: Dr Kaushal Jyendra Thaker, J., decided an appeal with regard to the claim petition being filed beyond 6 months and the same being dismissed by the Motor Accident Claims Tribunal on the said ground in light of Section 166(3) of the Motor Vehicles Act as amended in 2019.

The instant appeal was filed at the behest of claimants whose claim petition came to be dismissed by the Motor Accident Claims Tribunal holding it barred by limitation as the accident took place on 24-12-2019 and the petition was filed on 20-08-2010 (sic).

The claim petition by MACT was dismissed on the ground of filing of the same beyond 6 months of the date when the accident took place.

The above-stated claim was barred under provisions of Section 166 (3) of the Motor Vehicle Act as amended in 2019.

It has been contended in the present appeal that the Tribunal mechanically held that amended Section 166 (3) of the MV Act subscribes a period of 6 months for filing claim petition and hence the matter could not be entertained.

Appellants counsel submitted that question of law is involved in the present appeal and hence contended that the order of the Tribunal was passed against the settled principle of law.

Further, it was submitted that the instant matter could be viewed from three angles:

Extension of Limitation Period

  • The accident took place in December 2019, even if the assumption made by the Tribunal that Section 166 (3) had been notified and is made applicable is considered, six months’ period would be over during the pandemic. But the pandemic struck us in the month of March, 2020 and the Supreme Court by an omnibus order extended the period of limitation. This aspect should have also been looked into by the Judge. Various orders in reference to the extension of limitation were passed in light of the lockdown.

Therefore it appears that the order passed by the tribunal was done in sheer haste.

No Limitation Period

  • Another aspect to be appreciated was, even if the provisions of Section 166(3) of the MV Act, 2019 were brought on the statute book, Judge could have seen the matter from a different angle that there is substitution of Section 163A with Section 164, where no period of limitation has been prescribed.

Evaluation of the Gazette of India with regard to Amendment Act 2019

  • The third Aspect was that though Section 166(3) of the MV Act was notified but what exactly is the current position of the said provision.

Concluding the instant matter, Bench noted that the provisions under Section 140 of the Principal Act which speaks about the liability of the Owner and/or Insurer to pay compensation in certain cases on the principle of no-fault, Section 163-A of the Principal Act which provides for the special provisions as to payment of compensation based on a structured formula and under Section 166 of the Principal Act which states that legal representative/s can continue to prefer any of the application mentioned hereinabove for compensation as Sections 140, 163-A and 166 of the Principal Act would continue to operate with full vigor till the time Section 51 to 57 of the Amendment Act are notified in the Official Gazette.

Court enquired from the State Law Officer, Mr Ojha in regard to the position of Section 166(3) of the MV Act and he stated that the same has not been brought on the statute book. Section 166 of the 1998 Act would still govern the litigation as of today.

Hence, High Court held that the alternatives were available for MACT, yet it passed the order in sheer haste of disposal while losing sight of the aspects stated above.

Bench directed Virjendra Kumar Singh, Presiding Officer, MACT to remain more vigilant in future while deciding the claim petition under beneficial legislation.

Judgment/Order passed by the Tribunal was quashed and set aside by the Court and the claim petition has been asked to restore. Further, the Court directed the Tribunal to proceed as per Section 166 read with Section 168 of the MV Act as till date amended section dealing with Chapter X, XI, XII of the Act have not been brought on statute book substituting the earlier provision. [Shailendra Tripathi v. Dharmendra Yadav, 2020 SCC OnLine All 1360, decided on 20-11-2020]


Counsels for the Parties:

Appellant: Yogesh Kumar Tripathi, Sanjay Kumar Singh

Respondent: Rahul Sahai

Case BriefsHigh Courts

Madras High Court: S.M. Subramaniam, J., while addressing a motor accident claim, observed that,

Once, the policy is contractual in nature and the parties have signed the agreement, then such a contract cannot be construed or brought within the ambit of statutory liability.

The Cholamandalam MS General Insurance Company Limited is the appellant. Respondent/Owner of Tata Indica Tourist Taxi TN-32-L-8595 dashed against the palm tree on the roadside due to unavoidable reasons, causing road traffic accident.

Respondent filed the claim petition under Section 163 of the Motor Vehicles Act seeking compensation of Rs 2,00,000 from the Insurance Company.

The Claim Petition was filed only against the appellant/Insurance company as the respondent car was insured with the appellant/Insurance company.

Appellant though defended the claim petition on the ground that the respondent was not some third party infcat he was the owner of the vehicle, therefore no statutory coverage in terms of Section 147(1) of the Motor Vehicles Act, 1988 can be granted.

The Claim Petition was filed under Section 166 of the Motor Vehicles Act. However, the Tribunal has referred the Claim Petition as if it was filed under Section 163A of the Motor Vehicles Act. However, misquoting of the provision could not disentitle the claimant from availing the rights.

Tribunal directed the Insurance Company to pay the compensation to the respondent.

Bench on perusal of the facts and circumstances of the present matter, stated that in the absence of any statutory liability on the part of the Insurance company, the provisions of the Motor Vehicles Act cannot be invoked nor an adjudication can be done before the Tribunal.

The very purpose and object of the Motor Accident Claims Tribunal are to adjudicate the Claim Petitions and grant ‘just compensation’ with reference to the provisions of the Motor Vehicles Act.

If a particular Personal Accident Policy is contractual in nature, then statutory liability cannot be fixed on the Insurance company.

Contractual liability cannot be equated with statutory liability.

Owner’s Package Policy with reference to the Personal Accident Cover for owner-cum driver is contractual in nature. There is no third party involvement with reference to the Personal Accident Cover.

Tribunal granted compensation beyond the agreed contract between the parties to the Personal Accident Cover.

The Tribunal is bound to see the nature of the insurance policy as well as the coverage with reference to the terms and conditions stipulated, which were agreed between the parties.

Court added that in the vent of no coverage under the policy, the insurance company cannot be held liable to pay compensation.

No person is entitled to claim any benefit beyond the scope of the terms and conditions agreed between the parties.

MV Act being a Special Legislation and the Motor Accident Claims Tribunal constituted to deal with the Accident Claims specifically under the provisions of the Motor Vehicles Act, the tribunal has no jurisdiction to deal with all other policies issued by the Insurance Company, which all are contractual in nature and the terms and conditions agreed between the parties specifically.

Insurance Policy

Motor Vehicle policies are issued by the Insurance company for the purpose of grant of compensation and the language employed is “Compensation”. However, the Personal Accident Coverage Policy reveals that it is “benefit” is to be granted.

Motor Accident Policies are strictly within the ambit of the provisions of the Motor Vehicles Act. The Personal Accident Coverage Policy is strictly in accordance with the terms and conditions agreed between the parties.

Court also added that the tribunals are bound to look into the nature of the Policy at the first instance, before entertaining the Claim Petition as the tribunal cannot adjudicate the terms and conditions agreed between the parties in a contract and grant compensation under the Motor Vehicles Act.

In the present case, the Personal Accident Coverage Policy has been agreed between the insurance company and respondent under the Personal Accident Coverage Policy of amount Rs 2,00,000.

For availing the benefit of the Personal Accident Coverage Policy, the respondent/claimant has to establish the nature of the ‘disablement’ and the same is to be established before the competent Court of law and the Motor Accident Claims Tribunal is not empowered to entertain the Claim Petition under the Motor Vehicles Act.

Hence if the Insurance Company has deposited any award amount before the Tribunal, then they can withdraw the said amount with accrued interest.[Cholamandalam MS General v. Ramesh Babu, 2020 SCC OnLine Mad 2164, decided on 02-09-2020]

Case BriefsSupreme Court

Supreme Court: When a practicing advocate, had suffered in nasty accident at the young age of 18 years, in which his entire left leg was crushed, approached the Court with the plea seeking reform in the Motor Vehicle Accident Claims system, the bench of Dr. AK Sikri and SA Nazeer, JJ asked the Government to consider the feasibility of enacting Indian Mediation Act to take care of various aspects of mediation in general.

The Court also issued the following directions:

  1. The Government may examine the feasibility of setting up Motor Accidents Mediation Authority (MAMA) by making necessary amendments in the Motor Vehicles Act.
  2. In the interregnum, NALSA is directed to set up Motor Accident Mediation Cell which can function independently under the aegis of NALSA or can be handed over to MCPC. Such a project should be prepared within a period of two months and it should start functioning immediately thereafter at various levels as suggested in this judgment. We reiterate the directions contained in order dated November 6, 2017 in Jai Prakash case for implementation of the latest Modified Claims Tribunal Agreed Procedure. For ensuring such implementation, NALSA is directed to take up the same in coordination and cooperation with various High Courts. MACAD Scheme shall be implemented by all Claim Tribunals on All India basis. Banks, Members of Indian Banks Assocation, who had taken decision to implement MACAD Scheme would do the same on All India basis.
  3. The Government should look into the feasibility of framing necessary schemes and for the availability of annuity certificates. This exercise may be done within the period of six months and decision be taken thereupon.
  4. There should be programmes from time to time, in all State Judicial Academies, to sensitizing the Presiding Officers of the Claims Tribunals, Senior Police Officers of the State Police as well as Insurance Company for the implementation of the said Procedure.

The appellant had prayed for:

  • On-road safety and grant of adequate compensation to the victims without any delay. For ensuring expeditious settlement of claims, resort to alternate means which may include innovative measures.
  • Taking adequate steps including adopting innovative measures, to ensure fast track disposal of cases by MACTs.
  • Ensuring receipt of compensation in the safe hands of victims and/or kiths and kins of victims, that too over a sustained period.

[MR Krishna Murthi v. New India Assurance Co. Ltd., 2019 SCC OnLine SC 315, decided on 05.03.2019]