In one of its recent judgement, the Supreme Court has observed that a claim presented under Section 163A of the Motor Vehicles Act is not maintainable against the owner and insurance company of the vehicle which was being driven by the deceased himself.

The judgement came in Ramkhiladi & Anr v The United India Insurance Company & Anr.

CASE BACKGROUND

The appellants here are the legal heirs of the deceased who had filed a claim under Section 163A of the Motor Vehicles Act against the owner and insurance company of the vehicle which the deceased drove himself.

In the Tribunal Court, the case was allowed on the ground that the deceased was in the employment of the owner of the vehicle which was driven by him.

The second reason that the Court provided was that in an application under Section 163A of the Act, the negligence isn't required to be established and proved and it is enough to establish and prove that the deceased has died in a vehicular accident and while driving a vehicle.

The appellants herein filed an appeal before the Top Court against the Rajasthan High Court judgement in which it was held:

Since claimants have not filed the claim petition against the owner of another vehicle whose driver was, in fact, negligent, even as per the claimants and the claim petition should have been filed by the claimants against the owner of another vehicle to seek the compensation, the application under Section 163A of the Act against the insurance company of the vehicle driven by the deceased himself is liable to be dismissed.

The Apex Court after listening to the agruements agreed with the High Court's verdict. 

The Bench comprising of Justice Ashok Bhushan and Justice MR Shah observed on this note that the claimants (appellants herein) ought to have joined and/or ought to have made the claim under Section 163A of the Act against the driver, owner and/or the insurance company of the 24 offending vehicles.

The bench noted the judgment in Ningamma v. United India Insurance Co. Ltd. (2009) 13 SCC 710 wherein it was held that the owner of the vehicle or his legal representatives or the borrower of the vehicle cannot raise a claim under Section 163A of the Act for an accident in which there was no negligence on the part of the insured vehicle.

It stated:

It is true that, in a claim under Section 163A of the Act, there is no need for the claimants to plead or establish the negligence and/or that the death in respect of which the claim petition is sought to be established was due to wrongful act, neglect or default of the owner of the vehicle concerned. It is also true that the claim petition under Section 163A of the Act is based on the principle of no-fault liability. However, at the same time, the deceased has to be a third party and cannot maintain a claim under Section 163A of the Act against the owner/insurer of the vehicle which is borrowed by him as he will be in the shoes of the owner and he cannot maintain a claim under Section 163A of the Act against the owner and insurer of the vehicle bearing registration No. RJ 02 SA 7811. In the present case, the parties are governed by the contract of insurance and under the contract of insurance the liability of the insurance company would be qua the third party only. In the present case, as observed hereinabove, the deceased cannot be said to be a third party with respect to the insured vehicle bearing registration No. RJ 02 SA 7811.

It was held that as the claim under Section 163A of the Act was made only against the owner and insurance company of the vehicle which was being driven by the deceased himself as borrower of the vehicle from the owner of the vehicle and he would be in the shoes of the owner, it was right on behalf of the High Court to hold that such a claim was not maintainable and the claimants ought to have joined and/or ought to have made the claim under Section 163A of the Act against the driver, owner and/or the insurance company of the offending vehicle.

The judgement was delivered by Justice Ashok Bhushan and Justice MR Shah on 07-01-2020.

Read Judgement Here:

 

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