Motor Vehicles Act | If Insurance Policy Only Covers Third Party Then No Other Person Can Claim Petition Under Section 163-A: Punjab and Haryana High Court

Motor Vehicles Act

PUNJAB: In the recent matter of National Insurance Company Limited Versus Roopa and others Punjab and Haryana High Court held that if the insurance policy only covers the third party and not the owner then the owner or any other person claiming under him cannot maintain a petition under Section 163-A of the Motor Vehicles Act, 1988.

The bench headed by Justice Pankaj Jain noted that Section 146 of the MVA requires an owner to insure against third-party risk before use of the vehicle. No such mandate is stipulated with respect to the cover of the vehicle owner. However, the insurer and the insured may contract for the expansion of the statutory policy.

“Where the policy is merely a statutory policy obviously the same will fall within the ratio of law laid down in Dhanraj’s case (supra) and the insurer shall be liable to indemnify only the third party and owner shall be precluded from maintaining petition under Section 163-A of the 1988 Act. However, where the policy is a comprehensive policy and the contracting parties have agreed to travel beyond the mandatory requirement of Section 146 of the 1988 Act and insurer agrees to indemnify the owner and has accepted premium for such contract to indemnify, the case would not be hit by law laid down in Dhanraj’s case.

In the said case the Court was dealing with an appeal by the Insurer against the award passed by the Motor Accident Claims Tribunal, Jhajjar.

Claim petition under Section 163-A of the MV Act was filed by the legal heirs on account of Sanjay who was driving the car that got hit by an unknown vehicle resulting in his death.

The owner of the Vehicle and the insurer were impleaded as respondents and Tribunal awarded compensation of Rs.4,95,200/- holding respondents liable jointly and severally. The insurer was an appealed against the said award.

However, in the instant case, the insurance policy in question was a comprehensive one and it covered the owner as well as the driver.

The Policy on record clearly shows that the premium was paid for insurance of the owner as well as the driver. Thus, in the present case the contention raised by the appellant w.r.t. the maintainability of the petition sans merit and thus is rejected. So far as the plea w.r.t. quantum of compensation awarded by the Tribunal is concerned, it is by now settled principle of law that the liability under Section 163-A is not limited.

Accordingly, the appeal was dismissed.

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