Chhattisgarh High Court confirms that the insurer must pay compensation to claimants first and can later recover from the owner if the driver did not hold a valid licence; this upholds the Supreme Court’s precedent in Swaran Singh and maintains established binding authority in motor accident claims. Applicable as binding precedent for claims arising under the Motor Vehicles Act within Chhattisgarh.
Summary
| Category | Data |
|---|---|
| Case Name | MAC/813/2022 of MATHURA BAI RATHORE Vs BABITA RATHORE |
| CNR | CGHC010229052022 |
| Date of Registration | 13-07-2022 |
| Decision Date | 03-11-2025 |
| Disposal Nature | ALLOWED |
| Judgment Author | HON’BLE SHRI JUSTICE SANJAY K. AGRAWAL |
| Court | High Court Of Chhattisgarh |
| Bench | Single Bench (Sanjay K. Agrawal, J.) |
| Precedent Value | Binding within the jurisdiction of Chhattisgarh High Court |
| Overrules / Affirms | Affirms Supreme Court precedent in National Insurance Co. Ltd. v. Swaran Singh (2004) 3 SCC 297 |
| Type of Law | Motor Accident Compensation (Motor Vehicles Act, 1988) |
| Questions of Law | Is the insurance company liable to pay compensation first even where the driver lacked a valid licence, and can it recover from the owner? |
| Ratio Decidendi | The Claims Tribunal found the driver had no valid licence. However, following the Swaran Singh principle, the insurer must pay compensation first to the claimants and may recover the paid amount from the vehicle owner later. The award was modified to order the Insurance Company to pay and recover. |
| Judgments Relied Upon | National Insurance Co. Ltd. v. Swaran Singh & Ors., (2004) 3 SCC 297 |
| Logic / Jurisprudence / Authorities Relied Upon by the Court | Supreme Court’s interpretation of insurer’s liability to ensure prompt compensation to victims regardless of internal defences, with subsequent right of recovery against the owner in case of lack of valid licence. |
| Facts as Summarised by the Court | Claimants (wife and sons of deceased) appealed for enhancement; Claims Tribunal had awarded ₹6,00,000 to claimants but exonerated insurer due to lack of valid licence. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts within the jurisdiction of Chhattisgarh High Court |
| Persuasive For | Other High Courts, in absence of contrary Supreme Court direction |
| Follows | National Insurance Co. Ltd. v. Swaran Singh & Ors., (2004) 3 SCC 297 |
What’s New / What Lawyers Should Note
- Reaffirms that insurer’s liability to “pay and recover” applies even if the driver lacked a valid licence.
- The insurance company is required to pay compensation to the victim’s family first, protecting their rights to expeditious relief.
- After payment, insurer can initiate recovery proceedings from the vehicle owner.
- Tribunal’s order exonerating the insurer was reversed to align with Supreme Court binding precedent.
- Lawyers representing claimants can secure satisfaction of awards directly from insurers, even if there are technical statutory breaches regarding licence validity.
Summary of Legal Reasoning
- The court framed the main question as whether the insurance company remains liable to pay compensation at the first instance, despite the driver lacking a valid driving licence.
- The court noted that the Claims Tribunal had exonerated the insurer solely on the ground of invalid licence.
- Applying National Insurance Co. Ltd. v. Swaran Singh (2004) 3 SCC 297, the court held that the insurer must pay to the victim first, given the beneficial object of the Motor Vehicles Act.
- The insurer can then initiate recovery from the vehicle owner for violations such as lack of a valid driving licence.
- Thus, the previous award was modified: insurer must satisfy the compensation, with a right to recover from the vehicle owner.
Arguments by the Parties
Petitioner (Appellants/Claimants):
- Cited Supreme Court’s Swaran Singh decision, asserting insurer’s obligation to pay first and recover later.
- Argued that exoneration of insurer by Tribunal was erroneous.
Respondent No.1 (Owner):
- Supported the Tribunal’s award and opposed the appeal.
Insurance Company (Respondent No.2):
- Supported the Tribunal’s exoneration of insurer.
- Argued insurer is not liable when driver lacked valid licence.
Factual Background
The case involves a fatal motor accident resulting in the death of Kanhaiya Rathore, aged about 60 years. His wife and sons sought compensation under the Motor Vehicles Act before the Claims Tribunal, which awarded ₹6,00,000 to them but absolved the insurance company of liability, based on the finding that the driver lacked a valid driving licence. The claimants appealed for enhancement and for fixing liability on the insurer.
Statutory Analysis
- The court applied Section 173 of the Motor Vehicles Act, relating to appellate jurisdiction.
- Relied on the interpretation of insurance company liability for compensation under the Motor Vehicles Act, especially when there is a violation of conditions such as licence requirement.
- The Supreme Court’s reading of the MV Act provisions in Swaran Singh guides that the insurer’s statutory liability to pay cannot be defeated by technical defences vis-à-vis third party victims, though recovery from the owner is permitted.
Dissenting / Concurring Opinion Summary
No dissenting or concurring opinions were recorded in the judgment.
Procedural Innovations
No new procedural precedents, changes to evidence, or suo motu guidelines were noted in the judgment.
Alert Indicators
- ✔ Precedent Followed – The court followed binding Supreme Court precedent (Swaran Singh), restating, rather than overturning, existing law.