Motor Vehicles Act, 1988 – S. 163A – Whether in a claim proceeding u/s. 163 A it is open for the Insurer to raise the defence / plea of negligence? – Held, in a proceeding u/s. 163A of the Act it is not open for the Insurer to raise any defence of negligence on the part of the victim.

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

(RANJAN GOGOI, J.) (ADARSH KUMAR GOEL, J.) (NAVIN SINHA, J.)

NOVEMBER 24, 2017

CIVIL APPEAL NO. 9694 OF 2013

UNITED INDIA INSURANCE CO. LTD. …APPELLANT(S)

VERSUS

SUNIL KUMAR & ANR. …RESPONDENT(S)

For Appellant(s) Mr. Amit Kumar Singh, AOR Ms. K. Enatoli Sema, Adv.

For Respondent(s) Ms. Nidhi, AOR Mr. Ajay Kumar Talesara, AOR

J U D G M E N T

RANJAN GOGOI, J.

1. Unable to agree with the reasoning and the conclusion of a two judge bench of this Court in National Insurance Company Limited v. Sinitha and others, [(2012) 2 SCC 356] a coordinate bench of this Court by order dated 29th October, 2013 has referred the instant matter for a resolution of what appears to be the following question of law.

“Whether in a claim proceeding under Section 163 A of the Motor Vehicles Act, 1988 (hereinafter referred to as “the Act”) it is open for the Insurer to raise the defence/plea of negligence?”

2. A second question as to what would be the true scope and meaning of the provisions contained in Section 170 of the Act more specifically as set out in Queries (iii) to (v) in paragraph 10 of the report of United India Insurance Company Limited v. Shila Datta and others, (2011) 10 SCC 509 also arises. However, the aforesaid Question stands referred to a Larger Bench in Shila Datta (supra) itself. We are told that answers to the questions referred are awaited. In view of the above, we would be required to answer only the first question arising in the reference which has been set out herein above.

3. In Sinitha‘s case (supra), a two judge bench of this Court understood the scope of Section 163A of the Act to be enabling an Insurer to raise the defence of negligence to counter a claim for compensation. The principal basis on which the conclusion in Sinitha‘s case (supra) was reached and recorded is the absence of a provision similar to sub-section (4) of Section 140 of the Act in Section 163A of the Act. Such absence has been understood by the Bench to be a manifestation of a clear legislative intention that unlike in a proceeding under Section 140 of the Act where the defence of the Insurer based on negligence is shut out, the same is not be the position in a proceeding under Section 163A of the Act.

4. We have considered the matter and have heard the learned counsels for the parties.

5. In Deepal Girishbhai Soni and others v. United India Insurance Co. Ltd., Baroda, (2004) 5 SCC 385 the issue before a three judge bench of this Court was with regard to the mutual exclusiveness of the provisions of Section 163A and Section 166 of the Act. While dealing with the said question, this Court had the occasion to go into the reasons and objects for the incorporation of Section 140 and 163A of the Act which came in by subsequent amendments, details of which are being noted separately herein below. The Bench also took the view that while Section 140 of the Act deals with cases of interim compensation leaving it open for the claimant to agitate for final compensation by resort to the provisions of Section 166 of the Act, Section 163A of the Act provides for award of final compensation on a structured formula following the provisions of Second Schedule appended to the Act. Both Sections i.e. Sections 140 and 163A are based on the concept of ‘no fault liability’ and have been enacted as measures of social security. It was further noted that in a proceeding under Section 163A of the Act the Tribunal may be required to adjudicate upon various disputed questions like age, income, etc. unlike in a proceeding under Section 140 of the Act.