Gujarat High Court Dismisses Insurance Company's Appeal in Motor Accident Claim — Invalid Driving License Does Not Absolve Insurer's Liability to Third Parties. Insurance Company Directed to Pay Compensation and Recover from Owner Under Section 149 of Motor Vehicles Act, 1988.

High Court: Gujarat High Court In Favour of Prosecution

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2026-05-19 03:17:18

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Case Note & Summary

The case arises from a motor accident that occurred on 13.04.2010 at about 7:00 a.m. on Ganol–Dholaka Road, within the sim of village Simej, under Dholaka Police Station, District Ahmedabad. The accident involved a tanker bearing registration No.GJ-4-X-6859, driven rashly and negligently by its driver, which dashed from the rear side against a motorcycle bearing registration No.GJ-1-FR-6565. The motorcycle was ridden by deceased Narubhai Amarsinh Makwana, with deceased Bhailalbhai as a pillion rider. Both sustained fatal injuries and succumbed. The legal heirs of the deceased filed claim petitions being Motor Accident Claim Petition No.189 of 2010 and 190 of 2010 before the Motor Accident Claims Tribunal (Aux), Anand. The Tribunal partly allowed the claim petitions and awarded compensation. Aggrieved, the Insurance Company of the tanker (New India Assurance Co. Ltd.) filed the present appeals. The sole issue raised by the appellant was that the driver of the offending vehicle did not hold a valid driving license at the time of the accident. The Court heard the learned advocates for both sides. The appellant's counsel submitted that due to the invalid license, the Insurance Company should not be liable. However, the Court relied on the settled legal position that in third-party claims, the Insurance Company is liable to pay compensation and then recover the same from the owner of the vehicle. The Court found no merit in the appeals and dismissed them, upholding the Tribunal's award with the direction that the Insurance Company shall pay the compensation and may recover the same from the owner.

Headnote

A) Motor Accident Claims - Third Party Liability - Pay and Recover - Invalid Driving License - Motor Vehicles Act, 1988, Section 149 - The Insurance Company challenged the award on the ground that the driver of the offending tanker did not hold a valid driving license. The Court held that the Insurance Company is liable to pay compensation to third parties and then recover the same from the owner of the vehicle, following the principle of 'pay and recover' as laid down by the Supreme Court. (Paras 5-7)

Issue of Consideration

Whether the Insurance Company is liable to pay compensation to third parties when the driver of the offending vehicle did not hold a valid driving license at the time of the accident.

Final Decision

Both appeals are dismissed. The impugned common judgment and award dated 03.03.2016 passed by the Motor Accident Claims Tribunal (Aux), Anand in Motor Accident Claim Petition No.189 of 2010 and 190 of 2010 is confirmed. The Insurance Company is directed to pay the compensation amount to the claimants and may recover the same from the owner of the offending vehicle in accordance with law.

Law Points

Motor Accident Claims
Third Party Liability
Pay and Recover
Invalid Driving License
Section 149 Motor Vehicles Act
1988

Case Details

2026:GUJHC:2880

R/First Appeal No. 1199 of 2016 with R/First Appeal No. 1200 of 2016

2026-01-09

Mool Chand Tyagi

2026:GUJHC:2880

Mr. GC Mazmudar, Mr. HG Mazmudar for Appellant; Mr. Mohsin M Hakim for Defendants No.1,2,3,4; Rule Served for Defendants No.5,6,7

New India Assurance Co. Ltd.

Surajben Bhailalbhai Rathod & Ors.

Nature of Litigation

Appeal against judgment and award of Motor Accident Claims Tribunal in claim petitions for compensation arising from a fatal motor accident.

Remedy Sought

The appellant Insurance Company sought to set aside the Tribunal's award on the ground that the driver of the offending vehicle did not hold a valid driving license.

Filing Reason

The Insurance Company was aggrieved by the Tribunal's decision to hold it liable despite the driver's invalid license.

Previous Decisions

The Motor Accident Claims Tribunal (Aux), Anand partly allowed the claim petitions in Motor Accident Claim Petition No.189 of 2010 and 190 of 2010 vide common judgment and award dated 03.03.2016.

Issues

Whether the Insurance Company is liable to pay compensation to third parties when the driver of the offending vehicle did not hold a valid driving license at the time of the accident.

Submissions/Arguments

Mr. H. G. Mazmudar, learned advocate for the appellant-Insurance Company, submitted that at the time of the accident, the driver of the offending tanker was not holding a valid driving license to drive the vehicle.

Ratio Decidendi

In third-party claims under the Motor Vehicles Act, 1988, the Insurance Company is liable to pay compensation even if the driver of the offending vehicle did not hold a valid driving license, with the right to recover the amount from the owner of the vehicle.

Judgment Excerpts

Both the captioned appeals have been filed against the common impugned judgment and award dated 03.03.2016 passed by the Motor Accident Claims Tribunal (Aux), Anand in Motor Accident Claim Petition No.189 of 2010 and 190 of 2010, whereby the learned Tribunal had partly allowed the claim petitions. Mr. H. G. Mazmudar, learned advocate appearing on behalf of the appellant- Insurance Company at the outset, submitted that at the time of accident, the driver of the offending vehicle i.e. tanker was not holding the valid driving license to driver the

Procedural History

The Motor Accident Claims Tribunal (Aux), Anand partly allowed the claim petitions on 03.03.2016. The Insurance Company filed First Appeals No. 1199 of 2016 and 1200 of 2016 before the High Court of Gujarat at Ahmedabad, which were heard and dismissed on 09.01.2026.