SCOPE OF SECTION 163-A OF MOTOR VEHICLES ACT IN CASE OF A VICTIM BEING OWNER OR BORROWER OF THE VEHICLE.

SCOPE OF SECTION 163-A OF MOTOR VEHICLES ACT  IN CASE OF A VICTIM BEING OWNER OR BORROWER OF THE VEHICLE.

As per the statute, victim being borrower of vehicle from registered owner, no claim can be made under sec. 163 A .

This aspect has been clearly discussed in National insurance company ltd.,. Puducherry  -vs- Rani  2020(1) TNMAC 593.

This case has been filed under sec 163 A of the motor vehicles act, 1988. The narration of the accident reveals that the rider of the motorcycle died on account of the accident and he is not the owner of the vehicle. Therefore, he was a borrower of the vehicle from the registered owner and accordingly he stepped into the shoes of the registered owner of the vehicle which met with an accident.

It is brought to the notice of the court that as per the policy even in case the owner of the vehicle is the rider of the vehicle, he is not entitled to claim compensation under section 163 A of the motor vehicles act, 1988.

This being the factum, the claimant, who was the rider of the vehicle stepped in to the shoes of the owner, is not entitled to claim compensation as there is no contract to pay compensation as there is no contract to pay compensation in such cases.

In this regard learned counsel appearing for the appellant cited the judgement of hon’ble supreme court of india in case of Ningamma and another Vs United india insurance co.ltd., 2009 (2) TNMAC 169(SC) 2009 ACJ 2020.

The apex court has held that section 163 A of the motor vehicles act, cannot be said to have any application in respect of an accident, wherein the owner of the motor cycle himself is involved. The liability under section 163 A of the motor vehicles at is on the owner of the vehicle. So a person cannot be both a claimant and also a recipient, with respect to claim. Thus, the heirs of the deceased could not have maintained a claim in terms of section 163 A of the motor vehicles act.

The recent judgement of hon’ble supreme court in the case of Ramkhiladi and another v United india insurance co ltd and another 2020 (1) CTC (SC) 2020 (1) TNMAC 1 (SC), elaborately discussed the scope of claim petition under section 163 A of the motor vehicles act. Undoubtedly the special provision cannot be read in isolation and the apex court considered sections 147, 166, & 163 A of the motor vehicles act. Thus the special provision is to be read conjointly and in consonance with the object, purpose as well as the intention of the legislature.

In the event of interpreting any special provision in isolation to the other provisions of the statute, then the very object would be defeated and therefore, the courts cannot make an interpretation of a special provision, which is otherwise intended to grant certain benefits in respect of grant of compensation in the event of not establishing negligence. Thus, the court is of considered opinion that even the personal accident coverage cannot be considered in certain cases, where the victim is not the registered owner of the vehicle. Three conditions are required even under personal accident policy (which is not a statutory coverage in terms of section 147 of the act) The said three conditions are mandatory, so as to avail compensation under the personal accident policy (not a statutory coverage in terms of section 147 of the act). They are

1.     The owner – driver is the registered owner of the vehicle insured

2.     The owner – driver is the insured named in the policy

3.     The owner – driver holds an effective driving license, in accordance with the provisions of the law.

With reference to section 163 A of the motor vehicles act, 1988, the hon’ble supreme court has taken a view that if a borrower of the vehicle met with an accident while riding a vehicle, he cannot claim compensation under section 163 – A of the act. The reason being in the event of granting compensation without adjudication of negligence, then the same would result in defeating the very object of the act, under section 147 & 166 of the motor vehicles act. When section 147 categorically enumerates requirements of policies, limits and liabilities, the same cannot be whittled down, while dealing with the claim petitions under sections 163 A of the act. All these provisions are to be read conjointly for the purpose of granting the benefit of special provision enacted under section 163 A of the act, for payment of compensation on structured formula basis. When the special provision is specifically provided for a structured formula basis, it cannot be read in isolation with reference to the nature of the contracted policy and the requirement of the policy and the limited liability clauses, which all are well enumerated under the provisions of the act. Thus the court is of the considered opinion that a person, who borrowed a vehicle from the registered owner and while driving the same met with an accident sustained injuries or dead, then he is not entitled to claim any compensation under section 163 A  of the act and even for claiming personal accident policy, he is bound to establish the three mandatory conditions and in the absence of compliance with the said three conditions, he is not entitled for compensation.

The court is of the considered opinion that the insurance company as well as the policy holders are bound by the terms and conditions of the contract agreed between the parties. In the event of superseding the terms of the contract, then the very legality of the law of contract is sacrificed under the provisions of the Indian contract act, which is unacceptable and therefore in respect of the contract, the courts are bound to consider the terms and conditions and the binding clauses between the parties.

The hon’ble supreme court in the judgement, cited supra, in unequivocal terms held that in a claim under section 163 A 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 163 A 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 163 A 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 163 A of the  act, against the owner and insurer of the vehicle.