Surinder And Anr vs Iffco Tokia General Insurance Company Ltd And Ors

1
FAO-1031-2016 (O&M)
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
FAO-1031-2016 (O&M)
Reserved on :30.10.2026
Pronounced on: 03.11.2026
Uploaded on 04.11.2026
Whether only operative part of the judgment is
pronounced or the full judgment is pronounced: Operative part/full
judgment
Surinder @ Lilu and another
…...Appellants
Versus
IFFCO TOKIA General Insurance Company Limited and others
CORAM: HON'BLE MS. JUSTICE MANDEEP PANNU
Present:- Mr. Jitender Nara, Advocate and
Mr. Davinder Kaliraman, Advocate for the appellants
Ms. Manvi Verma, Advocate for
Mr. Rajneesh Malhotra, Advocate
for respondent No.1-Insurance Company
Mr. Amit Sheoran, Advocate for
Mr. Kulvir Narwal, Advocate for respondents No. 2 to 6
MANDEEP PANNU, J.
1. The present FAO has been filed by the driver and owner of the
offending vehicle, tractor bearing registration No. HR-16-A-6383,
challenging the award dated 15.04.2015, passed by the learned Motor
Accident Claims Tribunal, Rohtak (hereinafter referred to as ‘MACT’),
whereby compensation of Rs. 17,81,250/- was awarded to the claimants and
the insurance company was directed to pay the compensation amount to
them, with a further right of recovery granted to the insurance company
against the appellants herein.
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
2. As per the claimants, on 02.03.2013, the deceased was
returning from Bhiwani to Rohtak in his car, with his employee Rajat
Chobey and when they reached near village Lahli, a tractor-trolley laden
with sugarcane, driven by appellant No. 1, was proceeding ahead of them in
the first lane. When the deceased attempted to overtake the tractor-trolley
from the second lane, appellant No. 1 suddenly changed the lane towards the
left without giving any signal or indicator, thereby striking the deceased's
car. As a result of the collision, the tractor-trolley overturned and the
deceased sustained fatal injuries. The deceased was shifted to Post Graduate
Institute of Medical Sciences, Rohtak, in an ambulance, where he was
declared brought dead.
3. The legal heirs of the deceased, who are respondents No. 2 to 6
in the present appeal, filed a claim petition before the learned MACT, which
was allowed and compensation was awarded to them, as detailed above.
Thereafter, the claimants filed FAO No. 6688 of 2015 seeking enhancement
of the compensation amount. The compensation was subsequently enhanced
by a coordinate Bench of this Court vide order dated 25.04.2023. In the said
appeal, the learned Coordinate Bench of this Court upheld the finding of the
learned MACT that the deceased and respondent No. 1 therein (appellant
No. 1 in the present appeal) were responsible for the accident in the ratio of
25:75.
4. The present FAO has been filed by the appellants, i.e., the
driver and owner of the offending tractor-trolley, challenging the award
dated 15.04.2015 passed by the learned MACT, whereby recovery rights
were granted to the respondent-insurance company against the appellants.
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
5. Learned counsel for the appellants, i.e., the driver and owner of
the offending vehicle, contends that the learned MACT erred in granting
recovery rights to the respondent-insurance company. It is argued that the
Tribunal failed to appreciate the evidence on record establishing that the
tractor-trolley was insured with the respondent-insurance company and that
the value of the tractor and trolley had been assessed separately, with the net
premium having been paid on the total value of both.
6. It is further contended that the tractor-trolley was loaded with
sugarcane at the time of the accident and was being used for agricultural
purposes, and not for any commercial purpose. In this regard, reliance is
placed upon the testimony of PW-4, who deposed that the tractor-trolley was
loaded with sugarcane at the time of the accident. Learned counsel submits
that the Tribunal, therefore, erred in holding that the offending vehicle was
being used for commercial purposes and that such use constituted a breach
of the insurance policy. It is argued that carrying sugarcane in a tractor-
trolley is an activity incidental to agriculture and cannot be construed as
commercial use.
7. It is also contended that the driver of the tractor-trolley was not
at fault in causing the accident and that the learned MACT erred in holding
that the driver was not possessing a valid driving licence to drive the
offending vehicle.
8. Learned counsel for the respondent-insurance company, while
opposing the present appeal, argued that the issue of negligence on the part
of the driver of the tractor-trolley already stands adjudicated in the
connected FAO filed by the claimants seeking enhancement of
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
compensation. It was submitted that the present appellants were also party to
the said appeal but chose not to contest the same. The Coordinate Bench of
this Court, while deciding the said appeal arising out of the same accident,
upheld the findings of the learned MACT that the deceased and respondent
No. 1 therein (appellant No. 1 in the present appeal) were responsible for the
accident in the ratio of 25:75. It was, therefore, contended that the said
findings have attained finality and cannot be reopened in the present appeal.
9. Learned counsel further argued that the evidence on record
establishes that the tractor-trolley was being used for commercial purposes,
in violation of the terms and conditions of the insurance policy.
Consequently, the learned MACT rightly granted recovery rights to the
insurance company to recover the compensation amount from the
appellants. It was submitted that the impugned award suffers from no
illegality or infirmity warranting interference by this Court.
10. I have heard the respective contentions of learned counsel for
the appellants and learned counsel for respondent No.1-Insurance Company
and have perused the record.
11. The question of negligence does not require any further
elaboration. The negligence of the driver of the offending vehicle stands
established from the evidence on record. In this regard, it is pertinent to note
that the same accident had also been the subject matter of FAO-3561-2015
(O&M), titled Kuldeep and Another v. Poonam and Others, decided by a
coordinate Bench of this Court on 05.03.2026. The findings recorded therein
with regard to the occurrence of the accident and the involvement of the
offending vehicle are relevant to the present controversy. Accordingly, the
REKHA SIHAG
2026.11.04 15:49
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integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
finding of negligence recorded by the learned Tribunal does not warrant
interference.
12. The principal question which remains for consideration is
whether the Insurance Company is entitled to avoid its liability under the
insurance policy and claim recovery rights against the owner and driver of
the offending vehicle.
13. In this regard, reliance has been placed upon the judgment of
the coordinate Bench of this Court in Kuldeep and Another v. Poonam
and Others, FAO-3561-2015 (O&M), decided on 05.03.2026. In the said
judgment, the coordinate Bench considered, inter alia, whether a driver
holding a licence to drive a Light Motor Vehicle was required to obtain a
separate endorsement to drive a tractor having a gross vehicle weight of
2110 kilograms, and whether the insurer could be exonerated on the ground
that the trolley attached to the insured tractor had not been separately
insured.
14. The coordinate Bench, relying upon the decision of the
Constitutional Bench of the Hon’ble Supreme Court in M/s Bajaj Alliance
General Insurance Co. Ltd. v. Rambha Devi and Others, 2025 (1)
R.C.R. (Civil) 5 , held that a driver holding a valid licence for a Light Motor
Vehicle is competent to drive a transport vehicle having a gross vehicle
weight of less than 7500 kilograms without obtaining an additional
endorsement specifically authorising him to drive a transport vehicle. It was
further held that the additional eligibility requirements prescribed under the
Motor Vehicles Act, 1988, would apply to vehicles exceeding the aforesaid
weight limit and to the other specified categories of vehicles.
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
15. Applying the aforesaid principle to the facts of the present case,
the mere absence of a separate endorsement authorising the driver to drive a
transport vehicle would not constitute a breach of the terms of the insurance
policy so as to absolve the Insurance Company of its liability, provided the
offending vehicle falls within the aforesaid weight limit and the driver
otherwise held a valid driving licence.
16. So far as contention of the learned counsel for Insurance
Company that the vehicle was being used for commercial purpose, it is not
disputed that the insurance policy in question restricted the use of the
offending tractor to agricultural and forestry purposes. The question,
therefore, is whether the Insurance Company has established that, at the time
of the accident, the tractor-trolley was being used for a purpose falling
outside the scope of the permitted use under the policy.
17. In this regard, it is pertinent to note that the mere fact that the
tractor-trolley was carrying sugarcane at the time of the accident does not,
by itself, establish that it was being used for commercial purposes. The
nature of the goods being transported is only one relevant circumstance, and
the purpose for which the transportation was undertaken has to be examined
in the light of the evidence available on record.
18. The transportation of agricultural produce in connection with
agricultural operations, including the movement of such produce from the
agricultural field to another location, may constitute use incidental to
agriculture. Conversely, where the tractor-trolley is employed for
transporting goods for hire or reward or for other commercial activities
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
unrelated to agricultural operations, such use may fall outside the scope of
the permitted use under the insurance policy.
19. The burden of establishing a breach of the policy conditions, so
as to enable the Insurance Company to avoid its liability and claim recovery
rights against the insured, rests upon the Insurance Company. In the present
case, the testimony of PW-4 establishes that the tractor-trolley was loaded
with sugarcane at the time of the accident. However, no evidence has been
brought to my notice establishing that the tractor-trolley was being used for
carrying goods for hire or reward or that it was otherwise being employed
for a commercial purpose in violation of the insurance policy.
20. In the absence of such evidence, the mere transportation of
sugarcane cannot be treated as sufficient proof of commercial use. The
finding of the learned Tribunal that the offending vehicle was being used for
commercial purposes, and that such use constituted a breach of the
insurance policy, is, therefore, not sustainable.
21. Consequently, the respondent-Insurance Company cannot avoid
its liability to satisfy the award or claim recovery rights against the
appellants merely on the ground that the tractor-trolley was carrying
sugarcane at the time of the accident.
22. In view of the aforesaid discussion, the appeal is allowed. The
impugned award is modified to the extent that respondent No. 1-Insurance
Company shall be liable to satisfy the award of compensation in accordance
with the terms of the insurance policy and shall not be entitled to recover the
compensation amount from the appellants.
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh

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FAO-1031-2016 (O&M)
23. All the pending miscellaneous applications, if any, are also
disposed of.
03.11.2026 (MANDEEP PANNU)
rekha JUDGE
Whether speaking/reasoned Yes/No
Whether reportable Yes/No
REKHA SIHAG
2026.11.04 15:49
I attest to the accuracy and
integrity of this document
Chandigarh