Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
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% Reserved on : 25 March 2026
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Pronounced on : 29 May 2026
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Uploaded on : 03 June 2026
+ MAC.APP. 175/2015 & CM APPL. 3065/2015
RELIANCE GENERAL INSURANCE CO LTD .....Appellant
Through: Mr. Rajeev M. Roy, Advocate
with Mr. P. Srinivasan, Advocate.
versus
MEENA KATIYAR & ORS .....Respondents
Through: Mr. Siddharth Mittal, Mr. Sumit
K. Sharma, Ms. Shilpa G. Mittal,
& Mr. Abhijeet Varshney,
Advocates for Respondent No.5.
CORAM:
HON'BLE MR. JUSTICE ANISH DAYAL
JUDGMENT
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ANISH DAYAL, J.
1. The present appeal has been preferred assailing the award dated
14th November 2014 [“ impugned award ”] passed by the learned Motor
Accident Claims Tribunal [“ Tribunal ”], Dwarka Courts, New Delhi in
MACP No. 329/11/14 , whereby compensation of Rs.49,09,587/- along
with interest came to be awarded in a fatal accident case arising out of
the death of Shri Adarsh Kumar Katiyar [“ deceased ”]. The
appellant/Insurance Company contends, inter alia , that the Tribunal
erred in assessing only 20% contributory negligence on the part of the
deceased despite the admitted position that the deceased had collided
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with the offending vehicle from behind and that the driver-cum-owner
[ respondent no.5 herein ] was holding a fake license . Challenge has also
been laid to the addition towards future prospects , adoption of multiplier,
deduction towards income tax and personal expenses , award under
conventional heads, grant of enhanced interest, and refusal to grant
recovery rights to the appellant despite alleged breach of policy
conditions.
Incident
2. On 15th August 2010 at about 7:00 p.m., deceased was travelling
from Jaipur to Delhi in a Hyundai car bearing registration no. UP-16W-
8764 . Upon reaching near Malpura Village , in front of HP Petrol Pump,
Bawal, Rewari , the vehicle tractor-trolley bearing registration no. HR-
36M-5886 [“ offending vehicle ” ], stated to be carrying bricks and driven
by respondent no.5 [ driver-cum-owner ], allegedly applied brakes
suddenly while taking a turn, due to which the deceased’s vehicle
collided with the offending vehicle from behind and went underneath it.
3. Deceased sustained grievous injuries and was taken by the local
police to ESI Dispensary, Bawal, Rewari , where he succumbed to the
injuries sustained in the accident. Claimants [ respondent nos.1 to 4
herein ], being the legal heirs and dependents of deceased, thereafter
instituted a claim petition alleging that the accident occurred solely due
to the rash and negligent driving of respondent no.5.
4. As per claim petition, deceased was 53 years of age at the time of
the accident and was employed as “ Deputy General Manager (Vendor
Development) ” with M/s Universal Autofoundry Pvt. Ltd ., allegedly
earning a monthly salary of Rs.60,000/-. Offending vehicle was stated to
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be owned by respondent no.1 and insured with the appellant/Insurance
Company under a policy valid for the period from 29th October 2009 to
28th October 2010.
Impugned Award
5. On the issue of negligence, the Tribunal relied upon the
testimonies of PW-1 [ Meena Katiyar , wife of the deceased ], PW-2
[ official witness who proved the criminal record ], and PW-3 [ Vinod
Chand Katiyar / eye-witness and brother-in-law of the deceased] . PW-
3/ eye-witness deposed that the offending vehicle, namely the tractor
trolley carrying bricks, was moving ahead of deceased’s vehicle and
suddenly applied brakes while taking a turn, resulting in the deceased’s
vehicle colliding with the tractor trolley from behind. The Tribunal
observed that PW-3/ eye-witness had withstood cross-examination, his
presence at the site was believable, and his testimony regarding the
manner of the accident was trustworthy and corroborated by the criminal
record including FIR No. 244/2010 , site plan, seizure memos and post-
mortem report.
6. The Tribunal, therefore, held that the accident had occurred due to
rash and negligent driving of the offending vehicle driven by respondent
no.5 [ driver-cum-owner ]. However, while examining the aspect of
contributory negligence, the Tribunal referred to Rules 23 and 24 of the
Rules of the Road Regulations, 1989 and observed that a vehicle
following another vehicle is required to maintain “ sufficient distance ” to
avoid collision in case the vehicle ahead suddenly slows down or stops.
The Tribunal further observed that although the tractor-trolley had
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abruptly applied brakes while taking a turn, the deceased was also
required to maintain a “ safe distance ” and control over his vehicle.
7. The Tribunal concluded that the deceased had also contributed
towards the occurrence of the accident since the collision had taken place
from behind and it appeared that the deceased was driving at such speed
that he could not control the vehicle in time to avoid the collision.
Accordingly, contributory negligence on the part of the deceased was
assessed to the extent of 20% and deduction of the said amount was
directed from the total compensation awarded.
8. On the aspect of income, the Tribunal accepted the evidence of
PW-4 [ official from Universal Autofoundry Pvt. Ltd .], and held that the
deceased was employed as Deputy General Manager (Vendor
Development) . Monthly salary of deceased was assessed at Rs.57,600/-,
from which 10% was deducted towards Tax Deducted at Source [ TDS ],
resulting in assessed monthly income of Rs.51,840/- and annual income
of Rs.6,22,080/-. Tribunal further added 15% towards future prospects
considering that the deceased was 53 years of age at the time of the
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accident. Since there were four dependents, 1/4 deduction was made
towards personal expenses and multiplier of ‘ 11 ’ was applied.
9. As regards the defence of appellant/Insurance Company that the
tractor-trolley was not covered under the insurance policy and that the
vehicle was being used for commercial purposes, the Tribunal rejected
the same relying upon the decision in New India Assurance Co. Ltd. v.
Sanjay Tyagi & Ors ., 2014 SCC OnLine Del 1339, observing that “ mere
attachment of a trolley with a tractor would not amount to violation of
the terms and conditions of the insurance policy ”. The Tribunal further
held that the appellant/Insurance Company had failed to establish that
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the driving licence of respondent no.5 was fake , despite the plea
regarding missing licensing records and registration of a FIR in that
regard. Consequently, no recovery rights were granted in favour of the
appellant/Insurance Company.
10. The compensation awarded is tabulated as under:
S. No. Heads Amount Awarded
1. Monthly Income Rs.51,840/-
2. Annual Income Rs.6,22,080/-
3. Future Prospects 15%
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4. Deduction towards Personal Expenses ¼
5. Multiplier 11
6. Loss of Dependency Rs.59,01,984/-
7. Loss of Love and Affection Rs.1,00,000/-
8. Loss of Consortium Rs.1,00,000/-
9. Funeral Expenses Rs.25,000/-
10. Loss of Estate Rs.10,000/-
Total Compensation Rs.61,36,984/-
Less: 20% towards contributory negligence Rs.12,27,397/-
Final Compensation Awarded Rs.49,09,587/-
Interest 7.5% p.a.
Submissions on behalf of appellant
11. Counsel for appellant/Insurance Company contended that the
Tribunal erred in assessing contributory negligence of the deceased only
to the extent of 20% , despite the admitted factual position that the
deceased had collided with the offending tractor-trolley from behind.
Reliance was placed upon the claim petition as well as the testimony of
PW-3 [ eye-witness ], who had deposed that the deceased was travelling
behind the offending tractor-trolley carrying bricks and that the tractor-
trolley had suddenly applied brakes while taking a turn, resulting in the
deceased’s vehicle colliding with the offending vehicle from behind.
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12. It was submitted that the testimony of PW-3 [ eye-witness ]
regarding the tractor-trolley moving at a speed of 50–60 kmph could not
be accepted at face value, since it is common knowledge that the
maximum speed of a tractor is ordinarily not more than 30 kmph and
attachment of a trolley loaded with bricks would further reduce its speed.
According to the appellant/Insurance Company, the fact that the
deceased’s vehicle struck the tractor-trolley from behind clearly
established that the deceased was driving at excessive speed and had
failed to maintain “ sufficient distance ” from the vehicle moving ahead.
13. Reliance was placed upon Rule 23 of the Rules of the Road
Regulations, 1989 , which mandates that the driver of a vehicle moving
behind another vehicle shall maintain “ sufficient distance ” so as to avoid
collision in the event the vehicle ahead suddenly slows down or stops. It
was contended that the principle of res ipsa loquitur was applicable in
the facts of the present case and the circumstances led to the only
reasonable inference that the deceased himself had substantially
contributed towards the occurrence of the accident. Reliance was further
placed upon the decision of the Supreme Court in Nishan Singh & Ors.
v. Oriental Insurance Co. Ltd. (2018) 6 SCC 765 to contend that
contributory negligence to the extent of at least 50% ought to have been
attributed to the deceased.
14. Counsel for appellant/Insurance Company distinguished the
decisions relied upon on behalf of respondent nos.1 to 4 [ claimants ],
namely Archit Saini v. Oriental Insurance Co. Ltd. [2018] 1 S.C.R. 626
and Sushma vs Nitin Ganapati Rangole & Ors. 2024 INSC 706,
contending that in those matters, the offending vehicles were parked in
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the middle of the road without indicators, whereas in the present case the
tractor-trolley was admittedly moving ahead of the deceased’s vehicle.
15. As regards liability, counsel for the appellant/Insurance Company
submitted that recovery rights ought to have been granted in favour of
the appellant/Insurance Company since respondent no.5/driver-cum-
owner had failed to establish that he possessed a valid and effective
driving licence. It was contended that respondent no.5/driver-cum-
owner, after filing written statement, stopped appearing before the
Tribunal and was proceeded ex parte . Reliance was placed upon the
testimony of R3W1 from the Licensing Authority, Farrukhabad , to
submit that the records pertaining to the driving licence produced by
respondent no.5/driver-cum-owner were not traceable and an FIR had
been registered regarding missing records. According to appellant, the
burden to prove validity of the driving licence was upon respondent
no.5/driver-cum-owner and adverse inference ought to have been drawn
against him.
16. It was further submitted that the offending vehicle was a tractor
attached with a trolley carrying bricks and was therefore being used for
‘ commercial purposes ’ rather than ‘ agricultural purposes ’. Counsel for
appellant/Insurance Company contended that only the tractor stood
insured under the policy and not the attached trolley . It was submitted
that attachment of a trolley required separate insurance coverage and use
of the tractor-trolley for carrying bricks amounted to violation of policy
conditions.
17. In support of the aforesaid contention, reliance was placed upon
the decisions in Oriental Insurance Co. Ltd. v. Brij Mohan (2007) 7
SCC 56 , and Dhondubai v. Hanmantappa Bandappa Gandigude 2023
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SCC OnLine SC 2387. It was contended that the decision in Fahim
Ahmad v. United India Insurance Co. Ltd. (2014) 14 SCC 148 , relied
upon on behalf of respondent no.5/driver-cum-owner was
distinguishable, since in the present case attachment of the trolley with
the tractor was admitted and undisputed. It was also contended that the
decision in National Insurance Co. Ltd. v. V. Chinnamma (2004) 8
SCC 697, would not apply, as in the said case the tractor was being used
for carriage of vegetables constituting agricultural produce, whereas in
the present case the tractor-trolley was carrying bricks, which could not
be treated as an ‘ agricultural purpose ’. Accordingly, it was submitted
that the appellant/Insurance Company ought to have been granted
recovery rights against respondent no.5/driver-cum-owner and the
compensation payable by the appellant/Insurance Company deserved to
be reduced proportionately on account of higher contributory negligence
attributable to the deceased.
Submissions made on behalf of respondent nos.1-4/claimants
18. Counsel for respondent nos.1 to 4/claimants opposed the appeal
and submitted that the challenge raised by the appellant/Insurance
Company was essentially confined to the findings on contributory
negligence and refusal to grant recovery rights. It was contended that no
interference was warranted with the impugned award insofar as
respondent nos.1 to 4/ claimants were concerned.
19. As regards contributory negligence , it was submitted that the
appellant/Insurance Company had neither led any independent evidence
nor produced any documentary material to substantiate the plea that the
deceased was negligent. According to claimants, the entire plea of
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contributory negligence rested merely upon suggestions put during
cross-examination, which by themselves could not constitute evidence.
20. Reliance was placed upon the testimony of PW-3 [ eye-witness ],
who had deposed that the offending tractor-trolley had abruptly applied
brakes while attempting to take a turn, which led to the collision. It was
contended that the appellant/ Insurance Company was selectively
emphasizing the fact that the collision had occurred from behind while
ignoring the evidence regarding “ sudden braking ” and “ abrupt turning ”
by the offending vehicle.
21. Counsel for respondent nos.1 to 4 further submitted that the site
plan demonstrated that the accident had occurred in the middle of the
road and corroborated the version of PW-3 [ eye-witness ]. It was also
pointed out that the FIR and chargesheet filed by the police authorities
remained unchallenged and the appellant/Insurance Company had not
even summoned the Investigating Officer for examination.
22. Reliance was placed upon the decisions in Archit Saini and
Another v. Oriental Insurance Company Ltd & Ors. ( supra ), Sushma
and Others v. Nitin Ganpati & Ors ( supra ), Prabhavathi & Ors. v The
Managing Director, Bangalore Metropolitan, Transport Corporation
2025 INSC 293 and Dheeraj Gupta v. Ajay Kumar & Anr @ Bharati
AXA General Insurance Co. Ltd. 2024:DHC:1963, to contend that
negligence could not be inferred merely because the collision had
occurred from behind and that the overall facts and circumstances of the
accident were required to be assessed.
23. Without prejudice to the aforesaid submissions, counsel for
respondent nos.1 to 4 further contended that the deduction of 20%
towards contributory negligence itself was unwarranted and unsupported
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by evidence on record. It was submitted that mere existence of a
statutory obligation to maintain safe distance could not, by itself, lead to
a presumption of negligence on the part of the deceased in absence of
cogent evidence. According to the claimants, the deduction towards
contributory negligence had resulted in unjust reduction of compensation
payable to the legal heirs of the deceased.
24. On the aspect of quantum, counsel for respondent nos.1 to 4
submitted that the Tribunal had correctly appreciated the evidence led by
the claimants, including the salary records and testimony of PW-4, while
assessing the income of the deceased and computing compensation. It
was further submitted that despite all family members being entitled to
consortium , only a lump sum amount had been awarded under the said
head.
25. It was also submitted that the claimants had lost their sole
breadwinner in the year 2010 and had been deprived of compensation for
a considerable period due to the pendency of proceedings. In these
circumstances, the award of interest did not warrant any interference.
26. Counsel for respondent nos.1 to 4 further stated that even in
absence of cross-objections, this Court, while exercising appellate
jurisdiction in motor accident cases, is empowered to award just
compensation where the facts of the case so warrant.
Submissions made on behalf of respondent no.5/ driver-cum-owner
27. Counsel appearing on behalf of respondent no.5/driver-cum-owner
opposed the appeal and submitted that no ground for interference with
the impugned award was made out insofar as refusal to grant recovery
rights was concerned. It was contended that the appellant/Insurance
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Company had primarily raised two objections, namely, that respondent
no.5/driver-cum-owner was not holding a valid driving licence and that
the tractor-trolley was being used for ‘ commercial purposes ’ while only
the tractor stood insured.
28. On the issue of driving licence, counsel for respondent no.5
submitted that the driving licence had duly been produced on record
before the Tribunal. It was contended that appellant/Insurance Company
had not taken any specific plea in its written statement alleging that the
licence was fake and had also failed to lead cogent evidence to establish
the same. Reliance was placed upon the testimonies of R3W1 [ Amit
Rastogi, Clerk from the Licensing Authority, Farrukhabad ] and R3W2
[ Naresh Kumar, Deputy Manager of the appellant/Insurance Company ].
29. It was further submitted that the report of the Assistant Regional
Transport Officer [ ARTO ] did not declare the driving licence to be fake ,
but merely recorded that several original records pertaining to driving
licences were missing and that FIR No.334/2013 under Section 409 of
the Indian Penal Code 1860 [ IPC ] had been registered in that regard.
According to respondent no.5/driver-cum-owner, mere non-availability
of records could not lead to the conclusion that the licence itself was
‘ fake ’ or ‘ invalid ’. It was contended that the Tribunal, upon appreciation
of evidence, had rightly concluded that the appellant/Insurance Company
had failed to substantiate its defence regarding breach of policy
conditions on account of fake driving licence.
30. As regards the plea that only the tractor stood insured and not the
attached trolley , counsel for respondent no.5 submitted that the
appellant/Insurance Company had failed to specifically plead and prove
violation of policy conditions. It was contended that except for a vague
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defence in the written statement, neither any specific issue was framed
nor any evidence led by the appellant/Insurance Company to establish
that the tractor was being used in violation of the insurance policy.
31. Reliance was placed upon the decision of the Supreme Court in
Fahim Ahmad v. United India Insurance Co. Ltd. ( supra ), to contend
that the insurer is required not only to plead breach of policy conditions
but also substantiate the same through positive evidence. It was
submitted that in the said decision, involving a tractor-trolley carrying
sand, the Supreme Court had rejected the plea of breach in absence of
cogent proof.
32. Counsel for respondent no.5 further relied upon the decision of
this Court in New India Assurance Co. Ltd. v. Sanjay Tyagi and Others
( supra ), wherein it was held that mere attachment of a trolley with a
tractor would not amount to violation of terms and conditions of the
insurance policy where the tractor was insured for ‘ agricultural
purposes ’. Reliance was also placed upon the decision in United India
Insurance Co. Ltd. v. Rekha 2024 SCC OnLine Del 9019.
33. It was further contended that the reliance placed by the appellant
upon Oriental Insurance Co. Ltd. v. Brij Mohan ( supra ) was misplaced,
since the said decision pertained to gratuitous passengers and was
distinguishable on facts. It was submitted that the judgment in National
Insurance Co. Ltd. v. Chinnamma and Others ( supra ) referred to in
Brij Mohan ( supra ), had itself been considered in Fahim Ahmed
( supra ), wherein the Supreme Court observed that a tractor fitted with a
trailer may or may not answer the definition of a ‘ goods carriage ’
depending upon the facts of each case.
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34. Accordingly, it was submitted that no ground existed for grant of
recovery rights in favour of the appellant/Insurance Company and the
impugned award did not warrant interference insofar as respondent
no.5/driver-cum-owner was concerned.
Analysis
35. The issues which have been raised by counsel for parties and
which require this Court’s assessment:
i) first, the issue of contributory negligence assessed at 20% with
respect to the deceased;
ii) second , the defence of the insurer regarding the attachment of
the trolley to the tractor loaded with bricks;
iii) third , the lack of a valid and effective driving licence.
Each of these issues are discussed hereunder in some detail.
I. Contributory Negligence
36. Contributory negligence , in tort law, contemplates a situation
where a person’s own negligence has materially contributed to the harm
suffered, thereby warranting apportionment of liability to the extent of
such negligence.
37. The accident occurred between the offending vehicle i.e. a tractor-
trolley carrying bricks, admittedly moving ahead of deceased’s vehicle,
and allegedly applying brakes while taking a turn, resulting in deceased’s
vehicle colliding from behind. Rear-end collisions can be divided into
two categories- first , where an abandoned/stationary vehicle is parked on
the road without indication, lighting or warning signs, and the
impacted/following vehicle crashes into the rear end, being unable to
estimate that the offending vehicle is abandoned/stationary; and second ,
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where there is flowing traffic and the vehicle in front suddenly applies
brakes. In the latter case, the matter has to be assessed with regard to the
duty of the person following the vehicle to maintain a ‘ safe distance ’ in
order to avoid a collision.
38. Considering that the facts of the present case fall within the
second category, the decisions of this Court, the Supreme Court and
some from other international jurisdictions, in this context, are briefly
discussed hereunder:
a) Rajpal v. Dharampal 2012 SCC Online Del 31:
This Court was dealing with an accident which occurred due to
the offending vehicle coming at a high speed, overtaking the
two-wheeler scooter, and suddenly applied brakes. The
Tribunal held that even though the accident had occurred on
account of “ sudden application of brakes ”, the two-wheeler
rider had also contributed to the accident since he was not in
full control of the vehicle. Ratio of negligence was accordingly
assessed as 70:30.
b) Nishan Singh & Ors. v. Oriental Insurance Co. Ltd. & Ors.
2018 6 SCC 765:
The Supreme Court dealt with the issue of a moving vehicle in
a rear-end collision. The decision of the Supreme Court’s
continues to holds the field with regard to rear-end collision. A
Maruti car dashed against a truck moving ahead of it.
Claimants alleged that the truck driver “ suddenly applied
brakes ” being in the centre of the road but bringing it to the
right side as a result of which the Maruti car collided. The
Tribunal recorded the testimony of the driver of the car, who
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stated that he was at a distance of about 10 to 14 feet. In these
circumstances, the issue arose as to whether the said distance
was “ sufficient ” to avoid a collision in a case of sudden
braking.
The Tribunal, and thereafter the High Court, held that the
Maruti car had been driven in a rash and negligent manner,
which was the cause of accident resulting in fatality. The
Supreme Court emphasized on Rule 23 of the Rules of the
Road Regulations 1989 , which obligates the vehicle following
the truck to maintain a “ safe distance ”. The Supreme Court
noted that the expression “sufficient distance” has not been
defined and therefore, the thumb rule would be ‘ at least a safe
distance of 2 to 3 seconds gap in ideal conditions’ . This would
allow the driver of the vehicle behind to respond and avert a
collision. The distance of “ 10 to 15 feet ” was held not to be a
‘ safe distance ’.
The Tribunal had also noted that there was no evidence to
indicate that the driver of the truck suddenly applied brakes in
the middle of the road, which was endorsed by the High Court.
Though, the claim was dismissed, the Court proceeded to grant
limited relief under Section 140 of the MV Act.
c) S. Mohammed Hakkim v. National Insurance Company Ltd.
& Ors. 2025 INSC 905:
The Supreme Court was dealing with an accident wherein a
motorcycle carrying two occupants collided with the vehicle
ahead, which had suddenly applied brakes, resulting in
amputation of the left leg of one of the occupants. The
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Tribunal as well as the High Court affirmed that the accident
had occurred due to the sudden stoppage of the car and, relying
on Rule 23 of the Rules of the Road Regulations 1989 , imposed
contributory negligence of 20% for failure to maintain a “ safe
distance ”.
The Supreme Court noted that the root cause of the accident
was the “ sudden braking ” by the car driver. It was the
responsibility of the said driver to provide warning or signals
to vehicles moving behind on the road. The percentage of
contributory negligence was, therefore, increased.
d) Rouse v. Squires 1973 QB 889:
The Court of Appeal in England was dealing with a collision
where a lorry skidded into a jack-knife position, obstructing
the centre lane of a three-lane carriageway of a motorway. A
motor car being driven in the centre lane collided with a lorry
and came to a halt with its rear lights switched on. Another
lorry driver, who had been following, parked with the hand
brake engaged in the near side lane. Yet another lorry driver,
who was approaching the spot, did not realise that the vehicles
were stationary, and though he braked, could not avoid
colliding with the parked lorry, resulting in a fatal accident. In
relation to such chain reaction accidents, the Court of appeal
relied on Harvey v. Road Haulage Executive [1952] 1 KB 120
and Barber v. British Road Services , reported in the Times,
November 18, 1964. The Court held:
“ if a driver so negligently manages his vehicle so as
to cause it to obstruct the highway and constitute a
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danger to other users including those who are
driving fast and not keeping a proper lookout, but
not those who deliberately or recklessly drive into
the obstruction, then the first driver’s negligence
can be held to have contributed to the causation of
an accident of which the immediate cause was the
negligent driving of the vehicle is because of the
presence of the obstruction collides with it or with
some other vehicle or some other person.”
(emphasis added)
The Court held that the lorry driver who ultimately collided
had not initiated the dangerous situation but had failed to take
adequate steps to cope with an already existing danger.
Accordingly, 75% of the blame was put on his shoulders as
against 25% to the third-party driver. The third-party driver
was the first lorry which ended up across two lanes of the road
way creating a risk. The Court held that:
“ where the party guilty of the prior negligence has
created a dangerous situation and the danger is still
continuing to a substantial degree at the time of the
accident and the accident would not have happened
but for this continuing danger, he is responsible for
the accident as well as the party who was subsequently
negligent .”
(emphasis added)
The Court, therefore, effectively held that an initial negligent
act creating a dangerous obstruction continues to attract
liability so long as the danger remains an effective cause of the
accident. A subsequent negligent act does not break the chain
of causation unless it is wholly independent and unforeseeable.
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e) Flynn v. Bus Átha Cliath [2012] IEHC 398:
The Irish High Court held that “ sudden braking ” is not
negligent, where scientific evidence establishes an imminent
danger requiring an immediate response. The victim was
thrown to the ground when the bus driver braked sharply to
avoid a child. Video evidence showed that, as the bus
approached, two children were standing at a bus stop on the
opposite side of the road and one of them attempted to cross
the road in the path of the bus. Since, there had been no reason
to anticipate such manoeuvre, even at the level of a bare
possibility, but there arose an immediate necessity to react
appropriately once it occurred, “ sudden braking ” was
warranted. The Court held that:
“ the courts cannot apply a counsel of perfection. The
duty of care expected of a driver is a high standard,
but it is still to be measured by the reactions and
expectations of reasonable men and women’ and
observed that ‘in making decisions in emergencies, the
Court must bear in mind that detached reflection and
the weighing of various options is not to be expected
and certainly not required where a human life is to be
saved .”
(emphasis added)
The Court ultimately held that the bus driver had reacted
correctly to a potential hazard to life and, was, therefore, not
responsible for the injuries suffered by the plaintiff.
f) Leslie O'Donnell v. Smith and Royal & Sun Alliance
PLC [2018] SC EDIN 68:
In this decision of the Scotland Personal Injury Court rendered
in December 2018, the matter related to a motorcyclist
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travelling on a highway with the respondent’s car moving
ahead. While attempting to overtake the car, the driver of the
car slowed down and braked rather abruptly. The motorcyclist
also braked hard but was unable to avoid a collision, resulting
in injury. Submissions were advanced to the effect that there
were no strict rules governing the distance to be maintained by
a following vehicle, nor could negligence automatically be
inferred merely because a vehicle collided with the rear side of
another. Contributory negligence was urged by the respondent
car driver. The Court noted that there was no evidence to
suggest that the motorcyclist had been travelling too close to
the car and, rather, had been maintaining a distance of
approximately 50-60 metres , which was considered
reasonable. On the issue of contributory negligence , the Court
held that the preponderance of blame would still lie upon the
car driver. The Court found the car driver to be in breach of
duty by abruptly stopping due to apprehension about the
motorcycle overtaking the vehicle. There had been no
justification for such sharp braking , and the manoeuvre was
found to be inappropriate. The Highway Code advised steady
driving without sudden changes in speed or direction and,
accordingly, the primary negligence was attributed to the car
driver. The assessment was based on the rule of “ stopping
distances ” in the Highway Code. The apportionment resulted
in a 20% reduction in the award of damages. Effectively, the
Court held that “ the duty of a following driver is to maintain a
manner and position of driving enabling response to
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reasonably anticipated traffic exigencies ”. However, where a
reasonable distance is maintained and the lead vehicle
performs an unexpected emergency stop, contr ibutory
negligence cannot be presumed in the absence of evidence
demonstrating that the following vehicle had been too close or
driven imprudently.
g) Rules of the Road Regulations 1989
Reference may also be made to both Rules 23 and 24 of the
Rules of the Road Regulations 1989, the former being a duty
on the following vehicle to maintain “ sufficient distance ” and
the latter being on the vehicle ahead to avoid “ abrupt braking ”
unless for safety reasons. For ease of reference said rules are
extracted as under:
“ Rule 23
“ 23. Distance from vehicles in front.-The driver of a
motor vehicle moving behind another vehicle shall
keep at a sufficient distance from that other vehicle to
avoid collision if the vehicle in front should suddenly
slow down or stop.”
Rule 24
“24. Abrupt brake.- No driver of a vehicle shall apply
brake abruptly unless it is necessary to do so for safety
reasons. ”
Assessment in the present case
39. The issue requiring consideration is whether the finding of
20% contributory negligence attributed to the deceased in the
impugned award warrants interference.
40. At the outset, the evidentiary position assumes significance.
PW-1 / wife of the deceased , though admittedly not an eye witness,
consistently deposed in her affidavit [ Exhibit PW1/A ] that the
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offending tractor carrying bricks, while moving ahead of the
deceased’s vehicle, suddenly took a left turn and applied brakes
without any indication, as a consequence of which the deceased had
no sufficient time to react and collided with the offending vehicle
from behind. The version of PW-1 / wife of the deceased substantially
derives corroboration from the testimony of PW-3 /Vinod Chand
Katiyar, who was treated by the Tribunal as the sole eye-witness.
41. PW-3 / eye-witness specifically deposed that he had met the
deceased at Dharuhera Bus Stand and was following him for some
distance on his scooter when he witnessed the occurrence. His
testimony records that the tractor-trolley laden with bricks was
travelling ahead of the deceased’s vehicle and suddenly applied
brakes in order to take a turn, resulting in the deceased’s vehicle
colliding with the trolley from behind. Significantly, in cross-
examination, PW-3 / eye-witness denied the suggestion that the
deceased was driving at a speed of 80–90 kmph , and no contrary
material was produced by the insurer [ appellant herein ] to
substantiate excessive speed. Equally material is the fact that PW-
3 / eye-witness candidly stated that he could not say whether the
tractor owner had signalled by hand before turning, which
demonstrates absence of embellishment and lends credibility to his
testimony.
42. The Tribunal itself accepted PW-3 / eye-witness to be a reliable
witness, specifically recording that his testimony remained free from
contradiction, explained his presence at the site, and stood
corroborated by the criminal record including the FIR and site plan.
Consequently, the foundational factual finding regarding the
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offending vehicle/ tractor-trolley having suddenly slowed down or
braked while negotiating a turn cannot be lightly displaced.
43. The site plan also depicts the place of occurrence on NH-8 near
the HP Petrol Pump and the turning point, and broadly corroborates
that the accident occurred while both vehicles were moving in the
same direction of travel. Importantly, the site plan does not indicate a
case of a stationary or parked vehicle obstructing the carriageway.
Therefore, the present case is distinguishable from those where a
stationary vehicle was left negligently parked on the road without
indicators. Rather, the facts indicate a moving tractor-trolley ahead
and a moving car behind, where the collision occurred in the
backdrop of a sudden attempt to turn.
44. In this factual setting, the principles governing rear-end
collisions require cautious application. In Raj Pal & Ors. v.
Dharampal & Ors. ( supra ), this Court held that a collision from
behind cannot automatically result in an inference of sole negligence
on the part of the following vehicle and that surrounding
circumstances, including the conduct of the vehicle ahead, are
required to be assessed. Thus, the mere fact that deceased’s vehicle
struck the tractor-trolley from behind cannot, by itself, conclude the
issue of negligence. At the same time, Nishan Singh & Ors. v.
Oriental Insurance Co. Ltd. & Ors (supra ) recognizes the duty of a
vehicle following another to maintain “ sufficient distance ” so as to
account for foreseeable slowing down or stopping of the vehicle
ahead. The principle underlying the judgment is that the following
vehicle must retain “ sufficient control ” to avoid collision. However,
the decision does not lay down an absolute rule that every rear-end
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collision ipso facto establishes exclusive negligence of the rear
vehicle irrespective of the conduct of the lead vehicle.
45. The present facts indicate competing obligations on both sides.
On the one hand, the offending tractor-trolley , admittedly laden with
bricks, is alleged to have suddenly applied brakes while attempting to
turn, thereby attracting concern regarding abrupt braking and safe
turning manoeuvre. On the other hand, the collision from behind also
suggests that the deceased may not have maintained such distance or
control as would have enabled him to avoid impact after the tractor
slowed down.
46. The approach adopted by the Tribunal appears to reflect this
balanced position. The Tribunal consciously considered both Rule 23
of the Rules of the Road Regulations , 1989, concerning maintenance
of “ sufficient distance” by the vehicle behind, and Rule 24 , which
restrains abrupt braking except for safety reasons. Having accepted
the claimant’s version regarding sudden braking by the offending
vehicle, the Tribunal nonetheless held that the deceased, being the
following vehicle, was also expected to maintain “ sufficient reaction
distance ”. The finding of contributory negligence was thus not based
merely on the factum of rear impact, but upon the combined
circumstances surrounding the occurrence.
47. The Supreme Court in S. Mohammed Hakkim v. National
Insurance Company Ltd. ( supra ) has reiterated that in road accidents
involving sequential vehicular conduct, negligence may legitimately
be apportioned where the conduct of both vehicles contributes to the
occurrence. The Court recognized that “ sudden braking ” by one
vehicle and inability of the vehicle behind to sufficiently react may
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together justify attribution of contributory negligence rather than
complete exoneration of either side. Tested on the anvil of the
aforesaid principles, the impugned award does not appear to suffer
from perversity in attributing 20% contributory negligence to the
deceased.
II. Tractor-Trolley
48. There is definitional difference between ‘ tractor’ and a ‘ goods
carriage ’. While Section 2 (44) of the MV Act defines ‘ tractor ’ as:
“Section 2(44)
(44) “tractor” means a motor vehicle which is not
itself constructed to carry any load (other than
equipment used for the purpose of propulsion); but
excludes a road-roller;”
Section 2 (14 ) defines ‘ goods carriages ’ as under:
“ Section 2(14)
(14) “goods carriage” means any motor vehicle
constructed or adapted for use solely for the
carriage of goods, or any motor vehicle not so
constructed or adapted when used for the carriage
of goods;”
‘ Trailer’ on the other hand is defined under Section 2 (46)
as under:
“ Section 2(46)
(46) “trailer” means any vehicle, other than a semi-
trailer and a side-car, drawn or intended to be
drawn by a motor vehicle;”
49. In the present case, the insurer has raised a defence that the
insurance policy pertains only to a tractor , whereas the trolley attached
to the tactor , and being laden with bricks, gives a valid defence to the
insurance company for breach of policy conditions under Section 147
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read with Section 149 (2)(a)(i)(a) of the MV Act. In this regard, it will
be instructive to traverse through the decisions of the Supreme Court and
this Court in a chronological manner, as under:
a) National Insurance Company Limited v. V. Chinnnama
(2004) 8 SCC 697:
The Court was dealing with a deceased, who had purchased
five bags of vegetables, loaded them in a trailer connected to a
tractor and, upon seeing an oncoming bus, could not control
his vehicle, fell down and suffered injuries. Insurance
Company disputed its liability on the ground that the deceased
was travelling in the said tractor as a paid passenger. In this
context, the Court noted that the tractor was not even a goods
carriage and, therefore, in context of Section 147 of the MV
Act, the provision applicable to a goods vehicle would not be
triggered. Relevant paragraphs are extracted as under:
“ 15. Furthermore, a tractor is not even a goods
carriage. The expression “goods carriage” has been
defined in Section 2(14) to mean
“any motor vehicle constructed or adapted for
use solely for the carriage of goods, or any motor
vehicle not so constructed or adapted when used
for the carriage of goods”
(emphasis supplied)
whereas “tractor” has been defined in Section 2(44)
to mean
“a motor vehicle which is not itself constructed to
carry any load (other than equipment used for the
purpose of propulsion); but excludes a road
roller”.
“Trailer” has been defined in Section 2(46) to mean
“any vehicle, other than a semi-trailer and a sidecar,
drawn or intended to be drawn by a motor vehicle”.
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16. A tractor fitted with a trailer may or may not
answer the definition of goods carriage contained in
Section 2(14) of the Motor Vehicles Act. The tractor
was meant to be used for agricultural purposes. The
trailer attached to the tractor, thus, necessarily is
required to be used for agricultural purposes, unless
registered otherwise. It may be, as has been
contended by Mrs K. Sharda Devi, that carriage of
vegetables being agricultural produce would lead to
an inference that the tractor was being used for
agricultural purposes but the same by itself would
not be construed to mean that the tractor and trailer
can be used for carriage of goods by another person
for his business activities. The deceased was a
businessman. He used to deal in vegetables. After he
purchased the vegetables, he was to transport the
same to the market for the purpose of sale thereof
and not for any agricultural purpose. The tractor
and trailer, therefore, were not being used for
agricultural purposes. However, even if it be
assumed that the trailer would answer the
description of “goods carriage” as contained in
Section 2(14) of the Motor Vehicles Act, the case
would be covered by the decisions of this Court
in Asha Rani [(2003) 2 SCC 223 : 2003 SCC (Cri)
493] and other decisions following the same, as the
accident had taken place on 24-11-1991 i.e. much
prior to coming into force of the 1994 amendment. ”
(emphasis added)
The important aspect of this decision is that the Supreme Court
notes that the trailer attached to the tractor is necessarily
required to be used for ‘ agricultural purposes ’, unless
registered otherwise. Thus, while the tractor and trailer can be
used for ‘ agricultural purposes ’, they cannot be used for
carriage of goods by another person for his business activities.
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b) Oriental Insurance Co. Ltd. v. Brij Mohan (2007) 7 SCC 56:
The Supreme Court was dealing with a claimant, a labourer
travelling on a trolley attached to the tractor . Earth dump was
loaded on the trolley attached to the tractor , and claimant and
other workers were returning to the brick mill. The tractor was
allegedly driven rashly and negligently by the driver, and the
claimant slipped from the trolley , came under the wheels, and
suffered grievous injuries. The insurer’s defence was that the
trolley was not insured and that the tractor was insured only
for the purpose of carrying of ‘ agricultural loads ’. The earth
dug and stored in the trailer was for manufacturing bricks and
could not amount to agricultural work. Relying on
Chinnamma ( supra ), the Court noted that the claimant was
merely a passenger travelling on the trolley. The Court,
therefore, continued to endorse the award to the claimant, but
recovery rights were granted to the insurer from the owner of
the tractor and trolley .
c) United India Insurance Co. Ltd., Kadapa District v. Koduru
Bhagyamma & Ors., 2007 SCC OnLine AP 830:
The Andhra Pradesh High Court was dealing with an issue of
whether Insurance Company could be fastened with the
liability in respect of a person who died while travelling in a
trailer attached to a tractor , where the trailer was not
separately insured. Upon analysing the provisions of the MV
Act and earlier judgments, reliance was placed on the decision
of the Andhra Pradesh High Court in Gunti Devaiah v. Vaka
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Peddi Reddy (2004) ACJ 1881, holding that the MV Act does
not contemplate separate insurance for a trailer and that, when
a trailer is attached to the tractor , it becomes part of the
tractor . The reasoning was that the trailer by itself cannot be
driven and has to be carried or towed with a motor vehicle
namely a tractor or a self-propelled vehicle . Therefore, the
question of driving the trailer in a rash and manner would not
arise. It is only the prime mover or the motor vehicle which
controls the movement, and the owner of the vehicle and its
insurer can be made liable for compensation. The trailer
therefore, when attached to the tractor , becomes a “ tractor-
trailer ” and, there is no provision requiring the trailer to be
separately insured to cover the third-party risk.
d) Fahim Ahmad and Others v. United India Insurance Co.
Ltd. and Others (2014) 14 SCC 148:
In this case, the Supreme Court was dealing with collision
involving a tractor and the deceased. The Insurance Company
raised an objection that there was a breach of policy conditions
because, at the time of the accident, the tractor was carrying
sand. The Court held as under:
“ 5. A perusal of the records shows that, at the time of
the accident, a trolley was attached with the tractor,
which was carrying sand for the purpose of
construction of underground tank near the farm land
for irrigation purpose(s). However, merely because it
was carrying sand would not mean that the tractor
was being used for commercial purpose and
consequently, there was a breach of the condition of
policy on the part of the insured. There is nothing on
record to show that the tractor was being used for
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commercial purpose(s) or purpose(s) other than
agricultural purpose(s) i.e. for hire or reward, as
contemplated under Section 149(2)(a)(i)(a) of the said
Act.
6. Although the plea of breach of the conditions of
policy was raised before the Tribunal, yet neither any
issue was framed nor was any evidence led to prove
the same. In our opinion, it was mandatory for
Respondent 1 Insurance Company not only to plead
the said breach, but also substantiate the same by
adducing positive evidence in respect of the same. In
the absence of any such evidence, it cannot be
presumed that there was breach of the conditions of
policy. Thus, there was no reason to fasten the said
liability of payment of the amount of compensation
awarded by the Tribunal on the appellants herein.
7. We may also notice that this Court in National
Insurance Co. Ltd. v. V. Chinnamma [(2004) 8 SCC
697 : 2005 SCC (Cri) 378 : JT (2004) 7 SC 167] held
that: (SCC p. 702, para 16)
“16. … carriage of vegetables being agricultural
produce would lead to an inference that the
tractor was being used for agricultural purposes
but the same by itself would not be construed to
mean that the tractor and trailer can be used for
carriage of goods by another person for his
business activities.”
Thus, a tractor fitted with a trailer may or may not
answer the definition of “goods carriage” contained
in Section 2(14) of the said Act. ”
(emphasis added)
The Supreme Court held that merely because the tractor was
carrying sand would not mean that it was being used for a
‘ commercial purpose ’ rather than ‘ agricultural purpose ’.
e) New India Assurance Co. Ltd. v. Sanjay Tyagi 2014 SCC
OnLine Del 1339:
The Coordinate Bench of this Court, while dealing with an
accident with a tractor carrying a trolley and the plea of the
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Insurance Company that there was a breach of the policy, noted
that the insurance policy was a comprehensive policy for
‘ agricultural purpose ’ and that the tractor , without equipment,
is actually of no use. The term ‘ agricultural purpose ’ denotes a
wide amplitude; it is not only the tractor simpliciter that is
insured, rather it is insured for ‘ agricultural purposes ’, which
covers the trolley as well.
f) Dhondubai v.Hanmantappa Bandappa Gandigude 2023 SCC
OnLine SC 2387:
The Supreme Court was dealing with a tractor-trolley collision
and the Insurance Company’s plea that only the tractor was
insured. The Court noted in the following paragraphs as under:
“ 5. In a matter of the present nature, the law is well
settled that when a tractor and trailer are involved,
both the tractor as well as the trailer are required to
be insured. Therefore, in a normal circumstance,
when the appellant/claimant was travelling in the
trailer which was not insured, the liability on the
Insurance Company cannot be fastened and to that
extent the High Court was justified.
6. However, the question for consideration herein is
as to whether in the peculiar facts and circumstances
arising in this case, this Court is required to exercise
the power under Article 142 of the Constitution of
India to direct the Insurance Company to pay the
amount and recover the same from the owner of the
vehicle. In that regard, the position is no more res-
integra in view of the consideration made by this
2
Court in Oriental Insurance Co. Ltd. v. Brij Mohan .
This Court in a similar circumstance where the
trailer did not have insurance, has exercised the
power under Article 142 taking into consideration
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the difficult circumstances in which the claimant
therein was placed.
7. If the said decision is taken note and the instant
facts are taken into consideration, it is noticed that
the claimant a lady who was working as a labourer
and was travelling in the tractor attached to the
trailer, was about 20 years old as on the date of the
accident. Due to the injuries suffered in the accident
she had also undergone amputation of her left lower
limb above the knee joint. Therefore, apart from the
disability being 100%, there is prejudice to the
marriage prospects and to lead a normal life. In such
circumstance, it would not be possible for the
claimant to recover the amount from the owner.
Therefore, in that circumstance, we direct that the
respondent-Insurance Company shall pay the
amount awarded by the High Court as compensation
with the accrued interest and recover the same from
the owner of the vehicle. The amount shall be
deposited before the MACT within six weeks from the
date of receipt of a copy of this judgment whereupon
the amount shall be disbursed to the claimant. ”
(emphasis added)
The Supreme Court effectively noted that both the tractor and
the trailer are required to be insured. Therefore, if the claimant
was travelling in the trailer which was not insured, liability
cannot be ordinarily fastened on the Insurance Company.
g) United India Insurance Co. Ltd. v. Rekha 2024 SCC OnLine
Del 9019:
The challenge by Insurance Company was to the compensation
awarded in a case involving a tractor-trolley , where the tractor
was allegedly carrying rohri, which, according to the
Insurance Company, showed that it was being used for
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‘ commercial purpose ’. The Court held that the commercial use
could not be established since there was no corroborative
evidence to show that it was carrying rohri . Therefore, the
Insurance Company was not entitled to recovery rights.
h) Royal Sundaram Alliance Insurance Co. Ltd. v. Honnamma
2025 SCC OnLine SC 1027:
The Supreme Court dealt with a case where the deceased was
travelling in a tractor and trailer as a coolie for unloading soil.
The High Court enhanced compensation while fastening
liability upon the Insurance Company. Insurance company
appealed, the Supreme Court noted that it was clear that the
tractor , which was insured, was the cause of the accident and
that the accident was not caused solely because of a stand-
alone trailer . The principal cause of the accident was a tractor
and, in sequence of events, the trailer overturned. The Court
relied upon certain judgments to note that ultimately the root
cause of the accident is the tractor, which was insured, and this
fact could not be lost sight of. The Court further noted:
“ Moreover, this Court is duty bound to be mindful of the
ground realities of our nation and cannot let practicality be
overshadowed by technicality ”. The Court further noted as
under:
“ 13. In Dhondubai (supra), the Court stated:
‘5. In a matter of the present nature, the law is well
settled that when a tractor and trailer are involved,
both the tractor as well as the trailer are required to
be insured. Therefore, in a normal circumstance ,
when the appellant/claimant was travelling in the
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trailer which was not insured, the liability on the
Insurance Company cannot be fastened and to that
extent the High Court was justified.
14. To our mind, the learned Judges
in Dhondubhai (supra) did not lay down an absolute
principle of law, but taking note of Oriental
Insurance Co. Limited v. Brij Mohan, (2007) 7 SCC
56, it was ordered that the ‘respondent-Insurance
Company shall pay the amount awarded by the High
Court as compensation with the accrued interest and
recover the same from the owner of the vehicle.’ A
decision by a Division Bench of the Andhra Pradesh
High Court in United India Insurance Co. Ltd.,
Kadapa District v. Koduru Bhagyamma, 2007 SCC
OnLine AP 830 is relevant:
‘ 1. This case has come before this Court on a
reference made by a learned Single Judge of
this Court as it was contended before the
learned Single Judge by the appellant that as
the trailer in which the deceased was travelling
was not insured, although it was attached to
the tractor which was insured, therefore no
liability could be fastened upon the insurer.
xxx
13. Now on analysis of these judgments and the
provisions of law which have been quoted
above, we feel that the law has been correctly
appreciated by a learned Single Judge of this
Court in Gunti Devaiah v. Vaka Peddi
Reddy (supra) and the reasons given by him
are sufficient to hold that under the Motor
Vehicles Act no separate insurance is
contemplated for a trailer and when the trailer
is attached to the tractor which is insured, it
becomes the part of the tractor. We reproduce
the Para 26 of the said judgment as under:
“The word “vehicle” mentioned in Section 147
is co-relatable to the word motor vehicles,
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which is stipulated in Section 146. Therefore,
the expression vehicle wherever appearing in
Chapter X(XI) has to be only read as motor
vehicle. The principle of claim for
compensation in accidents arising out of the
use of the motor vehicle is based on tortuous
liability and the negligence of the driver of the
motor vehicle is a sine quo non for
maintaining a claim under the provisions of
the Act. Inasmuch as the trailer by itself
cannot be driven and it has to be carried or
towed with a motor vehicle namely a tractor or
a like self-propelled vehicles. Therefore, the
question of driving the trailer in a rash and
negligent manner would not arise. It is only
the prime mover or the motor vehicle which
controls movement of the tractor and in case
of the negligence driving of the trailer or the
motor vehicle, the owner of the vehicle and its
insurer alone will be made liable for payment
of compensation. But, since the trailer is
attached can it be said that trailer should also
be independently insured so as to avoid the
liability of compensation in case of rash and
negligent driving by the driver. That
contingency would not arise, as it is only a
vehicle and not a motor vehicle. It may be for
tax purposes, it is treated as a goods vehicle.
But, under the provisions of the Motor
Vehicles Act, no separate insurance is
contemplated. When the trailer is attached to
the tractor it becomes a tractor-trailer. There is
no provision requiring the trailer to be
separately insured to cover the third party risk.
The reasons are obvious that it cannot be
driven by the driver as in the case of motor
vehicles or tractors. Thus, a separate
distinction has been drawn between the motor
vehicle and a vehicle i.e., visible in all the
definitions and more especially in Chapter XI.
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The same situation also persists in Chapter X
in case of no fault liability wherein it has been
stated that whether a death or a permanent
disability of any person has been resulted from
an accident arising out of the use of a motor
vehicle or motor vehicles and there is no
reference to vehicle as such. This aspect was
never considered in any of the decisions relied
on by the learned Standing Counsel for the
Insurance Company and also for other side. ”
(underlined in original; emphasis supplied by
us through the bold highlight)
(emphasis added)
The Court distinguished the decision in Dhondubai ( supra )
while observing that it did not lay down an absolute principle
of law. In fact, the Andhra Pradesh High Court's decision in
Kadapa District v Koduru Bhagyamma ( supra ) was relied
upon.
i) New India Assurance Co. Ltd. v. Nirmla 2025 SCC OnLine
Del 10698:
In this decision by a Coordinate Bench of this Court, which
related to a tractor being driven by the owner along with a
trolley carrying packets of chana, the Insurance Company
pleaded that that the trailer was not covered under the policy.
However, noting the decision of the Supreme Court in
Honnamma ( supra ), the Court held that the limitation of
liability under the insurance policy relates to the use of the
tractor for drawing more trailers than permitted by law.
Therefore, the Insurance Company was liable to compensate
the claimants. The limitation of liability under insurance policy
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in the present case that case is akin to the limitation considered
in Honnamma ( supra ).
Assessment in the present case
50. After an assessment of all these decisions, in the opinion of this
Court, relying upon the recent decision of the Supreme Court in
Honnamma ( supra) , which places the issue of causation of an accident
upon the tractor itself, the aspect of the trailer stands separated, while
observing that the trailer was no entity as a stand-alone motor vehicle.
The focus was on the principal cause of the accident, namely, the tractor
pulling/hauling/moving the trailer , and therefore, the accident is
considered to have been caused by the tractor .
51. This Court, therefore, defers to the categorical opinion of the
Supreme Court in this regard and, in fact, notes that this proposition had
previously been considered in Kadapa District ( supra ) by the Andhra
Pradesh High Court and in Sanjay Tyagi ( supra ) by this Court.
52. The fundamental issue requiring appreciation is that, admittedly,
the tractor is insured. In the present case, there is nothing in the
insurance policy placed on record to indicate that the tractor was insured
only for ‘ agricultural purposes ’. However, for the sake of assessment, it
shall be assumed that the insurance policy covers the tractor for
‘ agricultural purposes ’. The moving vehicle or motor vehicle is,
therefore, the tractor , which is defined under Section 2(44) of the MV
Act, and in fact states that the vehicle is “ not itself constructed to carry
any load ”.
A trailer , to the contrary, as defined under Section
2(46) of the MV Act, is merely a ‘ vehicle’ and not a
‘ motor vehicle’ , which is “ drawn or intended to be
drawn by a motor vehicle ”.
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53. The Supreme Court in Dhondubai ( supra ) states that, as a general
rule, a tractor and trailer are both required to be insured; however, it
restricts the same to “ normal circumstances ” where the trailer was not
insured. In Honnamma ( supra ) , the Supreme Court clearly noted that
Dhondubai ( supra ) did not lay down an absolute principle of law. The
driving on the road is by a motor vehicle, namely, the motorised vehicle
which is in motion, and the accident is caused due to the alleged braking
of that vehicle. Whether a trailer is attached to it or not, and whether it is
separately insured or not, would not make any difference, in the opinion
of this Court, since the negligence, if any, has to be attributed to the
entire tractor-trolley unit being driven by a person and cannot be severed
between the tractor and the trailer .
54. Essentially, the trolley / trailer not being separately insured cannot
be held to be the cause of the accident. It so happens that the
trolley/trailer is attached to a motorised vehicle which, due to its
movement on the road, becomes the cause of an accident. The
trolley/trailer has no independent identity as a motorised vehicle on the
road unless it is left abandoned or detached from the motorised vehicle
and is involved in a situation involving a rear-end collision with another
vehicle. However, this is not a case of a stationary vehicle left
abandoned, but rather of a moving vehicle, indeed a motor vehicle in the
form of a ‘ tractor’ , which is alleged to have caused the accident by
‘ abrupt braking ’ and a ‘ sudden turn ’.
55. Insurance companies have often attempted to introduce the
distinction between a tractor and trolley/trailer into the controversy.
However, in the opinion of this Court, the Supreme Court has now
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provided a determinative opinion, and the Courts henceforth would be
expected to align with the said opinion, unless a different view is taken
subsequently.
56. The fact that the trolley was carrying bricks or not would not be an
issue in a case of “ sudden braking ”. However, it could assume
significance where Section 147 of the MV Act comes into play with
regard to the tractor being used for carrying goods and, therefore, the
insurance not extending to a ‘ goods vehicle’ .
57. The principal cause of the accident is the movement of the tractor
on the road, involved in ‘ abrupt braking ’ and ‘ sudden turn ’. In the
opinion of this Court, the carriage of the trolley , together with whatever
contents it carried, would not fall within the scope of a successful
insurance defence. Accordingly, the plea of the insurance company in
this regard is not sustainable.
58. The issue of the principal cause is exemplified in the decision in
Honnamma ( supra ) , particularly in paragraph 12 , as also in chain-
reaction collisions as discussed in the English decision in Rouse v.
Squires ( supra ). In fact, Rouse v. Squires ( supra ) was relied upon by the
Supreme Court in Karnataka State Road Transport Corporation v. K.V.
Sakeena , (1996) 3 SCC 446.
III. Fake Driving Licence
59. Further, appellant/Insurance Company prays for recovery rights
against the respondent no.5/driver-cum-owner of offending vehicle, on
the basis that he did not possess a valid and effective driving licence at
the time of accident.
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60. In response to aforesaid, respondent no.5/driver-cum-owner stated
that said driving licence had been duly produced on record, and that
appellant/Insurance Company neither took any specific plea as regards
the license being fake in its written statement nor led any cogent evidence
in this regard.
61. Appellant/Insurance Company's plea was based on the testimony
of clerk from Licensing Authority Farrukhabad, Uttar Pradesh [ R3W1 ],
who stated that records pertaining to the driving licence produced by
respondent no. 5/driver-cum-owner were not traceable and a FIR had
been registered regarding said missing records. For ease of reference,
statement of R3W1 is extracted as under:
“ The ARTO has given this letter to me and I do not
know anything about the DL in question. The FIR is
registered by Predecessor of present ARTO.
xxxxx
1 do not know whether the non availability of
original record of DL is for the reason mentioned in
the complaint given to the police. ”
62. Since driving license could not be verified by Licensing Authority
Farrukhabad, Uttar Pradesh , appellant/Insurance Company contended
that the driving licence produced by respondent no. 5/driver-cum-owner
could not be considered genuine. Accordingly, what needs to be
examined is whether mere non-availability of records with Licensing
Authority would, by itself, lead to a conclusion that the driving license
was ‘ fake ’ or ‘ invalid ’.
63. The Tribunal, vide impugned award, concluded that Insurance
Company had failed to substantiate its defence regarding breach of
policy conditions on the ground that the driving license was fake .
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64. With respect to fake driving licenses and defences available to
appellant/Insurance Company on the said ground, reference may be
made to certain decisions of the Supreme Court, as under:
a) Pepsu Road Transport Corporation v. National Insurance
Company Ltd. , (2013) 10 SCC 217:
The Supreme Court in the said case was dealing with an insurer's
plea for exoneration under Section 149(2)(a)(ii) of the MV Act,
relating to breach of conditions concerning the driving licence, on
the allegation that the driver was holding a fake driving license.
The Court relied upon the decisions made by the Supreme Court
in United India Insurance Co. Ltd. v. Lehru , 2003 3 SCC 338
and National Insurance Co. Ltd. v. Swaran Singh , 2004 3 SCC
297, wherein it was held that “ mere absence of a valid driving
license, possession of fake or invalid driving licence, or
disqualification of driver, would not constitute valid defences
available to Insurance Company against the insured or third
parties ”.
Insurance Company, in such cases, was required to establish that
the insured was guilty of negligence. and had failed to exercise
reasonable care in complying with the policy conditions relating
to use of insured vehicle by a duly licensed driver. The Court,
therefore, held as under:
“ 10. In a claim for compensation, it is certainly open
to the insurer under Section 149(2)(a)(ii) to take a
defence that the driver of the vehicle involved in the
accident was not duly licensed. Once such a defence
is taken, the onus is on the insurer. But even after it
is proved that the licence possessed by the driver was
a fake one, whether there is liability on the insurer is
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the moot question. As far as the owner of the vehicle
is concerned, when he hires a driver, he has to check
whether the driver has a valid driving licence.
Thereafter he has to satisfy himself as to the
competence of the driver. If satisfied in that regard
also, it can be said that the owner had taken
reasonable care in employing a person who is
qualified and competent to drive the vehicle. The
owner cannot be expected to go beyond that, to the
extent of verifying the genuineness of the driving
licence with the licensing authority before hiring the
services of the driver. However, the situation would
be different if at the time of insurance of the vehicle
or thereafter the insurance company requires the
owner of the vehicle to have the licence duly verified
from the licensing authority or if the attention of the
owner of the vehicle is otherwise invited to the
allegation that the licence issued to the driver
employed by him is a fake one and yet the owner
does not take appropriate action for verification of
the matter regarding the genuineness of the licence
from the licensing authority. That is what is
explained in Swaran Singh case [National Insurance
Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297:2004
SCC (Cri) 733] . If despite such information with the
owner that the licence possessed by his driver is
fake, no action is taken by the insured for
appropriate verification, then the insured will be at
fault and, in such circumstances, the Insurance
Company is not liable for the compensation. ”
(emphasis added)
On facts of the case, the Court held that driver had been engaged
nearly six years prior to the accident, had been put to a driving
test, and had also been imparted training. Therefore, in these
circumstances, insured could not be considered at fault for having
employed a person whose licence was subsequently proved to be
fake.
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Notably, the Supreme Court held, in the paragraph extracted
above, that the position may be different, where, either at time of
issuance of insurance policy or thereafter, Insurance Company
requires the owner to have the driving license verified from
Licensing Authority, or where insured/owner is informed that the
driver’s license is fake and yet it fails to take appropriate steps in
that regard.
b) IFFCO Tokio General Insurance Co. Ltd. v. Geeta Devi (2024)
13 SCC 755:
The Supreme Court was dealing with an appeal preferred by
Insurance Company against the denial of recovery rights . The
Tribunal, initially recorded that driver of the tempo was holding a
fake driving license and consequently, opined that Insurance
Company would not be liable to pay compensation. The High
Court, however, reversed the said finding and denied recovery
rights to Insurance Company on the ground that it had neither
been pleaded nor proved that the owner of the vehicle had failed
to take adequate steps to verify the genuineness of the driving
licence. Accordingly, it was held that breach of the terms and
conditions of insurance policy could not be sufficiently
established. Relevant paragraphs in this regard are extracted as
under:
“ 8. The argument with respect to the driving skill test
does not merit acceptance as the insurance policy in
question admittedly did not postulate that a driving
skill test should compulsorily be taken before
employing a chauffeur to drive the insured vehicle. The
relevant condition in the insurance policy, titled
“Driver Clause”, reads as follows:
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“Any person including insured: provided that the
person driving holds an effective driving licence at the
time of the accident and is not disqualified from
holding or obtaining such a licence.”
There is, thus, no mandate in the statutory provision or
the above clause that a driving skill test should be
undertaken without fail before employing a driver.
Therefore, it is not open to the petitioner Insurance
Company to cite the same as a breach of the terms and
conditions of the policy. In fact, there was no such term
or condition in the policy.
9. As regards the contention that the driver of the
vehicle was not duly licensed as he possessed a fake
licence, it may be noted that neither Section
149(2)(a)(ii) of the 1988 Act nor the “Driver Clause”
in the subject insurance policy provide that the owner
of the insured vehicle must, as a rule, get the driving
licence of the person employed as a driver for the said
vehicle verified and checked with the Transport
Authorities concerned. Generally, and as a matter of
course, no person employing a driver would undertake
such a verification exercise and would be satisfied with
the production of a licence issued by a seemingly
competent authority, the validity of which has not
expired. It would be wholly impracticable for every
person employing a driver to expect the Transport
Authority concerned to verify and confirm whether the
driving licence produced by that driver is a valid and
genuine one, subject to just exceptions. In fact, no such
mandatory condition is provided in any car insurance
policy and it is not open to the petitioner Insurance
Company, which also did not prescribe such a
stringent condition, to cite the failure of the deceased
vehicle owner to get Ujay Pal's driving licence checked
with the RTO as a reason to disclaim liability under
the insurance policy. ”
(emphasis added)
65. Yet again, the Supreme Court, emphasised that insurance policy
did not contain any stipulation requiring a compulsory driving test to be
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conducted before employing a driver to drive the insured vehicle, while
referring to the “ driver clause in the Insurance Policy ”. Therefore, the
contention raised by the Insurance Company that the vehicle owner did
not conduct due diligence while employing the said person as a driver,
by insisting upon a condition which was neither prescribed under the
statute nor under the insurance policy, cannot be sustained. While
adverting to Swaran Singh ( supra ) and Lehru ( supra ), the Court further
held as under:
“ 15. Further, in the context of cases where the
driver's licence was found to be fake, the Bench
in Swaran Singh [National Insurance Co.
Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC
(Cri) 733 : (2004) 118 Comp Cas 396] observed that
the question would be whether the insurer could
prove that the owner was guilty of wilful breach of
the conditions of the insurance policy. It was pointed
out that the defence to the effect that the licence held
by the person driving the vehicle was a fake one
would be available to the insurance company but
whether, despite the same, the plea of default on the
part of the owner has been established or not would
be a question which would have to be determined in
each case. The earlier decision in United India
Insurance Co. Ltd. v. Lehru [United India Insurance
Co. Ltd. v. Lehru, (2003) 3 SCC 338 : 2003 SCC
(Cri) 614] was considered and the Bench in Swaran
Singh [National Insurance Co. Ltd. v. Swaran Singh,
(2004) 3 SCC 297 : 2004 SCC (Cri) 733 : (2004)
118 Comp Cas 396] observed that the ratio therein
must not be read to mean that an owner of a vehicle
can, under no circumstances, have any duty to make
an inquiry with regard to the genuineness of the
driving licence and the same would again be a
question which would arise for consideration in
each individual case. The argument that the decision
in Lehru [United India Insurance Co. Ltd. v. Lehru,
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(2003) 3 SCC 338 : 2003 SCC (Cri) 614] meant
that, for all intent and purport, the right of the
insurer to raise a defence that the licence was fake
was taken away was, however, rejected as not being
correct and it was held that such a defence can
certainly be raised, but it will be for the insurer to
prove that the insured did not take adequate care
and caution to verify the genuineness or otherwise of
the licence held by the driver. ”
(emphasis added)
In the case of Lehru (supra) , the Supreme Court further
elaborated upon the manner in which burden cast upon the insured
could be discharged. In this regard, reference may be made to
paragraphs 16 and 19 of the judgement which have been extracted
hereinbelow:
“ 16. The findings summed up by the Bench, to the
extent presently relevant, are as under: (Swaran
Singh [National Insurance Co. Ltd. v. Swaran Singh,
(2004) 3 SCC 297 : 2004 SCC (Cri) 733 : (2004) 118
Comp Cas 396] , SCC pp. 341-42, para 110)
“110. … (iii) The breach of policy condition e.g.
disqualification of the driver or invalid driving
licence of the driver, as contained in sub-section
(2)(a)(ii) of Section 149, has to be proved to have
been committed by the insured for avoiding
liability by the insurer. Mere absence, fake or
invalid driving licence or disqualification of the
driver for driving at the relevant time, are not in
themselves defences available to the insurer
against either the insured or the third parties. To
avoid its liability towards the insured, the insurer
has to prove that the insured was guilty of
negligence and failed to exercise reasonable care
in the matter of fulfilling the condition of the
policy regarding use of vehicles by a duly
licensed driver or one who was not disqualified
to drive at the relevant time.
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(iv) Insurance companies, however, with a view
to avoid their liability must not only establish the
available defence(s) raised in the said
proceedings but must also establish “breach” on
the part of the owner of the vehicle; the burden of
proof wherefor would be on them.
(v) The court cannot lay down any criteria as to
how the said burden would be discharged,
inasmuch as the same would depend upon the
facts and circumstances of each case.
(vi) Even where the insurer is able to prove
breach on the part of the insured concerning the
policy condition regarding holding of a valid
licence by the driver or his qualification to drive
during the relevant period, the insurer would not
be allowed to avoid its liability towards the
insured unless the said breach or breaches on the
condition of driving licence is/are so fundamental
as are found to have contributed to the cause of
the accident. The Tribunals in interpreting the
policy conditions would apply “the rule of main
purpose” and the concept of “fundamental
breach” to allow defences available to the
insurer under Section 149(2) of the Act.
(vii) The question, as to whether the owner has
taken reasonable care to find out as to whether
the driving licence produced by the driver (a fake
one or otherwise), does not fulfil the
requirements of law or not will have to be
determined in each case.
………
19. As already pointed out supra, once a seemingly
valid driving licence is produced by a person
employed to drive a vehicle, unless such licence is
demonstrably fake on the face of it, warranting any
sensible employer to make inquiries as to its
genuineness, or when the period of the licence has
already expired, or there is some other reason to
entertain a genuine doubt as to its validity, the burden
is upon the insurance company to prove that there was
a failure on the part of the vehicle owner in carrying
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out due diligence apropos such driving licence before
employing that person to drive the vehicle. ”
(emphasis added)
66. The Supreme Court has, therefore, categorically laid down the
legal position with respect to the defences available to Insurance
Company in order to succeed on the ground that the driving license held
by driver was fake . Firstly , the burden lies upon Insurance Company to
establish that the insured was guilty of negligence, and had failed to
exercise reasonable care in complying with the condition of insurance
policy relating to use of the vehicle by a duly licensed driver; secondly ,
no hard and fast rule can be laid down as to manner in which such
burden must be discharged, and the same will depend on the facts of
each case; thirdly , even if the breach is established or proved, the same
must be so fundamental so as to have contributed to the cause of the
accident; fourthly , the question of whether owner had taken reasonable
care to verify the driving licence, has to be determined on a case-to-case
basis; fifthly , as a matter of general principle, where a seemingly valid
driving licence is produced, unless the same is demonstratably fake on
the face of it, has expired or any other reason, or the employer has been
intimated that license is fake , or is otherwise propelled by a specific
clause of the insurance policy to have license verified, the burden would
be upon Insurance Company to prove that insured failed in carrying out
the due diligence process.
67. Accordingly, the factors which could be taken into consideration,
as general guidelines, to apply in cases involving a plea of “ fake driving
license ” can be formulated as under:
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i. Whether the driving licence was demonstratably fake, on the
face of it?
ii. Whether the license seemed, on the face of it, to have expired?
iii. Whether the driver had been engaged by the owner/employer
for a substantial period of time, and, during said period had
given any occasion to owner/employer to doubt his driving
skills?
iv. Whether there existed an easily accessible manner by which
employer could verify driving license of driver, including
through online platforms such as Parivahan Application
instituted by the Ministry of Road Transport and Highways
( MoRTH )?
v. Whether the license was valid at the time the driver entered
employment, but subsequently expired and was not renewed in
time, and whether the owner/employer failed to insist upon
such renewal before assigning driving duties to driver?
vi. Whether Insurance Company discharged its burden of proof by
establishing that driving licence was fake on the basis of
official records, and not merely by relying upon the absence or
lack of verification by owner/employer arising out of
administrative and processual deficiencies within transport
authorities?
68. The aforesaid list of factors is merely illustrative and not
exhaustive, and only indicates some of the situations that may arise
where Insurance Company raises a defence on the basis of a fake driving
license.
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Assessment of the present case
69. In the present case, there is nothing on record to state that the
driving licence produced by respondent no.5/ driver-cum-owner was
“ fake ”. Further, Insurance Company neither took any specific plea as
regards the license being fake in its written statement nor led any cogent
evidence in this regard. Contention of Insurance Company was therefore,
solely based on testimony of R3W1 , stating that he did not know
anything about the driving license in question, which is not the same as
stating that the said licence was fake or invalid. R3W1 , further stated
that FIR No. 334/2016 had been registered under Section 409 of IPC,
pertaining to missing records of various driving licenses, not specific to
the driving licence produced by respondent no.5/ driver-cum-owner. In
fact, copy of driving license produced, clearly shows that it was valid
th th
from 16 April 2003 to 14 August 2020. In view of aforesaid and since
th
the accident in question occurred on 15 August 2010, it can be said that
the plea of appellant/Insurance Company of defence of breach of
insurance policy, may not be merited.
Conclusion
70. Applying the aforesaid principles to the facts of the present case,
appellant has failed to establish the contentions raised by it.
71. A plea was raised by counsel for the Insurance Company, with
regard to the rate of interest. Reliance in this regard can be placed upon
the judgment of the Supreme Court in Kaushnuma Begum (Smt.) & Ors.
v. New India Assurance Co. Ltd. & Ors ., (2001) 2 SCC 9 wherein, while
interpreting the powers of the Tribunal under Section 171 of the MV Act
to award simple interest on compensation from the date of institution of
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the claim petition, it was observed that the rate of interest awarded by
nationalised banks on fixed deposits ought to serve as the guiding factor
while determining the rate of interest payable on compensation amounts.
72. In the facts of the present case, since the long-term fixed deposit
rates offered by nationalised banks during the year 2010, i.e. the year of
filing of the claim petition, were between 7% and 7.75% per annum, the
interest awarded on the compensation granted in the impugned award is
correct @ 7.5% per annum from the date of filing of the claim petition.
rd
73. Vide order dated 23 February 2015, the Court had directed
deposit of 50% of the awarded amount along with proportionate interest
to be deposited before the Tribunal and released to the claimants, as per
disbursal directions contained in the impugned award
74. Accordingly, this Appeal stands dismissed.
75. In view of dismissal of appeal, balance amount shall also be
disbursed as per directions passed by the Tribunal.
76. Pending applications (if any) are rendered as infructuous.
77. Statutory deposit, if any, be refunded to the appellant.
78. Judgement be uploaded to the website of this Court.
(ANISH DAYAL)
JUDGE
MAY 29, 2026/ tk/ya
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