A borrowing rider is not a third party and cannot claim compensation under Section 163-A.

The claimants—the deceased Muttappa Uppar’s wife, two minor daughters and mother—sought compensation under Section 163-A of the Motor Vehicles Act, 1988, after Muttappa died in a road accident while riding a motorcycle he had borrowed from its owner.

The accident and death were undisputed.

The Tribunal dismissed the claim, finding that Muttappa had stepped into the owner’s shoes and that he did not hold a valid driving licence.

The claimants appealed.

Section 163-A of the Motor Vehicles Act provides for compensation on the basis set out in that provision, but, under Ningamma v. United India Insurance Co. Ltd., a person who is the owner or has stepped into the owner’s shoes cannot claim compensation under that section as a third party; the person’s legal representatives likewise cannot claim in that capacity.

The Court also relied on Ramkhiladi v. United India Insurance Co., which it cited for the requirement that a claimant under Section 163-A must be a third party.

On driving-licence breaches, the Court relied on Beli Ram v. Rajinder Kumar, which recognises that, once the insurer establishes that the licence was invalid, the onus shifts to the insured to show that sufficient steps were taken to avoid breach of the policy conditions.

Muttappa was riding a motorcycle borrowed from its owner when the fatal accident occurred.

Applying Ningamma and Ramkhiladi, the Court held that he had stepped into the owner’s shoes and was therefore not a third party entitled to claim under Section 163-A; his legal representatives could not maintain the claim on that basis.

The Court further accepted that Muttappa had no valid driving licence and treated this as a breach of policy conditions, relying on Beli Ram in support of its conclusion that the claimants were not entitled to compensation on this ground as well.

It confirmed the Tribunal’s judgment and award dated 2 August 2013 dismissing MVC No. 421/2009.