Insurer cannot avoid compensation liability without proving policy breach or contributory negligence.

On 27 August 2018, Biralsaya Lakra was travelling on a motorcycle from village Ladua towards Rajpur when it collided with another motorcycle bearing registration No. CG-15-DF-6547, allegedly driven rashly and negligently by respondent No. 8, Chaitaram. Biralsaya sustained serious injuries and died. An FIR under Section 304-A IPC was registered, and a charge-sheet was filed against Chaitaram.

The deceased’s wife, minor children and parents filed a claim petition under Section 166 of the Motor Vehicles Act, 1988. The Motor Accident Claims Tribunal held the claim proved, found no breach of the insurance policy, and awarded compensation of ₹11,50,000 with interest.

The insurer challenged the award under Section 173 of the Motor Vehicles Act, contending that the offending vehicle’s driver did not possess a valid licence to drive a motorcycle and that the deceased had also contributed to the accident.

Whether the insurer established a breach of the insurance policy on the ground that the driver of the offending motorcycle lacked a valid and effective licence to drive a motorcycle?

Whether the deceased was guilty of contributory negligence and whether his alleged contribution justified reduction or denial of compensation?

Whether the Tribunal’s award of ₹11,50,000 with interest required appellate interference?

The Court applied Sections 166 and 173 of the Motor Vehicles Act, 1988, governing claims for compensation and appeals against awards.

It relied on Mangla Ram v. Oriental Insurance Co. Ltd., (2018) 5 SCC 656, holding that police records, including the FIR and charge-sheet, may constitute prima facie evidence of the accident and the offending driver’s negligence; the party disputing negligence must produce evidence to rebut them.

Under Geeta Dubey v. United India Insurance Co. Ltd., 2024 SCC OnLine SC 3779, motor accident claims are decided on the touchstone of the preponderance of probabilities and not proof beyond reasonable doubt.

Meera Bai v. ICICI Lombard General Insurance Co. Ltd., 2025 SCC OnLine SC 992, establishes that absence of an eyewitness is not by itself fatal where negligence can reasonably be inferred from the FIR, charge-sheet and other official records.

The insurer bears the burden of proving the alleged breach of the policy condition, including absence of a valid driving licence, and must substantiate any allegation of contributory negligence.

The Court found that the FIR and charge-sheet clearly recorded that Chaitaram, the driver of the offending motorcycle, was prosecuted for driving at excessive speed and in a negligent manner. These records provided sufficient prima facie support for the claimants’ case, and the insurer produced no contrary evidence.

The Court rejected the insurer’s submission that the deceased had contributed to the collision, observing that no reliable oral or documentary evidence established any negligent act by the deceased; the allegation was therefore speculative.

The insurer also failed to prove that the driver lacked a valid licence to operate a motorcycle. Although it alleged a breach of the policy condition, it produced no evidence in support of that allegation.

The Tribunal’s finding that breach of the policy condition was not proved was consequently consistent with the evidence and did not warrant interference.

Applying the preponderance-of-probabilities standard, the Court held that the Tribunal had properly assessed the material on record.

The High Court upheld the Tribunal’s award of ₹11,50,000 with interest, holding that neither contributory negligence of the deceased nor breach of the insurance policy by reason of the driver’s alleged invalid licence had been proved.

The Tribunal’s record was directed to be returned for necessary compliance.