Insurer cannot deny liability for self-negligence of a paid driver if additional premium was paid.

The Appellant, a truck driver/owner, sustained grievous injuries in a vehicular accident on March 16, 2008, involving two other vehicles (a truck and an Eicher tempo)

He filed a claim petition (M.A.C.P. No. 1102 of 2008) seeking Rs. 11,00,000/- in compensation

The Motor Accident Claims Tribunal, Rajkot, dismissed the petition on July 19, 2017, concluding that the Appellant was negligent for the accident and, as the owner of the vehicle, could not claim compensation from his own insurer

The Appellant challenged this dismissal, arguing that a specific premium had been paid to cover the owner-cum-driver

Whether a claim for compensation can be rejected solely on the grounds of the claimant’s own negligence when an additional premium was paid to cover the owner-cum-driver

Whether the Insurance Company is contractually liable to indemnify the owner-driver under Section 147 of the Motor Vehicles Act despite self-negligence

The Court relied on the Full Bench decision of the Gujarat High Court in *Valiben Laxmanbhai Thakore (Koli) v. Kandla Dock Labour Board* (2021), which interpreted Section 147 of the Motor Vehicles Act, 1988

The principle established is that if an owner pays an additional premium (e.g., IMT 28) to cover the driver or owner-driver, the Insurance Company’s liability becomes contractual and extended

This creates an "unlimited liability" where the insurer cannot avoid its obligation by citing the self-negligence of the insured party

The Court found that the Tribunal’s dismissal was legally flawed in light of the *Valiben Laxmanbhai Thakore* precedent

It reasoned that when an insurance company accepts an additional premium (in this case, Rs. 100/-), it acknowledges a contractual duty to indemnify the risk of the owner-driver

The Court observed that the Tribunal failed to recognize that by accepting such a premium, the insurer "enlarges the scope" of its liability and forfeits the right to raise the defense of self-negligence

Consequently, the identity of the claimant as the owner/driver does not automatically bar a claim if the policy's contractual terms provide coverage for that specific class of person

The Court held that the claim should not have been dismissed on the grounds of negligence or ownership status given the contractual indemnity

The matter was remanded to the Motor Accident Claims Tribunal (Main), Rajkot, with directions to decide the issues of negligence and quantum afresh on merits within six months

Any statutory deposits were ordered to be transferred to the Tribunal