Insurer must first pay compensation for a gratuitous passenger and recover it from the vehicle owner.

The claimant, Smt. Kiran Thakur, filed MAC No. 1075 of 2019 under Section 173 of the Motor Vehicles Act, 1988, seeking enhancement of compensation awarded by the Claims Tribunal on 10 January 2019.

The connected appeal, MAC No. 460 of 2019, was filed by Yogesh Kumar Rathore, the driver and owner of the offending vehicle. Both appeals arose from the same award and were heard together.

The Claims Tribunal had awarded compensation of ₹10,29,600 but deducted 50% on the ground of contributory negligence.

It had also exonerated the Oriental Insurance Company on the basis that the deceased was a gratuitous passenger.

The claimant challenged both findings, seeking full compensation, enhancement, and application of the “pay and recover” principle.

The driver and owner did not appear when their appeal was taken up on two occasions.

Whether the Claims Tribunal was justified in deducting 50% of the compensation on the ground of contributory negligence?

Whether the claimant was entitled to additional compensation under the head of parental consortium?

Whether the Insurance Company, despite the deceased being a gratuitous passenger not covered by the policy, should first satisfy the award and thereafter recover the amount from the driver and owner?

Whether the driver-owner’s appeal was liable to be dismissed for want of prosecution due to non-appearance?

Section 173 of the Motor Vehicles Act, 1988 permits an aggrieved party to appeal against an award of the Claims Tribunal.

The principle of contributory negligence must be established by reliable and affirmative evidence; a mere plea by the insurer is insufficient.

A passenger travelling in a vehicle is not, merely by being present in it, guilty of contributory negligence where there is no evidence of negligence on his part.

Under the “pay and recover” doctrine, even where a gratuitous passenger is not covered by the insurance policy, the insurer may be directed to pay the compensation to the claimant in the first instance and recover it from the vehicle owner and driver.

The Court relied principally on Sunita v. United India Insurance Co. Ltd., 2025 SCC OnLine SC 1469 : 2025 INSC 867, and the principles reaffirmed in National Insurance Co. Ltd. v. Baljit Kaur, (2004) 2 SCC 1, Anu Bhanvara v. IFFCO Tokio General Insurance Co. Ltd., (2020) 20 SCC 632, and other decisions cited in Sunita.

Compensation may also be enhanced by awarding an appropriate amount for consortium where the Tribunal omitted that head.

The High Court found that the Insurance Company had pleaded contributory negligence but had not produced any cogent evidence to establish it.

Although its witness, Deepak Kumar Dewangan, was examined, he did not depose regarding any negligence by the deceased.

Since the deceased was merely sitting in the offending vehicle, the Court held that contributory negligence could not be attributed to him and set aside the 50% deduction.

The Court further held that the Tribunal had failed to award any amount for parental consortium and granted ₹40,000 under that head.

On the insurance issue, the Court applied Sunita, holding that the Tribunal erred in completely exonerating the insurer merely because the deceased was a gratuitous passenger.

The appropriate course was to direct the Insurance Company to satisfy the award first and then recover the amount from the owner and driver of the offending vehicle.

MAC No. 1075 of 2019, filed by the claimant, was partly allowed.

The finding of contributory negligence and the consequent 50% deduction were set aside.

The compensation was enhanced from ₹10,29,600 to ₹10,69,600, including ₹40,000 for parental consortium.

The Oriental Insurance Company was directed to first deposit and pay the entire compensation, including interest and the enhanced amount, to the claimant and thereafter recover it from the owner and driver under the “pay and recover” doctrine.

The additional compensation was directed to carry interest at 7% per annum from the date of the claim application until realization, with the remaining conditions of the Tribunal’s award left undisturbed.