Insurer must pay compensation despite policy breach, with liberty to recover from the vehicle owner.

On 17 September 2013, Raju Bora was travelling with goods in a mini truck that had no registration number.

The vehicle left the road and fell into a ditch, and Bora later died from his injuries.

His wife and son filed a claim under Section 166 of the Motor Vehicles Act, 1988.

The Motor Accident Claims Tribunal, Dibrugarh, awarded them ₹4,80,000 with interest at 6% per annum.

The Tribunal observed that the insurer could recover the compensation from the vehicle’s owner because the vehicle had been used without registration and a permit, but omitted a recovery direction in the operative part of its award.

The insurer appealed on that limited point.

The claimants did not oppose the requested recovery direction.

1. Whether the insurer, having been directed to satisfy the compensation award, should also receive an express direction permitting recovery from the vehicle’s owner because the vehicle was used without registration and a permit.

2. Whether the appellate court should specify the amount, interest, and time for payment of the outstanding compensation.

Section 166 of the Motor Vehicles Act, 1988, provides the basis for a claim for compensation arising from a motor vehicle accident, while Section 173 provides for an appeal against a Claims Tribunal’s award.

The Court proceeded on the Tribunal’s finding that the insurer was liable to pay the claimants but could recover the compensation from the vehicle’s owner because of the breach arising from use of the vehicle without registration and a permit.

The judgment cites no further statutory provision or precedent on the insurer’s right of recovery.

The appeal concerned only the omission of an express recovery direction from the operative part of the Tribunal’s award; the insurer did not challenge the compensation award itself.

Because the Tribunal had already observed that the insurer could recover from the owner, and the owner did not appear before either the Tribunal or the High Court, the Court held that the operative order should give effect to that observation.

The claimants’ lack of objection to the insurer’s request further left that limited issue uncontested.

The Registry was directed to disburse the 50% already deposited to the claimants after verification and to refund the insurer’s statutory deposit of ₹25,000 after verification.