Insurer must satisfy the award first and recover from the insured when passenger status is unproved.

On 6 May 1999, a truck allegedly driven rashly and negligently left the road and struck Pravinbhai and others standing on the roadside; Pravinbhai was crushed under the truck and died.

The claimants sought compensation of ₹9,40,000. The Tribunal awarded ₹2,65,000 with 7.5% annual interest, holding the driver and owner jointly and severally liable while exonerating the insurer.

The claimants appealed, seeking compensation of ₹5,00,000 and asking that the insurer be directed to pay first and recover from the driver and owner.

1. Whether the compensation should be enhanced to ₹5,00,000 by applying the principles in Kishan Gopal v. Lala.

2. Whether the insurer should satisfy the award in the first instance and recover the amount from the driver and owner.

Section 173 of the Motor Vehicles Act, 1988 provides for an appeal against an award of the Motor Accident Claims Tribunal.

Relying on Kishan Gopal v. Lala, 2014 (1) SCC 244, the Court treated ₹5,00,000 as just compensation in the circumstances of this case.

It also relied on Kaminiben v. Oriental Insurance Company Limited, 2026 LiveLaw (SC) 174, and the authorities discussed there, including Manuara Khatun and Saju P. Paul, for the “pay and recover” principle: in appropriate cases involving an uninsured risk such as a gratuitous passenger, the insurer may be directed to satisfy the award first and recover the amount from the insured in the same proceedings.

The Court considered the claimants’ reliance on Kishan Gopal and concluded that ₹5,00,000 was appropriate compensation for the loss of their son, modifying the Tribunal’s award accordingly.

On liability, the claimants argued that the deceased was a third party and there was no proof that he was travelling in the goods vehicle; the Court nevertheless applied the “pay and recover” principle drawn from Kaminiben and the cases it discussed.

It directed the insurer to satisfy the award first, with a right to recover from the driver and owner.

The award was modified to provide fixed compensation of ₹5,00,000 with interest at 7.5% per annum from the date of the claim petition until realization.

The opponents were held jointly and severally liable; the insurer was directed to pay first and recover from the driver and owner by executing the order.

The Tribunal was directed to disburse the amount held by it, with accrued interest, subject to verification, procedure and deduction of any unpaid court fees.