Karnataka HC Orders Police, Courts To Withhold Seized Vehicles Until Valid Insurance Is Produced

The claimant sought compensation under Section 166 of the Motor Vehicles Act, 1988, for injuries sustained in a 2017 collision involving his motorcycle and a NEKRTC bus.

The Tribunal found the bus driver negligent and awarded ₹2,30,443 against the Corporation.

The Corporation appealed, contending that the claimant was riding without a valid driving licence or insurance, was carrying two pillion riders, and was responsible for the accident.

The claimant was served but did not appear in the appeal.

The High Court found that the motorcycle was uninsured, the claimant had not produced a driving licence, and he was carrying two pillion riders.

Section 166 of the Motor Vehicles Act provides the basis for an injured person’s claim for compensation; the appeal was brought under Section 173(1) of that Act.

The Court treated compliance with the Act’s requirements concerning driving licences, compulsory insurance and permitted passenger capacity as relevant to assessing negligence and road safety.

It stated that, in its prior approach, absence of a valid driving licence could support attributing 30% negligence to a claimant-rider, while the additional circumstances here—including triple riding—justified a different apportionment.

The Court also referred to Oriental Insurance Co. Ltd. v. Tuni Pati, 2026 SCC OnLine SC 1710, concerning alleged fraudulent motor-accident claims, and National Insurance Co. Ltd. v. Thungala Dhana Laxmi, 2026 SCC OnLine SC 1486, concerning uninsured vehicles and enforcement of compulsory insurance.

Those authorities informed the Court’s broader discussion of insurance compliance; the judgment did not identify a specific provision authorising its vehicle-release directions.

The Court relied on the spot sketch, which placed the accident in the middle of the road and, in its view, showed sufficient space for the motorcycle to pass safely.

It considered the charge sheet’s attribution of negligence to the bus driver insufficient by itself and inconsistent with the sketch.

Given the claimant’s unproved licence, the motorcycle’s lack of insurance and the triple riding, the Court attributed 50% negligence to the claimant.

Separately, reasoning that release of uninsured vehicles could expose third-party victims to uncompensated loss, it directed that valid insurance be produced before seized vehicles involved in offences are released by police or jurisdictional courts.

The operative order nevertheless states that the claimant remains entitled to the Tribunal’s full award of ₹2,30,443 with 6% annual interest, while directing the Corporation to deposit only 50% of the compensation, with proportionate interest, within eight weeks; the Tribunal’s release and investment directions were maintained, and the matter was listed for compliance on 14 December 2026.

The judgment thus attributes 50% negligence to the claimant but does not expressly reduce the stated compensation entitlement; the relationship between that finding and the 50% deposit direction is not clarified in the operative order.

The Court also directed police authorities and jurisdictional courts to require production of a valid insurance policy before releasing a seized vehicle, and directed the State police leadership to report compliance.