Legal heirs cannot claim compensation under Section 163-A when the deceased driver borrowed the offending vehicle.

On 26 May 2021, Suresh Netam was riding motorcycle No. OD-27-L-5472, allegedly with the permission and on the instructions of its owner, Mahendra Poyam, to bring insecticide/pesticide.

A cow/cattle suddenly came onto the road; while applying the brakes, the motorcycle became unbalanced and collided with a culvert. Suresh sustained serious injuries and died during treatment on 28 May 2021.

His legal representatives filed a claim under Section 163-A of the Motor Vehicles Act, 1988, seeking compensation of ₹5,70,000.

The Motor Accidents Claims Tribunal dismissed the claim, holding that Suresh had borrowed the motorcycle and, therefore, had stepped into the shoes of its owner; consequently, he could not be treated as a third party entitled to claim under Section 163-A.

The claimants challenged that award before the High Court, contending, inter alia, that there was no proved breach of the insurance policy and that compensation was payable at least to the extent of the coverage under the policy.

Section 163-A of the Motor Vehicles Act provides a structured, no-fault compensation remedy for victims of motor accidents, but it does not apply where the deceased driver had borrowed the offending vehicle and, in relation to that vehicle, stepped into the shoes of its owner.

Relying on Ningamma & Anr. v. United India Insurance Co. Ltd., (2009) 13 SCC 710, and Ramkhiladi & Anr. v. United India Insurance Co. Ltd., (2020) 2 SCC 550, the Court held that the legal representatives of such a deceased driver cannot claim compensation under Section 163-A against the owner and insurer of the borrowed vehicle because the deceased was not a third party.

The controlling consideration was the deceased’s legal status vis-à-vis the vehicle, rather than the establishment of negligence or breach of a policy condition.

The evidence and the Tribunal’s findings established that Suresh was driving the motorcycle with the owner’s permission and that the accident involved the motorcycle itself, without any other offending vehicle.

By borrowing and driving the vehicle, Suresh assumed the legal position of the owner for the purpose of a claim under Section 163-A.

Applying Ningamma and Ramkhiladi, the High Court held that a person who is effectively in the shoes of the owner cannot simultaneously claim to be a third-party victim under Section 163-A against that same vehicle’s owner and insurer.

The arguments concerning absence of a proved policy breach and Suresh’s alleged employment under the owner did not overcome the threshold bar arising from the non-maintainability of the claim.

The Tribunal’s dismissal of the claim was upheld, the appeal was dismissed as devoid of merit, and no order as to costs was made.