Orissa HC Dismisses Insurer’s 143-Day-Delayed Appeal, Still Cuts Accident Compensation Interest From 9% To 6%

On 24 May 2004, a truck allegedly struck a motorcycle from behind, killing Sricharan Harijan and his passenger.

Sricharan’s dependants sought compensation; the Tribunal awarded ₹8,00,000 with simple interest at 9% per annum from the date of the claim, and directed the insurer to pay first, with a right to recover from the vehicle owner for breach of policy conditions.

The insurer appealed against the compensation and interest award, but filed 143 days late.

It attributed the delay to internal processing and obtaining legal opinions; it produced no supporting material.

The appeal was brought under Section 173 of the Motor Vehicles Act, 1988.

On condonation of delay, the Court applied the principle in Postmaster General v. Living Media India Ltd., (2012) 3 SCC 563: public bodies must provide a reasonable and acceptable explanation and demonstrate bona fide diligence; routine reliance on internal procedural delay is insufficient, and condonation is not an anticipated benefit for government bodies.

The Court also treated the owner’s failure to challenge the Tribunal’s decision as a reason not to disturb the recovery-rights finding in this appeal.

The insurer’s explanation described the movement of the file between offices and counsel, but did not establish a convincing reason or sufficient cause for the 143-day delay.

Applying Living Media, the Court held that routine internal processing could not justify condonation, particularly without supporting material.

Although the appeal was time-barred, the Court considered the 9% interest excessive; the claimant’s counsel acknowledged that it was on the higher side, and the Court reduced it to 6% per annum.

It declined to revisit the recovery-rights finding because the owner had not appealed, while noting that recovery remained subject to proof of the policy breach.

It nevertheless reduced the interest on the ₹8,00,000 compensation award from 9% to 6% per annum from 23 June 2004 until realization, and directed the insurer to pay within eight weeks.

The insurer’s right to recover from the owner remained subject to establishment of the policy breach.