Pre-amendment law excludes insurance coverage for gratuitous passengers in goods vehicles.

The claimant was injured in a motor accident on 2 July 1988 while travelling in a goods truck with his goods.

He sought compensation under Section 166 of the Motor Vehicles Act, 1988, alleging that his injuries reduced his earning capacity

The Tribunal awarded him Rs. 36,600 with interest at 9% per annum from the date of the petition, but held the insurer not liable and fastened liability on the driver and owner

On appeal, the claimant sought a direction requiring the insurer to pay the award and recover the amount from the insured

Whether the insurer was liable for injuries sustained by a gratuitous passenger travelling in a goods vehicle in an accident governed by the pre-amendment motor vehicle law.

Whether the insurer could be directed to pay the compensation first and recover it from the vehicle owner.

The Court applied Section 95 of the Motor Vehicles Act, 1939, governing the accident because it occurred before the 1988 Act came into force.

Relying principally on New India Assurance Co. Ltd. v. Asha Rani, (2003) 2 SCC 223, and the authorities discussed in National Insurance Co. Ltd. v. V. Chinnamma, (2004) 8 SCC 697, it held that the insurer had no statutory liability for a gratuitous passenger in a goods vehicle under the applicable pre-amendment law; the 1994 amendment’s extension of compulsory coverage to an owner of goods or authorised representative did not apply.

The Court also relied on United India Insurance Co. Ltd. v. Chandrakant Revashankar Bhatt, 2016 ACJ 557, for the proposition that the pay-and-recover provisions in Section 149(4) and (5) did not authorise such a direction for gratuitous passengers.

The accident occurred on 2 July 1988, before the 1988 Act came into force, and the claimant was travelling in a goods vehicle without a permit to carry passengers.

Applying Section 95 of the 1939 Act and the authorities on gratuitous passengers, the Court concluded that the insurer had no obligation to indemnify the vehicle owner for the claimant’s injuries.

It therefore found no legal basis to direct the insurer to pay first and recover later, and no error in the Tribunal’s decision.

The appeal was dismissed; any interim relief was vacated, and any connected civil application was held not to survive.