Section 164’s beneficial ₹5 lakh no-fault compensation applies retrospectively to earlier accident deaths.

Kartar Singh died on 11 April 1999 in a motor vehicle accident involving Bus No. PB-13-D-619, driven by respondent No. 1, owned by respondent No. 2, and insured with respondent No. 3.

The claimants initially instituted proceedings under Section 166 of the Motor Vehicles Act, 1988, but pressed the claim under the no-fault liability provisions.

The Motor Accident Claims Tribunal, Fatehgarh Sahib, awarded Rs. 50,000 to the claimants jointly and severally under no-fault liability by award dated 16 September 2002.

The claimants appealed seeking enhancement.

The finding that the accident occurred due to the use of the offending vehicle was not challenged by the respondents and was therefore not interfered with.

Whether the claimants were entitled to enhancement of the no-fault compensation from Rs. 50,000 to Rs. 5,00,000 under Section 164 of the Motor Vehicles Act, 1988, despite the accident having occurred in 1999?

Whether the enhanced compensation was payable with interest, and against which respondents?

The Court considered the no-fault liability provisions under Sections 140, 163-A and 164 of the Motor Vehicles Act, 1988.

Section 164, introduced through the Motor Vehicles (Amendment) Act, 2019 with effect from 1 September 2019, provides compensation of Rs. 5,00,000 in the event of death, without proof of fault.

The Court relied on Ram Murti v. Punjab State Electricity Board, 2023 ACJ 631, where the Supreme Court applied the beneficial compensation available under Section 164 retrospectively to an earlier accident and directed payment of Rs. 5,00,000, after adjusting any amount already paid.

Beneficial amendments enhancing statutory no-fault compensation may therefore be applied to pending claims arising from accidents predating the amendment.

The Tribunal had already found that Kartar Singh’s death resulted from the use of the offending bus, and that finding had attained finality because the respondents filed neither an appeal nor cross-objections.

Since the claimants had received only Rs. 50,000 under the earlier no-fault regime, the Court applied the beneficial principle recognised in Ram Murti and held that the claimants were entitled to the statutory amount of Rs. 5,00,000 under Section 164, notwithstanding that the accident occurred on 11 April 1999.

After deducting the Rs. 50,000 already awarded and received under Section 140, the balance payable was Rs. 4,50,000.

The Court made respondents No. 2 and 3 jointly and severally liable and awarded interest from 1 September 2019, the date on which Section 164 came into force.

The claimants were held entitled to total compensation of Rs. 5,00,000 for Kartar Singh’s death under the no-fault liability principle.

After adjustment of the Rs. 50,000 already awarded, respondents No. 2 and 3 were directed to pay the enhanced amount of Rs. 4,50,000 with interest at 9% per annum from 1 September 2019 until realization, jointly and severally.

Rs. 50,000 each, together with proportionate interest, was directed to be paid to claimants No. 2 to 4.

The Court also issued administrative directions for communicating the judgment to the Insurance Company, the Tribunal, the DLSA and the claimants.