Sugarcane Load Alone Didn’t Prove Commercial Use: P&H HC Bars Insurer From Recovering Accident Payout From Tractor Owner, Driver

The appellants, the driver and owner of a tractor-trolley, challenged the MACT’s award of compensation and its grant of recovery rights to the insurer.

The accident occurred when the tractor-trolley, loaded with sugarcane, collided with a car; the car’s occupant died.

In a connected appeal arising from the same accident, the High Court had upheld the finding that the deceased and the tractor driver were responsible in the ratio of 25:75.

The present appeal challenged the insurer’s recovery rights, including the findings concerning the driver’s licence and the tractor-trolley’s alleged commercial use.

The Court relied on the Constitutional Bench decision in M/s Bajaj Alliance General Insurance Co. Ltd. v. Rambha Devi and Others, 2025 (1) R.C.R. (Civil) 5, as applied by a coordinate Bench in Kuldeep and Another v. Poonam and Others, FAO-3561-2015 (O&M), decided 5 March 2026.

Under the principle stated in those decisions, a driver holding a valid Light Motor Vehicle licence may drive a transport vehicle with gross vehicle weight below 7,500 kg without a separate transport-vehicle endorsement, subject to the applicable statutory requirements.

The insurer bears the burden of proving a policy breach relied upon to avoid liability and obtain recovery rights.

Use of a tractor for transporting agricultural produce may be incidental to agriculture; carrying goods for hire or reward or for unrelated commercial activity may fall outside a policy restricted to agricultural and forestry use.

The negligence finding had been upheld in the connected appeal arising from the same accident and did not warrant interference.

As to the insurer’s liability, the Court held that absence of a separate transport endorsement would not, by itself, establish a policy breach where the vehicle was within the specified weight limit and the driver otherwise held a valid licence.

Although the evidence showed that the tractor-trolley carried sugarcane, the insurer produced no evidence that it was transporting goods for hire or reward or was otherwise being used commercially in breach of the policy.

The presence of sugarcane alone did not prove prohibited commercial use.

The award was modified so that the insurer must satisfy the compensation award in accordance with the policy and may not recover the compensation from the appellants on the grounds relied upon in this appeal.

Pending miscellaneous applications were also disposed of.