UNITED LNDIA INSURANCE CO. LTD. versus SUNIL KUMAR & ANR.

Citation: [2017] 11 S.C.R. 130 · Decided: 24-11-2017 · Supreme Court of India · Bench: RANJAN GOGOI · Disposal: Hearing Adjourned
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Judgment (excerpt)

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(2017] I l S.C.R. 130 
UNITED lNDIA INSURANCE CO. LTD. 
v. 
SUNIL KUMAR & ANR. 
(Civil Appeal No. 9694of2013) 
NOVEMBER 24, 20 l 7 
[RANJAN GOGOi, ADARSH KUMAR GOEL AND 
NAVIN SINHA, JJ.] 
Motor Vehicles Act, 1988 - s.163A - Compensation - Claim 
proceedings u/s. l 63A - Defence/plea by tile insurer of negligence 
on the part of the driver/owner of tile vehicle - Held: It is not open 
for the insurer to raise the defence/plea of negligence - Grant of 
compensation u/s. 163-A on the basis of the stmctured formula is in 
tile nature of a final award and the adjudication thereunder is 
required to be made without any requirement of any proof of 
negligence of the driver/owner of the vehicle(s) involved in the 
l1cciclent. 
Adjourning the matter, the Court 
HELD: It is clear that grant of compensation under Section 
163-A of the Motor Vehicles Act, 1988 on the basis of the 
structured formula is in the nature of u final award and the 
adjudication thereunder is required to be made without any 
requirement of any proof of negligence of the driver/owner of the 
vehiclc(s) involved in the accident. This is made explicit by 
Section I 63A(2). Though the said section of the Act docs not 
specifically exclude a possible defence of the Insurer based on 
the negligence of the claimant as contemplated by Section 140(4), 
to permit such defence to he introduced by the Insurer and/or to 
understand the provisions of Section l63A of the Act to he 
contemplating any such situation would go contrary to the very 
legislative object behind introduction of Section l63A of the Act, 
namely, final compensation within a limited time frame on the 
basis of the strnctured formula to overcome situations where the 
claim of compensation on the basis of fault liability was taking an 
unduly long time. In fact, to understand Section 163A of the Act 
to permit the Insurer to raise the defence of negligence would 
130 
UNITED INDIA INSURANCE CO. LTD. v. SUNIL KUMAR 
131 
&ANR. 
be to bring a proceeding under Section 163A Of the Act at par A 
with the proceeding under Section 166 of the Act which would 
not only be selt~contradictory but also defeat the very legislative 
intention. Thus, in a proceeding under Section 163A of the Act it 
is not open for the Insurer to raise any defence of negligence on 
the part of the victim. As the final disposal of the appeal may take B 
some time, 50% of the compensation that is presently lying in 
dcpo.sit in the Registry in terms of the Order dated 24-02-2012 
should be released to the claimant on due identification. (Paras 
8, 9, 11)[135-B-E; G] 
National Insurance Company Limited v. Sinitha and 
others (2012) 2 SCC 356 : [20U] 16 SCR 166; United 
India Insurance Company Limited v. Shila Datta and 
others (2011) lO SCC 509: (2011) 14 SCR 763; Deepa/ 
Girishbhai Soni and others v. United India Insurance 
Co. Ltd.. Baroda (2004) 5 SCC 385; Oriental Insurance 
Co. Ltd. v. Hansrajbhai v. Koda/a and other (2001) 5 
SCC 175 : )2001] 2 SCR 999 - referred to. 
Case Law Reference 
[2011] 1.6 SCR 166 
referred to 
Para l 
[2011] 14 SCR 763 
referred to 
Para 2 
(2004) s sec 385 
referred lo 
Paras 
[2001) 2 SCR 999 
referred to 
Para 6 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 9694 
of2013. 
From the Judgment and Order dated 10.10.2011 of the High Court 
of Delhi at New Delhi in MAC Appeal No. 900 of201 I. 
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Amit Kumar Singh, Mrs. E. Enatoli Serna (for Mis. Law 
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Associates), Advs. for the Appellant. 
Ajay KumarTalesarn,Amit Singh Chauhan, Ms. Nidhi, Vipin Nair, 
P. B. Surcsh, Abbay Pratap Singh, Ad vs. for the Respondents. 
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132 
SUPREME COURT REPORTS 
(2017] l 1 S.C.R. 
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The Judgment of the Court was delivered by 
RANJAN GOGOi, J. I. Unable to agree with the reasoning 
and the conclusion of a two judge bench of this Court in National 
Insurance Comvany Limited vs. Sinitha a11d others' a coordinate 
bench of this Court by order dated 29'" October, 2013 has referred the 
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instant matter fem a resolution of what appears to be the following question 
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oflaw. 
"Whether in a claim proceeding under Section 163 A of the Motor 
Vehicles Act, 1988 (hereinafter referred to as "the Act") it is 
open for the Insurer to raise the defence/pica of negligence?" 
2. A second question as to what would be the true scope and 
meaning of the provisions contained in Section 170 of the Act more 
specifically as set out in Queries (iii) to (v) in paragraph 10 of the report 
of
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