The Supreme Court has decided to revisit a crucial ruling on motor accident compensation, questioning whether claimants should be barred from seeking benefits under Section 163A of the Motor Vehicles Act if their claim under Section 166 has been rejected. The matter has now been referred to a larger bench for reconsideration.
At the heart of this legal debate is a precedent set in Deepal Girishbhai Soni & Ors. v. United India Insurance Co. Ltd., which held that if compensation cannot be awarded under Section 166—where fault or negligence must be proven—then the claimant cannot subsequently seek compensation under the no-fault Section 163A. However, the current Bench, comprising Justices Sudhanshu Dhulia and K. Vinod Chandran, expressed concerns about this approach, noting that Section 163A was introduced as a beneficial provision to aid accident victims.
The case under review involves a tragic accident in which Chacko George, his child, and the driver of the vehicle lost their lives, while his wife and another child survived. The family’s compensation claim under Section 166 was dismissed by the Tribunal and later upheld by the High Court, which relied on the Deepal Girishbhai Soni ruling to reject their subsequent plea under Section 163A.
Recognizing the hardship this creates for victims, the Supreme Court observed that Section 163A was designed to provide swift financial relief without requiring proof of negligence. The Court noted that denying claimants an alternative remedy contradicts the very purpose of this provision. It further suggested that when a Section 166 claim is dismissed, tribunals should allow claimants the opportunity to convert their plea under Section 163A.
Given these concerns, the Supreme Court has now referred the matter to a larger bench for a fresh evaluation, signaling a potential shift in how motor accident compensation laws are interpreted in the future.