Recently, the Gauhati High Court held that the Insurance Company is not liable to pay compensation for the death of gratuitous passengers travelling in a goods vehicle. The bench of Justice Parthiv Jyoti Saikia held: 

“The Insurance Company is not liable to pay compensation to the claimant. The claimant is at liberty to recover the compensation granted in their favour by the Tribunal from the owner of the vehicle.”

Case Brief:

In the said matter, Back in 2005, the deceased was travelling in a pick-up truck which met with an accident and he sustained injuries later in January 2006, he died. The Motor Accident Claims Tribunal vide judgement dated held that the deceased was a gratuitous passenger and the concerned insurance policy did not cover such a passenger. However, the Tribunal directed the insurance company to pay the compensation to the legal heirs of the deceased with the liberty to recover the same from the owner of the vehicle.

The insurance company filed an appeal under Section 173 of the Motor Vehicles Act, 1988 against the impugned judgment of the Tribunal.

Senior Advocate, S. Dutta, Counsel for the appellant-insurance company argued that the impugned judgement should be modified to the extent that the direction given by the Tribunal to go for pay recovery of the compensation should be set aside.

The court relied upon the judgement in National Insurance Co. Ltd. v. Bommithi Subbhayamma (2005) 12 SCC 243 in which the Supreme Court has laid down that the Insurance Company is not liable for payment of any compensation for the death of a gratuitous passenger travelling in a goods vehicle.

The court thus held that the Tribunal committed error by directing the Insurance Company to pay the compensation and to go for recovery of the same from the owner of the vehicle.

Accordingly, the court allowed the appeal and set aside the impugned judgement of the Tribunal.