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SUPREME COURT: INSURER CAN’T RAISE DEFENCE OF VICTIM’S NEGLIGENCE IN PROCEEDINGS UNDER SEC. 163A MV ACT

The Supreme Court, in United India Insurance Co. Ltd. Sunil Kumar & Anr, has held that, in a proceeding under Section 163A of the Motor Vehicles Act, it is not open for the insurer to raise any defence of negligence on the part of the victim.

A three-judge bench of the Supreme Court headed by Justice Ranjan Gogoi was answering a reference to it by the division bench wherein it had disagreed with the dictum in National Insurance Company Limited vs. Sinitha and others.

In Sinitha case, the division bench had held that Section 163 A enables an insurer to raise the defence of negligence to counter a claim for compensation. The Section 163A deals with special provisions as to payment of compensation on structured formula basis. The question formulated by the division bench in this case, was whether in a claim proceeding under Section 163 A of the Motor Vehicles Act, 198, it is open for the insurer to raise the defence/plea of negligence?

Answering the reference, the bench, also comprising of Justice AK Goel and Justice Navin Sinha, observed that the grant of compensation under Section 163-A of the Act on the basis of the structured formula is in the 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 accident.