TATA AIG GENERAL INSURANCE CO. LTD.versusMALSINGBHAI KALIYABHAI @ KALIYABHAI DAMOR

    C/FA/4554/2024                             JUDGMENT DATED: 09/01/2026




IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
                     R/FIRST APPEAL NO. 4554 of 2024
                                  With
                     R/FIRST APPEAL NO. 4556 of 2024

FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE HASMUKH D. SUTHAR
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        Approved for Reporting              Yes        No
                                                        √
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              TATA AIG GENERAL INSURANCE CO. LTD.
                               Versus
               GAVJIBHAI DEVLABHAI DAMOR & ORS.
==========================================================
Appearance:
MR RATHIN P RAVAL(5013) for the Appellant(s) No. 1
MR KK MAGHNANI(7543) for the Defendant(s) No. 3
MR KB MAGHNANI(9673) for the Defendant(s) No. 3
MR NISHIT A BHALODI(9597) for the Defendant(s) No. 1,2
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  CORAM:HONOURABLE MR. JUSTICE HASMUKH D. SUTHAR

                          Date : 09/01/2026
                       COMMON ORAL JUDGMENT

      Admit. Learned advocate Mr. Nishit Bhalodi waives service of
notice of Admission for and on behalf of original claimants and
learned advocate Mr. K.B. Maghnani waives service of notice of
Admission for and on behalf of respondent No.3. With the consent of
learned advocates appearing for respective parties, appeals are taken
up for >nal hearing.

[1.0] Present First Appeals under Section 173 of the Motor Vehicles
Act, 1988 (for short “MV Act”) arising out of the same accident are
>led by the appellant – original opponent No.2 challenging the
impugned common judgment and award dated 05.10.2024 passed by
the learned Motor Accident Claims Tribunal (Main), Dahod (for short


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“learned Tribunal”) in Motor Accident Claim Petition No.82/2019 and
81/2019, whereby the learned Tribunal was pleased to partly allow the
claim petitions and awarded compensation of Rs.5,00,000/- each to
the original claimants. First Appeal No.4554/2024 is taken as lead
matter and facts of the said case are taken for sake of brevity.

[2.0] The brief facts leading to >ling of present appeal is as follows:

[2.1] On 11.03.2013, deceased Pankaj, Arpit and Kalpesh were going
on Motorcycle No.GJ-20-P-1613 and at around 19.15 hours, when they
were passing the bridge of Kali river at village Gultora, an unknown
vehicle hit their motorcycle and Jed and due to the accident, all the
three persons riding the motorcycle sustained injuries and Kalpesh
died on the spot whereas Pankaj and Arpit fell down in the river and
died. In this connection, an FIR being I-CR No.29/2013 came to be >led.
The legal heirs and representatives of deceased Arpit has >led MACP
No.82/2019 and that of deceased Pankaj have >led MACP No.81/2019.

[2.2] After considering the evidence produced and adduced, the
learned Tribunal held the appellant – insurance company of the
oKending motorcycle solely negligent for the accident and was
pleased to award Rs.5,00,000/- to the original claimants of MACP
No.82/2019 and 81/2019 respectively. Hence, the appellant –
insurance company has >led the present First Appeals.

[3.0] Learned advocate Mr. Rathin Raval appearing for the appellant –
insurance company has submitted that the impugned common
judgment and award passed by the learned Tribunal is against the
settled principles of law and is passed without properly appreciation
of evidence on record. The impugned judgment is prima facie
erroneous and against the provisions of law. The driver of the


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    C/FA/4554/2024                            JUDGMENT DATED: 09/01/2026




oKending motorcycle was not having the license or having invalid
license and though the learned Tribunal has accepted the said defence
of the insurance company that the minor was driving the motorcycle
and was not quali>ed to hold any type of license to drive the vehicle,
the insurance company is saddled with the liability. It is further
submitted that in one of the claim petition being MACP No.130/2019
arising from the said accident, the learned Tribunal has exonerated
the insurance company while in present two cases, the insurance
company is saddled with the liability on the ground that the deceased
of present two cases were travelling on the motorcycle as pillion
riders. The insurance company has proved the defence by examining
the Legal Manager of appellant – insurance company at Exh.48 and
though the insurance company has placed on record insurance policy
at Exh.51 and progress report of deceased Kalpesh Damor at Exh.52
which clearly proves on record that three minors were travelling on
the motorcycle on the date of accident and all three were minor
though 1/3rd deduction is not made and Rs.50,000/- is awarded under
the conventional head towards loss of love and aKection, funeral
expenses and last rites which is not permissible under Section 163A of
the MV Act as per the structure based formula and hence, he has
requested to allow the present appeals and quash and set aside the
impugned judgment and award and to exonerate the insurance
company.

[4.0] Learned advocate Mr. K.B. Maghnani appearing for the
respondent No.3 – owner of the motorcycle has opposed the present
appeals by submitting that the original owner appeared before the
learned Tribunal and >led his written statement at Exh.10 and
considering the said defence, the learned Tribunal has properly
appreciated the evidence and passed the impugned judgment and


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award and held the insurance company liable and hence, question
does not arise to exonerate the insurance company. Hence, he has
requested to dismiss the >rst appeals.

[5.0] Learned advocate Mr. Bhalodi appearing for the original
claimants has submitted that the original claimants are third parties
and they have nothing to do with the breach of condition policy or
with the fact whether the deceased driver of motorcycle was having
license to drive oKending vehicle or not. If alleged breach is
considered even though the claimants being third parties, insurance
company is liable to satisfy the award in favor of the original
claimants. Hence, he has requested not to interfere with the
impugned judgment and award and to dismiss the appeals.

[6.0] Present appeals are >led on limited ground of liability and
therefore, same is considered in narrow compass.

[7.0] Having heard learned advocate appearing for respective parties
and perusing the evidence produced on record, it is worth to mention
at the outset that three claim petitions being MACP No.81/2019,
82/2019 and 130/2019 were >led before the learned Tribunal
amongst which MACP No.130/2019 was dismissed. Before the learned
Tribunal, speci>c defence was raised by the appellant – insurance
company that the oKending Motorcycle was driven by deceased
Kalpesh, who was minor and was not holding valid and eKective
driving license to drive the motorcycle. To prove the said defence,
evidence of Mr. Ashutosh Chauhan, Legal Managar of appellant –
insurance company is produced at Exh.48 and learned Tribunal has
considered the fact that minor Kalpesh being the driver of oKending
motorcycle, his legal heirs and representatives cannot claim the
compensation for the wrong of deceased as he was the tort feasor as

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    C/FA/4554/2024                              JUDGMENT DATED: 09/01/2026




he was below age of 18 years and was not quali>ed to hold valid and
eKective driving license. Considering the said defence, claim petition
being MACP No.130/2019 >led under Section 163A of the MV Act
came to be dismissed. Involvement of oKending motorcycle is not in
dispute and insurance policy was in force is also not in dispute.

[7.1] Learned Tribunal has also accepted the defence that admittedly
deceased Kalpesh was minor and was not quali>ed to hold the driving
license to drive the motorcycle but deceased Pankaj and Arpit both
were pillion riders and for them, driving license was not required.
Based on the said >nding, insurance company is held liable. But once
on the same set of facts and evidence, learned Tribunal wrongly
interpreted the decision of Hon’ble Supreme Court in the case of
United India Insurance Co. Ltd. vs. Rakesh Kumar Arora reported in
2008 (0) AIJEL (SC) 42231 wherein it has been observed that once it is
proved the vehicle was being driven on the date of accident by a
minor, who does not have or hold any valid or eKective driving license,
then under Sections 3 or 5 of the MV Act, it is the statutory
responsibility upon the owner of the vehicle not to permit any person
who does not satisfy the provisions of section 3 or section 5 of the MV
Act for driving the vehicle and in such circumstances, insurance
company cannot be held liable or saddled with the liability to satisfy
the award in case of statutory breach of insurance policy.

[8.0] Learned advocate Mr. Maghnani appearing for the original
owner has submitted that in the written statement, speci>c defence is
taken that the owner of the vehicle was not aware that minor has
taken away his vehicle and without his knowledge minor deceased
were driving the motorcycle. Merely to make such type of averment in
written statement itself is not a proof. Evidence in that regard is



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required to be lead and it is needless to say that if any defence is
raised in the pleading then, it is required to be proved as, who asserts
or take such defence has to prove the same. Herein, the owner has
failed to prove the said fact and undisputedly and admittedly it
reveals from the record that vehicle was driven by minor who was not
having any valid or eKective driving license on the date of accident.
Hence, in light of the decision of the Hon’ble Supreme Court in the
case of Rakesh Kumar Arora (Supra) , learned Tribunal has committed
an error in saddling the insurance company with the liability and
therefore, appellant – insurance company is required to be
exonerated on the said ground alone as the learned Tribunal has
already accepted the said fact in cognate matter i.e. MACP
No.130/2019.

[8.1] At the same time, it is pertinent to note that the original
claimants are third parties and they have nothing to do with any
breach of the condition of policy. In this regard, it is appropriate to
refer to the decision of the Hon’ble Supreme Court in the case of
National Insurance Co. Ltd. vs. Swaran Singh reported in (2004) 3
SCC 297 wherein the Hon’ble Supreme Court in paragraph 83 has
observed as under:

      “83. Sub-section (5) of Section 149 which imposes a liability on the
      insurer must also be given its full e"ect. The insurance company may
      not be liable to satisfy the decree and, therefore, its liability may be zero
      but it does mean that it did not have initial liability at all. Thus, if the
      insurance company is made liable to pay any amount, it can recover the
      entire amount paid to the third party on behalf of the assured. If this
      interpretation is not given to the bene(cent provisions of the Act having
      regard to its purport and object, we fail to see a situation where
      bene(cent provisions can be given e"ect to. Sub-section (7) of Section
      149 of the Act, to which pointed attention of the Court has been drawn
      by the learned counsel for the petitioner, which is in negative language
      may now be noticed. The said provision must be read with sub-section
      (1) thereof. The right to avoid liability in terms of sub- section (2) of


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      Section 149 is restricted as has been discussed hereinbefore. It is one
      thing to say that the insurance companies are entitled to raise a defence
      but it is another thing to say that despite the fact that its defence has
      been accepted having regard to the facts and circumstances of the case,
      the Tribunal has power to direct them to satisfy the decree at the (rst
      instance and then direct recovery of the same from the owner. These
      two matters stand apart and require contextual reading.”

      The said authority is also followed by the Hon’ble Apex Court
once again in the case of Shamanna vs. Oriental Insurance Co. Ltd.
reported in (2018) 9 SCC 650 wherein, considering sections 147 and
149 of the MV Act, third party victim of the motor vehicle accident is
passed and it is the duty of the insurer to satisfy the award and
principle of “pay and recover” is summarized wherein it is held that if
the driver had no valid driving license and that there was breach of
policy condition, the High Court ought not to have interfered with the
order passed by the Tribunal of ‘pay and recover’. If the insurance
company has paid any amount then mode of recovery is also provided
and insurance company has a liberty to initiate proceeding before the
executing Court concerned, if dispute is between the insurer and the
owner. Herein, the original claimants are third party and have nothing
to do with the said terms and conditions of the insurance policy.
Hence, in view of the decision of the Hon’ble Supreme Court in the
case of Anu Bhanvara and Others vs. I:co Tokio General Insurance
Company Limited and Others reported in (2020) 20 SCC 632; Sunita
& Ors. United India Insurance Co. Ltd. & Ors. as well as in the case of
Rama Bai vs. M/s. Amit Minerals reported in 2025 INSC 1162, the
insurance company shall be entitled to recover the amount of
compensation from the original owner of the oKending motorcycle.

[8.2] Further, in view of the decision of the Hon’ble Supreme Court in
the case of K. Nagendra vs. New India Insurance Co. Ltd. reported in



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    C/FA/4554/2024                               JUDGMENT DATED: 09/01/2026




2025 SCC OnLine SC 2297, the Hon’ble Supreme Court has re-
aQrmed the social welfare intent behind the MV Act. The principle or
order of “To Pay and Recover” embodies judicial empathy ensuring
victims are not left uncompensated due to dispute between owner
and insurer. At the same time, considering the contractual
accountability, owner who breaches the condition cannot escape
>nancial responsibility as insurers retain the right to recover paid sum
to claimant. The dual balance of justice for victim and fairness for
insurers     strenghthen   integrity   of     Motor   Vehicles      Accident
Compensation system.

[9.0] In wake of aforesaid conspectus, present First Appeals are
partly allowed. The impugned common judgment and award dated
05.10.2024 passed by the learned Motor Accident Claims Tribunal
(Main), Dahod in Motor Accident Claim Petition No.82/2019 and
81/2019 is modi>ed to the extent that >rstly the appellant – insurance
company shall pay the compensation to the original claimants in
respective claim petitions i.e. MACP No.82/2019 and 81/2019 as
awarded by the learned Tribunal alongwith accrued interest as
awarded by the learned Tribunal and cost within a period of FOUR
WEEKS from the date of receipt of this judgment and thereafter, the
appellant – insurance company shall be entitled to recover the said
amount from the original owner of the Motorcycle No.GJ-20-P-
1613.

[9.1] Thereafter, the learned Tribunal shall disburse the entire
amount with accrued interest thereon, if any, to the original claimants
of respective First Appeals, by account payee cheque / NEFT / RTGS,
after proper veri>cation and after following due procedure.




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      C/FA/4554/2024                                                         JUDGMENT DATED: 09/01/2026




[10.0]             While making the payment, the Tribunal shall deduct the
courts fees, if not paid.

[11.0]             Record and proceedings, if any, be sent back to the
concerned Tribunal, forthwith.


                                                                                           Sd/-
                                                                         (HASMUKH D. SUTHAR, J.)
Ajay
 Original copy of this order has been signed by the Hon'ble Judge.
 Digitally signed by: AJAY CHANDRAN MENON(HC00939), PRINCIPAL PRIVATE SECRETARY, at High Court of Gujarat on 12/01/2026 15:08:35




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