The Supreme Court Criticises States and High Courts for Not Filing Compliance Reports on Motor Accident Compensation Claims Directions.

The Supreme Court Reprimands States and High Courts for Failing to File Compliance Reports Regarding Directions Issued Regarding Motor Accident Compensation Claims

Monday, the Supreme Court exhorted the States and High Courts that had not presented their compliance ts with regard to a series of directives issued by the Supreme Court in December 2022 regarding motor accident compensation claims to do so by August 14. The Court warned that if the ts were not submitted on time, it would be forced to require the High Court Registrars and State Chief Secretaries to appear in court. In 2022, guidelines were issued to implement the Motor Vehicle Amendment Act Rules.

In its order, a divisional bench composed of Justices J K Maheshwari and K V Viswanathan stated:

In case compliance report is not filed by the remaining High Courts or the State authorities, before the next date, this Court shall be constrained to pass an order seeking the presence of the Registrar Generals of the concerned High Court and the Chief Secretaries of the concerned State /Union Territories.

The Court noted that the High Courts of Jammu & Kashmir, Ladakh, Karnataka, Manipur, Patna, Rajasthan, Telangana, and Allahabad have not submitted reports or compliance affidavits.

The Court issued several guidelines in December 2022 for the registration of the First Accident Report by the police immediately following a motor vehicle accident so that the claim process under the Motor Vehicles Act can be initiated as soon as possible.

To ensure proper compliance with the Motor Vehicles Amendment Act 2019 and the related Rules, the Court had ordered the Chief Secretary/Director General of Police in each State to create a specialized unit in each police station and post trained police personnel to ensure compliance within three months.

The court also ordered that within 48 hours of filing the FIR, the investigating officer must submit the First Accident Report to the Claims Tribunal in accordance with the Motor Vehicles Amendment Rules, 2022. Additionally, the Interim Accident Report and Detailed Accident Report must be submitted to the Claims Tribunal within the specified time frame. To assure compliance, the Registrar General of the High Courts was tasked with distributing police station attachments to the relevant Claim Tribunals.

The Court also urged the Registrar General of the High Courts, the States Legal Services Authority, and the State Judicial Academies to educate all stakeholders as soon as possible about the provisions of Chapters XI and XII of the MV Amendment Act and the MV 65 Amendment Rules, 2022 and to ensure compliance with the law.

The State Authorities were also instructed to construct a joint web portal/platform to facilitate the implementation of the MV Amendment Act and the Rules in coordination with any technical agency.In this regard, the respective Chief Secretaries of State and Registrar Generals of respective High Courts were tasked with submitting compliance reports.

The following are the detailed guidelines issued by the Court on 15th December 2022:The following are the detailed guidelines issued by the Court on 15th December 2022 :

i) On receiving the intimation regarding a road accident by use of a motor vehicle at public place, the SHO concerned shall take steps as per Section 159 of the M.V. Amendment Act.

ii) On receiving the intimation regarding a road accident by use of a motor vehicle at public place, the SHO concerned shall take steps as per Section 159 of the M.V. Amendment Act.

iii) The registering officer is duty bound to verify the registration of the vehicle, driving licence, fitness of vehicle, permit and other ancillary issues and submit the report in coordination with the police officer before the Claims Tribunal.

iv) The flow chart and all other documents, as specified in the Rules, shall either be in the vernacular language or in the English language, as the case may be and shall be supplied as per Rules. The Investigating Officer shall inform the victims)/legal representative(s), drivers), owner(s), insurance companies and other stakeholders with respect to the action taken following the M.V. Amendment Rules and shall take steps to produce the witnesses on the date so fixed by the Tribunal.

v) For the purpose of carrying out direction No. (il), distribution of police stations attaching them with the Claim Tribunals is required. Therefore, distribution memos attaching the police stations to the Claim Tribunals shall be issued by the Registrar General of the High Courts from time to time, if not already issued, to ensure compliance with the Rules.

vi) In view of the M.V. Amendment Act and Rules, as discussed hereinabove, the role of the Investigating Officer is very important. He is required to comply with the provisions of the Rules within the time limit as prescribed therein. Therefore, for effective implementation of the M.V. Amendment Act and the Rules framed thereunder, the specified trained police personnel are required to be deputed to deal with the motor accident claim cases. Therefore, we direct that the Chief Secretary/Director General of Police in each and every State/Union Territory shall develop a specialized unit in every police station or at the town level and post the trained police personnel to ensure compliance of the provisions of the M.V. Amendment Act and the Rules, within a period of three months from the date of this order.vii) On receiving FAR from the police station, the Claims Tribunal shall register such FAR as Miscellaneous Application. On filing the AR and DAR by the Investigating Officer in connection with the said FAR, it shall be attached with the same Miscellaneous Application. The Claims Tribunal shall pass appropriate orders in the said application to carry out the purpose of Section 149 of the M.V. Amendment Act and the Rules, as discussed above.

viii) The Claim Tribunals are directed to satisfy themselves with the offer of the Designated Officer of the insurance company with an intent to award just and reasonable compensation. After recording such satisfaction, the settlement be recorded under Section 149(2) of the M.V. Amendment Act, subject to consent by the claimants). If the claimant (s) is not ready to accept the same, the date be fixed for hearing and affording an opportunity to produce the documents and other evidence seeking enhancement, the petition be decided. In the said event, the said enquiry shall be limited only to the extent of the enhancement of compensation, shifting the onus on the claimant(s).

ix) The General Insurance Council and all insurance companies are directed to issue appropriate directions to follow the mandate of Section 149 of the M.V. Amendment Act and the amended Rules. The appointment of the Nodal Officer prescribed in Rule 24 and the Designated Officer prescribed in Rule 23 shall be immediately notified, and modified orders also be notified from time to time to all the police stations/stakeholders.

x) If the claimants) files an application under Section 164 or 166 of the M.V. Amendment Act; on receiving the information, the Miscellaneous Application registered under Section 149 shall be sent to the Claims Tribunal where the application under Section 164 or 166 is pending immediately by the Claims Tribunal.

xi) In the case of the claimants) or legal representative(s) of the deceased have filed separate claim petition (s) in the territorial jurisdiction of different High Courts; in the said situation, the first claim petition filed by the claimants)/legal representative (s) shall be maintained by the said Claims Tribunal and the subsequent claim petitions) shall stand transferred to the Claims Tribunal, where the first claim petition was filed and is pending. It is made clear here that the claimant(s) are not required to apply before this Court seeking transfer of other claim petition(s) though filed in the territorial jurisdiction of different High Courts. The Registrar Generals of the High Courts shall take appropriate steps and pass appropriate orders in this regard in furtherance to the directions of this Court.

xii) If the claimants) takes recourse under Section 164 or 166 of the M.V. Amendment Act, as the case may be, he/they are directed to join the Nodal Officer/Designated Officer of the insurance company as respondents in the claim petition as proper party of the place of accident where the FIR has been registered by the police station. Those officers may facilitate the Claims Tribunal specifying the recourse as taken under Section 149 of the M.V. Amendment Act.

xiii) Registrar General of the High Courts, States Legal Services Authority and State Judicial Academies are requested to sensitize all stakeholders as early as possible with respect to the provisions of Chapters XI and XII of the M.V. Amendment Act and the M.V. Amendment Rules, 2022 and to ensure the mandate of law.

xiv) For compliance with the mandate of Rule 30 of the M.V. Amendment Rules, 2022, it is directed that on disputing the liability by the insurance company, the Claims Tribunal shall record the evidence through the Local Commissioner and the fee and expenses of such Local Commissioner shall be borne by the insurance company.

Xv) The State Authorities shall take appropriate steps to develop a joint web portal/platform to coordinate and facilitate the stakeholders for the purpose to carry out the provisions of M.V.

Amendment Act and the Rules in coordination with any technical agency and be notified to the public at large.

The guidelines were issued while the bench was hearing an appeal challenging the 9 September 2018 order of the Allahabad High Court.

In 2018, the MACT granted an accident victim’s claim petition and awarded compensation of Rs. 31,90,000/- 2 plus 7% interest. In calculating the loss of dependency, the deceased’s annual income was acknowledged as Rs. 3,09,660.

It was determined that the vehicle was not being operated in accordance with the terms of the permit and was in violation of the terms and conditions of the insurance policy; as a result, the proprietor of the vehicle was held liable to pay damages.

The appellant challenged the issue of liability before the High Court, arguing that there was no violation of guidelines and that the offending vehicle was insured, with the insurance company covering the liability. In addition, the appellant argued that he possessed Special Temporary Authorization to operate the vehicle on the route for which the fee was paid. The High Court, however, upheld the findings of MACT and ruled that the vehicle owner failed to produce the original permit and was unable to obtain the same evidence to contact the Transport Department employee. The aggrieved party petitioned the Supreme Court.

The Supreme Court began by noting that in Rajesh Tyagi’s case, the Delhi High Court had formulated the “Claims Tribunal Agreed Procedure” for time-bound resolution of motor accident claims within 90 to 120 days and ordered its trial implementation for six months in 2010.

“The High Court also directed the Delhi Police to create an “Accident Investigation Manual” for the implementation of the TAP. The outcome was that the Motor Accident Compensation Scheme was revolutionized, resulting in the 13 claimants receiving compensation within 120 days of the accident, as noted by the Bench.

In 2017, the Supreme Court ordered all states to implement the ‘Modified CTAP’. However, in M.R. Krishna Murthi v. The New India Assurance Co. Ltd., the Supreme Court was informed that modified TAP was not being effectively implemented by Claim Tribunals at the pan-India level.

The court then ordered the National Legal Services Authority to monitor the situation in coordination and cooperation with the numerous High Courts. In addition, State Judicial Academies were instructed to educate the Presiding Officers of Claim Tribunals, senior police officials, and insurance companies about the modified TAP. Last but not least, the court ordered all claim tribunals in India to implement the “Motor Accident Claims Annuity Deposit Scheme.”

The Motor Vehicle Amendment Act, 2019 subsequently amended Chapter XI – Insurance of Motor Vehicles against Third Party Risks and Chapter XII – Claims Tribunals.

Regarding Section 146, which addresses whether insurance of motor vehicles is required, the Bench stated, “Upon perusing the MV Amendment Act, in particular Section 146 of Chapter XI, it is evident that a motor vehicle cannot operate on a public place and is not permitted to be used on a public place unless it is insured. The exemption from insurance has been prescribed for vehicles possessed by the Central Government, a State Government, a local authority, or any State Transport Undertaking when used for non-commercial purposes.

The Bench also reviewed the pertinent provisions for processing the claim for compensation before the Tribunal.

In the aforementioned case, the Bench denied the appeal and reaffirmed the MACT and High Court’s decisions.

Case Title: Gohar Mohammed Versus Uttar Pradesh State Road Transport Corporation & others | Civil Appeal No. 9322 OF 2022

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