Motor Accident Laws

All you need to know about motor accident laws alongwith procedure to be followed

Motor Vehicle Act, 1988

The Motor Vehicles Act, 1988 is an Act of the Parliament of India which regulates all the aspects of road transport vehicles. This Act came into force from 1 July 1989. Motor vehicles act created a new forum named Motor Accidents Claims Tribunals which substituted civil courts in order to provide cheaper and speedier remedy to the victims of accident of motor vehicles. The Tribunal is to follow a summary procedure for adjudication of claims being provided; the sections do not deal with the substantive law regarding determination of liability. For determination of liability one has still to look to the substantive law in the law of torts and Fatal Accident Act, 1855 or at any rate to the principles thereof.

Section 169 – Procedures and Powers of Claim Tribunals

  1. In holding any inquiry under section 168, the Claims Tribunal may, subject to any rules that may be made in this behalf, follow such summary procedure as it thinks fit.
  2. The Claims Tribunal shall have all the powers of a Civil Court for the purpose of taking evidence on oath and of enforcing the attendance of witnesses and of compelling the discovery and production of documents and material objects and for such other purposes as may be prescribed; and the Claims Tribunal shall be deemed to be a Civil Court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).
  3. Subject to any rules that may be made in this behalf, the Claims Tribunal may, for the purpose of adjudicating upon any claim for compensation, choose one or more persons possessing special knowledge of and matter relevant to the inquiry to assist it in holding the inquiry.

Procedure to be followed

Section 169 expressly empowers the claims tribunals to formulate its own procedure. Since the claims tribunal has all the powers equal to High Court, it may choose to follow the procedure laid down in the CPC. In holding an enquiry under the section 168 of the act, the claims tribunal is empowered to follow such summary procedure as it thinks fit. The intention is that the enquiry should not take the shape of elaborate and long-drawn proceedings as a regular civil suit but should be concluded as much speedily as possible. The nature of enquiry should be more or less like a judicial enquiry. There can be no gain saying that vast power exists in the claims tribunal to determine its own procedure in dealing with the claim applications. The claims tribunal has all the trappings of a court and the proceedings before it closely resemble the proceedings in a civil court. The whole intention of the legislature is to ensure a speedy disposal of the claim applications filed by the injured persons or the legal representatives of the deceased.

What to Do After an Accident?

A case should be registered before the local police or either they will take cognizance on their own. For this-

  • One should take pictures of the accident scene or even a video for use as evidencelater on. Even just a passer-by can do this and provide the photos or videos to police for support in investigation and delivery of justice.
  • After this, police has to register FIR, investigate and then charge-sheet the accused. After this, the judicial mechanism will set itself into motion.


  • Every application is to be made at the option of the claimant, either to the Claims Tribunal who is having jurisdiction over the area in which the accident occurred.
  • Or to the Claims Tribunal within the local limits of whose jurisdiction the claimant resides (Nearest Tribunal to Victim) or carries on business.
  • Or within the local limits of whose jurisdiction the defendant resides

Third party Insurance

Section 145 to 164 of MV act 1988, provides for compulsory third party insurance, which is required to be taken by every vehicle owner. It has been specified in Section 146(1) that no person shall use or allow using a motor vehicle in public place unless there is in force a policy of insurance. Contravention of the provisions of section 146 is an offence and is punishable with imprisonment which may extend to three months or with fine which may extend to one thousand rupees or with both. Section 147 provides for the requirement of policy and limit of liability. Every vehicle owner is required to take a policy covering against any liability which may be incurred by him in respect of death or bodily injury including owner of goods or his authorized representative carried in the vehicle or damage to the property of third party and also death or bodily injury to any passenger of a public service vehicle. According to this section the policy not require covering the liability of death or injuries arising to the employees in the course of employment except to the extent of liability under Workmen Compensation Act. Under Section149 the insurer has been statutorily liable to satisfy the judgment and award against the person insured in respect of third party risk.

Legal Defence available to Insurance Company towards 3rd party  

The Insurance Company cannot avoid the liability except on the grounds and not any other ground, which have been provided in Section 149(2). If the defense has been pleaded and proved by the Insurance Company, they are not absolve from liability to make payment to the third party but can receive such amount from the owner insured. The courts one after one have held that the burden of proving availability of defense is on Insurance Company and Insurance Company has not only to lead evidence as to breach of condition of policy or violation of provisions of Section 149(2) but has to prove also that such act happens with the connivance or knowledge of the owner. If knowledge or connivance has not been proved, the Insurance Company shall remain liable even if defense is available.

Calculation of compensation

Where death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle, the owner of the vehicle will be liable to pay road accident compensation in respect of such death or disablement.

In the case of death, the minimum sum to be paid is INR 50,000/- and in the case of disablement, a minimum sum to be paid is INR 25,000/-, and this minimum is subject to additional compensation which the tribunal might grant under s 163A.

For a victim, one does not need to prove the negligence of the opposite side, it is assumed. The victim need not be required to plead and establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act, neglect or default of the owner or owners of the vehicle or vehicles concerned or of any other person.

Factors determining the compensation amount

  1. Age of the deceased at the time of accident.
  2. Income of deceased injured when accident took place.
  3. Permanent/Temporary Disability, Partial/Functional Disability qua whole body or with respect to particular limb.
  4. Treatment cost- Surgeries, any special equipment being used should also be produced along with the bills in the name of the patient.
  5. Rate of Interest, entirely based on facts of the case from the date of application. No uniformity. Every court awards the compensation on its own notion.
  6. Dependency- Brother and Father not dependents of deceased. Only mother can claim money. Must give proof if they are dependant.

When road accident compensation is awarded, the person who is required to pay that amount has to pay it within 30 days of announcing of orders. Even simple interest is applied on the amount from the date of making of claims.  When the person required to pay the road accident compensation is willingly or otherwise not paying the amount, the tribunal can order Collector to recover the money as it happens in cases of arrears of land revenue.

It has been upheld in various judgments of the Hon’ble MACT that amounts prescribed in the Motor Vehicles Act and subsequent amendments and recommendations are not straightjacket and compensation maybe awarded basis the gravity of the losses to the parties as well. In that regard, it adjusts to the needs of the situation as well.


Article by-

Rakhsit Malik (Intern, December 2018)

Sushant Chaturvedi (Associate)

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