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DEEPAK GUPTA, J. –

These two appeals arise out of the same award dated 10.09.2019 passed by the learned Motor Accident Claims Tribunal, Panipat and are, therefore, being decided by this common order.

2. FAO-7144-2019 has been preferred by the Insurance Company seeking its complete exoneration from liability; whereas FAO-967-2021 has been filed by the claimants seeking enhancement of the compensation.

FAO-7144-2019

3. The facts, insofar as relevant for adjudication of the present appeals, are not in dispute. On 13.03.2017, several persons were travelling on tractor bearing registration No. HR-60G-9769, which was being driven by Ajay. At about 1:30 P.M., the tractor met with an accident on account of rash and negligent driving of its driver. Kartik, aged about 23 years, who was travelling on the bonnet of the tractor as a gratuitous passenger, fell from the tractor and, during treatment, succumbed to the injuries sustained in the accident. His father and two siblings instituted a claim petition under Section 166 and 140 of the Motor Vehicles Act, 1988 against the driver, owner and insurer of the offending vehicle.

4. The learned Tribunal, on appreciation of the evidence, recorded a categorical finding that the accident had occurred due to rash and negligent driving of the offending tractor. The income of the deceased was assessed at Rs.8,280/- per month on the basis of the minimum wages applicable to an unskilled worker. After deducting 50% towards his personal and living expenses and applying the multiplier of 18, the Tribunal assessed the total compensation at Rs.12,81,936/-, under the permissible heads. The driver, owner and insurer were held jointly and severally liable to satisfy the award alongwith interest. At the same time, the Insurance Company was granted the right to recover the amount from the driver and owner of the offending vehicle.

5. Learned counsel appearing for the Insurance Company submits that the deceased was admittedly a gratuitous passenger travelling on the bonnet of an agricultural tractor. Such carriage of a passenger was neither authorised nor covered by the insurance policy and, therefore, the Insurance Company could not have been directed even to satisfy the award in the first instance. It is accordingly argued that the Insurance Company deserves to be completely exonerated.

6. Reliance has been placed upon New India Assurance Company Ltd. v. Vedwati and others, (2007) 9 SCC 486; National Insurance Company Ltd. v. Prema Devi and others, (2008) 5 SCC 403; and various judgments of this Court, including Rajender and another v. Krishna and another, 2019 (1) PLR 559.

7. There can be no quarrel with the proposition that a gratuitous passenger travelling in a goods vehicle, or on a tractor in circumstances, where carriage of such passenger is not covered by the policy, is not a risk, which the insurer is statutorily obliged to indemnify.

8. The Constitution Bench judgment in New India Assurance Company Ltd. v. Asha Rani, (2003) 2 SCC 223, and the subsequent judgment in National Insurance Company Ltd. v. Baljit Kaur, (2004) 2 SCC 1, make it clear that the insurer is not liable, on the strength of the policy, to indemnify the owner in respect of a gratuitous passenger travelling in a goods carriage. The same position was reiterated in New India Assurance Company Ltd. v. Vedwati and others, (Supra) and National Insurance Company Ltd. v. Prema Devi and others, (Supra).

9. Thus, on the first question, the Insurance Company is justified in contending that the deceased was not a passenger, whose risk was required to be covered under the policy.

10. The aforesaid, however, does not conclude the controversy. The question whether the insurer is contractually or statutorily liable to indemnify the insured is distinct from the question whether, in an appropriate case, the insurer can be directed to satisfy the award in the first instance and thereafter recover the amount from the owner.

11. The Hon’ble Supreme Court has, in a line of decisions, applied the principle of "pay and recover" notwithstanding the absence of substantive liability of the insurer to indemnify the insured. The principle finds expression in National Insurance Company Ltd. v. Baljit Kaur, (2004) 2 SCC 1; National Insurance Company Ltd. v. Challa Bharathamma, (2004) 8 SCC 517; Manager, National Insurance Company Ltd. v. Saju P. Paul, (2013) 2 SCC 41; and Manuara Khatun and others v. Rajesh Kumar Singh and others, (2017) 4 SCC 796.

12. In Saju P. Paul (supra), after holding that the gratuitous passenger was not covered by the policy, the Hon’ble Supreme Court nevertheless directed the Insurance Company to satisfy the award and recover the amount from the owner. The Court specifically noted that the pendency of questions before a larger Bench did not preclude following the course adopted in Baljit Kaur (supra) in an appropriate factual situation. The recovery was directed to be made in accordance with the procedure laid down in Challa Bharathamma (supra).

13. The principle was subsequently applied in Manuara Khatun (supra), wherein the Hon’ble Supreme Court considered the entire earlier line of authority and approved the direction requiring the insurer to first satisfy the award and thereafter recover the same from the owner.

14. Likewise, in Anu Bhanvara and others v. IFFCO Tokio General Insurance Company Ltd. and others, Civil Appeal Nos.6231-6232 of 2019, decided on 09.08.2019, the Hon’ble Supreme Court dealt with gratuitous passengers travelling in a goods vehicle and directed the Insurance Company to pay the compensation and thereafter recover the same from the owner and driver.

15. The subsequent pronouncement of the Hon’ble Supreme Court in Sunita and others v. United India Insurance Company Ltd. and others, 2025 INSC 867, is particularly significant. There also, the offending vehicle was covered under a "Liability Only Policy" and no premium had been paid for the driver, owner or gratuitous passenger. Despite holding that the risk of the gratuitous passenger was not covered, the Hon’ble Supreme Court held that the Courts below had erred in completely exonerating the Insurance Company and directed application of the principle of "pay and recover". The Hon’ble Court referred, inter alia, to Baljit Kaur (supra) and Anu Bhanvara (supra).

16. The position has been further clarified by the most recent judgment of the Hon’ble Supreme Court in Kaminiben and others v. The Oriental Insurance Company Limited and others, Civil Appeal arising out of SLP (C) No.21802 of 2023, decided on 11.02.2026 Law Finder Doc ID # 2855820. The deceased therein was travelling as a gratuitous passenger in a goods vehicle. The High Court had reversed the Tribunal's direction requiring the insurer to first pay and thereafter recover. The Hon’ble Supreme Court restored the Tribunal's direction. While doing so, the Hon’ble Supreme Court relied upon Manuara Khatun (supra) and Saju P. Paul (supra) and expressly held that, although the gratuitous passenger was not covered by the insurance policy, the insurer could nevertheless be directed to first satisfy the awarded sum and thereafter recover the same from the insured in the same proceedings. The Court distinguished Amudhavalli and others v. HDFC Ergo General Insurance Company Ltd. and others, 2025 INSC 1219, on its peculiar facts, observing that in Amudhavalli (supra) the goods vehicle itself had been hired for travelling, whereas in Kaminiben (supra) the dominant purpose was carriage of goods and travelling was only incidental.

17. The aforesaid latest pronouncement is of considerable relevance to the present case. Here also, the deceased was travelling on an agricultural tractor as a gratuitous passenger. The fact that the passenger was not covered by the policy determines the ultimate right of the insurer to recover the amount from the insured; but does not, in view of the aforesaid line of binding precedents, require the claimant to first execute the award against the owner and driver.

18. The object of the Motor Vehicles Act is to ensure just and effective compensation to victims of motor accidents. The direction to pay and recover strikes a balance between the two competing considerations, as the insurer is not saddled with the ultimate burden of indemnifying a risk, which was not covered by the policy, while the innocent claimants are not compelled to undertake a separate and potentially prolonged recovery process against the owner.

19. The decision in Amudhavalli (supra) does not advance the case of the appellant in the facts of the present case. That decision turned upon its own factual setting, and the Hon’ble Supreme Court in Kaminiben (supra) has subsequently explained the distinction between the two situations and restored the pay-and-recover direction, where travelling was incidental to carriage of goods.

20. Consequently, while it is held that the deceased, being a gratuitous passenger travelling on the tractor, was not a person whose risk the Insurance Company was bound to indemnify under the policy, the direction issued by the learned Tribunal requiring the Insurance Company to satisfy the award in the first instance, with liberty to recover the amount from the driver and owner, is fully consistent with the subsequent binding pronouncements of the Hon'ble Supreme Court.

21. The right of recovery granted to the Insurance Company adequately protects its interest. No ground is made out for directing the claimants to recover the awarded amount directly from the owner and driver in the first instance.

22. Consequently, FAO-7144-2019, filed by the Insurance Company, is dismissed.

23. Learned counsel for the claimants submits that the learned Tribunal has not awarded any amount towards loss of consortium to the father of the deceased.

24. The submission deserves acceptance. The deceased was aged about 23 years and was unmarried. His father, being a parent of the deceased, is entitled to compensation under the head of filial consortium. The Hon'ble Supreme Court in Magma General Insurance Company Ltd. v. Nanu Ram alias Chuhru Ram and others, (2018) 18 SCC 130, recognised parental and filial consortium as a legitimate head of compensation. The principle has subsequently been reiterated in United India Insurance Company Ltd. v. Satinder Kaur alias Satwinder Kaur and others, (2021) 11 SCC 780.

25. The siblings, however, are not entitled to an independent award under the head of loss of consortium in the facts of the present case.

26. As regards the quantum, National Insurance Company Ltd. v. Pranay Sethi, (2017) 16 SCC 680, prescribed Rs.40,000/- as the reasonable amount towards loss of consortium, with enhancement of 10% every three years. The said principle has subsequently been followed by the Hon’ble Supreme Court while assessing consortium payable in motor accident claims. In Sunita (supra), in respect of an accident of the year 2017, the Hon’ble Supreme Court applied the enhanced figure of Rs.48,400/- towards consortium.

27. Accordingly, the father of the deceased is entitled to Rs.48,400/-towards loss of filial consortium.

28. The enhanced amount of Rs.48,400/- shall carry interest at the rate of 7.5% per annum from the date of filing of the claim petition till actual realization, in terms of the rate applicable to the award.

29. The aforesaid amount shall be in addition to the compensation already awarded by the learned Tribunal. The liability of the respondents shall remain joint and several, as held by the learned Tribunal. The Insurance Company shall, however, retain its right to recover the entire amount paid by it from the driver and owner of the offending vehicle in accordance with law and in terms of the direction already issued by the Tribunal.

30. Consequently, FAO-967-2021 is allowed to the aforesaid extent and the award of the learned Tribunal stands modified accordingly.

31. Both the appeals stand disposed of in the above terms. A photocopy of this order be placed on the file of the connected case. Pending application(s), if any, shall stand disposed of.

Order accordingly.

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