Supreme Court To Examine Methods To Expedite Compensation In Motor Accident Cases

A three-judge Bench of Justices S.K. Kaul, Dinesh Maheshwari and Hrishikesh Roy has been hearing the plea filed Insurance Company Bajaj Allianz seeking slew of directions in the matter and had in its previous hearing directed the petitioner, to come up with draft directions and guidelines it seeks for facilitating compensation disbursement process and expedition of cases before Motor Accidents Claims Tribunal in terms of previous orders of the High Court.

During the hearing, the Court was assured by Additional Solicitor General Jayant Sud, that coordinated effort will be made and a virtual conference with all the stakeholders represented the Court will be held and the agreed directions will be given to the Court along with the different perceptions of all the stakeholders involved. The Apex Court has directed certain issues to be discussed in the virtual meeting of the stakeholders:

Recommendations of Supreme Court's Artificial Intelligence Committee: The Court has also directed that the meeting should consider consonance of the recommendations that would be made by the Supreme Court's Committee dealing with use of Artificial intelligence. The Bench was informed by the Counsel that the Committee of the Supreme Court dealing with the use of Artificial Intelligence is also examining some aspects and the directions to be issued should be in consonance with the same.

The Supreme Court Artificial Committee was formed by CJI Bobde in November 2019 to develop various modules and assist Courts in application of Artificial Intelligence tools in various situations. The Committee headed by Justice Nageswara Rao is seized with a host of issues concerning the Motor Accident Claim Jurisdiction, to deliver a sure and sound regime expeditious disposal of the claims.

Recommendations of Ministry of Road and Transport: The Court received assurance from, Deputy Advocate General Sourav Roy appearing on behalf of the State of Chhattisgarh who stated that assistance will be taken from the Ministry of Road and Transport (MORT) in framing the directions. He suggested the Court that since the Ministry has some aggregated platforms it may also be of assistance in framing of the directions, and therefore should be consulted.

Orders of the Delhi and Madras High Court: The Court has asked suggestions made by Bajaj Allianz to be taken up and examined during the discussion. The petitioner Bajaj Allianz suggested that the Delhi High Court and the Madras High Court have placed very effective machinery to take care of practically all the problems and largely those directions can be replicated.

The Supreme Court had on Feb 13th directed the Bajaj Allianz General Insurance Company, the petitioner in the matter, to come up with draft directions and guidelines for facilitating compensation disbursement process and expedition of cases before Motor Accidents Claims Tribunal (MACT). The Court had observed that in its previous hearing on 18th January 2021, the bench had directed the petitioner to submit a note indicating the directions within 10 days, but the petitioner failed to do so.

During the course of proceedings today, Meenakshi Arora had informed the bench that she had submitted the required note in the Court wherein she had incorporated various directions given by the Delhi High Court and other High Courts across India dealing with compensation disbursement process and expedition of cases pending before MACT.

However, Justice Kaul clarified that the bench had asked the petitioner to prepare "draft directions" for the Court to look into the aspect of its implementation. Ms. Arora, accepting her fault for not submitting the requisite draft directions, sought permission from the bench to grant some time to the petitioner to come up with the guidelines.

"You cannot put everything on court and say you do it. You should have framed the guidelines. You've not done the exercise." Justice Kaul had remarked at the outset.

"We asked you vide Order dated 18th January for directions related to disbursement of compensation and expedition of MACT cases, which would have then modulated for a uniform application. We are trying to help you out. We will give you one more chance. Otherwise we will close this case." The bench had observed.

The bench had therefore granted one last chance to the petitioner in order to come up with the draft guidelines. However, in doing so, the bench also ordered that if the petitioner fail to come up with the guidelines in the next date of hearing, it will mean that the insurance company is not interested in the passing of directions.

"We have seen the application and the notes submitted by the petitioner but in the course of proceedings, it has been impressed upon learned senior counsel for the petitioner that this is not what we had in mind when we passed the directions on 18.01.2021 and thus, if the insurance company is interested in the slew of directions, the same be set forth in the manner which we have indicated in the Court failing which we will presume that the insurance Company is not interested." The order had said.

The present plea has been filed by Bajaj Alianz General Insurance Company seeking implementation of online and virtual mechanism for collection of information and ensuring expeditious payment of compensation in motor accident claims and a functional common online virtual platform to ensure filing of such claims and settlement.

The present case revolves around implementation of provisions of Section 158, 159 and 165 of the Motor Vehicles Act that mandated provision of certificates in certain cases under the Act.

Section 158, read with Section 159 after the 2019 amendment mandates that in event of a motor vehicle accident causing death or bodily injury, the police must collect certificate of insurance and registration for all types of vehicles, and certificate of fitness and transport permit for transport vehicles along with driving license of the driver. These documents must be collected contemporaneously with the occurrence of the accident. The document must then be submitted by the officer in charge of the jurisdictional police station before the jurisdictional tribunal and the insurer in terms of Section 158(6). The report has to be treated as an application for compensation in terms of Section 166(4). The petitioner has stated that when Section 166(4) is read with 158(6) it ensures expeditious payment of compensation to third party victims.

According to the petitioner, Section 158 by providing for collection of information contemporaneously at the time of the accident itself, captures a valuable right of the insurers of separating genuine claims that ought to be satisfied immediately from others since if such information is not collected or verified immediately, doing the same later would become very difficult. The passage of time enable unscrupulous elements to pollute the judicial process, forcing insurance companies to err on the side of caution and contest all claims. The situation is particularly stark in cases where insurance companies would be willing to satisfy a genuine claim, but they cannot for absence of verified information under Section 158(6). The non implementation of these sections therefore locks insurers like the petitioner, in meaningless litigation before Tribunals impugning their fundamental rights under Article 19(1)(g).

However, the petitioner has argued that the physical submission of report causes great delay and frustrates the intendment of Section 158.

The petitioner, being one of the largest third party insurers in India has stated from its Pan-India experience that the inability of the jurisdictional police stations to spare adequate human resources in the prime reason for non implementation of the provisions under the Motor Vehicle Act and affects their right to equality and access to justice as guaranteed under Article 14 and Article 39A of the Indian Constitution.

Orders of Supreme Court and High Courts: Supreme Court had ordered for strict implementation of Section 158(6) in 2007 through its order in the case of General Insurance Council and ors vs State of Andhra Pradesh.

The Delhi High Court in 2009 in the case of Rajesh Tyagi vs Jaibir Singh, devised a " Claim Tribunal Agreed Procedure" which emphasised upon contemporaneous collection and verification of information pertaining to the accident. The petitioner has stated that the Claims Tribunal Agreed Procedure devised by the Delhi High Court which has expedited the disbursal of compensation in Delhi is not online and is dependent on physical submission of documents before the Tribunal. However, it has succeeded in Delhi only due to Delhi's small geography and better man power, and cannot be successful in larger states unless supported with online mechanisms. Online mechanisms will ensure that motor accident victims receive compensation quickly and efficiently and are specially essential in Covid19 situation where physical interaction amongst people is very difficult.

The Apex Court noted the Delhi High Court's order in the case of Rajesh Tyagi, while deciding another titled Jai Prakash vs National Insurance Company Ltd and Ors first in its order in 2009 and then extended it throughout India in 2016. Some provisions of the Agreed procedure were therefore incorporated in the Motor Vehicles Amendment Act 2019, pursuant to these Court's orders.

The Madras High Court through its order in 2017 in the case of Cholamandalam General Insurance Company Ltd vs The Inspector of Police had directed the creation of an online platform for submission of documents required in the enquiry under the Act, and the platform has become functional since then. The Court had observed that the SCRB had implemented the DAR regime as an online platform and its effort was a sure shot improved one worth replicating pan India.

In fact, if the Apex Court becomes aware of this online venture of the implementation of the DAR regime, it may even consider recommending its implementation across India, as being paperless is the way to go. SCRB has done a commendable job of what it was directed to do and one fervently hopes that all stakeholders would take full advantage of what is an offer for the lasting benefit of the community of motor accident victims to seek early closure of their claims for just compensation and to come out of a traumatised event and circumstances as early as possible and get rid of the jurisdiction of the pernicious practise of false and fabricated motor accidents claims and falsification of records. With these words the Court commends application of DAR Regime as proposed for the entire State in its online version as constituting full compliance with mandate of the decision of the Supreme Court dated 13/5/2016 in Jai Prakash vs National Insurance Co Ltd and as per directions of the Court commencing from 16/8/2016 and culminating in this order. This Court commends the efforts of all those involved in implementation of the DAR Regime for the lasting benefit of the innocent motor accidents victims to deliver on the promise of social justice as a Constitutional principle.

The petitioner is aggrieved by the fact that even after extension of the Agreed Procedure throughout India, while success has been achieved in Delhi, it has not been implemented elsewhere, due to grave human resource constraint faced by police departments of other States as compared to Delhi. Another reason as suggested by the petitioner is that the geographical expanse of other states and their districts are far larger than those of Delhi and uts districts, and the human resource crunch coupled with large geographical areas effectively disables jurisdictional police stations from submitting reports before the Tribunals.

Petitioner's Prayers: The petitioner, Bajaj Allianz General Insurance Company has in its present petition filed by Advocate Siddharth, urged the Court to issue a slew of directions including following directions:

Permit the police authorities to submit report under Section 158 of the Act before the Tribunals and the petitioner insurer by online method.

Permit the service of copies of the claim petition or DAR by the Tribunal to the petitioner through virtual mode in cases where notice under Section 149(2) read with section 166 of the Act is yet to be issued.

Permit the petitioner to submit its response or offer in the claims pending before the tribunals online and be served with tribunal's order online.

Permit the petitioner to make online payments to satisfy the awards passed by the tribunals into the bank accounts maintained by the tribunals.

Direct the respondents to create a common online virtual platform accessible by all stakeholders including the police authorities, insurer, respective tribunals and the claimants such that the mandate of section 158 of the Act is complied with in letter and spirit.

Direct the respondents to create a functional common online virtual platform to ensure filing of claims and settlement thereof by electronic mode itself by the concerned tribunal.

Direct Union of India and States to develop software for submission of the documents mentioned in the prayers as early as possible within a limited time frame.

Therefore, the petitioner believes that the problem's solution is to permit police to submit their report as required under Section 158(6) online before the tribunal and the insurer, and if the insurer finds the report to reflect a bona fide claim it may be permitted to submit its offer for satisfaction of the claim online before the Tribunal and the claimants. This would greatly expedite the settlement claims that need not be contested by the insurer.