HIGH COURT OF UTTARAKHAND AT NAINITAL v. Mr. D C S Rawat, learned counsel for the

tractor, FIR, charge-sheet, post-mortem report, map, Aadhar cards and educational certificates. Smt. Savitri (PW-1) and Ramdas (PW-2) were examined in oral evidence. On behalf of the appellant-Insurance Company, Mahendra Rawat (DW-1) and Nishant Uniyal (DW-2) were 2 examined. Documentary evidence included the insurance policy, driving licence and enquiry report. Respondent no. 8, the driver, also filed written statement denying negligence and asserting that he possessed a valid licence and that the vehicle was duly insured. The appellant/Insurance Company, in its written statement, denied liability and pleaded that the tractor was meant solely for agricultural use, had only one authorized seat, and was not permitted to carry any other person. It was further contended the deceased, being an unauthorized passenger, fell outside the policy coverage and therefore the insurer could not be held liable.

8. After hearing the parties and upon perusal of the evidence led by the parties, the learned Tribunal passed the impugned judgment and award, as above. On issue no. 1, the Tribunal held that the accident occurred due to rash and negligent driving of respondent no. 8, and decided the issue in favour of the claimants. On issue no. 2, the Tribunal found that the driver possessed a valid and effective licence and that the vehicle was insured and had valid documents. On issue no. 3, the Tribunal found that though the deceased was travelling as a passenger unauthorisedly in the tractor, which amounted to violation of policy conditions, yet applying the principle of "pay and recover," the Insurance Company was directed to pay the compensation first and recover it from the owner and driver.

9. After taking into consideration the evidence led by the claimants and the pleadings of the parties, The Tribunal assessed the monthly income of the deceased, being an unskilled labourer, at ₹8,300/- and his annual income at ₹99,600/-. After adding 25% for future prospects, deducting 1/4th towards personal expenses, 3 and applying the multiplier of 14 (as per Sarla Verma v. DTC, 2009 ACJ 677) for the age of 43 years, the Tribunal assessed the dependency compensation at ₹10,45,800/-. Further amounts of ₹15,000/- loss of estate, ₹15,000/- for funeral expenses, and ₹2,00,000/- towards consortium were added, computing compensation at ₹15,37,250/- with interest @ 6% p.a.

10. Learned counsel for the appellant would submit that the Tribunal itself held that the deceased was an unauthorised/gratuitous passenger on the tractor, which was insured only for the driver’s use. The policy did not cover such risk, and therefore the insurer could not be saddled with liability. It was further contended that the Tribunal erred in directing the Insurance Company to pay the compensation and then recover it from the owner and driver.

12. Heard and perused the material on record. The Tribunal has recorded categorical findings that (i) the accident occurred due to rash and negligent driving of respondent no. 8, (ii) the driver had a valid licence and the vehicle had valid documents, and (iii) the deceased was travelling as a passenger on the tractor unauthorisedly in violation of the terms of the policy.

13. The question that falls for consideration is whether, in such circumstances, the Insurance Company can still be directed to first pay the compensation and thereafter recover it from the owner and driver.

14. The Hon’ble Supreme Court in Manuara Khatun & Ors. v. Rajesh Kr. Singh & Ors., 2017 (2) TAC 5 (SC), after considering earlier decisions including National Insurance Co. Ltd. v. Baljit Kaur, (2004) 2 SCC 1 and National Insurance Co. Ltd. v. Saju P. Paul, (2013) 2 4 SCC 41, has categorically held that where the victim is found to be a gratuitous passenger, the insurer cannot be held liable under the policy. However, to balance the benevolent object of the Motor Vehicle Act, directions can be issued requiring the Insurance Company to pay the awarded sum to the claimants and then recover it from the owner/driver.

15. The facts of the present case are squarely covered by the aforesaid decision. The Tribunal has rightly applied the principle of "pay and recover" to ensure that the claimants, who are dependents of the deceased, are not left remediless, while simultaneously protecting the insurer’s contractual rights.

16. Accordingly, this Court finds no error in the award passed by the Tribunal warranting interference in this appeal.

17. In view of the above, the appeal fails and is hereby dismissed.

19. There shall be no order as to costs. The statutory deposit of ₹25,000/- deposited by the appellant/Insurance Company before this Court shall be remitted back to the concerned Tribunal. Dat ed: 18.09.2025 Mam t a ( A LOK M A H RA , J.) 5