Tacit Legal 19-feb 2026
In a significant ruling strengthening the principle of “pay and recover” in motor accident compensation cases, the Supreme Court has held that even where an insurance company is not statutorily liable to pay compensation for a passenger travelling in a goods vehicle, it may still be directed to first satisfy the award and thereafter recover the amount from the vehicle owner:- provided the dominant purpose of hiring the vehicle was carriage of goods and not transportation of passengers.
The judgment was delivered by a Bench comprising Justice Prashant Kumar Mishra and Justice N.V. Anjaria in:
Kaminiben & Ors. v. Oriental Insurance Company Limited & Ors. The Court restored the award passed by the Motor Accident Claims Tribunal (MACT), which had directed the insurer to pay compensation to the claimants and then recover the same from the vehicle owner.
Background of the Case
The case arose from a fatal accident involving a tempo (goods vehicle) hired during a Ganesh immersion procession. The deceased was travelling in the vehicle along with a Ganesh idol that was being taken for immersion in the Narmada River.
The vehicle was insured with The Oriental Insurance Company Limited on the date of the accident. On 11 January 2010, the Motor Accident Claims Tribunal awarded ₹13,23,000 as compensation to the claimants and directed the insurance company to deposit the amount with liberty to recover it from the owner. However, the High Court set aside this direction, holding that the insurer could not be made liable even on a “pay and recover” basis.
Key Issue Before the Supreme Court
Whether an insurer can be directed to first pay compensation and then recover it from the owner where the deceased was travelling in a goods vehicle as a gratuitous passenger?
Supreme Court’s Observations
The Court carefully examined the purpose for which the vehicle had been hired. It observed:
“The dominant purpose for hiring the vehicle was not for travelling but for carrying the Ganesh idol for immersion. Travelling in the vehicle was only incidental.”
The Court held that:
The deceased was travelling along with the Ganesh idol.
The primary object of hiring the tempo was carriage of goods (the idol). Travel was merely incidental to that purpose.
At best, the deceased could be treated as a gratuitous passenger travelling with his goods. Thus, although the insurer may not be directly liable under the policy terms, equity and judicial precedents permit invoking the “pay and recover” principle.
Reliance on Precedents
The Court relied upon: Manuara Khatun & Ors. v. Rajesh Kumar Singh & Ors. In that case, the Supreme Court had directed the insurer to satisfy the award first and recover the amount from the insured in the same proceedings.
The Court distinguished the judgment in:
Amudhavalli & Ors. v. HDFC Ergo General Insurance Company Ltd. & Ors. It noted that in Amudhavalli, the goods vehicle had been hired primarily for travelling, not for carriage of goods. Therefore, the facts were materially different.
Final Decision
The Supreme Court: Allowed the appeal, Set aside the High Court’s judgment, and Restored the Tribunal’s direction requiring the insurer to first pay the compensation and then recover it from the vehicle owner.
Legal Significance of the Judgment:- This ruling reaffirms several important principles: The doctrine of “pay and recover” is a tool of social justice. Courts may prioritize victim compensation over technical defences. The “dominant purpose” test is crucial in determining liability. Insurance companies cannot avoid initial liability where goods carriage was the primary object and passenger travel was incidental.
The judgment reinforces the beneficial nature of motor accident compensation laws and ensures that victims’ families are not left remediless due to technical contractual exclusions.
Conclusion :- The decision in Kaminiben & Ors. v. Oriental Insurance Company Limited & Ors. strengthens victim-centric jurisprudence under motor accident law. By restoring the MACT award, the Supreme Court once again emphasized that compensation mechanisms must serve the ends of justice and not be defeated by rigid technicalities.
Case Details :- SLP No 21802 of 2023
Case Title – Kaminiben & Ors. v. Oriental Insurance Company Limited & Ors.
