Bombay High Court Affirms Insurer's Liability in 30-Year-Old Motor Accident Claim, Recommends Dedicated Appellate Tribunals

In a ruling that brings closure to a claim stretching back nearly three decades, the Bombay High Court has upheld a Motor Accident Claims Tribunal award of Rs 74,422 in favour of a minor injured in a 1996 road accident. The Oriental Insurance Company’s attempt to escape liability by citing an expired policy was rejected after it failed to discharge its burden of proving the policy had lapsed.

The Decades-Long Journey from Accident to Finality

The accident occurred on 19 October 1996. Mast. Sandeep Sunder Kolhe, then a minor, sustained injuries. His next friend filed a claim before the Motor Accident Claims Tribunal at Mumbai. The Tribunal, after considering evidence including records from the Regional Transport Office, held that the vehicle was validly insured with Oriental Insurance and awarded compensation on 19 October 2011.

Oriental Insurance challenged the award through First Appeal (St.) No. 35338 of 2012. The appeal itself took more than a decade and a half to reach admission and final hearing. On 22 April 2026, Justice Jitendra Jain condoned the delay, admitted the appeal, and heard it finally on the same day.

Why the Insurance Company’s Core Defence Failed

The insurer’s sole substantive argument was straightforward: the policy had expired on 26 August 1996, before the accident date, so no liability could attach. The Tribunal had framed issue no. 2 on this precise question and devoted paragraphs 16 to 27 of its order to analysing the evidence.

Justice Jain refused to disturb those findings. The High Court noted that the insurer had led no convincing material to show the policy was not in force, while RTO records produced by the claimant indicated valid insurance cover. “Nothing has been produced before me to show that these findings of facts given by the Tribunal are contrary to the material on record,” the Court observed.

The appeal was accordingly dismissed, with the Court expressly agreeing with the Tribunal’s reasoning on insurance coverage.

A Systemic Critique: Pendency, Delay and the Need for Structural Reform

Beyond deciding the individual appeal, Justice Jain used the opportunity to highlight a larger crisis in motor accident adjudication. The judgment records that over 10.73 lakh motor accident claims were pending nationwide as of 2024-25, involving more than Rs 96,000 crore. In Maharashtra alone, around 86,000 original petitions remain pending before MACTs, with nearly 18,000 appeals pending before the Bombay High Court.

The Court pointed out that appeals typically take eight to ten years for disposal after the Tribunal award. By the time claimants—often victims or their families—receive even 50 percent of the amount deposited by insurers, the constitutional purpose of timely compensation stands defeated.

Citing the Supreme Court’s identical concern in Rasmita Biswal & Ors. vs. Divisional Manager, National Insurance Company Limited & Anr. ((2022) 2 SCC 767), Justice Jain reproduced paragraphs 18 and 19 of that judgment recommending the creation of Motor Vehicle Appellate Tribunals comprising senior District Judges, with benches in regional cities, and no further appeal except by way of writ.

Key Observations

> “The provisions relating to compensation to be paid under the Motor Vehicles Act, 1988 is to ensure that the claimants get their compensation when there is a need which results into injury or death… This again results into severe prejudice to the claimants.”

> “In my view, atleast 30-40% of these claims, if not more, would be challenged in appeal which would be close to 5,00,000 involving atleast 40,000 crores. These figures do justify setting up of specialised Appellate Tribunal…”

> “It is high time that the Union of India should consider setting up the Appellate Tribunal for resolving the disputes arising from the orders passed by the Court of first instance, instead of appeals to the High Court.”

The judgment directs that a copy be sent to the Ministry of Law and Justice and the Finance Ministry for consideration of constituting such an appellate forum that could also handle Railway Claims Tribunal appeals.

Practical Impact and the Road Ahead

The immediate effect of the order is that the awarded sum, modest though it may be by today’s standards, now becomes payable without further challenge. More significantly, the judgment adds judicial weight to the long-standing demand for structural reform. By documenting exact pendency figures and endorsing the Supreme Court’s blueprint, the Bombay High Court has signalled that incremental tweaks are no longer sufficient.

Until Parliament acts, claimants and insurers alike will likely continue facing the same delays that have already consumed thirty years in this single case—from accident in 1996 to final adjudication in 2026.