The main legal point established in the judgment is that the Claims Tribunal is empowered to award costs and counsel's fee in accordance with the Delhi High Court Rules, and cannot award counsel's fee beyond the terms of settlement or direct payment of fees directly to the counsel.

G. P. MITTAL, J.

1. In these Appeals (MAC.APP. 645/2012, CM (M) 651/2012, MAC.APP.655/2012, MAC.APP.594/2012, MAC.APP. 588/2012, and MAC.APP. 689/2012), a common question of law and fact arises for consideration; whether the Claims Tribunal could have awarded the Counsel’s fee or out of pocket expenses while deciding a Claim Petition filed under Section 166/163-A of the Motor Vehicles Act, 1988 (the Act).

2. Since the Appellants do not dispute the award of compensation and challenge the judgment only on the question of award of counsel’s fee and out of pocket expenses, it is not necessary to deal with the manner of accident and the quantum of compensation awarded. I would advert to the circumstances of awarding costs in each case a little later and would first deal with the general principles governing award of costs.

3. The common case set up by the Appellant Insurance Companies in these Appeals/Petition is that the Motor Vehicles Act, 1988 is a Code in itself which governs the payment of costs in certain situations. The Claims Tribunal cannot go beyond the provisions contained in the statute to award costs. The Insurance Companies rely on Section 172 of the Act, which is extracted hereunder:-

“172. Award of compensatory costs in certain cases.

.(1) Any Claims Tribunal adjudicating upon any claim for compensation under this Act, may in any case where it is satisfied for reasons to be recorded by it in writing that-

.(a) the policy of insurance is void on the ground that it was obtained by representation of fact which was false in any material particular, or

.(b) any party or insurer has put forward a false or vexatious claim or defence, such Tribunal may make an order for the payment, by the party who is guilty of misrepresentation or by whom such claim or defence has been put forward of special costs by way of compensation to the insurer or, as the case may be, to the party against whom such claim or defence has been put forward.

.(2) No Claims Tribunal shall pass an order for special costs under sub-section (1) for any amount exceeding one thousand rupees.

.(3) No person or insurer against whom an order has been made under this section shall, by reason thereof be exempted from any criminal liability in respect of such misrepresentation, claim or defence as is referred to in sub-section (1). (4) Any amount awarded by way of compensation under this section in respect of any misrepresentation, claim or defence, shall be taken into account in any subsequent suit for damages for compensation in respect of such misrepresentation, claim or defence.

4. In view of the provision extracted above, it is urged by the learned counsels for the Insurance Companies that the Claims Tribunal is entitled to award costs only in two

eventualities mentioned in Section 172 (1) (a) and (b) above. Thus, where an Insurer has not put up any false or vexatious defence, no costs can be imposed upon an Insurer.

1. 5. In the alternative, it is contended that even if it is admitted that costs can be awarded by the Claims Tribunal like any other Civil Court, the same has to be in consonance with the provisions of the Code of Civil Procedure, 1908 (the Code) and the Rules framed by the Delhi High Court (the Rules) in this regard.

2. 6. On the other hand, it is urged by the learned counsels for the Respondents that the provisions of the Code are applicable for conducting an inquiry in a Claim Petition under Sections 168 and 169 of the Act. Therefore, the provisions of Section 35 of the Code are impliedly extended to the proceeding before the Claims Tribunal. The Claims Tribunal and the High Court of Delhi while dealing with a Petition or an Appeal under the Act thus have all the powers to award reasonable costs while deciding a Claim Petition or an Appeal.

3. 7. In view of the submissions raised, the following questions need to be addressed:-

.(1) Whether any costs can be awarded by the Claims Tribunal holding an inquiry in a Claim Petition under Secti