1. The question that has come up for consideration before us is whether a claim under S.163A of the Motor Vehicles Act, 1988 (in short'the Act') for compensation for death or permanent disablement be met by the Insurance Company on establishing that the death or permanent disablement was caused due to any wrongful act, neglect or default of the person in respect of whose death or permanent disablement claim has been made.

2. These cases have been placed before us on a reference made by a Division Bench of this Court after having felt that an authoritative pronouncement on the scope and ambit of S.163A is necessary. In all these cases applications were made by the legal heirs of the deceased claiming compensation under S.163A of the Act. Tribunal awarded compensation relying upon the structured formula prescribed in Schedule II. Contention raised by the Insurance Company that S.163A of the Act did not create any new right or liability and the claim could be defeated by the Insurance Company by adducing evidence was rejected by the Tribunal holding that the liability is absolute. Tribunal also found that the Insurance Company had not adduced any evidence to prove that there was negligence on the part of the deceased. All these appeals could have been disposed on the ground that no evidence was adduced by the Insurance Companies with regard to negligence of the deceased, but counsel appearing for the Insurance Company prayed for an authoritative pronouncement on the scope and ambit of S.163A of the Act since such questions are likely to arise for consideration in large number of cases.

3. In order to examine the scope and ambit of the provision, it is necessary to refer to the related provisions which enable the Claims Tribunal to consider the application for compensation in cases of death or disablement which comes under S.140 read with S.166 and also under under S.163A of the Motor Vehicles Act. Reference may also be made to cases which fall under "hit and run" category under S.161 of the Act.

4. The Motor Vehicles Act, 1988 (Act 59 of 1988) was enacted to consolidate and amend the law relating to motor vehicles in India. The Act has been amended on several occasions in accordance with the socio economic and social legal relationship and to achieve the social responsibility to protect victims of motor accidents. The Act also enabled the State Government to issue notification constituting Motor Accidents Claims Tribunals in the State for compensation in respect of accident or fatal injury to persons arising out of the use of the motor vehicles or damages to any property of a third party so arising or both. Claims Tribunals have been constituted and the claims are being adjudicated by the Tribunals.

5. Before the setting up of the Tribunals for entertaining claims for compensation, claimants had to approach civil courts for redressing their grievances. Motor Vehicles Act, 1939 was enacted to consolidate and amend the law relating to motor vehicles. Before that Fatal Accidents Act, 1855 governed the field. Due to proliferation of motor vehicles on the roads there has been considerable increase in the volume of traffic resulting in a corresponding increase in the motor accidents on the road. Hit and run cases are also on the rise and in many cases offending vehicles could not be apprehended. In order to meet to some extent the responsibility of the society to the deaths and injuries caused in road accidents there has been a continuous agitation throughout the world to make the concept of absolute liability or strict liability for damages arising out of motor vehicle accidents to a liability without fault. This was not due to any moral relaxation in law but was a social necessity. Introduction of the maxim "res ipsa loquitor" in motor accident cases has simplified the law of evidence to great extent but the introduction of "no fault" theory in motor vehicle accident cases and unlimited liability of insurance companies are fo