Section 140(1) of the Motor Vehicles Act, 1988 provides that where the death or permanent disablement of any person results from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicles shall, or as the case may be, the owners of the vehicles shall be jointly and severally be liable to pay compensation in respect of such death or disablement according to the provisions of this section.
Section 140 creates a new liability which is called a liability without fault. The purpose for the inclusion of the no liability in the Act has been very well stated in the Statement of Objects and Reasons appended to the Act. It sums up the scope of the provision as follows:
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“A new Chapter VII-A (now in Section 149) providing for payment of compensation in certain cases of accidents without proof of fault or negligence on the part of the owner or the driver of the motor vehicle is being inserted in the Act. Under this chapter, the owner of the vehicle involved in an accident will be liable to pay compensation of a fixed sum of Rs. 50,000 in respect of the death of a person and a fixed sum of Rs. 25,000 in case of permanent disablement of a person. For securing this compensation, it will not be necessary to prove any wrongful act or negligence on the part of owner or the driver of the vehicle. Right to claim the compensation aforesaid is without prejudice to any right to claim a higher compensation on the basis of a wrongful act or negligence of the owner or the driver of the vehicle. However, the compensation payable by an owner or on the basis of wrongful act or negligence on his part would be reduced by the compensation already paid by him under this Chapter. It has also been provided that the claim of compensation under the Chapter should be disposed of as expeditiously as possible. The benefit of the provision of the Chapter would also be available in cases where compensation is claimed in respect of motor accidents under any other law, as for example the Workmen’s Compensation Act, 1923.”
Sections 140 to 144 correspond to Sections 92-A to 92-F of the old Act which provided for liability without fault. The Supreme Court has suggested that the compensation amount payable under Section 92-A of the old Act for no-fault liability be enhanced. Accordingly, Section 140 (now) provides of a payment of Rs. 50,000 in case of death and Rs. 25,000 in case of permanent disablement as compensation.
Section 140 provides that where the death or permanent disablement of any person results from an accident arising out of the use of a motor vehicle or motor vehicles the owners of the vehicles shall be jointly and severally liable to pay compensation in respect of such death or disablement in accordance with the provisions of this section.
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Under this section in a claim for compensation the claimant is not required to prove that the accident has occurred due to any wrongful act, neglect or default of the owner of the vehicle or the driver of the vehicle. A claim for compensation under sub-section (1) shall not be defeated by reason of any wrongful act, neglect or default of the person in respect of whose death or permanent disablement the claim has been made nor shall the quantum of compensation recoverable in respect of such death or permanent disablement be reduced on the basis of the share of such responsibility for such death or permanent disablement. It means that in a claim for the amount fixed under the above rule the plea of contributory negligence of the person involved in the accident will not be taken. The above right to claim compensation shall not adversely affect the right to claim more compensation on the basis of the wrongful act or neglect of the owner of the vehicle or the driver of the vehicle. However, the amount of compensation payable by the owner of the vehicle in such cases shall be deducted from the amount of compensation already paid under this chapter.
The new Section 140 has been inserted in the Act with the object in view that there is no general and direct relationship between the use of a vehicle and accident. This interpretation of the words used in the section considerably widens the scope of the prosecution available to the injured party in the accident and is in accordance with the beneficial object of the Act. With this object in view, Section 140 was included in the Act.
Section 140 does not apply retrospectively. Section 140 of Chapter X was brought into operation with effect from 1.6.1982. Section 140 is not applicable to accidents taking place before that date.
Since liability under Section 140 is not dependent on fault, if an accident occurs in which two or more motor vehicles are involved the owners of all of them and the insurers will be jointly and severely liable under the section and the liability will not be restricted to the owner of the offending vehicle’ meaning thereby the vehicle which was being driven negligently. The liability without fault under Section 140 arises only when the accident results in death or permanent disablement but not in other cases.
The right to claim compensation under Section 140 in respect of death or permanent disablement of any person shall be in addition to any other right to claim compensation in respect of any other provision of this Act or of any other law for the time being in force. [Section 141].
The Act also provides that a claim for compensation under Section 140 shall be disposed of as expeditiously as possible. It provides that where compensation is claimed in respect of death or permanent disablement under Section 140 and also in pursuance of any right on the principle of fault. The claim for compensation under 140 shall be disposed of aforesaid in the first place [Section 141].
In S. Kaushnuma Begam v. New India Assurance Co. Ltd., the appellants widow and children of Haji Mohammad Hanif, the victim of the accident, filed a claim petition before the claims Tribunal in 1986 claiming a sum of Rs. 2,36,000 by way of compensation against the owner of the jeep who caused the accident in which the victim was killed. The accident which gave rise to the claim occurred at about 7.00 p.m. on 20-3-1986 the vehicle capsized due to the bursting of the front tyre of the jeep hitting one Haji Mohammad Hanif who was walking on the road and consequently the was crushed and subsequently succumbed to the injuries sustained in the accident. The Tribunal dismissed the claim for compensation. Thereupon the appellants moved the Supreme Court in appeal. The Supreme Court held that the driver though not negligent in causing death of the pedestrain the claim for compensation before the Tribunal was maintainable and the owner of the vehicle was vicariously liable for damages on the basis of strict liability rule laid down in Rylands v. Fletcher’s case. The jurisdiction of the Tribunal is not restricted to decide claims arising out of negligence on the use of motor vehicles. Negligence is only one of the species of the causes of action for making a claim for compensation in respect of accidents arising out of the use of motor vehicles. There are other premises for such cause of action. Even apart from Section 140 which envisages no fault liability claim for compensation can be maintainable by applying The Rule in Rylands v Fletcher unless any one of the exceptions to rule can be applied. The rule in Ryland v. Fletcher, has been approved in a larger number of decisions by Courts in England and India and other countries. Though in M.C. Mehta v. Union of India, P. N. Bhagwati, C.J., speaking for the Court expressed the view that there was no necessity to bank on the Rule in Ryland v. Fletcher but the Court did not disapprove the Rule and therefore the Rule is still applicable.
“No fault liability envisaged in Section 140 of the M.V. Act is distinguishable from the rule of strict liability. In the former the compensation amount is fixed and is payable even if one of the exceptions to the Rule can be applied. It is a statutory viability created without which the claimant should not get any amount under that count. Compensation on account of accident arising from the use of motor vehicles can be claimed under common law even without the aid of a statute. The provisions of M.V. Act permits that compensation paid under “no fault liability” can be deducted from the final amount awarded by the Tribunal. Therefore, these two are resting on two different premises. Therefore apart from Section 140 of the M.V. Act, a victim in an accident which occurred in using a motor vehicle, is entitled to get compensation from a Tribunal unless any one of the exceptions applies.
Question:- Explain ‘No Fault Liability’ as envisaged in the Motor Vehicles Act, 1988.