Sikkim High Court Awards ₹5 Lakh No-Fault Compensation Despite Negligence Claim Failure

Whether a Claims Tribunal could compensate a deceased driver's family after rejecting negligence under Section 166 of the Motor Vehicles Act

Deepen Mukhia died in an accident on 12 November 2019. His wife, minor son and parents claimed ₹19,07,560. The Tribunal rejected the Section 166 case after accepting brake failure rather than rash driving.

Issue and applicable law

The central question was whether a Claims Tribunal could compensate a deceased driver's family after rejecting negligence under Section 166 of the Motor Vehicles Act.

The Court held that the Tribunal could still grant statutory no-fault compensation. It also directed insurers to place complete policies and coverage terms before tribunals instead of forcing claimants and courts to reconstruct them from websites.

Court's reasoning

The Court held that Section 140 no-fault liability remained available even though rash or negligent driving was not proved. Its principal reason was that Section 140(4) prevents defeat of the claim merely because of the deceased's own wrongful act, neglect or default, and the package policy required the insurer to indemnify the owner.

Decision and practical effect

The insurer was directed to pay ₹5 lakh with seven per cent interest from 14 February 2023 until realization.

The ruling is significant because it clarifies how the stated legal standard should be applied to comparable disputes without extending the decision beyond the facts reported by the source.

Case details

• Case: Rekha Chhetri v. Tata AIG General Insurance Company
• Court: Sikkim High Court
• Case number or citation: MAC Appeal No. 20 of 2024
• Date of decision: 1 September 2026
• Judges: Justice Bhaskar Raj Pradhan
• Source: https://www.livelaw.in/high-court/sikkim-high-court/sikkim-high-court-tribunal-grant-no-fault-compensation-rejecting-claim-section166-mv-act-549252