Partly allowed¶¶29

The New India Assurance Company Limited v. Sushila Verma

Chhattisgarh HC1 Jan 2026CR/152/2025

Case brief

AI extract

What is this about?

Penal interest direction; 9% per annum; 30 days payment window extended to 45 days; 50% amount already deposited by insurer; Section 166 Motor Vehicles Act; MACT Bemetara; Claim Case No. 75/2024; award dated 15.01.2025; The New India Assurance Company Limited v. Sushila Verma & Ors.; Bolero CG-07/BQ-7290; accident 11.12.2023 near village Hasda; injury claim; civil revision partly allowed; Chhattisgarh High Court; Amitendra Kishore Prasad, J.; no precedent discussed.

What did the court decide?

Insurance company (applicant) directed to pay the rest of the awarded amount within a period of 45 days, 50% having already been deposited; revision allowed in part on its challenge to the Tribunal's 30-day/9% penal interest direction. ¶¶29

The New India Assurance Company Limited Vs… — Motor Accident Claims | Chhattisgarh HC (2026)

What the court decided

AI extract

Outcome

¶¶29

Issue for consideration

Whether the learned Tribunal's direction to the insurance company to pay the awarded compensation within 30 days, failing which penal interest at 9% per annum would be levied, is arbitrary, unreasonable and unsustainable in law.

¶¶24

Court's answer

Having regard to the facts and circumstances, and since the insurance company has already deposited 50% of the amount, the insurance company is directed to pay the rest of the amount within a period of 45 days.

¶¶28

Ratio / Principle

The revision is allowed in part as indicated above.

¶¶29

Key takeaways

The Tribunal's 30-day payment direction (with penal interest at 9% per annum on expiry) was interfered with only to the extent of extending the time for payment to 45 days; the order does not expressly state whether the 9% penal interest would apply after the extended period.ratio¶¶29

Detailed headnote1 paragraphs

Chhattisgarh High Court, Bilaspur - CR No. 152 of 2025, decided 02/01/2026 by Amitendra Kishore Prasad, J. (NAFR). The New India Assurance Company Limited filed this civil revision against the award dated 15.01.2025 (printed as '1501-2025') in MACT Bemetara Claim Case No. 75/2024, a claim under Section 166 of the Motor Vehicles Act by Sushila Verma, injured when a Bolero (CG-07/BQ-7290) overturned near village Hasda on 11.12.2023. The challenge before the High Court was confined to the Tribunal's direction to pay the awarded compensation within 30 days, failing which penal interest at 9% per annum would be levied. The Court, noting that the insurer had already deposited 50% of the amount and that the amount passed against it was meager and would not affect other connected matters arising from the accident, directed the insurer to pay the rest of the amount within 45 days and allowed the revision in part. No finding was recorded on liability or quantum, and no precedent was cited or relied upon.

¶1

¶2

RAGHVENDRAJAT Digitallysigned byRAGHVENDRAJAT

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2026:CGHC:188

¶4

NAFR

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HIGH COURT OF CHHATTISGARH AT BILASPUR

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CR No. 152 of 2025

¶7

1 - The New India Assurance Company Limited Through - Branch Manager, Address - Second Floor, L.I.C. Investment Building, Phase-Ii, Jeevan Beema Marg, Pandari Raipur, District- Raipur (C.G.) Through - The Manager Of T.P. Hube, The New India Assurance Company Limited, Near Old Bus Stand Bilaspur, District- Bilaspur (C.G.) (Insurer Of Offending Vehicle Bolero Bearing Registration No. Cg-07/bq-7290).

¶8

... Applicant(s)

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versus

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1 - Sushila Verma W/o Bhuvan Lal Verma Aged About 49 Years R/o Village- Khamtarai, Tahsil - Berla, District- Bemetara (C.G.)

¶11

2 - Aditya Kumar Patil S/o Santosh Kumar Patil Aged About 23 Years R/o Village- Ghatiyakala, Post- Godgiri, Tahsil And Police Station- Berla, District- Bemetara, (C.G.) (Driver Of Offending Vehicle Cg-07/bq-7290).

¶12

3 - Dalendra Rajput S/o Bharat Singh Rajput Aged About 34 Years R/o Village- Hasda, Tahsil And Police Station - Berla, District- Bemetara, (C.G.) (Driver Of Offending Vehicle Cg-07/bq-7290).

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... Respondent(s)

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For Applicant(s) : Mr. Anil Kumar Gulati, Advocate.

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Hon’ble Mr. Justice Amitendra Kishore Prasad

Order on Board

02/01/2026

By way of this revision, the applicant has prayed for following reliefs:-

¶20

“It, is therefore, prayed that the Hon'ble Court may be pleased to allow the revision and be pleased to make an order to set-aside/quash the impugned award dated 1501-2025 (Annexure A-1), passed in Claim Case No.75/2024 by the Court of learned Motor Accident Claim Tribunal Bemetara, District Bemetara (C.G.), in the interest of justice.”

¶21

Brief facts of the case, is that, on 11.12.2023, the claimant, along with other villagers, travelled in a Bolero vehicle to District Mungeli, and while returning, when the vehicle reached near village Hasda, the non-applicant No.1 drove the said vehicle in a rash and negligent manner, as a result of which the vehicle overturned, causing the claimant and other occupants to sustain grievous injuries; thereafter, the claimant was immediately taken to the District Hospital, Berla, where she received primary treatment and was subsequently referred to Agrawal Hospital, Raipur, where her right shoulder was operated upon. On account of the said accident, the claimant filed a claim application under Section 166 of the Motor Vehicles Act seeking compensation of Rs. 3,80,000/-, inter alia pleading that she was earning Rs. 15,000/- per month by working as a labourer, but due to the injuries sustained in the accident, she is no longer in a position to

¶22

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perform her work as earlier. The non-applicant Nos. 1 and 2 filed their reply denying the averments made in the claim application, and non-applicant No.2 pleaded that the claimant and other persons, being residents of a nearby village, had gone to a religious place at Pendritarai without paying any fare, and while returning, the tyre of the vehicle burst, and since the vehicle was insured, the liability, if any, ought to be fastened upon the insurer. The insurer, in its reply, pleaded that 4–5 persons were travelling in the vehicle, which was insured as a private vehicle but was allegedly being used for commercial purposes (hire and reward), thereby violating the terms and conditions of the insurance policy; it was further pleaded that the policy issued was a liability-only policy, under which the risk of occupants of the vehicle is not covered, as they do not fall within the definition of third parties, and therefore, the insurer is not liable to indemnify the award. On the basis of the pleadings of the respective parties, the learned MACT framed four issues, all of which were decided in favour of the claimant. Hence, this revision.

¶24

Learned counsel for the applicant submits that the imposition of penal interest upon the insurance company is wholly contrary to the settled principles of law. It is submitted that the learned Tribunal has granted an unduly short period of only 30 days to the insurance company for payment of the awarded compensation and has further directed that, upon expiry of the said period, penal interest at the rate of 9% per annum shall be levied. According to

¶25

¶26

learned counsel, such a direction is arbitrary, unreasonable, and unsustainable in law, as the grant of penal interest in the aforesaid manner is not justified by the facts and circumstances of the case, and therefore the impugned direction relating to penal interest deserves to be set aside.

¶27

I have heard learned counsel for the applicant and perused the material available on record.

¶28

Considering the facts and circumstances of the case and considering the fact that the insurance company has already deposited 50% of the amount. The insurance company is directed to pay the rest of the amount within a period of 45 days. Since, the amount which was passed against the insurance company is meager one and shall not affect any other connected matters arising in relation to the death/injury of a person involved in the accident.

¶29

Accordingly, the revision is allowed in part as indicated above.

¶30

Sd/-

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(Amitendra Kishore Prasad)

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Judge

¶33

Raghu Jat

Procedural history

How this case reached the court

AI extract

Order under challenge
Award (Annexure A-1) in Claim Case No. 75/2024, by which the learned MACT decided four issues in favour of the claimant and, per the applicant's submission, directed payment of awarded compensation within 30 days failing which penal interest at 9% per annum would apply. Date printed in the revision prayer as '1501-2025', apparently 15.01.2025.¶¶20
learned Motor Accident Claim Tribunal Bemetara, District Bemetara (C.G.) · 15.01.2025
Prior proceeding
Accident of 11.12.2023: claimant travelling in a Bolero vehicle to District Mungeli; near village Hasda the vehicle, driven rashly and negligently by non-applicant No.1, overturned causing grievous injuries to the claimant and other occupants.¶¶21
Prior proceeding
Claimant received primary treatment at District Hospital, Berla, and was referred to Agrawal Hospital, Raipur, where her right shoulder was operated upon.¶¶21
Prior proceeding
Claimant filed a claim application under Section 166 of the Motor Vehicles Act seeking Rs. 3,80,000/-, pleading income of Rs. 15,000/- per month as a labourer and loss of earning capacity.¶¶21
Prior proceeding
Non-applicant Nos. 1 and 2 filed reply denying the claim averments; non-applicant No.2 pleaded that the occupants travelled to a religious place at Pendritarai without paying fare, the tyre burst on return, and liability, if any, should fall on the insurer.¶¶23
Prior proceeding
Insurer's reply: 4-5 persons travelling in a vehicle insured as private but allegedly used commercially (hire and reward) in violation of policy terms; the policy was liability-only, occupants are not third parties, and the insurer is not liable to indemnify the award.¶¶23
Prior proceeding
On the pleadings, the learned MACT framed four issues and decided all of them in favour of the claimant, prompting the present revision.¶¶23
Prior proceeding
Before this Court, the insurance company had already deposited 50% of the awarded amount.¶¶28

The New India Assurance Company Limited v. Sushila Verma

Case brief

What is this about?

What did the court decide?

The New India Assurance Company Limited v. Sushila Verma

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

Coram

Case details

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