Supreme Court Holds Insurer Liable in Accident Claim Despite Eyewitness Credibility Issues

Agrieved by the judgment by the High Court of Telangana which had overturned the Motor Accidents Claims Tribunal's (MACT) award against Bajaj Allianz General Insurance Co. Ltd. the present appeal is filed. The MACT had granted compensation to the appellants, the family of K. Yadagiri who died in 2011 when his scooter was hit by a Hyundai Verna. High Court had allowed the insurance company's appeal, primarily discrediting the testimony of an alleged eyewitness due to a significant delay in reporting the incident and inconsistencies.

Supreme Court analyzed whether insurance company could be absolves of its liability based on the High Court's assessment of the evidence, particularly concerning the identification of the offending vehicle and the reliability of the eyewitness account. Despite noting the initial registration of the vehicle as unknown in the FIR and expressing serious doubts about the belated testimony of the eyewitness (PW2) who identified the insured vehicle, the Supreme Court placed significant weight on the absence of any defence from the owner of the alleged offending vehicle (respondent no. 2) before all three legal forums. The Apex Court also highlighted that during the police investigation, the owner allegedly telephoned the driver, who admitted to the accident.

Furthermore, the owner's statement to the police corroborated his awareness of the accident involving his car and his driver's confession. The Court observed that in light of the owner's failure to contest the claim and the driver's admission to the police, the insurance company could not successfully argue a breach of policy conditions by the driver. The Court explicitly stated that its judgment was specific to the peculiarities of the case and should not influence the ongoing criminal proceedings.

The Supreme Court, therefore, allowed the appeal and set aside the Impugned Order of the High Court, and restored the Award made by the MACT. The Apex Court also held that even if there were doubts regarding the testimony of the eyewitnesses, the undisputed presence of the insured vehicle, indicated by the absence of the owner and the driver's alleged admission to the police, was enough to hold the insurance company liable.

CORAM: JUSTICE SUDHANSHU DHULIA & JUSTICE AHSANUDDIN AMANULLAH
BETWEEN: KUNCHAM LAVANYA & ORS VS BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ANR 2025 INSC 452
DATE OF JUDGMENT: 07-04-2025