Supreme Court Orders Implementation of Cashless Treatment for Accident Victims

This case addresses the critical issue of providing cashless medical treatment to victims of road accidents, particularly during the "Golden Hour". The term "Golden Hour" refers to the first hour immediately following a traumatic injury, wherein medical care can be most effective in saving lives. The case essentially deals with the operation of Section 162 of the MV Act, 1988 providing for a scheme to be implemented assuring cashless treatment at the crucial time. The court is apprehensive that though the law on this count has come into force in 2022, the scheme has not been implemented by the Central Government.

The Supreme Court is taking up the non-implementation of an important scheme aimed at saving the lives of road accident victims. The apex court order puts great emphasis on providing immediate medical care to the road accident victim during the "golden hour" after the accident. The judgment deals with the statutory duty of the Central Government to frame a scheme for cashless treatment and reprimands the latter for delaying the framing of such a scheme. Here's a breakdown of the key points:

On the "Golden Hour", the Apex Court has emphasized that the first hour following a traumatic injury, when timely medical treatment can prevent death, is of extreme importance and hence termed as "GOLDEN HOUR".

Section 162 of the MV Act: Hence, this section provides therein a stipulation that the insurance company shall pay to the victim for treatment, particularly in the golden hour, in accordance with a scheme framed by the Central Government. Cashless Treatment Scheme: The Central Government is to formulate a scheme under Section 162 for cashless treatment of road accident victims during the golden hour, which may include the provision for a fund thereof.

Motor Vehicle Accident Fund: Section 164-B of the MV Act provides for a Motor Vehicle Accident Fund that would extend compulsory insurance cover to all road users. This is to be utilized for the treatment of those injured in road accidents under the scheme framed under Section 162.

Non-Implementation: The aforesaid provisions notwithstanding, the Scheme for cashless treatment has not yet been framed by the Central Government. A perusal by the court on the issue shows that though the Motor Vehicle Accident Fund has been created and rules for its disbursement have also been framed, in the absence of a scheme, the same would be without efficacy.

Draft Concept Note: A draft concept note was provided by the Central Government, which the court went through. The court pointed out that limiting the scheme to payments of a maximum amount of Rs.1,50,000 and restricting the treatment to seven days is not apt.

Constitutional Right: The court makes it clear that the provision for a cashless treatment scheme under Section 162 is only to protect the right to life guaranteed under Article 21 of the Constitution.

Supreme Court thus directs the Central Government to frame the scheme as contemplated under Section 162, and do so on or before March 14, 2025. Further, they have directed the government to file a copy of the Scheme and an affidavit explaining its implementation by March 21, 2025.

Hit-and-Run Compensation: The court also brought into play the functioning of the hit-and-run scheme. It directed that the claims arising under the scheme shall be processed in compliance with the Seven specific documents as prepared by GIC. Further, the court ordered GIC to finish the work for the portal mechanism for claim processing and file a report about the work done, done on or before March 14, 2025.

The Apex Court emphatically held that such deficiency in the scheme for cashless treatment during the golden hour constitutes a lapse on the part of the Central Government to fulfill the statutory obligation and in view of increasing motor accidents the provisions assume great relevance and the scheme is required to save lives.

Supreme Court further held that the medical treatment should be provided straight away without any delay on account of apprehension about the payment or police formalities which often proves fatal and thus the scheme shall ensure that the right to life under Article 21 of the Constitution is protected. However, exception to the draft proposed limits on treatment cost and duration and underlined that the scheme 'should be geared towards saving life'

Motor Vehicle Accident Fund and rules for its disbursement exist, but without a scheme they are ineffective.

The Supreme Court directed the Central Government to formulate and implement the cashless treatment scheme under Section 162 by March 14, 2025, and to submit the scheme and an implementation plan by March 21, 2025. The court also directed the GIC to expedite hit-and-run compensation claims and establish a portal for the same by March 14, 2025. The Apex Court further observed that the delay in processing hit-and-run compensation claims and directed the GIC to expedite the process, and also to establish a portal for smoother processing.

Coram: Justice Abhay S. Oka and Justice Augustine George Masih
Between: S. Rajaseekaran vs Union Of India & Ors
Date of Judgment: 08-01-2025