New Delhi: The Delhi High Court has held that a government or local authority availing exemption from compulsory motor-vehicle insurance under Section 146 of the Motor Vehicles Act, 1988 cannot avoid liability to compensate third-party accident victims, Verdictum reported on Wednesday, October 21. A bench of Justice Anish Dayal directed the Municipal Corporation of Delhi (MCD) to pay the entire compensation of Rs 22.05 lakh — yaani just over Rs 22 lakh — with accrued interest, awarded to the legal heirs of a motorcyclist killed by an MCD truck, within four weeks; if any part had already been paid, the MCD must pay the balance within the same period.

The court was hearing an appeal by the truck driver, Rohtash Kumar, against a Motor Accident Claims Tribunal order that had fastened joint and several liability on him and the MCD (Rohtash Kumar v. Sangeeta Verma & Others, neutral citation 2026:DHC:9208). The court allowed the driver's appeal and set aside the execution proceedings against him, while leaving the MCD free to act against him under service and conduct rules. It rejected the MCD's submission that the driver should pay 50 per cent of the compensation, calling it inconsistent with the principle of vicarious liability and with the requirement that such liability be met through insurance or a fund established under Section 146(2). Case records of the underlying claims proceedings, available on Indian Kanoon, show the dispute grew out of a fatal 2014 accident in Dwarka involving an MCD dumper truck, in which the MCD had pleaded the Section 146 exemption for government vehicles.

“In no circumstances can an injured claimant, or the legal representatives of a deceased victim, be left without compensation for the harm suffered in an accident involving a vehicle owned by a government entity. In a welfare state, the obligation of the State and its authorities to ensure that compensation is paid, fully and promptly, is all the more compelling,” the court emphasised, according to Verdictum. The court held that the statutory fund contemplated under the Act substitutes the protection ordinarily provided by insurance, and that an authority's failure to establish or maintain that fund cannot prejudice accident victims. (Sources: Verdictum, October 21, 2026; case records via Indian Kanoon)