The Delhi High Court has upheld a motor accident award of about Rs 6.14 lakh against National Insurance Company. It held that a vegetable vendor injured while travelling in a goods tempo along with his own vegetables is the “owner of goods” covered by the insurance policy under Section 147 of the Motor Vehicles Act, and is not a gratuitous passenger.
After the 1994 amendment to Section 147 of the Motor Vehicles Act, the owner of goods or his authorised representative carried in a goods vehicle is covered by compulsory insurance, so such a person is not a “gratuitous passenger”, while other passengers in goods vehicles are not covered. The question is whether the occupant had a link to the goods or business of the vehicle, and the insurer must produce evidence to rebut consistent testimony that the claimant was travelling with his own goods. An omission of the injured person’s name from the FIR can be explained where hospital records show he was unconscious and unidentified at first.
Nadeshwar Yadav, a vegetable seller, was badly hurt on 19 June 2007, at about 5:45 in the morning. He was riding in a goods tempo, along with other vegetable sellers and their vegetables, on the way to the Shahdara vegetable market. The tempo hit the divider in the middle of the road and overturned. The driver said that a man had jumped over the railing onto the road, and he swerved to save him and hit the divider. In 2013, the Motor Accident Claims Tribunal ordered Rs 6,13,760 as compensation, with 9% yearly interest, and the vehicle’s insurance company, National Insurance, was told to pay it.
The insurance company appealed to the High Court. It said that Yadav was only a free passenger who had no right to compensation from the insurer, that nothing proved he was even in the tempo, that he had not proved that the vegetables were his, that he had not said how he earned his living, and that his name was not in the FIR. Justice Anish Dayal rejected all of this and dismissed the appeal.
He explained that the law protects a person travelling in a goods vehicle with his own goods, and the insurance policy covers him. A free passenger without any link to the goods is not covered. The question is whether the person was in the vehicle because of the goods or the business. Here, Yadav said in court that he and his colleagues were going to the market “for supply of vegetable items”. Another person who was in the tempo had told the police the same thing, saying that they had been taking vegetables to the market at that hour for several days. The insurance company did not produce any evidence to show that this was untrue. In another case from the same accident, the insurance company had itself said that the injured person there was travelling as the owner of vegetables.
The insurance company doubted that the injured man was even in the tempo, because his name was not in the police FIR. The court did not accept this. When he was brought to the hospital, nobody knew who he was, so he was written down as an “unknown person”, and he was too hurt to make a statement. The hospital records and discharge summary for the day of the accident, the police charge-sheet and the statement of another person from the tempo all show that he was hurt in the accident. The injured man’s lawyer also argued that, even if the insurance company were not liable under its policy, it should pay him first and recover the money from the owner. The court did not need to decide this, since it had already held that the insurance company was liable. It said that the money the insurance company had deposited for its appeal could be returned to it only if it had been deposited as ordered.
The court dismissed the insurance company’s appeal, so the Tribunal’s award of Rs 6,13,760 with 9% yearly interest stays, and National Insurance must pay it. The court held that Yadav was not a free passenger. He was travelling with his own vegetables for sale, and the law and the insurance policy cover a person travelling in a goods vehicle with his own goods. The court accepted that he was in the tempo and was hurt there, because of his own evidence, the statement of another person from the tempo, the hospital records and the police charge-sheet. It found no reason to doubt them because his name was missing from the FIR, since he was brought to the hospital as an unknown person and was too hurt to make a statement.
When an insurance company appeals against a compensation award, the law requires it to deposit some money in court first. The judgment calls this the “statutory deposit” and does not give the amount. Since the company lost its appeal, that money would normally go back to it. The court said that it should be returned only if the company really deposited the money as the court had ordered. If the company never deposited it, nothing is returned. The court said nothing about the money being paid to Yadav in this part of the judgment.
Citation: National Insurance Co. Ltd. v. Nadeshwar Yadav & Ors., MAC.APP. 1166/2013, Delhi High Court (Justice Anish Dayal), decided on 16.10.2026 | 2026:DHC:9254
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