The Allahabad High Court has held that an insurance company cannot avoid liability merely by pointing out that a tanker driver's licence did not contain a separate endorsement for carrying hazardous goods. The insurer must first establish that the substance actually being transported fell within the hazardous categories specified under the Central Motor Vehicles Rules, 1989.
Justice Prashant Kumar delivered the judgment, while deciding a challenge by National Insurance Company Ltd. against a compensation award passed by the Motor Accident Claims Tribunal, Sultanpur. The Court ultimately dismissed the insurer's appeal. The judgment and the reported account have been cross-checked for the key facts and outcome.
Background
The case arose from a road accident on March 27, 2015, near Kamta Market in Sultanpur. Mahendra Kumar, who was travelling on a motorcycle with Uttam Kumar Upadhaya as pillion rider, was hit by a tanker. Mahendra Kumar suffered fatal injuries and died at the spot, while the pillion rider was grievously injured.
The deceased was 28 years old and employed as a Class IV employee at an intermediate college, earning ₹17,000 per month. The Motor Accident Claims Tribunal found that the accident resulted from the rash and negligent driving of the tanker and awarded ₹19.04 lakh with 7% annual interest.
National Insurance Company challenged the award, arguing that although the tanker driver possessed a licence for heavy goods vehicles, he did not have the required endorsement to carry dangerous or hazardous goods.
The insurer relied upon information obtained from the Regional Transport Officer under the Right to Information Act, which showed that the driver did not have such a separate endorsement. It argued that the tanker was carrying spirit and that the substance should be treated as ethanol, which appears among the hazardous goods listed in Table III of the Rules.
The High Court examined Rule 9(3) and Table III of the Central Motor Vehicles Rules, 1989. It noted that the table does not classify every variety of spirit or ethanol as hazardous. Only specifically identified substances and categories are included.
The Court observed:
“Merely because the tanker was carrying spirit would not, by itself, lead to the conclusion that it was transporting hazardous goods within the meaning of the Rules.”
The Court further found that the transport documents only mentioned “spirit” and there was no evidence establishing that the particular substance belonged to any of the specified hazardous categories under Serial Nos. 851 to 853 of Table III.
The Court held that the insurer had failed to establish a breach of the policy conditions. Finding no illegality in the Tribunal's findings, the Allahabad High Court dismissed the appeal and directed that any statutory amount deposited by the insurer be remitted to the Tribunal for adjustment in accordance with law.
Case Details:
Case Title: National Insurance Company Ltd. Lucknow Throu. Astt. Manager v. Reena Devi & Ors.
Case Number: First Appeal From Order No. 350 of 2019
Judge: Justice Prashant Kumar
Decision Date: September 23, 2026
