District Magistrate And District ... vs National Insurance Company Limited

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District Magistrate And District ... vs National Insurance Company Limited on 23 March, 2026

Author: Sanjay Karol

Bench: Sanjay Karol

2026 INSC 279

                                                                       REPORTABLE

                                 IN THE SUPREME COURT OF INDIA
                                  CIVIL APPELLATE JURISDICTION

                              CIVIL APPEAL NO.                     OF 2026
                            (@ Special Leave Petition (Civil) No.22910 of 2025)

                     DISTRICT MAGISTRATE AND
                     DISTRICT ELECTION OFFICER AND
                     COLLECTOR, GWALIOR, M.P.                     … APPELLANT(S)

                                                     VERSUS

                     NATIONAL INSURANCE
                     COMPANY LIMITED & ORS.                      … RESPONDENT(S)

                                             JUDGMENT SANJAY KAROL J.

Leave Granted.

in connection with the accident that took place on 23rd January 2010

between a bus1 bearing registration number MP-07-MG-9897 and a
motorcycle bearing number MP-07-TC-0514, killing the rider of the
latter. The bus, although under the ownership of Kidzee Corner
School, Gwalior, had been, undisputedly, requisitioned under the
orders of the appellant for the purposes of Gram Panchayat
Elections. It had, while being under the orders and command of the
relevant election authorities, dashed into the motor-cycle of the
deceased. The Fifth Additional Motor Accident Claims Tribunal,
Gwalior2 allowed the claim3 that had been filed by the legal
representatives of the deceased, namely Rajesh Mandil and awarded
compensation to the tune of Rs 5,13,500 along with 6% interest from
the date of filing of the petition. The award also provided for a
distribution of the amount so awarded as per the discussion in issue
No. 6. Aggrieved by such determination, two Miscellaneous
Appeals came to be filed before the High Court of Madhya Pradesh

• one by the Insurance Company (respondent no.1 herein) being MA
  No.703 of 2012 and one by the legal representatives of the deceased

• respondent nos. 2 to 5, before this Court who instead took objection
  to the conservative estimation of the deceased’s income and as such,
  prayed for the enhancement of the compensation so awarded. In

Offending vehicle

Tribunal

terms of the impugned judgment dated 8th January 2024, both the
miscellaneous appeals were allowed. The Insurance Company’s
appeal was allowed insofar as liability originally fastened upon them
was instead shifted to the appellant herein. The Appeal by
Respondent Nos. 2-5 was allowed by enhancing the compensation
to Rs. 27,01,556/-.

1. The appellant by way of this appeal takes exception to the
   shifting of liability upon him. It is urged that the High Court’s
   determination was erroneous since at the relevant point in time the
   offending vehicle was under the coverage of an insurance policy,
   and so liability to be fastened otherwise would be wrong. Further, it
   is submitted that when the bus was being used for a public purpose
   and in course thereof, if the liability is fastened upon public
   authorities it would send a wrong message since the authorities do
   not have either ownership of the vehicle or any insurable interest
   therein.

2. The short question to be determined by us is whether the High
   Court’s finding that the appellant, a functionary of the State would
   be liable to meet the award and not the Respondent - Insurance
   Company, was in accordance with law or not. We have heard the
   learned counsel for the parties, Ms. Archana Pathak Dave, learned
   senior counsel, appointed as amicus curiae and also perused the

written submissions filed by them.

1. As already noted above, it is undisputed that the bus in question was requisitioned by the appellant for the Gram Panchayat elections. The word requisition is defined by the Cambridge Dictionary4 as follows: “to officially request or take something”. Merriam Webster5 defines it as “ the act of formally requiring or calling upon someone to perform an action; a formal demand made by one nation upon another for the surrender or extradition of a fugitive from justice; the act of requiring something to be furnished; a demand or application made usually with authority:

such as - a demand made by military authorities upon civilians for
supplies or other needs; a written request for something authorized
but not made available automatically; the state of being in demand
or use”.
6. The judgment of this Court in National Insurance Co. Ltd. v.
Deepa Devi6, appears to squarely cover the situation presented in
this case, as follows:

“10. Parliament either under the 1939 Act or the 1988 Act did
not take into consideration a situation of this nature. No doubt,
Respondents 3 and 4 continued to be the registered owners of
the vehicle despite the fact that the same was requisitioned
by the District Magistrate in exercise of the power conferred

https://dictionary.cambridge.org/dictionary/english/requisition

https://www.merriam-webster.com/dictionary/requisition

(2008) 1 SCC 414

upon him under the Representation of the People Act. A vehicle
is requisitioned by a statutory authority, pursuant to the
provisions contained in a statute. The owner of the vehicle
cannot refuse to abide by the order of requisition of the vehicle
by the Deputy Commissioner. While the vehicle remains under
requisition, the owner does not exercise any control thereover.
The driver may still be the employee of the owner of the vehicle
but he has to drive it as per the direction of the officer of the
State, who is put in charge thereof. Save and except for legal
ownership, for all intent and purport, the registered owner of the
vehicle loses entire control thereover. He has no say as to
whether the vehicle should be driven at a given point of time or
not. He cannot ask the driver not to drive a vehicle on a bad road.
He or the driver could not possibly say that the vehicle would
not be driven in the night. The purpose of requisition is to use
the vehicle. For the period the vehicle remains under the control
of the State and/or its officers, the owner is only entitled to
payment of compensation therefor in terms of the Act but he
cannot not (sic) exercise any control thereupon. In a situation of
this nature, this Court must proceed on the presumption that
Parliament while enacting the 1988 Act did not envisage such a
situation. If in a given situation, the statutory definitions
contained in the 1988 Act cannot be given effect to in letter and
spirit, the same should be understood from the common sense
point of view.”
(emphasis supplied)

Still further, a bench of three judges in Purnya Kala Devi v. State
of Assam7, dealt with a case in which the State of Assam had
requisitioned the vehicle in question. It was held:

“16. Though the above point was pressed into service, the High
Court, without adverting to Section 5 of the Assam Act, merely
on the basis of the definition of “owner” as contained in Section
2(30) of the 1988 Act, mulcted the award payable by the owner

(2014) 14 SCC 142

of the vehicle. The High Court failed to appreciate that at the
relevant time the offending vehicle was under the requisition of
Respondent 1 State of Assam under the provisions of the Assam
Act. Therefore, Respondent 1 was squarely covered under the
definition of “owner” as contained in Section 2(30) of the 1988
Act. The High Court failed to appreciate the underlying
legislative intention in including in the definition of “owner” a
person in possession of a vehicle either under an agreement of
lease or agreement of hypothecation or under a hire-purchase
agreement to the effect that a person in control and possession
of the vehicle should be construed as the “owner” and not alone
the registered owner. The High Court further failed to appreciate
the legislative intention that the registered owner of the vehicle
should not be held liable if the vehicle was not in his possession
and control. … The Tribunal also erred in accepting the
allegation of Respondent 2 that the vehicle was released on the
date of the accident at 10.30 a.m. and the accident occurred at
10.30 a.m. without any evidence even though in the claim
petition, it was stated that the accident had occurred at 10.15
a.m.”
(emphasis supplied)
7. That being the position of law, we are of the considered view
that no error can be found in the impugned judgment. As such, the
appeal is bereft of merit.

1. Before parting with the matter, however, we deem it
   

   appropriate to deal with one of the contentions raised by the
   appellant to the effect that it will send a bad message to civic
   authorities who are requisitioning such vehicles for public purposes.

2. When a public authority requisitions a privately owned
   vehicle for public purposes, the nature of possession and control
   changes entirely. The owner is divested of custody and decision-
   making power, and the vehicle is placed at the disposal of the State
   for governmental functions. During this period, the owner neither
   directs its use nor derives any benefit from it. It only stands to reason
   that in such circumstances, if an untoward incident occurs,
   responsibility would properly to rest with the requisitioning
   authority and not with the insurer engaged by the owner for
   ordinary, private or commercial use, as the case may be. Once
   requisitioned, the vehicle is operated under official directions. The
   authority determines the manner of deployment, the purpose for
   which it is used, and the conditions under which it is operated. The
   owner has no say in these matters. Where control is assumed by the
   State, the legal consequences arising from that control cannot, in
   fairness, be shifted back to a private insurer whose contractual
   engagement was premised on a wholly different footing. It is equally
   important to recognize that a requisition is not a voluntary
   arrangement, instead it is a command issued under statutory
   authority, as stated by the judgments referred to supra. The owner
   does not consent to part with possession; he is compelled to do so.
   The insurance policy obtained by him envisions and accounts for the

vehicle’s regular and lawful use in the ordinary course. Compelled
deployment for public functions cannot reasonably be characterised
as “regular use” within the ‘usual’ contemplation. To fasten liability
upon the insurer in these circumstances would be to extend the
contract beyond the risk that was agreed to be covered. Requiring
the insurer to answer for consequences arising from a use neither
authorised nor controlled by the insured would be unfair. The
insurer assesses and underwrites risk based on the insured’s ordinary
operations. When the State steps in, assumes control, and deploys
the vehicle for its own purposes, it assumes with that control the
corresponding responsibility. Further, when statutory power is
exercised to requisition private property in the public interest, that
power carries with it an obligation to answer for the consequences
flowing from such compelled use. To hold otherwise would impose
upon private parties and their insurers the burden of risks generated
exclusively by governmental action.

1.   Here itself, it be observed, that the learned Amicus Curiae, in
   

   her note, submitted to the Court that in view of U.P. SRTC v.
   National Insurance Co. Ltd.8, which in turn relied on U.P. SRTC
   v. Kulsum9, the insurer would continue to be liable despite it being

   2021 SCC OnLine SC 3278

   (2011) 8 SCC 142

operated by the authority. We cannot accept this view since the
crucial distinction in the above two cases vis-a-vis the present one is
that in the former the vehicles operated under an agreement for such
purpose. Here, as is abundantly clear, it was a requisition by the
authority under a special statute. Accordingly, it is held that where
a vehicle is requisitioned for public functions and an incident occurs
during the period of such requisition, liability ought properly to be
borne by the requisitioning authority, and not by the insurer engaged
by the owner for the vehicle’s regular and voluntary use.

1. There is yet another point that needs consideration. Section 160 of the Representation of the Peoples Act, 1950 grants power to the State to requisition premises and vehicles. The provision, however, does not expressly authorize the requisition of manpower such as driver. In practice, however, vehicles are often placed at the disposal of the authorities along with their drivers. In practice, however, vehicles are often placed at the disposal of the Authorities along with their drivers in view of operational convenience. Once the vehicle is requisitioned and deployed for election duty, its control and use effectively passes to the State authorities for the duration of that period, as already observed supra. In such circumstances, it is a reasonable conclusion that by accepting and utilizing the services of the driver, the Authorities implicitly

recognized such a driver’s competence, capacity and ability to
operate the vehicle. It is also to be noted that the authority in this
case made a conscious decision to requisition the vehicle with the
driver instead of exercising its power to request staff for the purpose
of carrying out duties in connection with the election. In other
words while the vehicle could have been requisitioned from the
School, the driver could have been a staff member of the
authorities/institutions listed under Section 159(2) of the Act.
However, that was not the case. Viewed thus too, the liability would
rest with the requisitioning authority, and thereby with the State.

1. With these observations, the appeal is dismissed along with any pending applications being disposed of.

………………………….…………………..J.
(SANJAY KAROL)

                 ………………………………………………J.
                 (NONGMEIKAPAM KOTISWAR SINGH)

March 23, 2026
New Delhi