Mere Presence of a Car in a Chain of Events Does Not Attract Motor Vehicles Act Liability, Supreme Court Holds

A Division Bench of Justices Sanjay Karol and Augustine George Masih sets aside compensation awards, finding no causal link between a vehicle and a passenger's death.

The Supreme Court has allowed an appeal by Dilip Agarwal, setting aside compensation awarded to the family of one Anand, who was last seen in Dilip's vehicle on 29 November 2009 and found dead three days later. The Court held that although there was a vehicle and an alleged unlawful death, the claimants had established no causal connection between the two sufficient to attract liability under the Motor Vehicles Act, 1988. Without that link, the phrase “arising out of” the use of a motor vehicle cannot be satisfied. Both the Motor Accident Claims Tribunal and the High Court had awarded compensation; the Supreme Court has now reversed both.

How the Dispute Reached the Court

Anand sat in a vehicle driven by his friend Dilip on 29 November 2009. On 3 December 2009, Anand's body was found near Binjkot village, PS Chalradhar Nagar. His wife, Rajshri, lodged FIR No. 963 of 2009 at PS Kotwali, District Raigarh.

A criminal chargesheet alleged that three accused persons, acting in furtherance of a conspiracy, kidnapped Anand, killed him in a premeditated manner, and disposed of his remains. The Sessions Trial (No. 38 of 2010) ended on 30 November 2012 with Dilip's conviction under Sections 365, 302, 201 and 120B of the Indian Penal Code, 1860. On appeal, the High Court acquitted Dilip on 18 November 2015, primarily because the last-seen theory on which the prosecution's case rested could not be proved.

In parallel, Rajshri and her three children filed Claim Case No. 37 of 2011 under Section 166 of the Motor Vehicles Act before the Fourth Additional Motor Accident Claims Tribunal, Raigarh, claiming approximately Rs. 26,00,000. Their case was that Anand was killed inside Dilip's vehicle and that the vehicle was therefore used in the commission of the offence.

The Tribunal found that rashness and negligence could not be proved but held nonetheless that Anand's death fell within Sections 165 and 166 of the Act. It reasoned that the dominant intention was not murder but that the injuries were inflicted while the parties were in the vehicle, eventually leading to death. The Tribunal also noted that Dilip had not denied the claimants' version. Compensation of Rs. 5,64,000 with 7% interest was awarded. The High Court upheld those findings and enhanced the amount to Rs. 8,60,832 with 6% interest on the enhanced sum.

Dilip challenged both orders. The Supreme Court granted leave and consolidated the appeals arising out of SLP (C) Nos. 9002-03 of 2026.

The Core Question: What Does “Arising Out Of” Require?

The Court framed the issue precisely: whether Anand's death “arises out of” the use of the motor vehicle so as to make Dilip and/or his insurer liable to compensate the respondents.

Justice Sanjay Karol, writing for the Bench, traced the phrase through two significant precedents. The Court referred to its recent decision in Bruhat Bangalore Mahanagara Palike v. K.K. Umesh Kumar (2026 SCC OnLine SC 1111), which involved a passenger in a parked autorickshaw injured when a tree branch fell on the vehicle. That decision had itself drawn on Shivaji Dayanu Patil v. Vatschala Uttam More, where the Court had construed “use” widely to include stationary vehicles, and had read “arising out of” to carry the wider meaning of “connected with” rather than the narrower sense of “arising under.”

The Court also drew on the three-Judge Bench decision in National Insurance Co. Ltd. v. Swaran Singh (2004) 3 SCC 297, which explained that an accident can occur for a variety of reasons and the driver need not be negligent. However, the Court was careful to note that accident, motor vehicle, and “arising out of” are three distinct elements. “Arising out of” is the causal link. Without it, liability under the Act cannot be fastened merely because an accident and a motor vehicle are both present in the narrative.

The Court further considered Rita Devi v. New India Assurance Co. Ltd. (2000) 5 SCC 113, where the primary objective was theft of a vehicle and the driver's murder was in furtherance of that theft. There, the death arose in relation to the vehicle itself because the felony was directed at the vehicle. The present case, the Court said, did not fit that template — there was no primary felony aimed at the vehicle around which a secondary act of killing could be framed.

Why the Lower Courts' Reasoning Did Not Hold

The Tribunal and the High Court had effectively assumed that injuries were inflicted on Anand while he and Dilip were in the car. The Supreme Court found this assumption unsupported by evidence.

No forensic proof was recovered from the vehicle. There was no blood, no skin cells, no hair. It was nobody's case that Dilip's car was involved in any collision. The injuries on Anand's body were caused by hard and blunt objects — a description that could fit many circumstances and did not point to the vehicle itself.

The Court acknowledged that claimants under Section 166 are not required to establish the precise manner in which injuries were sustained. Strict proof of how a particular vehicle caused harm in a particular way is not the standard. But that latitude, the Court held, does not mean that the mere incidental presence of a car somewhere in a chain of circumstances is enough. Some link between the car and the death must be established.

The distinction between the criminal standard (proof beyond reasonable doubt) and the civil standard (preponderance of probabilities) was also addressed. The Court drew on ICICI Lombard General Insurance Co. Ltd. v. Rajani Sahoo (2025) 2 SCC 599 and Mathew Alexander v. Mohd. Shafi (2023) 13 SCC 510, reaffirming that a criminal acquittal does not automatically defeat a civil claim and that the Tribunal must take a holistic view on preponderance of probabilities. The Court also quoted from N.G. Dastane (Dr) v. S. Dastane (1975) 2 SCC 326 to explain that preponderance of probabilities requires the court to weigh competing probabilities and act on the supposition that a fact exists if that supposition is more probable than not.

Even applying this lighter standard, the Court found no causal link. Anand knew Dilip and sat in his car. Three days later, he was found dead. The last-seen theory failed in the criminal trial. No evidence in the civil proceedings bridged the gap between the vehicle and the death.

The Significance of the Causal-Link Requirement

The judgment draws a clear boundary around the phrase “arising out of” in the Motor Vehicles Act. The phrase does not require the vehicle to have been moving or to have been the direct instrument of injury. The Court accepted that “use” is a broad concept. But breadth in the meaning of “use” does not eliminate the need for a causal relationship between that use and the harm.

In Rita Devi, the vehicle was the object of the primary felony; the murder was consequential to the felony directed at the vehicle. In Bruhat Bangalore Mahanagara Palike, the vehicle was physically present and the injury occurred because a passenger was inside it when a tree fell. In both cases, the vehicle was a meaningful part of the causal chain. Here, the vehicle appeared only at the start of the story — Anand entered it — and there was nothing to connect it to what happened three days later.

The Court's conclusion is that “arising out of the use of a motor vehicle” requires more than temporal or incidental association. There must be a demonstrable nexus, even if indirect, between the vehicle's use and the harm suffered. That nexus was absent here.

Order

The Supreme Court allowed the appeals and set aside the judgments of both the Tribunal and the High Court. It found that despite an alleged accidental murder and a motor vehicle, the relationship between the two — specifically implicating the vehicle — had not been established. Liability under the Motor Vehicles Act therefore could not arise.

Given the particular facts of the case, the Court directed that any compensation already paid to the respondents shall not be subject to recovery. Pending applications, if any, were disposed of.