Liability for Motor Vehicle Accidents — MCQs

All questions with answers and explanations

Read the full set here, or use the practice card above to test yourself one question at a time.

1. Under ordinary tort principles, liability for a motor vehicle accident is generally based on:

   • Strict liability, regardless of fault
   • Negligence, requiring proof of a breach of the duty of care (correct answer)
   • Absolute liability under the rule in Rylands v. Fletcher
   • Criminal liability alone, with no civil remedy

   Explanation. At its foundation, motor vehicle accident liability is liability in negligence, requiring proof of a duty of care, its breach, and resulting damage.

2. Section 164 of the Motor Vehicles Act, 1988 provides:

   • Vicarious liability of the employer
   • No-fault liability for death or grievous hurt, with a fixed sum payable (correct answer)
   • Strict liability for property damage only
   • Joint and several liability among multiple drivers

   Explanation. Section 164 provides no-fault liability — fixed compensation for death or grievous hurt, without proof of any wrongful act, neglect or default. It replaced Sections 140 to 144, omitted from 1 April 2022.

3. Compensation payable under Section 164 is best described as:

   • The final and complete compensation for the accident
   • A fixed amount (5 lakh rupees for death, 2.5 lakh rupees for grievous hurt), payable without proving negligence (correct answer)
   • A punitive amount imposed on the driver personally
   • Compensation payable only after the Claims Tribunal's final award

   Explanation. Section 164 compensation is a fixed amount, 5 lakh rupees for death and 2.5 lakh rupees for grievous hurt, payable without proving negligence.

4. Motor Accident Claims Tribunals are constituted under which section of the Motor Vehicles Act, 1988?

   • Section 164
   • Section 166
   • Section 165 (correct answer)
   • Section 196

   Explanation. Section 165 empowers the State Government to constitute Motor Accident Claims Tribunals for specified areas.

5. Once a Claims Tribunal is constituted for an area, the jurisdiction of ordinary civil courts over motor accident compensation claims is:

   • Unaffected and continues to run parallel to the Tribunal
   • Barred (correct answer)
   • Expanded to cover appeals from the Tribunal
   • Transferred to criminal courts

   Explanation. Once a Tribunal is constituted for an area, ordinary civil courts' jurisdiction to entertain such claims is barred.

6. An application for compensation under Section 166 may be filed by:

   • Only the police officer who investigated the accident
   • The injured person, or on death, the legal representatives of the deceased (correct answer)
   • Only the insurance company involved
   • Only the State Government

   Explanation. Section 166 applications may be filed by the person who sustained the injury, or by the legal representatives of the deceased where death has resulted.

7. In National Insurance Co. Ltd. v. Pranay Sethi (2017), the Supreme Court fixed the future-prospects addition for a self-employed deceased below 40 years of age at:

   • 10%
   • 25%
   • 40% (correct answer)
   • 50%

   Explanation. For a self-employed person or one on a fixed salary, the addition is 40, 25 or 10 per cent by age band; 40 per cent applies below 40 years. For a person with a permanent job it is 50, 30 or 15 per cent.

8. The multiplier method is used primarily to compute:

   • Funeral expenses
   • Loss of dependency (correct answer)
   • Loss of consortium
   • Medical expenses already incurred

   Explanation. Loss of dependency is computed by multiplying the annual dependency figure (income minus personal expenses) by a multiplier keyed primarily to the deceased's age.

9. In Pranay Sethi, which earlier decision's multiplier table was affirmed as the governing approach?

   • Rylands v. Fletcher
   • Donoghue v. Stevenson
   • Sarla Verma v. Delhi Transport Corporation (2009) (correct answer)
   • M.C. Mehta v. Union of India

   Explanation. The Constitution Bench in Pranay Sethi affirmed the multiplier method laid down in Sarla Verma v. Delhi Transport Corporation (2009).

10. Why is third-party insurance made compulsory under the Motor Vehicles Act?

    • To increase government revenue through premiums
    • To ensure the victim's right to compensation is not defeated by the owner's inability to pay (correct answer)
    • To replace the need for a Claims Tribunal
    • To exempt drivers from criminal liability

    Explanation. Compulsory third-party insurance ensures compensation is actually recoverable, since the insurer typically satisfies the award rather than relying solely on the individual owner's ability to pay.