Report No. 85
1.5. Objects of Chapter 8.-
In India, the provisions of Chapter 8 of the Motor Vehicles Act, 1939, particularly sections 94 to 96, were modelled on English statutes then in force. The objects of the Chapter were: (1) to enable a claimant to recover the whatever sum he is in law entitled to, despite the inability of the owner or the driver to pay; (2) to prevent the insurer from escaping liability on the ground of breach, on the part of the insured, of any term of the contract; and (3) to entitle the claimant to recover compensation directly from the insurer. Hitherto, legislation on the subject of compensation for death or injury from accidents caused by motor vehicles has proceeded mainly on two lines:
(i) Insertion of provisions for enforcing liability towards third parties against the insurer, even though the contract of insurance was between the owner and the insurer, thus modifying the general rule of the law of contract that a third party cannot sue on a contract.
(This change was effected in 1939 and came into force in 1946).
(ii) Creation of a special forum for the trial of claims for compensation, thus modifying the jurisdiction of the courts within the general hierarchy of courts.