The Supreme Court of India, through a five-judge Constitution Bench, delivered judgment on 4 November 2024 settling a long-contested question under the Motor Vehicles Act, 1988. The Bench comprising Chief Justice D.Y. Chandrachud, Justice Hrishikesh Roy, Justice P.S. Narasimha, Justice Pankaj Mithal, and Justice Manoj Misra held that holders of a light motor vehicle (LMV) licence are entitled to drive transport vehicles with an unladen weight below 7500 kilograms without obtaining a separate transport vehicle endorsement.
Background
The dispute centred on the interplay between Section 2(21) and Section 10 of the Motor Vehicles Act, 1988, which define vehicle categories and the corresponding licence requirements. Insurance companies had routinely denied third-party accident claims where the driver of a commercial vehicle held only an LMV licence, arguing that a separate transport vehicle licence was mandatory for any vehicle used for commercial purposes regardless of its weight.
This position had been upheld by some High Courts and challenged in others, creating significant uncertainty in motor accident claims tribunals across the country. The three-judge Bench in Mukund Dewangan v. Oriental Insurance Co. Ltd. (2017) had held that an LMV licence was sufficient for transport vehicles below the weight threshold, but subsequent decisions had cast doubt on the scope of that ruling, necessitating a definitive pronouncement by a larger Bench.
Key Holdings
The Constitution Bench laid down the following principles:
LMV licence sufficient for sub-7500 kg transport vehicles: A person holding an LMV licence under the Motor Vehicles Act, 1988 is authorised to drive transport vehicles whose unladen weight does not exceed 7500 kilograms. No separate endorsement or transport vehicle licence is required for such vehicles.
Statutory interpretation of Section 2(21): The definition of "light motor vehicle" in Section 2(21) encompasses all motor vehicles with a gross vehicle weight or unladen weight not exceeding the prescribed threshold, without distinguishing between personal and transport use. The licence category is determined by vehicle weight, not by the purpose of use.
Insurance companies cannot deny third-party claims on this ground: Insurers cannot repudiate third-party liability claims solely on the basis that the driver held an LMV licence rather than a transport vehicle licence when driving a commercial vehicle below the 7500 kg threshold. Such denial constitutes an invalid ground for repudiation.
Prospective and retrospective effect: The ruling applies both to pending claims before Motor Accident Claims Tribunals and to future claims, providing relief to claimants whose compensation had been denied or delayed on this ground.
Implications for Practitioners
This judgment resolves one of the most frequently litigated issues in motor accident claims practice. Practitioners representing accident victims should immediately review all pending cases where claims have been denied or contested on the ground that the driver lacked a transport vehicle licence for a sub-7500 kg vehicle. These cases are now ripe for favourable resolution.
For insurance law practitioners, the decision eliminates a commonly invoked defence in third-party claims. Insurers will need to reassess their claims processing protocols and cease routine repudiations based solely on this licence category distinction. Internal training materials and claims adjudication guidelines will require updating.
Fleet operators and transport companies benefit from the clarity that their drivers holding LMV licences are properly authorised to operate lighter commercial vehicles, reducing compliance uncertainty. However, practitioners should advise clients that this ruling does not extend to vehicles exceeding the 7500 kg unladen weight threshold, where a separate heavy transport vehicle licence remains mandatory.