The Supreme Court has rescinded its 2017 directive that mandated a Pollution Under Control (PUC) certificate as a prerequisite for obtaining third-party vehicle insurance. This decision was made by a bench consisting of Justice AS Oka and Justice AG Masih, following an application by the General Insurance Council which raised concerns about the 2017 order.
Solicitor General of India Tushar Mehta emphasised the potential adverse effects of the condition, pointing out that without third-party insurance, accident victims would need to seek compensation directly from vehicle owners, who often lack the financial capacity to pay.
“As rightly submitted by the Learned SG, if the said direction is implemented in its letter and spirit it will have disastrous consequences. Some vehicles will continue to play without 3rd party insurance. Therefore, we are inclined to allow the application by deleting the aforesaid direction,” the court stated.
The Supreme Court underscored that neither the Motor Vehicles Act, 1988, nor any related rules mandate insurance companies to require a valid PUC certificate for policy renewal. The original condition aimed to ensure vehicles had valid PUC certificates to control pollution. However, the court suggested using remote sensing technology to track vehicles in the Delhi-NCR region as a more effective solution.
Background:
Previously, the Supreme Court had expressed its intent to revisit the 2017 order that mandated a PUC certificate for third-party vehicle insurance. The Solicitor General noted that 55% of vehicles did not comply with third-party insurance, complicating compensation for accident victims.
The court acknowledged the necessity for a balanced approach to enforce PUC norms while maintaining third-party insurance coverage. It permitted the amicus curiae and the Solicitor General to propose modifications to the 2017 order, seeking a solution that ensures both compliance and insurance coverage.
