The Centre has left it to the States to deal with cab aggregators, going by amendments to the Motor Vehicle Amendment Bill passed in the Lok Sabha on Monday.

While aggregators have been maintaining that they come under the ambit of the Information Technology Act, they now have to follow the guidelines and penalties of the Motor Vehicles Act.

Speaking in Parliament, Transport Minister Nitin Gadkari asked States to strike a balance between saving employees of State road transport undertakings, many of which are bleeding, and providing good services to the population.

The bill seeks to “save lives” by ushering in radical reforms in the motor vehicles law to slap a heavy penalty on traffic violators, protecting good samaritans and making vehicle-makers responsible for design defects to cut road accidents. A whopping 5 lakh accidents take place every year claiming around 1.5 lakh lives across the country.

Insurance cap

It also caps the maximum liability for third-party insurance at ₹10 lakh in the case of death in a motor accident. “The Bill proposes a compensation of ₹5 lakh. This is not the upper limit. After getting this amount (the affected family) can withdraw the case or appeal,” he said.

“This (₹5 lakh) is being done to ensure that there are less court cases and immediate compensation is given ...,” Gadkari said. The minister also said that it would not be possible to increase the compensation in the case of death to ₹20 lakh as it would entail a substantial hike in insurance premiums.

Referring to the members’ concern over third-party insurance, Gadkari said: “There is no upper ceiling in awarding compensation by the Claims Tribunal.”

In the case of death in hit-and-run accidents, the Bill provides for an eight-fold increase in compensation for the victim’s family to ₹2 lakh.