India reports around 500,000 road accidents every year, out of which 150,000 are fatal accidents. This is a great loss for the society. Government of India has set a target to reduce the accidents and fatalities by 50% in five years (2020). It is estimated that the economy lost around 3% of GDP (1999-2000) due to road mishaps.

To achieve this target, the Ministry of Road Transport and Highways (MoRTH) constituted a Group of Transport Ministers (GoM) of the States to discuss various key issues. GoM consists of 19 transport ministers of the states and recommended to amend existing Motor Vehicle Act, 1988 and proposed Motor Vehicle (Amendment) Bill 2016 to address the issue of road safety and to improve the facility to the citizens while dealing with transport departments.

In the present Motor Vehicle Act, there are 223 sections out of which the bill aims to amend 68 sections whereas chapter 10 has been deleted and a chapter 11 is being replaced with new provisions to simplify third party insurance claims and settlement process. Two key highlights of the proposed bill are:

  • Stiff penalties for drunken driving, driving without licence, dangerous driving, over-speeding, overloading and other serious offences
  • Aims to reduce the corruption and waiting time in vehicle registration and licensing through the use of automation and e-governance

Some of the key amendments in the bill are as follows:

1.    Compensation for Hit & Run cases from ₹25,000 to ₹ 200,000. However, the Bill puts a ceiling on maximum claim in case of death from a road accident at ₹10 lakh (₹5 lakh for grievous hurt) from insurance companies

2.    Permitting the States to grant exemptions in stage carriage and contract carriage permits for promoting rural transport, public transport, last mile connectivity and for passenger convenience and road safety

3.    Proposes that the State Government can specify a multiplier, not less than one and not greater than ten, to be applied to each fine under this act and such modified fine. Modified penalty structure is:



Current Penalty

Minimum Penalties



₹ 100

₹ 500

New 177A

Rules of road regulation violation

₹ 100

₹ 500


Travel without ticket

₹ 200

₹ 500


Disobedience of orders of authorities

₹ 500

₹ 2000


Unauthorized use of vehicles without licence

₹ 1000

₹ 5000


Driving without licence

₹ 500

₹ 5000


Driving despite disqualification

₹ 500

₹ 10,000

182 B

Oversize vehicles


₹ 5000


Over speeding

₹ 400

₹ 1000 for LMV

₹ 2000 for MPV


Dangerous driving penalty

₹ 1000

Upto ₹ 5000


Drunken driving

₹ 2000

₹ 10,000


Speeding / Racing

₹ 500

₹ 5,000


Vehicle without permit

upto ₹ 5000

Upto ₹ 10,000


Aggregators (violations of licencing conditions)


₹ 25,000 to

₹ 1,00,000



₹ 2000 and

₹ 1000 per extra tonne

₹ 20,000 and

₹ 2000 per extra tonne

194 A

Overloading of passengers


₹ 1000 per extra passenger

194 B

Seat belt

₹ 100

₹ 1000

194 C

Overloading of two wheelers

₹ 100

₹ 2000, Disqualification for 3 months for licence

194 D


₹ 100

₹ 1000 Disqualification for 3 months for licence

194 E

Not providing way for emergency vehicles


₹ 10,000


Driving Without Insurance

₹ 1000

₹ 2000


4.    The driving training process has been strengthened enabling faster issuance of transport licenses. Learning licenses will be issued online, testing will be automated and dis-intermediated. Further, it is proposed to increase validity period for driving licenses, doing away with the requirements of educational qualifications for transport licenses.

5.    Proposes that the Guardian / owner shall be deemed to be guilty in cases of offences by the Juveniles and Juvenile to be tried under JJ Act. Registration of Motor Vehicle to be cancelled

6.    Improving the registration process for new vehicles, registration at the end of the dealer is being enabled and restrictions have been imposed on temporary registration

7.    Stricter provisions for helmets have been introduced along with provisions for electronic detection of violations

8.    To help the road accident victims, Good Samaritan guidelines have been incorporated

9.    Proposes to mandate the automated fitness testing for the transport vehicles with effect from 1st October 2018

10.  Proposes to create National Register for Driving Licence and National Register for Vehicle registration through “Vahan” & “Sarathi” platforms. This will facilitate uniformity of the process across the country

11.  Recognized “Aggregator” as a digital intermediary or market place for a passenger to connect with a driver for the purpose of transportation