Accident happened. No insurance of the vehicle. Can we be penalized?

Hi, My father in law had a Bus, in the year 2012, the driver stopped the bus on the road side for passenger to get down. While four people got down from the bus and were taking their luggage from the dicky, a lorry came and hit the bus from the back. all the 4 people who were standing outside the bus were killed on the spot. At this time there was no insurance on bus. And None of the people who were inside the bus got injured or died.
There was a complaint against the bus as well as Lorry in the two courts in Karnataka, both the courts given the judgement and found guilty of Lorry driver and asked Insurance company of the Lorry to give compensation to the relatives of the victims who died.
Now, the Insurance company moved to the higher court saying Bus owner also be penalised, and there is a fault of bus as well.
My Father in law is now deceased, and hence they court have made my Mother is law as a party. My father in law has two children ( Daughter and Son both are married and living separately ) My mother in law is ST Women living from her pension income. She is not capacity to fight in the higher court. because whatever the amount she received after selling the bus spent on hospital bill to take care of my father in law who was suffering from multiple organ failure during his last days.
There was no asset or cash belonged my father in law at his time of death. His entire hospital bills and other medical expenses were taken by the other family members.
So, since my monther in law is in no state to spend again on court, or in no capacity to move to higher court due to her old age, I request you to guide me how to handle this situation.
Since it is a Motor vehicle case, what will happen if we do not contest in court, or what would be the adverse effect. kindly guide me..

Thank you