Youth Congress leader Ravinder Jassal, aged 38 years, hailed from Sirmaur district, police said.
He was returning to Nahan after attending a rally at Shimla to felicitate Union minister V B Singh on completion of 50 years in public life when the accident happened.
The car plunged into 800-ft gorge near Ladu village, police said adding Jassal died instantly.
22-year-old Ishan was injured and was admitted to PGI Chandigarh where his condition was described as stable.