NATIONAL INSURANCE CO LTD v. VITH ADDITIONAL DISTRICT AND SESSION JUDGE/MOTOR ACCIDENT TRIBUNAL BARABANKI
2006-09-22
DEVI PRASAD SINGH
body2006
DigiLaw.ai
DEVI PRASAD SINGH, J. Whether the Motor Accident Claim Tribunal has got power under the law to recall its final judgment or award, is the question involved in the present writ petition? One Kasim Ali s/o Salar Baksh @ Salaroo R/o Mohalla-Miradhan, Kasba-Daryabad, Post Office-Daryabad, District-Barabanki succumbed to injuries at about 10 a. m. on 30th of September, 1998 in an accident alleged to be caused by a truck No. UPHG-9095. The dependants of late Kasim Ali had filed a claim petition registered as M. A. C. No. 350/1998 in the Court of Vth Additional District Judge/motor Accident Claim Tribunal, Barabanki. The Tribunal had decided the controversy and granted compensation to the claimants, Smt. Khatoon and others by the award dated 11th of January, 2001. According to Smt. Alka Verma, learned Counsel for the petitioner, after delivery of the award, on 3rd of January, 2001, petitioner had come to know that the driver of the vehicle Sri Prem Narain was having a fake and forged driving licence. After almost 1 year, petitioner had filed an application for recall of the award dated 11th of January, 2001 on the ground that in view of the provisions contained in Section 149 (2) of the Motor Vehicles Act, 1988, petitioner is not entitled to pay the compensation. After hearing the learned Counsel for the parties, by the impugned order dated 5th of March, 2002, the Tribunal has rejected petitioners application with the finding that the Insurance Company shall be responsible to pay the compensation to the 3rd party, even if the Driving licence was fake. It has been further held by the Tribunal that under the Motor Vehicles Act, 1988 (in short referred as an Act), the tribunal does not have got power to recall its judgment, order or award. It has been further held by the learned Tribunal that since the petitioner had not filed an appeal under Section 173 of the Act, a dilatory tactics has been adopted by moving application in question to prolong the payment of compensation. 2. Learned Counsel for the petitioner submits that since a fraud was committed and it was not in the knowledge of the petitioner relating to fake licence possessed by the driver of the vehicle, the Tribunal has got power to recall its award.
2. Learned Counsel for the petitioner submits that since a fraud was committed and it was not in the knowledge of the petitioner relating to fake licence possessed by the driver of the vehicle, the Tribunal has got power to recall its award. Learned Counsel for the petitioner has relied upon the judgments reported in (2001) 4 Supreme Court Cases 342, New India Assurance Co. , Shimla v. Kamla & Ors. , with connected cases, 2000 (1) JCLR 828 (SC) : (2000) 3 SCC 581 , United India Insurance Co. Ltd. v. Rajendra Singh & Ors. , with connected case and 2005 (1) JCLR 4 (SC) : 2005 (1) IAC 14 (SC), National Insurance Company Ltd. v. Chalia Bharathamma & Ors. 3. On the other hand Sri Ravindra Pratap Singh, learned Counsel for the respondents No. 2 to 5 submits that the power to review or recall of the judgment, order or award is the statutory power and in the absence of any statutory provision contained in the Act, learned Tribunal has got no jurisdiction to recall its award. It has been further submitted by the learned Counsel for the respondents No. 2 to 5 that since the insurance company had entered into an agreement with the owner of the vehicle to pay compensation to the 3rd party, it shall always be incumbent on the insurance company to pay the compensation with option to recover the same from the owner or the driver of the vehicle in accordance to law, in case from some subsequent development, it borne out that petitioner-insurance company is not liable to pay the compensation. It has been further submitted by the learned Counsel for the respondents No. 3 to 5 that no fraud was committed by the claimants. Neither there is any evidence on record nor it has been pleaded even in the application for recall of the award that claimants have committed some fraud or concealed the material facts in collusion with the motor vehicle owner or its driver. Accordingly, the further submission of the learned Counsel for the respondents No. 2 to 5 is that in the absence of statutory provisions under the Act, recall application shall not be maintainable.
Accordingly, the further submission of the learned Counsel for the respondents No. 2 to 5 is that in the absence of statutory provisions under the Act, recall application shall not be maintainable. Learned Counsel for the respondents No. 2 to 5 has relied upon the judgments reported in 2002 (1) JCLR 963 (All) : 2003 (1) TAC 551 (All.), Raj Kumari v. Motor Accidents Claims Tribunal, Jaunpur & Ors. , 2003 (1) TAC 492 (SC), Rajendra Kumar v. Rambhai & Ors. , 2000 (1) JCLR 828 (SC) : 2000 (2) TAC 613 (SC), United India Insurance Co. Ltd. v. Rajendra Singh, 2003 (2) TAC 26 (SC), Sadhana Lodh v. National Insurance Company, 2005 (23) LCD 835, Tauseem Ahmad v. New India Insurance Company, 2004 (22) LCD 40 (FB), Kamla Yadav v. Smt. Shushma Devi, 2003 (3) SCC 338 , United India Insurance v. Lehru and 2004 (1) JCLR 469 (SC) : 2004 (2) AWC 1589 (SC), National Insurance Co. Ltd. v. Swaran Singh & Ors. 4. Under sub-section (1) of Section 149 of the Motor Vehicles Act, 1988, it has been provided that it shall be the duty of the insurance company to satisfy the judgment or award against the person insured in respect of 3rd party. However, sub-section (2) of Section 149 of the Motor Vehicles Act, 1988 contains certain exceptions under which the insurance company may not be held responsible to satisfy the award or judgment of the Motor Accidents Claims Tribunal. For convenience, sub-section (2) of Section 149 of the Motor Vehicles Act, 1988 is reproduced as under: "149.
However, sub-section (2) of Section 149 of the Motor Vehicles Act, 1988 contains certain exceptions under which the insurance company may not be held responsible to satisfy the award or judgment of the Motor Accidents Claims Tribunal. For convenience, sub-section (2) of Section 149 of the Motor Vehicles Act, 1988 is reproduced as under: "149. (2) No sum shall be payable by an insurer under sub-section (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given the insurer had notice through the Court or, as the case may be, the Claims Tribunal of the bringing of the proceedings, or in respect of such judgment or award so long as execution is strayed thereon pending an appeal; and an insurer to whom notice of the bringing of such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely: (a) That there has been a breach of a specified condition of the policy, being one of the following conditions, namely: (i) a condition excluding the use of the vehicle - (a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or (b) for organized racing and speed testing, or (c) for a purpose not allowed by the permit under which the vehicle is used where the vehicle is a transport vehicle, or (d) without side-car being attached where the vehicle is a motorcycle; or (ii) a condition excluding driving by a named person or persons or by any person who is not duly licensed, or by any person who has been disqualified for holding or obtaining a driving licence during the period of disqualification; or (iii) a condition excluding liability for injury caused or contributed to by conditions of war, civil war, riot or civil commotion; or (b) that the policy is void on the ground that it was obtained by the non-disclosure of a material fact or by a representation of fact which was false in some material particular. " 5.
" 5. Under Section 168 of the Act, it has been provided that on receipt of an application for compensation made under Section 166, the Claims Tribunal has been authorized to determine the amount of compensation which may be payable to an aggrieved party while rendering the award. Section 168 of the Act further provides that it shall be the duty of the Claims Tribunal to specify the amount which shall be paid by the insurer or the owner or the driver of the vehicle involved in the accident or by all or any of them as the case may be. Section 169 of the Act further lays down the procedure which is to be followed by the tribunal. For convenience, Section 169 of the Act is reproduced as under: "169. Procedure and powers of Claims Tribunals.- (1) In holding any inquiry under Section 168, the Claims Tribunal may, subject to any rules that may be made in this behalf, follow such summary procedure as it thinks fit. (2) The Claims Tribunal shall have all the powers of a Civil Court for the purposes of taking evidence on oath and of enforcing the attendance of witnesses and of compelling the discovery and production of documents and material objects and for such other purposes as may be prescribed; and the Claims Tribunal shall be deemed to be a Civil Court for all the purposes of Section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974 ). (3) Subject to any rules that may be made in this behalf, the Claims Tribunal may, for the purpose of adjudication upon any claim for compensation, choose one or more persons possessing special knowledge of any matter relevant to the inquiry to assist it in holding the inquiry. " Under Section 170 of the Act, it has been made open to the Claims Tribunal to implead the insurer. For convenience, Section 170 of the Act is reproduced as under: "170.
" Under Section 170 of the Act, it has been made open to the Claims Tribunal to implead the insurer. For convenience, Section 170 of the Act is reproduced as under: "170. Impleading insurer in certain cases.- Where in the course of any inquiry, the Claims Tribunal is satisfied that - (a) there is collusion between the person making the claim and the person against whom the claim is made, or (b) the person against whom the claim is made has failed to contest the claim, it may, for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaded as a party to the proceeding and the insurer so impleaded shall thereupon have, without prejudice to the provisions contained in sub-section (2) of Section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made. " Under Section 173 of the Act, any person aggrieved by the award of Claims Tribunal may, within ninety days from the award, prefer an appeal to the High Court. Section 175 of the Act bars jurisdiction of Civil Courts. 6. A plain reading of sub-section (2) of Section 149 of the Act shows that the insurance company shall not be liable to pay compensation in respect of the judgment or award unless the insurer has got notice to defend the action on various grounds including the situation where the vehicle was driven by a person without having any driving licence. Section 149 of the Act does not contemplate that insurer shall not be liable to pay the damages or compensation on the ground disclosed in sub-section (2) of Section 149 of the Act itself, in case the award is rendered after the service of notice. Once, the insurance company is served with a notice to defend itself and the award is rendered in accordance to law, then the ground enumerated in sub- section (2) of Section 149 of the Act does not seem to be available to the insurer to deny the payment in pursuance to the award. For any grievance, the option seems to be open to the insurer is to file an appeal under Section 173 of the Motor Vehicle Act or to adopt the other recourse provided by law. 7.
For any grievance, the option seems to be open to the insurer is to file an appeal under Section 173 of the Motor Vehicle Act or to adopt the other recourse provided by law. 7. In the case of Raj Kumari (supra), Honble Single Judge of this Court held that a review petition is not maintainable against the award under the Act. 8. In the case of Rajendra Kumar (supra), the Apex Court held that for the exercise of power of review, foremost requirement is that the order of review which is sought, suffers from any error appearent at the face of record and in case, the order is permitted to stand, it shall lead to failure of justice. In the absence of any such error, finality shall be attached to such judgment. However, Honble Supreme Court has not recorded any finding relating to the maintainability of review petition under the Act. 9. In the case of Rajendra Singh (supra), Honble Supreme Court held that remedy to move for recalling the order on the basis of the newly discovered facts amounting to fraud of high degree cannot be foreclosed. According to the case of Raiendra Singh (supra), in the event of commission of fraud, Courts have got power to recall its order. For convenience, relevant portion from the judgment of Rajendra Singh (supra) is reproduced as under: " (16) Therefore, we have no doubt that the remedy to move for recalling the order on the basis of newly discovered facts amounting to fraud of high degree cannot be foreclosed in such a situation. No Court or Tribunal can be regarded as powerless to recall its own order if it is convinced that the order was wangled through fraud or misrepresentation of such a dimension as would affect the very basis of claim. " 10. In the case of Kamla (supra), Honble Supreme Court held that while deciding an appeal relating to 3rd party claim, High Court should not have dismissed the appeal of insurance company and the appellant should have been permitted to lead evidence to prove that the licence of the driver was the outcome of forgery. The Claim Tribunals has rejected the application of the insurance company to lead evidence to establish that the licence possessed by the driver was an act of forgery.
The Claim Tribunals has rejected the application of the insurance company to lead evidence to establish that the licence possessed by the driver was an act of forgery. Accordingly, the insurance company had raised an issue before the Honble Supreme Court in an appeal filed under Section 173 of the Motor Vehicles Act. However, the facts and circumstances of the present case does not seem to cover by the case of New India Insurance Co. (supra ). In the present case, during the course of trial, no plea was raised by the insurance company before the Tribunal and after delivery of award and lapse of almost a year, the recall application in question was moved without preferring an appeal, which has been rejected by the impugned order. Instead of moving recall application, the insurance company should have preferred an appeal under the Act to ventilate its grievance. 11. There is no provision for recall of the order under the Motor Vehicles Act. It is settled law that a thing should be done in the manner provided by the Act or Statute or not at all vide Nazir Ahmed v. King Emperor, AIR 1936 PC 253; Deep Chand v. State of Raiasthan, AIR 1961 SC 1527 ; Patna Improvement Trust v. Smt. Lakshmi Devi & Ors. , AIR 1963 SC 1077 , State of U. P. v. Singhara Singh & Ors. , AIR 1964 SC 358 ; Barium Chemicals Ltd. v. Company Law Board, AIR 1967 SC 295 ; (Para 34); Chandra Kishore Jha v. Mahavir Prasad & Ors. , 1999 (8) SCC 266 ; Delhi Administration v. Gurdip Singh Uban & Ors. , 2001 (1) JCLR 911 (SC) : 2000 (7) SCC 296 ; Dhanajay Reddy v. State of Karnataka, AIR 2001 SC 1512 ; Commissioner of Income Tax, Mumbai v. Anjum M. H. Ghaswala & Ors. , 2002 (1) SCC 633 ; Prabha Shankar Dubey v. State of M. P. , AIR 2004 SC 486 and Ramphal Kundu v. Kamal Sharma, AIR 2004 SC 1657 . Accordingly, in the absence of any provision in the Act ordinarily Tribunals will have no power to review or recall its award. 12. It has been settled by a Full Bench of this Court in a case reported in 1997 RD 562 , Smt. Shivraji & Ors. v. Dy. Director of Consolidation, Allahabad & Ors.
Accordingly, in the absence of any provision in the Act ordinarily Tribunals will have no power to review or recall its award. 12. It has been settled by a Full Bench of this Court in a case reported in 1997 RD 562 , Smt. Shivraji & Ors. v. Dy. Director of Consolidation, Allahabad & Ors. , that the Tribunal being constituted by an statute or statutory rule exercises power of adjudication derived from an statute or statutory rule concerned. Any authority or body deriving its power of adjudication from an Act or statute have to discharge duty within the ambit of power conferred by the said statute or Act. There is a clear distinction of power of statutory review and a review under the inherent power of the Tribunal to rectify the wrong that has been committed by itself. The Tribunal cannot exercise the judicial or quasi-judicial power which is not vested in it by law or statute by implication. In the case of Smt. Shivraji (supra), the controversy was relating to the power of review by the Deputy Director of Consolidation under the Consolidation of Holdings Act. While holding that the Deputy Director of Consolidation, Allahabad has got no power to review or recall his order, the Full Bench of this Court in the case of Smt. Shivraji (supra) proceeded to held as under: " (35) In our view the decisions only lay down the proposition that a tribunal exercising judicial or quasi- judicial power has the inherent power to correct a clerical mistake or arithmetical error in its order and has the power to review an order which has been obtained by practicing fraud on the Court, provided that injustice has been perpetrated on a party by such order. Therefore, these decisions should not be construed as laying down any proposition of law contrary to the well-settled principle of law that any order delivered and signed by a judicial or quasi- judicial authority attains finality subject to appeal or revision as provided under the Act and if the authority passing the order is not specifically vested with power of review under the statute, it cannot reopen the proceeding and review/revise its previous order.
(36) Coming to the provisions of the U. P. Consolidation of Holdings Act, it is our considered view that the consolidation authorities, particularly the Deputy Director of Consolidation while deciding a revision petition exercises judicial or quasi- judicial power and, therefore his order is final subject to any power of appeal or revision vested in superior authority under the Act. The consolidation authorities, particularly the Deputy Director of Consolidation, is not vested with any power of review of his order and, therefore, cannot reopen any proceeding and cannot review or revise his earlier order. However, as a judicial or quasi-judicial authority he has the power to correct any clerical mistake/arithmetical error, manifest error in his order in exercise of his inherent power as tribunal. (41) On the discussions in the foregoing paragraphs it is our considered view that it is not open for the consolidation authorities to review/recall their final orders passed in the proceedings under the U. P. Consolidation of Holdings Act in exercise of inherent powers. Thus, the question formulated earlier is answered in the negative. " In view of above, since admittedly, the Motor Vehicles Act does not empower the tribunal to review its award or final judgment, such application shall not be maintainable subject to condition reflected from the case of Smt. Shivraji (supra ). 13. However, there is no dispute to the settled proposition of law that in case during the course of litigation a fraud is committed and the final judgment or award is the outcome of fraud, then the Court or the tribunal will have got right to recall its own judgment or award. But the question arises as to when the judgment or award shall deem to be outcome of the fraud. 14. In a case reported in (2005) 7 Supreme Court Cases 605, Bhaurao Dagdu Paralkar v. State of Maharashtra & Ors. , their Lordships of Apex Court held that a "fraud" is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by anothers loss. It is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from ill will towards the other. The expression "fraud" involves two elements, deceit and injury to the person deceived. Undoubtedly, something obtained by fraud shall vitiate every solemn act.
It is a deception in order to gain by anothers loss. It is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from ill will towards the other. The expression "fraud" involves two elements, deceit and injury to the person deceived. Undoubtedly, something obtained by fraud shall vitiate every solemn act. Fraud and justice never dwell together. For convenience, relevant portion from the judgment of Bhaurao Dagdu Paralkar (supra) is reproduced as under: " (9) By "fraud" is meant an intention to deceive; whether it is from any exception of advantage to the party himself or from ill will towards the other is immaterial. The expression "fraud" involves two elements, deceit and injury to the person deceived. Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non- economic or non-pecuniary loss. A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied (See Vimla (Dr.) v. Delhi Admn. and Indian Bank v. Satyam Fibres (India) (P) Ltd. 0 (10) A "fraud" is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to again by anothers loss. It is a cheating intended to get an advantage (See S. P. Chengalvarava Naidu v. Jagannath)". 15. The aforesaid definition of fraud has been reiterated by the Apex Court in one another case reported in (2005) 8 Supreme Court Cases 283, Lilly Kutty v. Scrutiny Committee, SC and ST & Ors. For convenience, relevant portion from the judgment of Lilly Kutty (supra) is reproduced as under: " (25) In Ram Chandra Singh v. Savitri Devi, this Court held: SCC p. 327, paras 15-16) " (15 ). . . Fraud is a well known. . . vitiates every solemn act. Fraud and justice never dwell together.
For convenience, relevant portion from the judgment of Lilly Kutty (supra) is reproduced as under: " (25) In Ram Chandra Singh v. Savitri Devi, this Court held: SCC p. 327, paras 15-16) " (15 ). . . Fraud is a well known. . . vitiates every solemn act. Fraud and justice never dwell together. (16) Fraud is a conduct either by letter or words, which induces the other person or authority to take a definite determinative stand as a response to the conduct of the former either by word or letter. " It was further held SCC pp. 327 and 328-29, paras18 and 23-26 ). " (18) A fraudulent misrepresentation is called deceit and consists in leading a man into damage by willfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representation which he knows to be false, and injury ensues therefrom although the motive from which the representations proceeded may not have been bad. (23) An act of fraud on Court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio. Fraud and deception are synonymous. " 16. From the judgment of the Apex Court referred herein above, it is evident that to establish commission of fraud, it shall be incumbent on the person who alleges fraud, to establish that there has been a collusion or conspiracy with a view to deprive the rights of the others in relation to a property. Fraud and deception are synonymous. Fraud is anathema to all equitable principles and any affair 1 tainted with fraud cannot be perpetuated or saved by the application of any equitable doctrine vide another case reported in 2004 (2) JCLR 980 (SC) : (2003) 8 SCC 319 , Ram Chandra Singh v. Savitri Devi. In the case of Bhaurao Dagdu Paralkar (supra), Honble Supreme Court further held that no judgment of the Court shall be allowed to stand in case, it has been obtained by fraud. The fraud can be either by letters or words. 17. Let the present controversy be considered under the above principle.
In the case of Bhaurao Dagdu Paralkar (supra), Honble Supreme Court further held that no judgment of the Court shall be allowed to stand in case, it has been obtained by fraud. The fraud can be either by letters or words. 17. Let the present controversy be considered under the above principle. Learned Counsel for the petitioner had not pointed out any action on the part of opposite parties No. 2 to 5 i. e. the claimants which may amount to commission of fraud. There is no material on record which may indicate that claimants themselves in collusion of the respondent driver had proceeded ahead to conceal the material facts relating to alleged fake driving licence. Accordingly, in the absence of any such material or evidence, ordinarily, it may not be presumed that the impugned award is the outcome of the commission of fraud by which the claimants had got compensation. 18. In a case reported in 2005 (23) LCD 835, Tauseem Ahmad v. New Indian Insurance Company Limited, Faizabad & Anr. I have an occasion to deal with the various provisions of the Motor Vehicles Act and it has been held that an aggrieved party has got right to raise grievance by preferring an appeal under Section 173 of the Motor Vehicles Act. It has been further held that the appellate Court has got much wider power than this Court under extraordinary remedy of Article 226/227 of the Constitution of India. 19. Honble Supreme Court in the case of Sadhana Lodh (supra), held that insurer can ventilate his grievance by preferring an appeal under Section 173 of the Motor Vehicles Act and a petition under Article 227 of the Constitution of India shall not be maintain able to ventilate the grievance or to avail the benefit of Section 149 (2) of the Act. 20. In the case of Kamla Yadav (supra) the Full Bench of this Court held that the order passed by the Claims Tribunal shall be amenable to revisional jurisdiction of the High Court under Section 115 of the Code of Civil Procedure. In the said case, an application for amendment of written statement was rejected by the Claims Tribunal which was impugned in a revision filed under Section 115 of the Code of Civil Procedure.
In the said case, an application for amendment of written statement was rejected by the Claims Tribunal which was impugned in a revision filed under Section 115 of the Code of Civil Procedure. The matter was referred to a Full Bench of this Court and it has been held by the Full Bench of this Court that the revision shall be maintainable. However, the case of Kamla Yadav (supra) does not seem to be applicable in the facts and circumstances of the present case. The petitioner was having the remedy to prefer an appeal under Section 173 of the Motor Vehicles Act against the award. 2 21. In the case of Lehru (supra), Honble Supreme Court held that in case, it is found that the driver was not possessing a valid driving licence, even then, the insurance company shall not be absolved from its liability because of breach of Section 149 (2) (a) (ii ). In such a situation, the insurance company shall continue to remain liable with option to recover the compensation from driver of owner. For convenience, relevant portion from the judgment of Lehru (supra) is reproduced as under: " (20) When an owner is hiring a driver he will therefore have to check whether the driver has a driving licence. If the driver produces a driving licence which on the face of it looks genuine, the owner is not expected to find out whether the incense has in fact been issued by a competent authority or not. The owner would then take the test of the driver. If he finds that the driver is competent to drive the vehicle, he will hire the driver. We find it rather strange that insurance companies expect owners to make enquiries with RTOs, which are spread all over the country, whether the driving licence shown to them is valid or not. Thus where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149 (2) (a) (ii ). The insurance company would not then be absolved of liability. If it ultimately turns out that the licence was fake, then insurance company would continue to remain liable unless they prove that the owner/insured was aware or had noticed that the licence was fake and sill permitted that person to drive.
The insurance company would not then be absolved of liability. If it ultimately turns out that the licence was fake, then insurance company would continue to remain liable unless they prove that the owner/insured was aware or had noticed that the licence was fake and sill permitted that person to drive. More importantly, even in such a case the insurance company would remain liable to the innocent third party, but it may be able to recover from the insured. This is the law which has been laid down in Skandia, Sohan Lal Passi and Kamla cases. We are in full agreement with the views expressed therein and see no reason to take a different view. " 22. In one another case reported in 2004 (1) JCLR 469 (SC) : 2004 (2) AWC 1589 (SC), National Insurance Co. Ltd. v. Swaran Singh & Ors. , their Lordships of Apex Court had reconsidered the law laid down in Lehrus case (supra ). Honble Supreme Court held that in the event of breach of provisions contained in Section 149 (2) (a) (ii) of the Act, it shall be open to the insurance company to initiate a separate action against the owner or the driver of the vehicle to recover the amount paid to the claimants. For convenience, the relevant finding recorded by their Lordships of the Apex Court in the case of Swaran Singh (supra) is reproduced as under: " (104) We may, however, hasten to add that the Tribunal and the Court must, however, exercise their jurisdiction to issue such a direction upon consideration of the facts and circumstances of each case and in the even of such a direction has been issued despite arriving at a finding of fact to the effect that the insurer has been able to establish that the insured has committed a breach of contract of insurance as envisaged under sub-clause (ii) of clause (a) of sub-section (2) of Section 149 of the Act, the insurance company shall be entitled to realize the awarded amount from the owner or driver of the vehicle, as the case may be, in execution of the same award having regard to the provisions of Sections 165 and 168 of 3 the Act.
However, in the event, having regard to the limited scope of inquiry in the proceedings before the Tribunal, it had not be able to do so, the insurance company may initiate a separate action, therefore against the owner or the driver of the vehicle or both, as the case may be. Those exceptional cases may arise when the evidence becomes available to or comes to the notice of the insurer at a subsequent stage or for one reason or the other, the insurer was not given opportunity to defend at all. Such a course of action may also be resorted when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage. " Their Lordships of Apex Court again in para 107 of the Swaran Singhs case (supra) had recorded a finding providing the facts, circumstances and the manner to give effect to the provisions contained in Section 149 (2) of the Act. 23. Honble Supreme Court in the case of Swaran Singh (supra) while reiterating the principles of law propounded by the case of Lehru (supra) further held that the insurer has got right to raise a defence relating to the use of fake driving licence but while raising such defence, it shall be incumbent on the insurer to prove that insured did not take adequate care and caution to verify the genuineness or otherwise of the licence held by the driver. 24. Keeping in view the facts and circumstances of the present case, since, there is no material on record which may indicate that the respondents No. 2 to 5 had succeeded in Tribunal in collusion with the driver concerned, the impugned award cannot be treated to be the outcome of fraud. From the definition of "fraud" as discussed here in above, it is borne out that collusive involvement of claimants- respondents with the driver for the purpose to obtain compensation is a necessary condition to declare that award in question is the outcome of fraud. But in the present case, petitioner has not raised any objection against the conduct of the claimants.
But in the present case, petitioner has not raised any objection against the conduct of the claimants. Rather it has been stated that on account of certain lapses in his own office, records of the Claim Petition could not be searched out and it took time to receive information from the Regional Transport Office relating to the validity of the driving licence. Once, the impugned award has been rendered by the Tribunal after exchange of response and after providing the opportunity of hearing to the parties in accordance to law, the claimants cannot be blamed and the impugned award cannot be said to be the outcome of fraud or collusion. Relying upon the Apex Courts judgment, learned Tribunal had rightly held that the recall application cannot be entertained to provide the opportunity of de novo hearing on the basis of new materials. 25. The other case laws relied upon by the petitioners Counsel does not seem to extend any help in view of law settled by the Apex Court in Swaran Singhs case (supra ). Accordingly, the impugned order 4 dated 5th of March, 2002 passed by the learned Tribunal does not seem to suffer from any impropriety of illegality. 26. Moreover, in view of law laid down in the case of Swaran Singh (supra), it shall be open to the petitioner to adopt other recourse of law to recover the compensation paid to the claimants from the owner or the driver, as the case may be, but on the basis of new facts which has come to the knowledge of the petitioner after delivery of the impugned award and when such new facts do not amount to commission of fraud the recall application does not seems to be maintainable. Needless to say that petitioner could have filed an appeal against the impugned award and could have moved appropriate application at the appellate stage, but the same has not been done. Appellate Court has got ample power to pass appropriate orders on the factual dispute raised by the parties. 27. In view of above, the writ petition seems to be devoid of merit. Accordingly, dismissed. No order as to costs. However, it shall be open to the petitioner to adopt appropriate recourse of law keeping in view of the law laid down by the Apex Court in Swaran Singhs case (supra ). The writ petition is dismissed accordingly.
27. In view of above, the writ petition seems to be devoid of merit. Accordingly, dismissed. No order as to costs. However, it shall be open to the petitioner to adopt appropriate recourse of law keeping in view of the law laid down by the Apex Court in Swaran Singhs case (supra ). The writ petition is dismissed accordingly. No order as to costs. Petition dismissed. .