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2016 DIGILAW 189 (HP)

Oriental Insurance Co. v. Shibi Devi

2016-03-04

MANSOOR AHMAD MIR

body2016
JUDGMENT : Mansoor Ahmad Mir, Chief Justice, (Oral) 1. This appeal is directed against the judgment and award dated 12.5.2009, made by the Motor Accident Claims Tribunal Shimla, H.P. in MACC No. 56-S/2 of 2005, titled Shibi Devi versus Sh. Ishwar Dass Balnata and others, for short “the Tribunal”, whereby compensation to the tune of Rs.2,45,000/- alongwith interest @ 9% per annum was awarded in favour of the claimant, hereinafter referred to as “the impugned award”, for short. 2. Claimant, owner and driver have not questioned the impugned award on any ground, thus it has attained finality so far it relates to them. 3. The insurer, by the medium of this appeal, has questioned the impugned award on the ground that the Tribunal has fallen in an error in saddling it with the liability for the reasons that the driver was not having a valid and effective driving licence. 4. Admittedly, the insurer has not led any evidence. However, one witness, namely, Rohtash a clerk of Licence Branch of RTA Sonipat, Haryana was examined as RW2. He has categorically stated that the licence on the file is not recorded in the Register which relates to heavy motor vehicles. He further stated that the separate registers are to be maintained relating to the light motor vehicles and no such register was brought before the Court or proved. 5. Admittedly, the vehicle is Bolero Camper a light motor vehicle and it is not proved that the driver was not having valid and effective driving licence. 6. Having said so, the Tribunal has rightly made the discussion in para 27 of the impugned award. It was for the insurer to plead that the driver was not having a valid and effective driving licence and owner has committed willful breach, in terms of National Insurance Co. Ltd. versus Swaran Singh and others, reported in AIR 2004 Supreme Court 1531. It is apt to reproduce relevant portion of para 105 of the judgment herein: “105. ..................... (i) ......................... (ii) ........................ (iii) The breach of policy condition e.g. disqualification of driver or invalid driving licence of the driver, as contained in sub-section (2) (a) (ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. ..................... (i) ......................... (ii) ........................ (iii) The breach of policy condition e.g. disqualification of driver or invalid driving licence of the driver, as contained in sub-section (2) (a) (ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time. (iv) The insurance companies are, however, with a view to avoid their liability, must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof wherefore would be on them. (v)......................... (vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply “the rule of main purpose” and the concept of “fundamental breach” to allow defences available to the insured under Section 149 (2) of the Act.” 7. It would also be profitable to reproduce para 10 of the judgment rendered by the Apex Court in Pepsu Road Transport Corporation versus National Insurance Company, reported in (2013) 10 Supreme Court Cases 217, herein: “10. In a claim for compensation, it is certainly open to the insurer under Section 149(2)(a)(ii) to take a defence that the driver of the vehicle involved in the accident was not duly licensed. Once such a defence is taken, the onus is on the insurer. In a claim for compensation, it is certainly open to the insurer under Section 149(2)(a)(ii) to take a defence that the driver of the vehicle involved in the accident was not duly licensed. Once such a defence is taken, the onus is on the insurer. But even after it is proved that the licence possessed by the driver was a fake one, whether there is liability on the insurer is the moot question. As far as the owner of the vehicle is concerned, when he hires a driver, he has to check whether the driver has a valid driving licence. Thereafter he has to satisfy himself as to the competence of the driver. If satisfied in that regard also, it can be said that the owner had taken reasonable care in employing a person who is qualified and competent to drive the vehicle. The owner cannot be expected to go beyond that, to the extent of verifying the genuineness of the driving licence with the licensing authority before hiring the services of the driver. However, the situation would be different if at the time of insurance of the vehicle or thereafter the insurance company requires the owner of the vehicle to have the licence duly verified from the licensing authority or if the attention of the owner of the vehicle is otherwise invited to the allegation that the licence issued to the driver employed by him is a fake one and yet the owner does not take appropriate action for verification of the matter regarding the genuineness of the licence from the licensing authority. That is what is explained in Swaran Singh case. If despite such information with the owner that the licence possessed by his driver is fake, no action is taken by the insured for appropriate verification, then the insured will be at fault and, in such circumstances, the Insurance Company is not liable for the compensation.” 8. Having said so, the Tribunal has rightly made the discussion, needs no interference. Accordingly, the impugned award is upheld and the appeal is dismissed. 9. The insurer is directed to deposit the amount, if not already deposited, in this Registry within six weeks from today. Having said so, the Tribunal has rightly made the discussion, needs no interference. Accordingly, the impugned award is upheld and the appeal is dismissed. 9. The insurer is directed to deposit the amount, if not already deposited, in this Registry within six weeks from today. The Registry, on deposit of the amount, is directed to release the same in favour of the claimant, strictly in terms of the conditions contained in the impugned award, through payees cheque account, or by depositing the same in her bank account. 10. The appeal stands disposed of accordingly. 11. Send down the record forthwith, after placing a copy of this judgment.