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2017 DIGILAW 66 (TRI)

New India Assurance Company Ltd. v. Biswajit Das

2017-01-27

T.VAIPHEI

body2017
JUDGMENT & ORDER : Whether the insurer can avoid its liability to pay compensation when the driver of the offending vehicle had fake driving license at the time of the vehicular accident is the moot point in this appeal preferred by the Insurance Company. 2. The facts giving rise to this appeal may be briefly noticed at the outset. On 25-1-2004 at about 2.45 PM, when the deceased (Biman Das) was repairing the headlight of the vehicle bearing registration number NL-02-D-0422 (Truck) as the assistant of the truck, which was standing on the road side, a truck bearing No. PB-29-D-9266 moving rashly and negligently in a back gear dashed against him by its back side and pressed him against the truck he was repairing and caused serious multiple injuries on his person. He was immediately shifted to Downtown Hospital, Guwahati but succumbed to his injuries on the same day at about 4.30 PM. The deceased was found to be only 18 years old at the time of the accident and is survived by his brother and sisters, who filed the claim petition for compensation amounting to Rs.5,64,000/- for his death. The claim petition was contested by the Insurance Company by filing its written statement. At the conclusion of the trial, the Tribunal did not find any evidence to substantiate the claim of the claimants that the deceased was earning Rs.4,000/- per month and, therefore, fixed his income at Rs.2,000/- per month. As he was 18 years old, the Tribunal adopted a multiplier of 16 and determined the loss of income to be Rs.2,000 x 12x16 = Rs.3,84,000/-. As the deceased was a bachelor, 50% was deducted from this amount for his living expenses had he been alive. Therefore, the Tribunal held the loss of income to the order of Rs.3,84,000-192,000 = Rs.1,92,000/-, to which it added Rs.3,000/- for funeral expenses and another sum of Rs.5,000/- as loss of consortium. The total amount of compensation so awarded was worked out to be Rs.2,00,000/- with an interest at the rate of 6% per annum w.e.f. 20-5-2011, i.e. the date of filing the claim petition. 3. The main contention of Mr. The total amount of compensation so awarded was worked out to be Rs.2,00,000/- with an interest at the rate of 6% per annum w.e.f. 20-5-2011, i.e. the date of filing the claim petition. 3. The main contention of Mr. A. Gon Choudhury, the learned counsel for the insurer, in attacking the impugned award is that when there I clear-cut finding by the Tribunal to the effect that the driver of the offending vehicle was having a fake driving license at the time of the accident, there is definite breach of the policy conditions thereby absolving the insurer of any liability to satisfy the award; the Tribunal has completely overlooked this glaring fact and has in the process wrongly fastened the liability to pay the compensation upon the insurer. He, therefore, submits that the impugned judgment, in so far as it saddles the insurer with the liability to pay the compensation, cannot be sustained in law and is liable to be set aside. This is the only contention of the insurer urged by the insurer in the memo of appeal. Mr. D.K. Biwas, the learned counsel for the claimant-respondents, supports the impugned judgment and submits that no interference is called for. 4. The question as to whether the insurer may avoid liability to satisfy the award when the driver is proved to have a fake driving license is, in my opinion, no longer res integra. The Apex Court from a catena of decisions such as United Insurance Co. Ltd. v. Lehru, (2003) 3 SCC 338 ; National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 and National Insurance Co. Ltd. v. Laxmi Narain Dhut, (2007) 3 SCC 700 , has firmly settled the law that the defence of insurer that the driver had fake driving license at the time of the accident in breach of policy conditions is not sufficient to avoid its liability to pay the compensation. The latest in the series is Pepsu Road Transport Corporation v. National Insurance Company Ltd., (2013) 10 SCC 217 . The legal position is reiterated thus: “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. The legal position is reiterated thus: “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. But even after it is proved that the license 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 license. 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 license 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 license duly verified from the licensing authority or if the attention of the owner of the vehicle is otherwise invited to the allegation that the license 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 license from the licensing authority. That is what is explained in Swaran Singh case, National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 338. If despite such information with the owner that the license 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. 5. Need I say more? There is, therefore, no merit in this appeal, which is hereby dismissed. The insurer is, accordingly, directed to deposit the awarded amount together with interest @ 6% per annum from the date of the claim petition for payment to the claimant-respondents within two months from the date of receipt of this judgment. 5. Need I say more? There is, therefore, no merit in this appeal, which is hereby dismissed. The insurer is, accordingly, directed to deposit the awarded amount together with interest @ 6% per annum from the date of the claim petition for payment to the claimant-respondents within two months from the date of receipt of this judgment. Any amount already deposited, or paid to the claimants shall be accordingly adjusted. As and when the amount is deposited, the same shall be paid to the claimant-respondents after satisfying the usual formalities without further reference to this Court. Transmit the L.C. record.