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J&K High Court · body

2018 DIGILAW 623 (JK)

National Insurance Company Limited v. Puran Chand

2018-08-09

JANAK RAJ KOTWAL

body2018
JUDGMENT : 1. On 30.07.2012, respondent No. 1, Puran Chand, (hereinafter to be referred as the claimant) was knocked down by a Maruti Car bearing registration No. JK 02P 4235 (hereinafter to be referred as the offending car) at Bikram Chowk, Jammu. He sustained multiple injuries and, as per the certificate issued by the Doctor, suffered 50 per cent disability in the activity of his daily life. Respondent No. 2, who is also the owner of the offending car, (hereinafter to be referred as the owner/driver) was on the wheel. The car was insured with the appellant-insurance company (hereinafter to be referred as the insurer) for third party risk. 2. The claimant filed a claim for compensation under section 166 of the Motor Vehicles Act, 1988 (for short the MV Act) before the Motor Accident Claims Tribunal, Jammu (hereinafter to the referred as the Tribunal). The plea taken by the insurer before the learned Tribunal inter alia was that the owner/driver of the offending car did not possess a valid and effective driving license so there was breach of a condition of the policy of insurance and insurer was not liable to indemnify the insured. 3. Learned Tribunal after inquiry in the claim, by its judgment and award dated 23.05.2017 found that the accident had occurred due to rash and negligent driving of the driver of the offending car. The Tribunal found also that the owner/driver of the offending car was holding the driving license No. 13024/C/RTOJ issued by RTO, Jammu, which was valid up to 23.07.2012 and after that was renewed from 01.09.2012 till 31.08.2017. The license, however, was not renewed from 23.07.2012 to 01.09.2012 and therefore, was not renewed as at the time of the accident. Learned Tribunal awarded compensation of Rs. 7,48,500/- to the claimant and, having regard to the second proviso to sub section (2) of section 14 of the MV Act, foisted liability of paying the compensation on the insurer. 4. In this appeal the appellant-insurer challenges the judgment and award dated 23.05.2017, primarily, on the ground that in view of the breach of condition of the policy of insurance by the owner of the offending car, who was driving the offending car at the time of accident, the company is not liable to pay the compensation to the claimant. Besides, there is challenge to the quantum of compensation awarded by the learned Tribunal. 5. Besides, there is challenge to the quantum of compensation awarded by the learned Tribunal. 5. The short and precise submission made by Mr. Sanjay Kumar Dhar, learned counsel appearing on behalf of the appellant-insurer, was that learned Tribunal has fallen in error by giving the owner/driver the benefit of the second proviso to sub section (2) of section 14 of the MV Act, as such a benefit is available only in a case where application for renewal of the driving license is made within thirty days after the date of its expiry as contemplated under the first proviso to sub section (1) of section 15. Learned counsel submitted that the second proviso to sub section (2) of section 14 is governed by sub section (1) of section 15 read with first proviso thereto so the benefit of second proviso to section 14 would be available only if the application for renewal of the license is made within thirty days after its expiry also because in that case alone the renewal of license shall take effect from the date of its expiry. Learned counsel cited a Full Bench decision of the High Court of Kerela in Oriental Insurance Co. Ltd. v Poulose and anr., 2015 ACJ 1307 and Supreme Court decisions in Ram Babu Tiwari v United India Insurance Co. Ltd, (2008) 8 SCC 165 and Mallappa v Mahantayya Neelakanthayy Hiremath and another, 2018 ACJ 431. Learned counsel, however, expressly opted not to press the objection in regard to the quantum of compensation awarded by the learned Tribunal. 6. Per contra, Mr. Vipin Gandotra, Adv. learned counsel appearing on behalf of the owner/driver, submitted that the second proviso to sub section (2) of section 14 of the MV Act is an independent provision, which extends the validity of a driving license up to thirty days after its expiry, without renewal. Learned counsel argued that the second proviso to sub section (2) of section 14 is an independent provision having no nexus with sub section (1) of section 15 and its first proviso and the license would remain effective for thirty days even if application for renewal of the license is not made within thirty days after its expiry. Learned counsel cited Supreme Court decisions in National Insurance Co. Ltd. v Swarn Singh and others, (2004) 3 SCC 297 and Ishwar Chandra and others v Oriental Insurance Co. Learned counsel cited Supreme Court decisions in National Insurance Co. Ltd. v Swarn Singh and others, (2004) 3 SCC 297 and Ishwar Chandra and others v Oriental Insurance Co. Ltd. and others, (2007) 10 SCC 650 and a Division Bench decision of Allahbad High Court dated 20.03.2018 in Oriental Insurance Co. Ltd. v Santosh Kumari and others, appeal No. 725/2014. 7. Sections 14 and 15 of the MV Act are reproduced in extenso: “14. Currency of licences to drive motor vehicles.- (1) A learner’s licence issued under this Act shall, subject to the other provisions of this Act, be effective for a period of six months from the date of issue of the licence. (2) A driving licence issued or renewed under this Act shall,- (a) in the case of a licence to drive a transport vehicle, be effective for a period of three years: [Provided that in the case of licence to drive a transport vehicle carrying goods of dangerous or hazardous nature be effective for a period of one year and renewal thereof shall be subject to the condition that the driver undergoes one day refresher course of the prescribed syllabus; and; (b) in the case of any other licence,- (i) if the person obtaining the licence, either originally or on renewal thereof, has not attained the age of [fifty years] on the date of issue or, as the case may be, renewal thereof,- (A) be effective for a period of twenty years from the date of such issue or renewal; or (B) until the date on which such person attains the age of [fifty years]. whichever is earlier; (ii) if the person referred to in sub-clause (i), has attained the age of fifty years on the date of issue or as the case may be, renewal thereof, be effective, on payment of such fee as may be prescribed, for a period of five years from the date of such issue or renewal: Provided that every driving licence shall, notwithstanding its expiry under this sub-section, continue to be effective for a period of thirty days from such expiry.” “15 Renewal of driving licences. – (1) Any licensing authority may, on application made to it, renew a driving licence issued under the provisions of this Act with effect from the date of its expiry: Provided that in any case where the application for the renewal of a licence is made more than thirty days after the date of its expiry, the driving licence shall be renewed with effect from the date of its renewal: Provided further that where the application is for the renewal of a licence to drive a transport vehicle or where in any other case the applicant has attained the age of forty years, the same shall be accompanied by a medical certificate in the same form and in the same manner as is referred to in sub-section (3) of section 8, and the provisions of sub-section (4) of section 8 shall, so far as may be, apply in relation to every such case as they apply in relation to a learner's licence. (2) An application for the renewal of a driving licence shall be made in such form and accompanied by such documents as may be prescribed by the Central Government. (3) Where an application for the renewal of a driving licence is made previous to, or not more than thirty days after the date of its expiry, the fee payable for such renewal shall be such as may be prescribed by the Central Government in this behalf. (4) Where an application for the renewal of a driving licence is made more than thirty days after the date of its expiry, the fee payable for such renewal shall be such amount as may be prescribed by the Central Government: Provided that the fee referred to in sub-section (3) may be accepted by the licensing authority in respect of an application for the renewal of a driving licence made under this sub-section if it is satisfied that the applicant was prevented by good and sufficient cause from applying within the time specified in such-section (3): Provided further that if the application is made more than five years after the driving licence has ceased to be effective, the licensing authority may refuse to renew the driving licence, unless the applicant undergoes and passes to its satisfaction the test of competence to drive referred to in sub-section (3) of section 9. (5) Where the application for renewal has been rejected, the fee paid shall be refunded to such extent and in such manner as may be prescribed by the Central Government. (6) Where the authority renewing the driving licence is not the authority which issued the driving licence it shall intimate the fact of renewal to the authority which issued the driving licence.” 8. The question raised in this appeal is as to; whether the effectiveness and validity of a driving license shall continue for thirty days after its expiry, even if no application for its renewal was made within thirty days from the date of its expiry? It may be said otherwise, whether there is any nexus between the second proviso to sub section (2) of section 14 and sub section (1) of section 15 read with its first proviso. 9. It may be stated here, though at the cost of repetition, that admittedly the license of the owner/driver of the offending car was renewed up to 23.07.2012 and thereafter, it was renewed from 01.09.2012 up to 31.08.2017. The accident occurred on 30.07.2012, that is, much within thirty days after its expiry. It is, however, not denied that after expiry of the license on 23.07.2012, the licensee did not make application for its renewal within thirty days and the license was later on renewed with effect from 01.09.2012 and not from the date of its expiry. Contextually, it may be stated here that under section 149(2)(a)(ii) of the MV Act insurer is absolved of its liability to satisfy a judgment or award and indemnify the insured if there has been a breach of the condition of the policy of insurance excluding a person from driving the vehicle, in respect of which insurance has been made, who is not “duly licensed” or has been disqualified for holding or obtaining driving license during the period of disqualification. 10. Section 3(1) of the MV Act prohibits a person from driving a motor vehicle in any public place without holding “an effective” driving license issued to him authorizing him to drive the vehicle. For a driving license to be “effective”, it should have been issued by a competent authority and should be duly renewed from time to time. Section 14 provides for the currency of the driving licenses and section 15 deals with their renewal. For a driving license to be “effective”, it should have been issued by a competent authority and should be duly renewed from time to time. Section 14 provides for the currency of the driving licenses and section 15 deals with their renewal. Under sub section (1) of section 15 a driving licence can be renewed by the licensing authority on an application made to him. The exigency of situation, in particular the nature of job of a driver, quite often may render it difficult and even impossible for the licensee to make the application for renewal of the license in time, that is on or shortly before its expiry. To say for example, a licensee, in particular driver of a transport vehicle, is on a long out station journey and therefore, not in a position to make the application for renewal of the license in time. To meet such exigency, the second proviso to sub section (2) of section 14 extends the effectiveness (validity) of the driving license for a period of thirty days from the date of its expiry. This is in order to enable the licensee to make the application for renewal of his license within the said extended period. Contextually, sub section (1) of section 15 read with its first proviso provides that the license shall be renewed from the date of its expiry if the application for renewal is made within these thirty days. The purpose to be achieved is that if a licensee makes the application for renewal of his license within thirty days of its expiry, the licensee is not rendered without effective license even after its expiry as he gets benefit of automatic renewal of his licence from the date of its expiry. Such a benefit, however, is not available to a licensee who fails to make the application for renewal of his license even within thirty days after its expiry as in that case license would not be renewed from the date of its expiry. In such a case the first proviso to sub section (1) of section 15 shall come into operation and the license would be renewed from date of its renewal and not from the date of its expiry and the licensee would be rendered without holding a valid and effective driving license from the date of the expiry up to the date of renewal. Given the scheme of the two provisions, it would not be correct to say that the second proviso to sub section (2) of section 14 and sub section (1) of section 15 along with its first proviso have no nexus and would operate independently. The two provisions rather operate in juxtaposition rather than independent of each other. 11. In Poulose’s case (supra) the primary question raised before the Full Bench of the Kerala High Court was “whether a driving license which stood expired on the date of the road accident and was not renewed within the statutory period would fulfil the requirement of “duly licensed” under section 149(2)(a)(ii) of the Motor Vehicles Act, 1988”. Learned Full Bench in paragraph 19 of the reporting has held clearly that the license would stand renewed “only if the application for renewal is filed within a period of thirty days from the date of expiry thereof.” As per paragraph (b) of the result arrived at by the learned Full Bench, such a benefit, however, would not accrue if the application for renewal is not made within thirty days after its expiry. Paragraph (b) is reproduced: “(b) We further hold that a driving license which stood expired on the date of the road accident and not subsequently renewed within the statutory period of thirty days would not fulfil the requirement of „duly licensed? under section 149 (2) (a)(ii) of the Act” 12. Much earlier than the decision in Poulose’s case, legal position in regard to effectiveness of the driving license where application for renewal is not made within thirty days statutory period after expiry of the license has been clearly stated by the Supreme Court in Ram Babu Tiwari’s case (supra). Paragraph 18 of the reporting is reproduced: “18. It is beyond any doubt or dispute that only in the event an application for renewal of licence is filed within a period 30 days from the date of expiry thereof, the same would be renewed automatically which means that even if an accident had taken place within the aforementioned period, the driver may be held to be possessing a valid licence. The proviso appended to sub-section (1) of Section 15, however, clearly states that the driving licence shall be renewed with effect from the date of its renewal in the event the application for renewal of a licence is made more than 30 days after the date of its expiry. It is, therefore, evident that as, on renewal of the licence on such terms, the driver of the vehicle cannot be said to be holding a valid licence, the insurer would not be liable to indemnify the insured.” 13. Recently in Mallappa’s case (supra), the Supreme Court has clearly held in paragraph 18 of the reporting that “if the application for renewal itself is filed beyond the period thirty days licensee would not get a right to contend that his license is to be treated as valid even after period for which it had lapsed.” 14. Even the decision in Ishwar Chandra’s case (supra) cited by learned counsel for the owner/driver does not support the proposition that effectiveness and validity of a driving license shall continue for a period of thirty days after its expiry also in a case where application for renewal is not made within the said thirty days. It is rather clearly stated in paragraph 9 of the reporting that if any application for renewal is made after thirty days, the license would be renewed from the date of its renewal. Paragraph No. 9 is reproduced: “9. Learned counsel for respondents 8 and 9 Mr. Akhter Abbas has contended that the proviso to Section 14 of the Motor Vehicles Act makes it clear that the licence was effective for a period of 30 days from the date of its expiry, which in this case, was 25.12.2006. In such circumstances, in law it has to be construed that the driving licence was effective till 24.01.2007. The accident took place on 31.12.2006. Therefore, the licence has to be considered to be effective on the date of the accident on 25.12.2006. The insurer cannot avoid its liability on this ground.” 15. In Santosh Kumari’s case (supra), the learned Division Bench of the Allahabad High Court has indeed held otherwise. The accident took place on 31.12.2006. Therefore, the licence has to be considered to be effective on the date of the accident on 25.12.2006. The insurer cannot avoid its liability on this ground.” 15. In Santosh Kumari’s case (supra), the learned Division Bench of the Allahabad High Court has indeed held otherwise. The view taken by the learned Bench is that “proviso to Section 15 does not in any way infringe upon or negate the effect of proviso to Section 14 of the Motor Vehicles Act” and further that “every driving license shall, notwithstanding its expiry continue to be effective for a period of 30 days from such expiry.” The view taken by the Allahabad High Court no doubt supports the proposition that the effectiveness of the driving license in all the cases shall continue for thirty days after the date of its expiry even if the application for renewal is not made within said thirty days and is made at a later stage. However, learned Division Bench seems not have taken note of the Supreme Court decision in Ram Babu Tiwari (supra) as also the Full Bench decision in Poulose’s case (supra). I would, thus, be respectfully unable to rely upon the Division Bench decision of the Allahabad High Court as compared to the decision in Ram Babu Tiwari and Pouluse. 16. In the Swarn Singh’s case (supra) also, learned three Judge Bench of the Supreme Court has recognized the thirty days? period for which effectiveness and validity of a driving license will continue after the date of its expiry and has emphasized the need of filing of the application for its renewal within thirty days after its expiry. This is discernible from the paragraphs 45 and 46 of the reporting, which are reproduced: “45. Thus, a person whose licence is ordinarily renewed in terms of the Motor Vehicles Act and the Rules framed there under, despite the fact that during the interregnum period, namely, when the accident took place and the date of expiry of the licence, he did not have a valid licence, he could during the prescribed period apply for renewal thereof and could obtain the same automatically without undergoing any further test or without having been declared unqualified there for. Proviso appended to Section 14 in unequivocal terms states that the licence remains valid for a period of thirty days from the day of its expiry. 46. Section 15 of the Act does not empower the authorities to reject an application for renewal only on the ground that there is a break in validity or tenure of the driving licence has lapsed, as in the meantime the provisions for disqualification of the driver contained in Sections 19, 20, 21, 22, 23 and 24 will not be attracted, would indisputably confer a right upon the person to get his driving licence renewed. In that view of the matter, he cannot be said to be delicensed and the same shall remain valid for a period of thirty days after its expiry.” 17. I would, thus, hold that the second proviso to sub section (2) of section 14 of the MV Act, on one hand and sub section (1) of section 15 and its first proviso, on the other, are two interlinked provisions and are to be read in juxtaposition. A driving licence shall remain effective and valid for the statutory period of thirty days after its expiry only in a case when the application for its renewal is made within said thirty days. In a case where application for renewal of license is not made within thirty days after its expiry, the renewal shall take effect from the date of the renewal and not from the date of expiry. 18. In the case on hand the application for renewal of the driving license was not made by the driver/owner of the offending car within thirty days after its expiry so neither the benefit of automatic renewal from the date of expiry was available to him nor was the license renewed from the date of expiry. In that, he cannot be said to be the “duly licensed”, driver of the offending car at the time of accident and therefore, the insurer cannot be held liable to indemnify him. Nonetheless, the license of the driver/owner has been renewed at a later stage and it is not the insurer’s case that the driver/owner has ever been disqualified from holding or obtaining a driving license. Nonetheless, the license of the driver/owner has been renewed at a later stage and it is not the insurer’s case that the driver/owner has ever been disqualified from holding or obtaining a driving license. It being so, in view of the ratio of the decision in Swarn Singh’s case, the insurer deserves the right of recovery from the owner/insured after satisfying the impugned judgment and award. 19. Viewed thus, the impugned judgment and award are modified by providing that the appellant-insurer after satisfying the award shall be entitled to recover the same from the owner/insured. 20. The award amount, if deposited in this Court be released along with proportionate interest accrued thereon, in favour of the claimant in accordance with the conditions laid down by the learned Tribunal. 21. Record of the trial court be remitted back along with a copy of this order. 22. Disposed of accordingly.