Chandra & Ors Vs. The Oriental Insurance Co. Ltd. & Ors  Insc 253 (8 March
S.B. Sinha & Markandey Katju
[Arising out of SLP (Civil) No. 16437 of 2006] S.B. SINHA, J :
One Reshma Devi, aged about 40 years, was going to take bath at Rajghat
Ganga with her son, Respondent No.3 herein. Driver of an Eicher Tractor bearing
Registration No. U.P.30/8423 was driving the said vehicle rashly and
negligently hit her as a result whereof, she fell down. She died on 01.05.1995.
A claim petition under Section 166 of the Motor Vehicles Act, 1988 (for short,
'the Act) was filed by Respondent No. 2 herein. The said tractor was insured
with Respondent No.1, the Insurance Company.
The Motor Accidents Claims Tribunal by an award dated 14.10.2004 determined
the amount of compensation payable to the said respondent at Rs.1,06,000/-. Out
of the said amount, a sum of Rs.75,000/- was to be paid to Respondent No. 2
(husband of the deceased) and Rs.31,000/- to her son, Respondent No.3 herein.
Respondent No.1, however, preferred an appeal there against, which was
dismissed by an order dated 24.01.2005, stating :
"We, therefore, while dismissing the aforesaid appeal give liberty to
the appellant to initiate appropriate proceedings against the owner and driver
of the vehicle for realization of the amount, which is to be paid by the
Insurance Company in terms of the award to the third party-claimant subject to
establishing its case before the Tribunal.
We further provide that the amount, which is in deposit before this Court as
well as before the Tribunal shall be allowed to be withdrawn by the
The balance amount shall be deposited by the Insurance Company within two
months from today before the Tribunal. On deposit so being made, the
claimants/respondents shall be allowed to withdraw the same also without
furnishing any security.
It will, however, be open to the Insurance Company to recover the amount in
question from the insured. For the purpose of recovering the same from the insured
owner of the vehicle, the insurer shall not be required to file a suit. It may
initiate a proceedings before the Executing Court as if the dispute between the
insurer and the owner was the subject matter of determination before the
Tribunal and the issue is decided against the owner and in favour of the
insurer. It is further directed that before releasing the amount, the insured
owner of the vehicle shall be issued a notice and he shall be required to
furnish security for the entire amount, which the insurer will pay to the
claimants. This observation is in consonance with the view taken by the Apex
Court in case of Oriental SC page 1630."
Respondent No.1, however, filed an application for review of the said order,
inter alia, on the premise that as on the date of the accident, admittedly, the
driver was not holding any valid licence in terms of the judgment of this Court
in National Insurance Company Limited v. Swaran Singh and Others [(2004) 3 SCC
297]. Relying on or on the basis of the decision of this Court in Oriental
Insurance Co. Ltd. v. Nanjappan and Others [AIR 2004 SC 1630], the said
application for review was dismissed.
The learned counsel appearing on behalf of the appellants would submit that
although the licence held by the driver of the tractor expired on 27.08.1994,
the same later on having been renewed, the Insurance Company was liable to
reimburse the amount of compensation payable by the appellants to the
The learned counsel appearing on behalf of the respondents, however,
supported the impugned judgment.
Section 15(1) of the Act and the first proviso appended thereto reads as
"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 dale 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 dale of its expiry, the driving licence
shall be renewed with effect from the date of its renewal:"
From a bare perusal of the said provision, it would appear that the licence
is renewed in terms of the said Act and the rules framed thereunder.
The proviso appended to Section 15(1) of the Act in no uncertain terms states
that whereas the original licence granted despite expiry remains valid for a
period of 30 days from the date of expiry, if any application for renewal
thereof is filed thereafter, the same would be renewed from the date of its
renewal. The accident took place 28.04.1995. As on the said date, the renewal
application had not been filed, the driver, did not have a valid licence on the
date when the vehicle met with the accident.
In Swaran Singh (supra), whereupon the learned counsel appearing on behalf
of the appellants relied upon, it is stated :
"45. Thus, a person whose licence is ordinarily renewed in terms of the
Act and the Rules framed thereunder, 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
therefor. 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
This aspect of the matter is now covered by a decision of this Court in
National Insurance Company v. Kusum Rai & Others [(2006) 4 SCC 250],
wherein this Court referring to Swaran Singh (supra), opined :
"14. This Court in Swaran Singh clearly laid down that the liability of
the Insurance Company vis-`-vis the owner would depend upon several factors.
The owner would be liable for payment of compensation in a case where the
driver was not having a licence at all. It was the obligation on the part of
the owner to take adequate care to see that the driver had an appropriate
licence to drive the vehicle.
The question as regards the liability of the owner vis-`-vis the driver
being not possessed of a valid licence was considered in Swaran Singh stating:
(SCC pp. 336-37, para 89)
89. Section 3 of the Act casts an obligation on a driver to hold an
effective driving licence for the type of vehicle which he intends to drive.
Section 10 of the Act enables the Central Government to prescribe forms of
driving licences for various categories of vehicles mentioned in sub-section
(2) of the said section. The various types of vehicles described for which a
driver may obtain a licence for one or more of them are: (a) motorcycle without
gear, (b) motorcycle with gear, (c) invalid carriage, (d) light motor vehicle,
(e) transport vehicle, (f) road roller, and (g) motor vehicle of other
specified description. The definition clause in Section 2 of the Act defines
various categories of vehicles which are covered in broad types mentioned in
sub-section (2) of Section 10. They are goods carriage, heavy goods vehicle,
heavy passenger motor vehicle, invalid carriage, light motor vehicle, maxi-cab,
medium goods vehicle, medium passenger motor vehicle, motor-cab, motorcycle,
omnibus, private service vehicle, semi-trailer, tourist vehicle, tractor,
trailer and transport vehicle. In claims for compensation for accidents,
various kinds of breaches with regard to the conditions of driving licences
arise for consideration before the Tribunal as a person possessing a driving
licence for motorcycle without gear, [sic may be driving a vehicle] for which
he has no licence. Cases may also arise where a holder of driving licence for
light motor vehicle is found to be driving a maxi-cab, motor-cab or omnibus for
which he has no licence. In each case, on evidence led before the Tribunal, a
decision has to be taken whether the fact of the driver possessing licence for
one type of vehicle but found driving another type of vehicle, was the main or
contributory cause of accident. If on facts, it is found that the accident was
caused solely because of some other unforeseen or intervening causes like
mechanical failures and similar other causes having no nexus with the driver
not possessing requisite type of licence, the insurer will not be allowed to
avoid its liability merely for technical breach of conditions concerning
[See Nanjappan (supra)] In this view of the matter, there is no merit in
this appeal, which is dismissed accordingly. However, in the facts and
circumstances of the case, there shall be no order as to costs.