National Insurance
Co. Ltd. Vs. Vidhyadhar Mahariwala & Ors. [2008] INSC 1582 (17 September
2008)
Judgment
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 5721 OF 2008 (Arising
out of S.L.P. (C) No.13174 of 2007) National Insurance Co. Ltd. .....Appellant
Versus Vidhyadhar Mahariwala and Ors. ....Respondents
Dr. ARIJIT PASAYAT,
J.
1.
Leave
granted.
2.
Challenge
in this appeal is to the judgment of a learned Single Judge of the Rajasthan
High Court at Jabalpur dismissing the appeal filed by the appellant under
Section 173 of the Motor Vehicles Act, 1988 (in short the `Act'). Challengein the
appeal was to the award made by the Motor Claims
Appellate Tribunal,
Ratangarh (Churu) (in short `MACT) in
Claim Case No.89 of
2004. By the said award, a sum of Rs.4,03,650/- was awarded to the
claimant-respondent No.1 in the appeal. The dispute related to the rejection of
appellant's claim for exoneration on the ground of violation of policy
condition. It was pointed out that the driving license of the driver of the
offending vehicle was not in force on the date of accident.
3.
Factual
position in detail need not be indicated because the issue relates to the
liability of the insurance company as the driving license was not valid on the
date of the accident.
4.
In
the instant case the date of accident was 11.6.2004.
The driver's license
was initially valid for the period from 15.12.1997 to 14.12.2000 and thereafter
from 29.12.2000 to 14.12.2003. Thereafter, it was again renewed from 16.5.2005
to 15.5.2008. The
appellant filed its objections before MACT taking the stand that since the
driving license was not valid on 2 the date of accident it had no liability.
The MACT turned down the plea. According to it though on the date of accident
the driving license was not valid, since the driver's license was renewed on
16.5.2005 for a further period of three years it cannot be said that during the
intervening period the driver was incompetent or disqualified to driver the
truck. With reference to Section 114 of the Indian Evidence Act, 1872 (in short
the `Evidence Act') it was held that at the time of accident driver was
competent to drive the vehicle.
5.
In
appeal by the impugned judgment the High Court referred to three judgments of
this Court in National Insurance Co. Ltd. v. Swaran Singh and Ors. (2004 (3)
SCC 297), National Insurance Co. Ltd. v. Kusum Rai and Ors.
(2006 (4) SCC 250)
and Oriental Insurance Co. Ltd. v. Nanjappan and Ors. (2004 (13) SCC 224) and
came to hold that the insurance company, the insurer was liable to indemnify
the award. It was held that merely there was a gap in the renewal of driving license
that cannot be a ground for exoneration.
6.
In
support of the appeal, placing reliance on the decision of this Court in Ishwar
Chandra and Ors. v. Oriental Insurance Co. Ltd. and Ors. (2007 (10) SCC 650),
it was contended that the High Court's view is unsustainable.
7.
Learned
counsel for respondent No.2 the owner of the vehicle on the other hand
supported the judgment of MACT.
8.
In
Swaran Singh's case (supra) whereupon the respondent no.2 relied, it was held
as follows:
"45. Thus, a
person whose licence is ordinarily renewed in terms of the Motor Vehicles 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 4 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."
9.
In
Kusum Rai's case (supra) it was held as follows:
14. This Court in
Swaran Singh (2004 (3) SCC 297) 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 5
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 driving licence."
10.
Nanjappan's
case (supra) was referred to in Kusum Rai's case (supra).
11.
In
Ishwar Chandra's case (supra) the three decisions referred to by the High Court
were considered and it was held that the insurance company would have no
liability in the case of this nature. We are in agreement with the view. The
appeal deserves to be allowed which we direct. The impugned order of the High
Court is set aside. It is open to the claimant to recover the amount from
respondent No.2.
...................................J.
(Dr.
ARIJIT PASAYAT) ..................................J.
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