The New India Assurance Company Limited-appellant filed this appeal, having been aggrieved by the order/award of the learned Chairman of the Motor Accident Claims Tribunal-cum-Principal District Judge, Kurnool (for short, 'Tribunal'), in MVOP No.46 of 2003 dated 19.10.2004, awarding compensation of Rs.l,00,000/- (Rupees one lakh only) as against the claim of the 1st respondent of Rs.2,00,000/- (Rupees two lakhs only), in the claim petition under Section 166 of the Motor Vehicle Act, 1988 (for short, 'the Act').

2. Heard Sri C.V. Rajeeva Reddy, learned Standing Counsel for the appellant and Sri M. Murali Lincoln, learned Counsel for the 1st respondent. The 2nd respondent, who was served with notice, is called absent with no representation and thus taken as heard the 2nd respondent for the absence to decide on merits and perused the record. The parties hereinafter are referred to as arrayed before the Tribunal for the sake of convenience in the appeal.

3. The contentions in the grounds of appeal in nutshell are that the trial Court erred in fastening the liability on the insurance company despite the fact that the driver was not having valid driving licence to drive the tractor propelled with trailer and thereby from the breach of terms of the policy Ex.B1, the insurer is not liable and hence to allow by exonerating the liability of the insurer-appellant, whereas the contention of the 1st respondent-claimant is that the trial Court, after full dressed trial and on discussed the legal position, came to a right conclusion including in fastening the liability on the insurer of the crime vehicle and thereby for this Court while sitting in appeal, there is nothing to interfere including on the rate of interest, hence to dismiss the appeal.

4. Now, the points that arise for consideration in the appeal are:

1. Whether there is any substantial breach of terms of the policy to exonerate the insurer of the crime vehicle from liability and if so, the award of the Tribunal fastening the liability on the insured and insurer of the crime vehicle is unsustainable and requires interference by this Court while sitting in appeal including on rate of interest?

2. To what result?

Point No.1:

5. A perusal of Ex.A2 charge-sheet filed against the driver of the crime tractor-cum-trailer of Ist respondent to the claim petition is under Section 338 IPC read with Section 3 read with 181 of the Motor Vehicles Act and it was on his admission of the guilt during the course of examination under Section 251 Cr.P.C., he was convicted by sentencing to pay a fine of Rs.l,000/- as per Ex.A5 conviction judgment in CC No.53 of 2002. No doubt in the chargesheet but for mentioning the Motor Vehicles Act 3 read with 181 amounts the offence thereunder that was committed is mentioned. However, the fact remains from reading of Section 181 Motor Vehicles Act that it is driving a vehicle in contravention of Section 3 or 4 of Act by providing that punishment upto 3 months or fine upto Rs.500/- or with both. Coming to Section 3 of the Act which speaks of licensing of drivers with necessity of driving licence which reads:

Necessity for driving licence.-(1) No person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to him authorizing him to drive the vehicle; and no person shall so drive a transport vehicle [other than a motor cab or motorcycle] hired for his own use or rented under any scheme made under subsection (2) of Section 75 unless his driving licence specifically entitles him so to do.

(2) The conditions subject to which subsection (1) shall not apply to a person receiving instructions in driving a motor vehicle shall be such as may be prescribed by the Central Government.

The word effective licence to mean a valid licence regarding the period and type of the vehicle. As per the evidence of RW1, Senior Assistant of insurer of the crime vehicle, the driver N. Babu (RW2), who was examined on summons before the Tribunal, d