The main legal point established in the judgment is the application of the 'pay and recovery principle' in cases of breach of policy conditions regarding driving license, emphasizing the insurer's liability to indemnify the insured.

JUDGMENT :

Heard Sri T.Kumara Ratnam, learned counsel representing Sri K.Rathanga Pani Reddy, learned counsel for the appellants/claimants and Sri Gudi Srinivasu, learned counsel for the respondent No.2/Insurance Company.

2. This appeal directed against the Order and Decree dated 11.04.2012 passed in M.V.O.P.No.540 of 2007 by the Motor Accidents Claims Tribunal – cum – Judge, Family Court – cum – VI Additional District Judge, Kadapa (hereinafter referred to as ‘Tribunal’).

3. Parties are referred to as they were arrayed in the proceedings before the learned Tribunal, for the sake of convenience and clarity.

4. The claimants filed the application under Section 166 of the Motor Vehicles Act, 1988 (for brevity ‘the Act’), seeking compensation for a sum of Rs.4,00,000/- for the death of Kalluri Pratap Reddy (hereinafter referred to as ‘deceased’) in a motor vehicle accident occurred on 25.07.2006.

5. The case of the claimants is that on 25.07.2006 around 10.00 AM, the deceased started to Vempalli town on a motorcycle bearing registration No.AP04 K 8806 (hereinafter referred to as ‘offending vehicle’) driven by N.Sivananda Reddy; the motorcycle was driven in a rash and negligent manner with high speed and when it reached at turning point near Pamuluru gutta, N.Sivananda Reddy failed to control the vehicle, as a result it turned turtle; the deceased fell down and sustained injuries; the deceased was shifted to the Government Hospital, Vempalli, but succumbed to injuries; the deceased was earning Rs.50,000/- per annum by doing cultivation.

6. The respondent No.1 remained ex parte. The respondent No.2/Insurance Company filed counter contending that the deceased was a pillion-rider in the respondent No.1’s motorcycle, as a gratuitous passenger; the liability of the respondent No.2 is subject to terms and conditions of the policy, if any; the respondent No.1 did not possess valid and effective driving licence at the time of accident; the claim of the claimants is highly excessive.

7. The learned Tribunal, basing on the rival contentions, framed the following issues for trial:

1. Whether the claimant received injuries in the accident due to the rash and negligent driving of the crime vehicle?

2. Whether R.1’s driver was having valid license at the time of the accident?

3. Whether the claimant is entitled for compensation and if so, for what amount and from whom?

4. To what relief?

8. On behalf of the claimants, the wife of deceased i.e., 1st claimant was examined herself as P.W.1 and exhibited six (06) documents as Ex.A1 to Ex.A6. The claimants examined P.W.2, who is an eye-witness to the accident. On behalf of the respondent No.2/Insurance Company, its Legal Manager examined as R.W.1 and the Junior Assistant in RTA Office, Kadapa was examined as R.W.2. On behalf of respondent No.2, Ex.B1 to Ex.B3 and Ex.X1 to Ex.X3 documents were marked.

9. Learned Tribunal, basing on the evidence, on issue No.1 held that the accident was occurred due to rash and negligent driving of the motorcycle. The learned Tribunal further held that the owner of the offending vehicle i.e., respondent No.1 is liable to pay the compensation and thereby, awarded a sum of Rs.3,24,000/- and dismissed the petition against respondent No.2/Insurance Company.

10. The only contention of the claimants is that the learned Tribunal erroneously exonerated the respondent No.2/Insurance Company from its liability to indemnify the respondent No.1/owner of the offending vehicle on the ground that the driver of the offending vehicle i.e., motorcycle was not holding valid and effective licence on the date of accident.

11. Learned counsel for the claimants would submit that the learned Tribunal failed to follow the Judgment of the Hon’ble Apex Court in National Insurance Company Limited Vs. Swaran Singh and others, 2004 (3) SCC 297 and thereby committed an error in exonerating the respondent No.2/ Insurance Company from its liability to indemnify the offending vehicle.

12. Sri Gudi Srinivasu, learned