An insurer remains liable to pay compensation to third parties even if the insured violates policy conditions, but retains the right to recover the paid amount from the insured.

JUDGMENT :

Venkata Jyothirmai Pratapa, J.

1. This Civil Miscellaneous Appeal is preferred under Section 30 of Workmen's Compensation Act, 1923[in short "the Act"] against the impugned order dated 27.03.2008 in W.C. Case No. 1 of 2007 on the file of the Commissioner for Workmen's Compensation and Assistant Commissioner of Labour, Nellore(FAC)[in short "Commissioner"].

2. The appellant was the Opposite Party No. 2, Respondent Nos. 1 to 5 were the applicants and Respondent No. 6 was the Opposite Party No. 1 before the learned Commissioner. For the sake of convenience, the parties will be referred hereinafter as they arrayed before the learned Commissioner.

3. The case of the applicants, in brief, is as follows:

a. It is stated that the deceased Kamireddy Giridhar @ Giribabu worked as a driver to the Auto bearing No. AP 26 W 8824 of O.P. No. 1. On 23.12.2006, while the deceased Giridhar was proceeding near Donthali Cross Road, Nellore Rural Mandal, he sustained injures in an accident arising out of and in the course of his employment due to dashing a TATA Sumo. He died in the said accident. A case was registered by the Police in Crime No. 335 of 2006.

b. The deceased used to get Rs. 6,000/-per month as wages and he was aged 28 years at the time of the alleged accident. Applicants claimed compensation of Rs. 4,00,000/-against the Opposite Parties.

4. O.P. No. 1 remained absent and was set ex parte. Whereas, O.P.2 filed counter denying the contents of the application and put the applicants to strict proof of their contentions. It is contended that the deceased was not having valid and effective driving licence to drive the crime vehicle. The compensation claimed is highly excessive. It is further contended that there is no valid insurance policy on the date of the accident.

5. Basing on the pleadings of both parties, learned Commissioner framed the following issues:

1. Whether the deceased was a workman as per the provisions of the Act and he died due to personal injuries he received in an accident arising out of and in the course of his employment?

2. Amount of compensation payable?

3. Who are liable to pay the compensation?

6. During the course of enquiry, Applicant No. 1, who is the wife of the deceased was examined as A.W.1. Exs.A.1 to A.4 were the documents marked. On behalf of the Insurance Company, R.Ws.1 and 2 were the witnesses examined. R.W.1 was the Junior Assistant from R.T.A.Office, Nellore. R.W.2 was the Administrative Officer of the Insurance Company. Exs.B.1 to B.3 were the documents marked.

7. After hearing both the counsel and on appreciation of the evidence on record, learned Commissioner awarded an amount of Rs. 3,77,093/-as compensation and ordered O.P. No. 2 to pay the amount and then recover from the owner of the vehicle.

8. Feeling aggrieved and dissatisfied with the impugned Order, the Insurance Company/O.P. No. 2 preferred the present appeal by raising the following substantial question of law.

"1. Whether the Order of the Commissioner is correct in making the appellant liable when it was concluded that the deceased was not holding an effective driving licence?

2. Whether the Order of the Commissioner is correct in applying the principle laid down by the Hon'ble Apex Court with regard to third parties when the deceased was not a third party?"

9. During the course of hearing, Smt. S.A.V.Ratnam, learned counsel for the Appellant would submit that the deceased had no valid driving licence at the time of the accident. The Insurance Company is not liable to pay the compensation, since it is a violation of terms and conditions of the insurance policy. She would further submit that the learned Commissioner cannot order pay and recovery against the Insurance Company.

10. Per Contra, Sri K.Gopal, learned counsel for Respondents 1 to 5 would submit that the deceased possessed driving licence to drive the non-transport vehicle, is authorized to drive the transport vehicle also.

11. A.W.1 is the wife of the deceased. According to her,