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TAMIL NADU STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, CHENNAI
Hon’ble Thiru Justice A. Raman,
President & Thiru Pon. Gunasekaran, Member
UNITED INDIA INSURANCE CO. LTD.—Appellant
versus
A.V. ARASU—Respondent
A.P. No. 370 of 2000—Decided on 17.5.2005
For the Appellant :Mr. K.S. Narasimhan and Mr. P.V. Raghavan, Advocates.
For the Respondent:Mr. K.M. Ramesh, Advocate.
The absence of a fitness certificate for a vehicle at the time of an accident can absolve the insurer from liability, as it contravenes the Motor Vehicles Act and is fundamental to the insurance contract.
Headnote:
Fitness Certificate - Insurance Claim - The court held that the absence of a fitness certificate for the vehicle at the time of the accident absolved the insurer from liability, as it contravened the Motor Vehicles Act and was fundamental to the insurance contract.
Fact of the Case:
The complainant's commercial vehicle was insured but met with an accident due to which a claim was made. The insurer repudiated the claim citing the absence of a fitness certificate for the vehicle at the time of the accident.
Finding of the Court:
The court found that the absence of a fitness certificate at the time of the accident absolved the insurer from liability, as it contravened the Motor Vehicles Act and was fundamental to the insurance contract. The appeal was allowed, and the complaint was dismissed with costs.
Issues: The main issue was the validity of the insurer's repudiation of the claim based on the absence of a fitness certificate for the vehicle at the time of the accident.
Ratio Decidendi: The court held that the absence of a fitness certificate for the vehicle at the time of the accident absolved the insurer from liability, as it contravened the Motor Vehicles Act and was fundamental to the insurance contract.
Final Decision: The appeal was allowed, and the complaint was dismissed with costs.
Thiru Justice A. Raman, President—The complainant had insured his commercial vehicle D.C.M. Toyota 1987 model with the opposite party for the period from 19.7.1990 to 18.7.1991. While so, on 23.10.1990, it met with an accident and was damaged. The complainant, therefore, made a claim to the opposite party who repudiated it. Hence, the complaint.
2. The opposite party among other things contended that there was no fitness certificate and it got expired on 4.8.1990 and on the date of accident the vehicle had no fitness certificate. Hence, on this ground, they repudiated the claim.
3. It is not disputed that the fitness certificate had expired by 4.8.1990. The Motor Vehicles Act makes it clear that no vehicle can be plied on a public road without fitness certificate. The vehicle should be fit for plying. This rule has been brought in with the safety of public in view. Therefore, one of the essential conditions for plying a vehicle on a highway or a road or a public place is that it should have a fitness certificate. The driver should have a proper driving licence. There must be a proper insurance. Therefore, the fitness certificate is an essential condition which must be satisfied before a vehicle can be put on road. Therefore, on the date of accident as there was no fitness certificate, it follows that the vehicle was not fit to be plied on the highway. Therefore, plying a vehicle on a road without a fitness certificate is a contravention of a Statute. When an accident happens as a result of a contravention in rule or provisions of law and in that accident damage is sustained, naturally the insurer is not liable. The lower Forum has taken a peculiar view that in the insurance policy, it is not stated so. But, it is one of the essential conditions of insurance that the vehicle had the necessary authorization or permit to ply and was fit enough to be plied on roads or public places. Only if the vehicle is fit enough to be plied on road or public places, then the question of insuring the same would arise. The contract of insurance being one based upon good faith, naturally the insurer would undertake such a risk, only if the conditions of any statute especially of Motor Vehicles Act is complied with. Therefore, in such circumstances, we hold that the condition regarding the fitness certificate is of such nature that is fundamental to the contract of insurance and, therefore, when an accident taken place when there was no fitness certificate, it follows that the insurer is not liable since the vehicle was plied in contravention of Motor Vehicles Act without a fitness certificate. Hence, there is no obligation on the part of the opposite party to honour. Hence, it follows that the repudiation is justified.
4. In the result, this appeal is allowed with cost of Rs. 250. The order passed by the lower Forum is set aside. The complaint will stand dismissed with cost of Rs. 250.
Appeal allowed with costs.
