Point of Law : Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under section 149(2) of the Act.

ORDER :

1. The appellant insurance company has preferred present appeal under Section 173 of the Motor Vehicles Act 1988 (“M.V. Act” for short) to question its liability to pay compensation under judgment and award dated 23.12.2019 passed by learned Motor Accident Claims Tribunal (Main) at Gandhinagar in M.A.C.P. No. 124 of 2016.

2. I have heard Mr. Raval, learned advocate for the appellant. There is no appearance on behalf of the respondents, though served with the notice of admission issued by this Court.

3. Mr. Raval, learned advocate for the appellant submits that the Tribunal has committed error in fastening liability of payment of compensation on the appellant insurance company, as the driver of the offending vehicle was holding the license to drive the non-transport vehicle, whereas the offending vehicle was Eicher Truck i.e. transport vehicle. It is his further submission that the appellant has produced various documents along with written statement Exh.17 to prove the defence of invalid driving license. He, therefore, submits that the tribunal has committed error in fastening liability of payment of compensation on the appellant insurance company relying on the decision of the Supreme Court in case of Mukund Dewangan vs. Oriental Insurance Co. reported in 2017 ACJ 2011 SC. He, therefore, submits that the appellant insurance company needs to be exonerated from its liability to pay compensation and ought to have directed the insurance company to pay the compensation to the claimants in the first instance and thereafter to recover the same from the owner of the offending vehicle in view of the decision of this Court in case of National Insurance Co. Ltd. vs. Nareshkumar Javsing Bamaniya and other reported in 2021 ACJ 995.

4. It emerges from the impugned judgment and award that it was argued on behalf of the appellant insurance company that the insurance company cannot be held liable to pay the amount of compensation on behalf of the owner of the vehicle, as the driver of the vehicle did not possess in fact even valid driving license to drive offending vehicle. The tribunal after examining the evidence on record has found that it is not in dispute that the driver of the offending vehicle was possessing license to drive non transport vehicle.

5. The only issue raised by the insurance company is that there is no endorsement upon the license by the authority that the license is valid to drive commercial vehicle. However, tribunal has fasten the liability of payment of amount of compensation on the insurance company in view of the decisions in case of National Insurance Co. vs. Swaran Singh reported in AIR 2004 SC 153 and in case of Mukund Dewangan (supra).

6. Mr. Raval, learned advocate for the appellant has placed reliance on the decision of this Court in case of National Insurance Co. Ltd vs. Nareshkumar Javsing Bamaniya (supra) wherein this Court has after considering various decisions of the Supreme Court has held that:-

“6.2 Now, in Swaran Singh (supra), the supreme court summarized its findings as under to propound the principle of pay and recover.

“(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.

(ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163 A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the said Act.

(iii) The breach of policy condition e.g., disqualification of driver or invalid driving licence of the driver, as contained in subsection (2)(a)(ii) of section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence,