The Insurance Company must initially pay compensation for third-party claims, even if the vehicle owner breached policy conditions, allowing for subsequent recovery from the owner.

ORDER :

1. The present First Appeal, under Section 173 of Motor Vehicles Act, 1988, is preferred by the appellants – original claimants being aggrieved and dissatisfied with the judgment and award dated 20.03.2010 passed by the Motor Accident Claims Tribunal, Bhavnagar in Motor Accident Claim Petition No.807 of 2008.

2. Brief facts of the case are as under :

2.1 The brief fact of the present appeal is such that on 09.11.2008, at about 10.00 hours, the minor deceased was playing on road side and at that time, one Tempo No.GJ-4-Y-1059 came in rash and negligent manner and dashed with the minor deceased. As a result, the accident took place and deceased sustained severe injuries and succumbed to the injuries. Therefore, offence to that effect is registered before the Khuntvada Police Station vide FIR being I-C.R.No.40 of 2008. The parents of the deceased have filed aforestated claim petition under Section 163-A of the Motor Vehicle Act, 1988. The learned Tribunal vide impugned judgment and award dated 20.03.2010 has granted compensation to the tune of Rs.1,54,500/-. Hence, the present appeal.

3. Heard learned advocates for the respective parties.

4. Learned advocate Mr.Tailor for the claimants would submit that learned Tribunal has committed error in not passing the order of pay and recover and not following the judgment of Hon’ble Supreme Court in case of National Insurance Company Limited vs. Swaran Singh – 2004 ACJ 1. He would further submit that even in case of absence of licence being a contractual breach, the Insurance Company could be held liable to pay the compensation at the first instance and then recover it from the owner of the errant vehicle. He would further submit that ratio laid down by Hon’ble Supreme Court in case of Swaran Singh (supra), has not been considered in its true perspective by the learned Tribunal. Mainly upon above submissions, he submits to pass necessary order by allowing this appeal.

5. On the other hand, learned advocate Mr.Nanavati submits that in the present case three wheeler Tempo No.GJ-4-Y-1059 was driven by the owner himself at the time of road accident. He has made endorsement below Exhibit-20 in the claim petition that he does not possess the licence. Therefore, it is submitted by Mr.Nanvati that since owner himself knowing that he was not possessing driving licence and yet he has plied vehicle on the public place and caused accident, it is a fundamental breach of terms and conditions of the policy. The judgment of Swaran Singh (supra), would not rescue the situation. The Insurance Company cannot be held liable and has rightly been exonerated by the learned Tribunal and therefore, he submits to dismiss this appeal.

6. I have heard learned advocates for both sides and perused the evidence on record. What could be noticed that minor Mahesh at the relevant time was playing outside the agricultural field in village Sendarda, at that time, the three wheeler tempo ridden by opponent No.1 who was also owner of the said vehicle dashed and mowed down the minor deceased and five years old child lost his life due to the road accident. Learned Tribunal has assessed the compensation to the tune of Rs.1,54,000/-. The Insurance Company has been exonerated on the ground that errant vehicle was ridden by owner himself knowing fully well that he was not possessing licence.

7. At this juncture, let me refer to the judgment of Hon’ble Supreme Court in case of N. K. V. Bros (P) Ltd vs M. Karumai Ammal And Ors – 1980 (3) SCC 457, wherein it is held as under :

“3. Road accidents are one of the top killers in our country, specially when truck and bus drivers operate nocturnally. This proverbial recklessness often persuades the courts, as has been observed by us earlier in other cases, to draw an initial presumption in several cases based on the doctrine of res ipsa loquitur. Accidents Tribunals must take special care to see that innocent victims do not suffer and drivers and owners do not escape liability merely because