The validity of the driver's licence and the breach of insurance policy terms determine the liability of the insurance company.

Rajiv Sharma, J.

1. This FAO has been filed against the award dated 30.9.2004 passed by the Motor Accident Claims Tribunal, Solan in MAC petition No. 33-S/2 of 2004.

2. The brief facts necessary for the adjudication of this appeal are that on 21.2.2004 the deceased had gone to Parwanoo. Around 12.30 p.m. when he was crossing a road at Parwanoo Chowk, Maruti Van No. HP-01-1280 appeared from Kalka side at a very fast speed. It hit the deceased. The deceased sustained fracture of ribs. The fractured ribs hurt the lungs, heart and spleen which resulted in the death of the deceased. The claimants filed the claim petition seeking compensation of Rs. 5,00,000/-. The owner resisted the claim and alleged that accident took place because of deceased own negligence. The appellant-company also resisted the petition by filing reply. It was alleged by the insurance company that respondent No. 6 hereinafter referred to as the owner and driver did not possess valid and effective driving licence. The learned Motor Accident Claims Tribunal on the basis of the evidence led by the parties awarded a sum of Rs. 1,35,000/- as compensation together with costs of the petition and interest @ 9% per annum from the date of petition till the date of deposit of the aforesaid amount. The owner/driver and the appellant-insurance company were held liable to satisfy the award jointly and severally vide award dated 30.9.2004.

3. Mr. G.C. Gupta, Senior Advocate had strenuously argued that the findings recorded by the learned Motor Accidents Claim that the driver was holding a valid driving licence is contrary to law. He also contended that the driving licence Ex. A-1 was valid only for light motor vehicle and the licence did not bear any endorsement to drive the transport vehicle.

4. Mr. Malay Kaushal, Advocate and Mr. M.S. Thakur, Advocate appearing on behalf of the respondents have supported the award dated 30.9.2004.

5. I have heard the learned Counsel for the parties and perused the record carefully.

6. The driving licence Ex. RA/1 was admittedly issued for driving motorcycle/scooter and LMV only. It was valid from 26.6.1997 to 15.11.2022. The Motor Accident Claims Tribunal on the basis of National Insurance Co. Limited v. Swaran Singh and Ors. AIR2004SC1531 came to a conclusion that the maruti van even though registered as a taxi, falls in the definition of LMV. The Motor Accident Claims Tribunal further opined that despite the fact that the driving licence of the respondent/owner/driver was not endorsed for the transport vehicle, the insurer was liable to satisfy the award because the breach of condition of the policy regarding possessing of a valid and effective licence is not shown to have been the main or the contributory cause of occurrence of the accident.

7. The fundamental question raised by Mr. G.C. Gupta, Senior Advocate has been considered by their Lordships of the Hon'ble Supreme Court in National Insurance Co. Limited v. Kusum Rai and Ors. AIR 2006 SC 3440 . Their Lordships have held as under:

It has not been disputed before us that the vehicle was being used as a taxi. It was, therefore, a commercial vehicle. The driver of the said vehicle, thus, was required to hold an appropriate licence therefor. Ram Lal who allegedly was driving the said vehicle at the relevant time, as noticed hereinbefore, was holder of a licence to drive a Light Motor Vehicle only. He did not possess any licence to drive a commercial vehicle. Evidently, therefore, there was a breach of condition of the contract of insurance. The Appellant, therefore, could raise the said defence.

We have noticed hereinbefore that the Tribunal has not gone into the said question. It proceeded on the basis that the case was covered by Kamla (supra). The correctness of the said decision came up for consideration before this Court in National Insurance Co. Ltd. v. Swaran Singh and Ors. AIR 2004 SC 1531 wherein this Court clearly held:

The owner of a motor vehicle in terms of Section 5 of the