The insurance company is statutorily liable to pay compensation to third parties on account of the certificate of insurance issued and may recover from the insured if there is a breach of policy conditions.

1. This appeal is directed against the award passed by M.A.C.T., Srinagar in a claim petition No. 58/94 titled Showkat Ahmad Khan Vs. Mohammad Haneef Malik. The facts leading upto this appeal are that on 31-12-1993 the respondent-driver who was under the employment of the respondent namely Mohammad Ramzan Bhat while driving Vehicle No. 7505 JK-01A a Mini bus rashly and negligently at Nundresh Colony Bemina hit Showkat Ahmad Khan the respondent-claimant as a result of which said Showkat Ahmad Khan sustained injuries on his person which in turn resulted into his permanent disability. A case for offence punishable under section 279, 337 PRC came to be registered against the driver-respondent with Police Station Sherghari under FIR No. 119 of 1994. The claimant injured Showkat Ahmad Khan approached Motor Accidents Claims Tribunal Srinagar through the medium of an application under section 166 seeking compensation in the sum of Rupees four lakhs. The petition came to be resisted by the appellant-respondent Insurance Company. The other respondents choose to remain absent as a result of which the case came to be set ex-parte against them by the Tribunal below. The appellant-Insurance Company resisted the petition by filing their objections wherein they have inter-alia stated that it is liable to pay compensation as the driver of the offending vehicle was not holding an effective driving licence under the terms of the policy of insurance issued by the Company.

2. The parties went to trial with the following issues:

1. Whether on31-12-1993 respondent No. 3 drew the vehicle No. 7505 JK-01 A rashly and negligently and on fast speed and hit the petitioner OPP.

2. What type of injury the petitioner has sustained and what are the effects? OPP.

3. To what amount of compensation the petitioner is entitled to from whom and in what proportion OPP.

4. Whether the respondent No. 3 is not liable to pay compensation on what grounds OPR-3.

5. Whether the compensation claimed is exaggerated? OPR-3.

3. It appears that during the trial of the case, the matter came up before Lokadalat constituted on 31-05-1997, wherein, a settlement was reached in between the parties and the appellant-respondent agreed to pay compensation of Rs. 1,60,000/- to the respondent-claimant subject to the verification of the driving licence of the respondent-driver and accordingly the matter came to be decided by Lokadalat. It further appears that this settlement before Lokadalat and the order passed thereon came to be set at naught and the file came to be re-opened and proceedings conducted. In a bid to substantiate its case, the petitioner besides examining himself has examined Bilal Ahmad Rather, Tanveer Ahmad, Dr. Mohammad Ramzan, Head Constable Mohammad Abdullah and Bashir Ahmad Rizvi. On the other hand the respondent-insurance company despite giving opportunities did not adduce any evidence in support of its claim and in rebuttal to the claim of the petitioner. The Tribunal on conclusion of the proceedings of the case came to award Rs. 1,92,0007- as compensation which shall be paid by the respondent in the following manner:-

i) Respondent driver Rs. 12,000/-.

ii) Respondent-owner Rs. 20,000/-.

iii) Appellant-respondent-Company rest of the awarded amount.

The claimant has been also held entitled to the interest @ 12% from the date of institution of the petition till the final liquidation of the awarded amount. However the interim relief if received by the claimant shall stand deducted from the total amount of the award.

4. Heard learned counsel for the parties.

5. The stand of learned counsel for the appellant is that the driver of the offending vehicle was not holding an effective and valid driving licence on the date of accident in question as a result of which the owner of the offending vehicle has committed breach of said insurance policy as therefore the Insurance Company cannot be saddled with liability to pay the compensation to the claimant. On the other hand the stand

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