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2014 Supreme(P&H) 1654
IN THE HIGH COURT OF PUNJAB AND HARYANA
LISA GILL, J.
NATIONAL INSURANCE COMPANY LIMITED - Appellant
Vs.
SANTOSH KUMAR GAUR - Respondent
FAO No. 985 of 2001 (O&M)
Decided On : 07-05-2014
Advocate Appeared:
For the Appellant :Ravinder Mohan Suri, Advocate.
The insurance company must prove breach on the part of the owner of the vehicle and establish that the insured was guilty of negligence and failed to exercise reasonable care in fulfilling the conditions of the policy.
Headnote:
Insurance - Motor Accident Claims - Validity of driving licence and liability of insurance company
Fact of the Case:
The appeal was filed by the Insurance Company challenging the award passed by the Motor Accident Claims Tribunal, Faridabad, imposing liability to pay compensation jointly and severally along with other respondents for an accident caused by a truck driver.
Finding of the Court:
The court held that the insurance company must establish breach on the part of the owner of the vehicle and prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter by fulfilling the conditions of the policy. The court applied the ratio of a decision of the Hon'ble Supreme Court and concluded that the insurance company, in this case, failed to prove negligence or lack of reasonable care on the part of the insured/owner.
Issues: Validity of driving licence, liability of insurance company, breach of policy conditions, negligence of insured/owner
Ratio Decidendi: The insurance company must establish breach on the part of the owner of the vehicle and prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter by fulfilling the conditions of the policy.
Final Decision: The appeal filed by the Insurance Company was dismissed, and the court upheld the decision of the Motor Accident Claims Tribunal, holding the appellant-insurance company liable jointly and severally with other respondents.
Lisa Gill, J.
This matter has been returned from the pre-Lok Adalat on 06.07.2011 as learned counsel for the appellant-Insurance Company has stated that it is not possible to settle the matter in Lok Adalat.
2. Fresh notice issued to respondent No. 5 i.e., the driver of the offending vehicle has not been received back served or otherwise, as per the office report. Memo of appearance of Mr. Adish Gupta, Advocate filed on behalf of respondents No. 5 and 6 is, however, on record. Keeping in view the fact that the appeal is of the year 2001, it would be a futile exercise to await the service upon the said respondent hence, the appeal is taken up for hearing.
3. This appeal has been filed by the Insurance Company challenging the award dated 14.10.2000 passed by the Motor Accident Claims Tribunal, Faridabad (hereinafter referred to as, the Tribunal') to the extent that liability to pay the compensation has been imposed upon the insurer jointly and severally alongwith the other respondents.
4. Shorn of the details, the claim petition had been filed by the dependents of the deceased Rambati, who had died in an accident occurred on 07.03.1997 caused by the offending truck bearing registration No. HYG-1126 being driven by respondent No. 5 rashly and negligently. The Tribunal has awarded compensation to the tune of Rs. 2,60,000/- to the claimants.
5. It has been contended by learned counsel for the appellant that the insurance company is not liable in this case as it has proved on the record that the driving licence Ex. R1 had never been issued from office of the District Transport Officer, Gauhati and therefore, the necessary conclusion is that Ex. R1 is a fake driving licence. Another driving licence bearing No. G2709 MTR 1989 issued by the Transport Authority at Mathura, which was on the case file of another case, had been produced as Ex. R2. The said licence was stated to be valid from 26.03.1999 to 25.03.2002. The insurance company had made efforts to get this licence verified through a private investigator of the company. The concerned licensing authority had endorsed it to be a renewal licence. Therefore, it is contended that Ex. R1 was a fake driving licence and, thus, it had been proved that the driver was not holding a valid licence, thereby there was breach of the specific terms and conditions of the insurance policy. Therefore, insurance company cannot be held liable in this situation.
6. After having heard learned counsel for the appellant and going through the record, it is seen that in response to the request of appellant-company to the Licensing Authority, Mathura (UP) for verification of the driving licence, there is an endorsement Mark 'D' of the Licensing Authority, Mathura to the effect that driving licence in the name of Maido Saha was issued on 26.01.1989 and renewed upto 25.03.2002. HMV is included on 26.01.1989 and the old driving licence which did not include HMV was valid from 20.08.1988 to 18.08.1991.
7. It has been held by Hon'ble Supreme Court in National Insurance Co. Ltd. Vs. Swaran Singh and Others, (2004) 3 SCC 297 that the insurance company must not only establish the available defences raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle. It is further observed that mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. It is incumbent upon the insurer to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter by fulfilling the conditions of the policy. The Hon'ble Supreme Court has, in fact, specifically observed as under:-
Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insure
