The Oriental Insurance Co. Ltd. vs Shri Santosh Kumar Chauhan
2008 Latest Caselaw 1360 Del

*      HIGH COURT OF DELHI : NEW DELHI

       MAC App. No.440/08 & CM No.11235/08

%                   Judgment reserved on: 7th August, 2008

                    Judgment delivered on:18th August,2008


The Oriental Insurance Co.Ltd.
88, Janpath,
New Delhi.                             ....Appellant

                    Through: Mr.Pankaj Seth, Adv.

                             Versus

1. Shri Santosh Kumar Chauhan
S/o Shri Dharam Nath Chauhan
Bagicha No.3, Sunlight Colony,
Ashram, New Delhi.

2.Shri Gian Chand,
S/o Shri Jagmal Singh
170, Pocket-C, Mayur Vihar,
Phase-II,
Delhi-91

3.Shri Bhagat Ram,
S/o Shri Narain Singh,
A-1800, Kotla Mubarakpur,
New Delhi.

Also at:
Chaudhry Bhagat Ram,
Chaudhry Taxi Stand,
South Extn. Part-II,
New Delhi.                             ...Respondents.

                    Through: Nemo.


MAC App.No.440 of 2008                          Page 1 of 22
 Coram:
HON'BLE MR. JUSTICE V.B. GUPTA

1. Whether the Reporters of local papers may
   be allowed to see the judgment?                   Yes

2. To be referred to Reporter or not?                Yes

3. Whether the judgment should be reported
   in the Digest?                                    Yes

V.B.Gupta, J.

The present appeal under section 173 of the

Motor Vehicles Act, 1988 (for short as the "Act") has

been filed by the Appellant/Insurance Company against

the award dated 24.04.08 passed by Ms. Deepa

Sharma, Judge, Motor Accidents Claims Tribunal (for

short as the "Tribunal"), Delhi.

2. Brief facts of the case are that on 10.11.98,

Respondent no.1 herein was going to Bhusa Mandi,

Jagan Nath Market, Ashram, New Delhi from his

house. When he reached at Hari Nagar Ashram Chowk,

a taxi no. DLT 5239 driven by Respondent no.2 herein,

came at a very fast speed in a rash and negligent

manner, without blowing any horn and hit him with a

great force. He fell down on the road and sustained

multiple injuries.

3. It is stated that Respondent no.1 had spent money

on medical treatment and also suffered temporary/

permanent disability and loss of employment and

income and damages.

4. Thus, the claim petition claiming compensation of

Rs.3,00,000/- filed by the Respondent no.1 against the

Respondent no.2 herein, driver, Respondent no.3

herein, owner of the offending vehicle and Appellant

herein, as the offending vehicle is insured with them.

5. Respondent no.2 & 3 even after service did not

appear and were proceeded ex-parte.

6. Appellant in its written statement alleged that the

offending vehicle was not insured on the date of

accident since, no premium was received by the

answering Respondent. The cheque submitted by the

insured towards insurance policy was dishonoured and

notice was given to him but despite that he has failed

to deposit the premium amount. All other contentions

of the Respondent no.1 were denied.

7. Vide impugned judgment, the Tribunal awarded

compensation of Rs. 34,000/- along with the interest @

7.5% per annum from the date of the filing of the

petition till its realization under the following heads;

On account of loss of income : Rs.6,000/-

On account of special diet and

conveyance                                 : Rs.7,000/-


On account of medical bills                  : Rs.11,000/-

On account of pain, sufferings and

mental agony : Rs.10,000/-

Total : Rs.34,000/-

8. It has been contended by the Ld. Counsel for the

Appellant that the Tribunal has erred in coming to the

conclusion that if a person has been issued a driving

licence to drive LMV, he can drive any of the vehicles

which comes under the definition of LMV and it

includes four-wheeler passenger vehicle, tempo, motor

car etc., while holding that the licence held by the

driver i.e. Respondent no.2 to drive the offending

vehicle which was registered and insured as a taxi.

9. The tribunal failed to distinguish between a

private vehicle and fare paying passenger carrying

vehicle while taking note of the provision of sections

10(2) and 21(2) of the Act.

10. The offending vehicle which was registered and

used as a taxi was a public service vehicle within the

meaning of section 2(35) of the Act and therefore, in

view of the provision of section 2(47) of the Act, an

endorsement on the driving licence of "transport

vehicle" in terms of section 10(2) of the Act was

required to authorize a driver to drive a taxi.

11. The tribunal also erred in coming to the

conclusion that it is not proved on record that after the

cheque was bounced, the policy was cancelled and

notice regarding cancellation of the policy was given to

the insured by the Appellant despite there has been no

rebuttal to the pleadings or the evidence of the

Appellant produced to this effect by the owner of the

vehicle-Respondent no.3.

12. Since the owner i.e. Respondent no. 3 has failed

to rebut the aforesaid plea of the Appellant regarding

bouncing of cheque, the same is deemed to be

admitted by him.

13. It is further contended that the Tribunal has

completely ignored the material fact that Respondent

no.3 i.e. owner of the offending vehicle, has not

appeared to contest the petition and to rebut the

allegations raised by the Appellant in its written

statement regarding the non-validity of the driving

licence held by the Driver/Respondent no.2 at the time

of accident and since such a dispute pertains to an

inter se dispute between the owner of the offending

vehicle and the Appellant, it amounts to admission on

the part of the owner regarding the aforesaid plea of

the Appellant on the non-validity of the driving licence.

14. Thus, the tribunal ought to have granted recovery

rights to the Appellant against the Respondent

no.3/owner of the offending vehicle in respect of

compensation to be paid by the Appellant, in the

satisfaction of the award in favour of Respondent no.1.

15. As regards the contention of valid driving licence,

although there is no defence taken by Insurance

Company in their written statement that offending

vehicle was not being driven by a person holding a

valid driving licence but they have led the evidence.

16. It is well settled that

"no amount of evidence can be looked into upon a plea which was never put forwarded."

[See Siddik Mahomed Shah v. Mt. Saran and

others, AIR 1930 P.C. 57(1)].

17. However, for the purpose of determination of the

above said issue, relevant provisions of the Act may be

referred.

18. Section 2(28) of the Act, defines the term „Motor

Vehicle‟. It reads as under;

„"motor vehicle" or "vehicle" means any mechanically propelled vehicle adapted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding ["twenty-five cubic centimetres"];‟

19. „Light Motor Vehicle‟ is defined under

Section 2 (21) of the Act;

„"light motor vehicle" means a transport vehicle or omnibus the gross vehicle weight of either of which or a motor car or tractor or road-roller the unladen weight of any of which, does not exceed [7500] kilograms;‟

20. Sub-section (10) of Section 2 of the Act defines

'driving licence' as under;

„"'driving licence" means the licence issued by a competent authority under Chapter II authorizing the person specified therein to drive, otherwise than as a learner, a motor vehicle or a motor vehicle of any specified class or description;"

21. Section 10 of the Act prescribes form and

contents of licences to drive, which reads as under;

"10. Forms and contents of licences to drive---

(1) Every learner's license and driving licence, except a driving licence issued under Section 18, shall be in such form and shall contain such information as may be prescribed by the Central Government.

(2) A learner's licence or, as the case may be, driving licence shall also be expressed as entitling the holder to drive a motor vehicle of one or more of the following classes, namely:

(a) motor cycle without gear;

(b) motor cycle with gear;

(c) invalid carriage;

(d) light motor vehicle;

(e) transport vehicle;

(i) road-roller;

(j) motor vehicle of a specified description."

22. This provision shows that for driving transport

vehicle a person needs to have a licence of that

category.

23. As per findings of the Tribunal, the offending

vehicle, as is apparent from its registration certificate,

is an LMV but, it is used as taxi. The licence of

Respondent no.2 has been proved as Ex.R3W1/1 and

Respondent no.2 was driving the taxi which comes

within the purview of LMV.

24. Now the question arises, as to simply because it is

used as taxi, the driver need to have separate licence

for driving LMV, used as taxi?

25. In National Insurance Co. Ltd. v. Swaran

Singh & Ors., (2004) 3 SCC 297, the Apex Court has

observed as under;

"In each case, on evidence led before the Tribunal, a decision has to be taken whether the fact of the driver possessing licence for one type of vehicle but found driving another type of vehicle, was the main or contributory cause of accident. If on facts, it is found that the accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with the driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence."

The Apex Court further in paragraph 47 of the judgment, held that;

"If a person has been given a licence for a particular type of vehicle as specified therein, he cannot be said to have no licence for driving another type of vehicle which is of the same category but of different type. As for example, when a person is granted a licence for driving a light motor vehicle, he can drive either a car or a jeep and it is not necessary that he must have driving licence both for car and jeep separately."

In paragraph 48, the Apex court has observed as under;

"Furthermore, the insurance company with a view to avoid its

liabilities is not only required to show that the conditions laid down under Section 149(2)(a) or (b) are satisfied but is further required to establish that there has been a breach on the part of the insured. By reason of the provisions contained in the 1988 Act, a more extensive remedy has been conferred upon those who have obtained judgment against the user of a vehicle and after a certificate of insurance is delivered in terms of Section147(3). After a third party has obtained a judgment against any person insured by the policy in respect of a liability required to be covered by Section 145, the same must be satisfied by the insurer, notwithstanding that the insurer may be entitled to avoid or to cancel the policy or may in fact have done so. The same obligation applies in respect of such a liability, but who would have been covered if the policy had covered the liability of all persons, except that in respect of liability for death or bodily injury."

The Apex court has observed as under;

"Under the Motor Vehicles Act, holding of a valid driving licence is one of the conditions of contract of insurance. Driving of a vehicle without a valid licence is an offence. However, the question herein is whether a third party involved in an accident is entitled to the amount of compensation granted by the Motor

Accidents Claims Tribunal although the driver of the vehicle at the relevant time might not have a valid driving licence but would be entitled to recover the same from the owner or driver thereof.

It is trite that where the insurers, relying upon the provisions of violation of law by the assured, take an exception to pay the assured or a third party, they must prove a wilful violation of the law by the assured. In some cases violation of criminal law, particularly, violation of the provisions of the Motor Vehicles Act may result in absolving the insurers but, the same may not necessarily hold good in the case of a third party. In any event, the exception applies only to acts done intentionally or "so recklessly as to denote that the assured did not care what the consequences of his act might be".

26. The provision of section 2(21) of the Act shows

that LMV also include transport vehicles. Therefore,

even if, the offending vehicle is used for transport

purpose and it is LMV and the driver has a licence to

drive LMV, he can drive any of the vehicles which

come under the definition of LMV.

27. Appellant‟s Counsel has failed to show any

provision in the Act, under which licencing authority

can debar a person from driving a transport vehicle,

falling under the category of LMV, if he possess valid

and effective driving licence for driving LMV.

28. The Appellant/Insurance Company has not

examined any witness from the transport authority to

prove that the driving licence of Respondent no.2 had

been issued solely for the purpose of non transport

vehicle and it debar him from driving LMV.

29. In Hardayan Singh v. Chiranji Lal and Ors., I

(2003) ACC 114, Punjab and Haryana High Court has

observed as under;

"Once, a licence can be granted by virtue of provisions contained in Section 10 only with regard to kind of vehicles or type of vehicle, enumerated therein, the mere fact that in the licence of appellant scooter/ motor cycle/ car/ jeep were mentioned, would be of no consequence. It shall be considered to be driving licence for a Light Motor Vehicle and tempo, as per definition of Light Motor Vehicle,

as contained in Section 2(21) of the Act of 1988, would be a light motor Vehicle. The definition of Light Motor Vehicle apart, it does not sound to reason even otherwise that a person, who is issued a valid licence to drive a car/ jeep, could not drive a tempo. There is no special training that may be required to drive a tempo which may be different in material details for driving a jeep/ car. The mechanism of all these vehicles is practically same. The distinction in driving various kinds of vehicles and grant of licence thereof is primarily when such vehicles are different in mechanism and require different kind of training."

30. Thus, the Tribunal has rightly held that the

offending vehicle i.e. taxi, is a four wheeler passenger

vehicle and the driver i.e. Respondent no.2, had been

given a driving licence to drive LMV and therefore he

was having valid and effective driving licence on the

date of accident.

31. As regards the contention of Ld. Counsel for the

Appellant in respect of bouncing of cheque, the

Tribunal held that;

"Cover note of the policy is Ex.R3W2/1 and according to this

document insured R2 was required to pay the premium amount of Rs.1538. Cheque Ex.R3W21/3 is of Rs.1561/- which is allegedly issued by one Rajeev Kumar while the policy holder is Bhagat Ram,R2. There is nothing on record to prove that this cheque Ex.R3W1/3, which was allegedly bounced had been issued by the insured. Even if it is presumed that this cheque pertains to the policy in question, it is not proved on record that after the cheque was allegedly bounced, the policy was cancelled and notice regarding cancellation of the insurance policy was given to the insured by R3. Copy of the notice dated 21.10.1998 is proved on record as Ex.R3W2/2. However, no receipt of sending this notice to the insured has been proved on record. No record has been produced to show that alleged notice was duly sent to the insured. No notice u/o12 r8 CPC before the date of accident has been allegedly sent to the insured. No evidence has come on record from insurance company to prove that insured was duly informed about cancellation of the insurance policy, if it is presumed that the cheque Ex.R3W1/3 pertains to the insurance policy Ex.R3W2/1. The notice u/o12 r 8 CPC copy of which is Ex.R3W2/3 and postal receipt Ex.R3W2/4 and R3W2/5and AD card Ex.R3W2/6 is dated 15.11.2007 i.e. it has been sent after ten years from the date of accident. Respondent no.3, insurance

company has miserably failed to prove that cheque of premium issued by R2 had been dishonoured or that they had cancelled the insurance policy or that they had duly informed the insured about the cancellation of such policy. I hold that there was a valid insurance policy Ex. R3W2/1 which was duly issued in favour of the insured."

32. In the present case, Appellant/Insurance

Company has failed to produce any evidence to show

that notice informing the insured, about the

cancellation of Insurance Policy was duly served.

33. The Appellant/Insurance Company has miserably

failed to prove that offending vehicle was not insured

with it or the offending vehicle was being driven by

Respondent no.2, without proper and effective driving

licence.

34. The Tribunal has rightly held that the offending

vehicle was being driven under a valid and effective

driving licence by Respondent no.2 and therefore,

Appellant has been rightly held liable, to pay the

awarded amount.

35. I, do not find any infirmity or illegality in the

impugned judgment passed by the Tribunal.

36. Before parting with, I must express my anguish

upon the callous attitude of the Appellant/ Insurance

Company in filing the present appeal.

37. The provisions as enacted in the Act were brought

in the statue book to grant relief to the victim of an

accident or his dependant/s by way of compensation.

These obviously are beneficial provisions to give relief

to a person who has suffered grievous injury or to the

dependants of a victim who are left without a bread

earner. The object thereof cannot be permitted to be

frustrated. Of course, if the vehicle in question is not

insured at all, the question of making the insurer liable

would not arise. But, the insurer cannot, by raising all

possible pleas, avoid payment of compensation and

thereby defeat the object of these provisions.

38. The law relating to award of compensation in

motor accident cases has developed enormously. It is

a good sign. Judicial pronouncements, dealing with

the subject, have greatly widened the horizons in this

field. New principles have been enunciated to cover

various concepts of damages. Enough care has been

taken to see that the victim, in case of personal

injuries, and the dependents in cases of fatal accidents,

do not suffer incalculably due to the accident in

question and decisions make an attempt to equate, as

for as possible, the misery with the compensation

awarded, though money compensation cannot be

considered to be in any way equal to the injuries

sustained or the life lost. Pecuniary and non-pecuniary

damages have to be carefully determined. Need for

future case is more, so that the victim or the

dependents do not lead a miserable life. [State of

Himachal Pradesh v. Shrichand Kishan Hazri

(1990) 1 Acc.C.C. 44]

39. Here in a road accident, the victim has suffered

head injuries and nail has been inserted in his left leg,

due to rash and negligent driving on the part of driver

of the offending vehicle, which was admittedly insured

with the Appellant/Insurance Company. As the luck

would have been, the victim has survived in the

accident and has got a new life.

40. Instead of letting the poor victim of the road

accident, live in peace and have little solace, due to

meager amount of compensation which has been

awarded to him, after a protracted trial, the Insurance

Company is after his blood and has filed the present

appeal.

41. It appears that the present appeal has filed by the

Appellant/Insurance Company mechanically, without

any legal justification and there being no application of

judicious mind and not taking into consideration, the

various decisions of the Apex Court and various High

Courts.

42. In Oriental Insurance Co. v. Zarifa and

others, AIR 1995 J & K 81, the Jammu and Kashmir

High Court has observed as under;

"Before concluding, it is also observed that it is a social welfare legislation under which the compensation is provided by way of Award to the people who sustain bodily injuries or get killed in the vehicular accident. These people who sustain injuries or whose kith and kins are killed, are necessarily to be provided such relief in a short span of time and the procedural technicalities cannot be allowed to defeat the just purpose of the Act, under which such compensation is to be paid to such claimants."

43. So, under these circumstances the present appeal

filed by the Appellant/Insurance Company has got no

legal force, and is devoid of any merits.

44. Thus, the same is hereby dismissed with costs of

Rs.10,000/-.

45. Costs of Rs.10,000/- be deposited with the Delhi

High Court Legal Services Committee within 4 weeks.

46. Registrar General of this Court will send the copy

of this judgment to;

The Chairman of Oriental Insurance Company Limited, 88, Janpath, New Delhi (for information).

47. List for compliance on 29th September 2008.

August 18, 2008                  V.B.GUPTA, J.
Bisht