New India Assurance Co. Ltd. vs Ram Dass And Ors.
2013 Latest Caselaw 4574 Del

$~R98
*   IN THE HIGH COURT OF DELHI AT NEW DELHI

%             Judgment delivered on: 3rd October, 2013

+      MAC.APP. 408/2006
NEW INDIA ASSURANCE CO. LTD.           ..... Appellant
                           Represented by: Mr. Salil Paul, Adv.

                          versus


RAM DASS AND ORS.                                  ..... Respondents
                                       Represented by: NEMO.

CORAM:
HON'BLE MR. JUSTICE SURESH KAIT

SURESH KAIT, J. (Oral)

1. Instant appeal has been preferred against the impugned award dated 13.02.2006, whereby ld. Tribunal while awarding the compensation has not granted recovery rights in favour of the appellant.

2. Ld. Counsel appearing on behalf of the appellant submits that the appellant has taken the defence before the ld. Tribunal that driver of the offending vehicle (respondent no. 1 before Tribunal) was driving the vehicle without having any licence at the time of accident. Therefore, the owner of the offending vehicle breached the terms and conditions of the insurance policy. Accordingly, the appellant is not liable to pay any compensation.

3. Alternatively, he argued that if this court is not inclined to give complete exoneration, certainly they are entitled for recovery rights against the owner of the offending vehicle.

4. He further submitted that R3W1, Ms. Manisha Trivedi, D/L Incharge, ARTO, Bulandshahar, UP has deposed that DL No. T-5670/BSR/2003 belongs to their office, but as per their record, the aforesaid D/L was issued in the name of Sh. Prempal, S/o, Sh. Ganpat Singh on 08.03.2003. She further stated that the said licence was not issued to Sh. Ashish Kumar, S/o, Sh. Rama Shankar. During cross-examination R3W1 stated that D/L of Sh. Ashish Kumar is not as per the format pertaining to their office nor it is signed by their officer. She filed record of her office as Ex.R3W1/A.

5. Further submitted that it is a matter of record that the said testimony has not been rebutted by the owner and driver of the offending vehicle as they were proceeded ex-parte during trial. Moreover, R3W2, Sh. Ashok Kumar Saluja, Sr. Assistant of appellant Company filed attested copy of the policy as R3W2/B.

6. From the statement of R3W1, it is established that the DL-T-5670/BSR/2003, which was seized by the police from the possession of Driver of the offending vehicle (respondent no. 1 before Tribunal) is a fake document.

7. Law is settled in case of no licence, fake licence and invalid licence that the first responsibility of the insurer to pay the amount and recover the same from the owner of the offending vehicle.

8. In Oriental Insurance Co. Ltd. v. Rakesh Kumar & Ors., 2012, ACJ,

1268, the Coordinate Bench of this court in Para 44 has held as under:

"44. (ii) Even when there is a willful breach of the terms of the policy under Section 149 (2) (a) of the Act, the Insurance Company is under obligation to indemnify the liability towards the third parties and recover the same from the owner.

(iii) Once the Insured proves that the driver did not hold any driving licence to drive the Class of vehicle involved in the accident or that the driving licence was fake; requires the owner and driver to produce the driving licence and if they failed to produce the same, the onus of proving breach of policy would be deemed to be discharged. Onus would then shift on the owner to establish that he was not guilty of breach of the terms of policy. In the absence of any evidence being produced by the Insured, in such cases, it will be presumed that he was guilty of a willful breach. The Insured in such cases, would be entitled to recover the compensation paid to third party in discharge of its statutory liability.

(iv) Where policy is avoided on proof or facts which renders the Insurance policy void under Section 149 (2) (b) of the Act, the Insurance Company would not be under obligation to pay even to third parties, as in such cases the contract of insurance is non est."

9. In the case of National Insurance Company Ltd. v. Geeta Bhat and ors. 2008 12 SCC 426, the Apex Court has held that if the driver of the offending vehicle was having a fake licence, the insurer would pay the amount to claimant, thereafter has right to recover the same from the owner of the vehicle in respect of the amount awarded in favour of a third party by the Tribunal in exercise of its jurisdiction under Section 166 of the Motor Vehicles Act, 1988.

10. In the present case, the appellant has proved that the driver of the offending vehicle was not holding valid licence at the time of accident. Despite, ld. Tribunal failed to grant recovery rights in favour of the appellant.

11. In view of the above discussion, recovery right is granted in favour of the appellant against respondent no. 9 / Shakil, owner of the offending vehicle.

12. Accordingly, instant appeal stands disposed of.

13. Pursuant to order dated 16.05.2006, appellant has deposited the entire award amount with up-to-date interest before the ld. Tribunal. Vide the even order, 50% was directed to be released in favour of the respondents / claimants.

14. Therefore, balance compensation amount be released in favour of the respondents / claimants.

15. Statutory amount be released in favour of the appellant.

CM. No. 6906/2006 (Stay) With the disposal of the appeal itself, instant application has become infructuous and disposed of as such.

SURESH KAIT, J OCTOBER 03, 2013/jg