Delhi High Court
New India Assurance Company Ltd vs Ashwani Kumar & Ors on 8 May, 2014
Author: Deepa Sharma
$~30
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ MAC.APP. 704/2010
% Date of decision : 8th May, 2014.
NEW INDIA ASSURANCE COMPANY LTD ..... Appellant
Through : Ms. Neerja Sachdeva, Adv.
versus
ASHWANI KUMAR & ORS ..... Respondent
Through : Mr. Amit Kaushik, Adv.
CORAM:
HON'BLE MS. JUSTICE DEEPA SHARMA
DEEPA SHARMA, J (Oral)
1. There is a short challenge in this case by the Insurance company of the
award dated 25th August, 2010. Vide this award dated 25th August, 2010,
learned Tribunal had reached to the conclusion that there was a breach of
terms of the insurance policy as driver of the TSR was not holding a valid
driving license at the time of incident. Consequently, the learned Tribunal had
granted the recovery rights to the appellant. It is against this recovery rights
given to the appellant, that the appellant has come before this court, arguing
that the liability to pay the claimant ought to have been fixed on the driver
and the owner of the offending vehicle.
2. In short the facts of the case are that an accident had taken place on 8 th
November, 2001 at about 9.30 p.m. opposite STD Booth, Hudson line near
Nala. At that time the injured/claimant Ashwini Kumar was going on his
Motor cycle bearing No. BR-15/A-0102 at a normal speed and a three
wheeler (TSR) bearing No. DL-1R-D-9572 which was being driven in a rash
and negligent manner hit his motorcycle. The claimant/injured fell down on
the road and received grievous injuries. He filed a claim petition being MACT
No. 654/2006 where he had been awarded a compensation of a sum of
Rs.1,38,750/- along with interest @ 7.5 % per annum from the date of
institution till the date of actual deposit. The Tribunal had opined that
accident had taken place due to the rash and negligent driving by the
offending vehicle i.e. the TSR.
3. Learned counsel for the claimant has contested the present appeal.
Notice of the appeal was also issued to respondents Nos. 2 to 4, the driver and
and owner of the TSR but they have not contested the present appeal.
4. I have heard the arguments and perused the record.
5. The appellant has not challenged the finding of the Tribunal, whereby
the TSR was held to be responsible of causing the accident. The finding of the
Tribunal to this effect has therefore attained the finality.
6. The law on this point is very clear. It is the settled principle that the
liability to pay the compensation is joint and several under the MACT Act. In
a case titled as Sohan Lal Passi v. P. Sesh Reddy reported as II (1996) ACC
617, the court while referring to Section 96 (2)(b)(ii) of Motor Vehicle Act
has held that this Section cannot be interpreted in a technical manner and only
enables the Insurance Company to defend the liability to pay the
compensation on the grounds mentioned in Sub-section (2) including that
there has been a contravention of the condition excluding the vehicle being
driven by any person who is not duly licensed. The relevant part of the said
order is reproduced as under:-
"12...........According to us, Section 96(2)(b)(ii)
should not be interpreted in a technical manner.
Sub-section (2) of Section 96 only enables the
insurance company to defend itself in respect of
the liability to pay compensation on any of the
grounds mentioned in sub-section (2) including
that there has been a contravention of the
condition excluding the vehicle being driven by
any person who is not duly licensed. This bar on
face of it operates on the person insured. If the
person who has got the vehicle insured has
allowed the vehicle to be driven by a person who
is not duly licensed then only that clause shall be
attracted. In a case where the person who has not
insured the vehicle with the insurance company,
has appointed a duly licensed driver and if the
accident takes place when the vehicle is being
driven by a person not duly licensed on the basis
of the authority of the driver duly authorised to
drive the vehicle whether the insurance company
in that event shall be absolved from its liability?
The expression "breach" occurring in Section
96(2)(b) means infringement or violation of a
promise or obligation. As such the insurance
company will have to establish that the insured
was guilty of an infringement or violation of a
promise. The insurer has also to satisfy the
Tribunal or the Court that such violation or
infringement on the part of the insured was
willful, It the insured has taken all precautions by
appointing a duly licensed driver to drive the
vehicle in question and it has not been established
that lt was the insured who allowed the vehicle to
be driven by a person not duly licensed, then the
insurance company cannot repudiate its statutory
liability under sub-section (1) of Section 96. In the
present case far from establishing that it was the
appellant who had allowed Rajinder Pal Singh to
drive the vehicle when the accident took place,
there is not even any allegation that it was the
appellant who was guilty of violating the
condition that the vehicle shall not be driven by a
person not duly licensed. From the facts of the
case, it appears that the appellant had done
everything within his power inasmuch as he has
engaged a licensed driver Gurubachan Singh and
had placed the vehicle in his charge. While
interpreting the contract of insurance, the
Tribunals and Courts have to be conscious of the
fact that right to claim compensation by heirs and
legal representatives of the victims of the accident
is not defeated on technical grounds. Unless it is
established on the materials on record that it was
the insured who had willfully violated the
condition of the policy by allowing a person not
duly licensed to drive the vehicle when the
accident took place, the insurer shall be deemed to
be a judgment-debtor in respect of the liability in
view of sub- section (1) of Section 96 of the
Act......."
7. In a recent judgment, titled as S. Iyyapan v. United India Insurance
Co. Ltd., reported as 2013 ACJ 1944, the Hon'ble Supreme Court has again
reiterated the same principle and has held as under in para 18:-
"...18. Reading the provisions of Sections 146
and 147 of the Motor vehicles Act, it is
evidently clear that in certain circumstances the
insurer's light is safeguarded but in any event
the insurer has to pay compensation when a
valid certificate of insurance is issued
notwithstanding the fact that the insurer may
proceed against the insured for recovery of the
amount. Under Section 149 of the Motor
Vehicles Act, the insurer can defend the action
inter alia on the grounds, namely, (i) the vehicle
was not driven by a named person, (ii) it was
being driven by a person who was not having a
duly granted licence, and (iii) person driving the
vehicle was disqualified to hold and obtain a
driving licence. Hence, in our considered
opinion, the insurer cannot disown its liability
on the ground that although the driver was
holding a licence to drive a light motor vehicle
but before driving light motor vehicle used as
commercial vehicle, no endorsement to drive
commercial vehicle was obtained in the driving
licence. In any case, it is the statutory right of a
third party to recover the amount of
compensation so awarded from the insurer. It is
for the insurer to proceed against the insured for
recovery of the amount in the event there has
been violation of any condition of the insurance
policy."
8. It is the established law that the liability to pay the third person under
the policy is that of the insurance company and the insurance company can
only be given a right to recover the awarded amount from the violators of the
terms and conditions of the insurance policy. The award of learned Tribunal
does not suffer from any infirmity.
9. The appeal is dismissed being devoid of merits.
10. On 28th October, 2010, this court while dealing with CM No.
18960/2010, directed the appellant to deposit the entire award amount with up
to date interest with the Registrar General of court and releasing 50% of the
amount in favour of the claimant. The balance amount if any lying with
Registrar General of this court be released henceforth to the claimant/injured.
11. The statutory amount deposited by the appellant is also released in his
favour.
12. The appeal is disposed of in the above terms.
DEEPA SHARMA, J
MAY 08, 2014
j
