Delhi High Court
The New India Assurance Co.Ltd vs Naresh & Ors. on 13 January, 2015
Author: G.P. Mittal
$~3
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 13th January, 2015
+ MAC.APP. 79/2006
THE NEW INDIA ASSURANCE CO.LTD ..... Appellant
Through: Mr. Pankaj Seth, Adv.
versus
NARESH & ORS. ..... Respondents
Through: Nemo.
.
CORAM:
HON'BLE MR. JUSTICE G.P.MITTAL
G. P. MITTAL, J. (ORAL)
1. I have perused the order dated 07.11.2014 passed by the Registrar
(Original). Respondent no.5 has failed to put in appearance despite
service through publication in the newspaper 'Statesman'. Respondent
no.5 is thus, proceeded ex-parte.
2. By virtue of this appeal, the Appellant New India Assurance Company
Limited seeks recovery of the compensation(from the owner of the
vehicle) paid to the legal heirs of the deceased Sri Krishan, who died
in a motor vehicular accident which occurred on 02.03.1995 at 1:50
a.m. while deceased Sri Krishan was driving a taxi bearing no.DLT-
6547 which was hit by a truck bearing registration no. DEL 5539,
which was being driven by Puran Singh in a rash and negligent
manner.
3. The Claims Tribunal on appreciation of evidence held that the
accident was caused on account of rash and negligent driving of the
driver of the insured truck bearing registration no.DEL 5539 and
awarded a compensation of Rs.6,32,000/- and made the Appellant
Insurance Company liable to pay the compensation as the vehicle was
insured with the Appellant.
4. The only ground urged by the learned counsel for the Appellant is that
the driving licence held by the driver Puran Singh was proved to be
fake. The Appellant, therefore, proved breach of the terms and
conditions of the policy and even if it was liable to initially pay the
compensation, it was entitled to recover the compensation paid from
the insured. It is urged that the Claims Tribunal erred in declining
recovery rights to the Appellant.
5. I have perused the impugned judgment and have gone through the trial
court record. There is no dispute about the fact that it was proved that
the driving licence which was seized by the investigating officer in the
criminal case was found to be fake on verification by the Appellant.
The Appellant examined Bhavani Dutt Joshi (RW2) from the office of
the RTO, Dehradun who testified that the driving licence was fake. In
spite of this, the Claims Tribunal declined to grant recovery rights on
the premise that the owner was never put to notice to produce the
driving licence, which might have been seen by him while employing
driver Puran Singh. It is urged by the learned counsel for the
Appellant that no purpose could have been served by issuing notice to
the owner to produce the driving licence as he preferred not to contest
the proceedings at all. I am unable to agree with the learned counsel
for the Appellant. Paras 13 to 15 of the impugned judgment are
extracted hereunder:-
"13. The insurance company has not examined the owner
of the vehicle. Notice was given to him Under Order 12
Rule 8 only for the production of original insurance
policy and not for the production of the driver or his
driving licence. Even no AD has been placed on the
record to show that owner was served. It was for the
insurance company to examine the owner to prove that
there was willful default on the part of the insured.
14. Insurance company has failed to prove that there was
willful breach on the part of insured. Here it is relevant
to refer to case of United India Insurance Company vs.
Lehru & Ors. II (2003) SLT 516 SC where it was held
that:
"When an owner is hiring a driver he will
therefore have to check whether the driver
has a driving license. If the driver produces
a driving license which on the face of it
looks genuine, the owner is not expected to
find out whether the license has in fact been
issued by a competent authority or not. The
owner would then take the test of the driver.
If he finds that the driver is competent to
drive the vehicle, he will hire the driver. We
find it rather strange that Insurance
companies expect owners to make inquiries
with RTO's, which are spread all over the
country, whether the driving license shown
to them is valid or not. Thus where the
owner has satisfied himself that the driver
has a license and is driving competently
there would be no breach of Section
149(2)(a)(ii). The Insurance company would
not then be absolved of liability. If it
ultimately turns out that the license was fake
the Insurance company would continue to
remain liable unless they prove that the
owner/insured was aware or had noticed
that the license was fake and still permitted
that person to drive. More importantly even
in such a case the Insurance company would
remain liable to the innocent third party, but
it may be able to recover from the insured"
15. Similar view was taken in case of New India
Insurance Company Ltd. Vs. Savitri Parag & Ors. 2002
ACJ 1781. Even the same view was taken by the Hon'ble
Supreme Court in case of National Insurance Company
Ltd. Vs. Swarn Singh and ors. 2004 I AD (SC) 491."
6. It is well settled that initial onus is on the Insurance Company to
prove that there was willful and conscious breach of the terms and
conditions of the policy. The Insurance Company required the owner
to produce the original Insurance Policy, since the owner failed to do
so, therefore, the Insurance Company was entitled to lead secondary
evidence to prove the Insurance Policy.
7. It is quite strange that no notice was issued to the insured to produce
the driving licence. In view of this, it cannot be said that the Insurance
Company has been able to discharge the initial onus to prove that there
was willful and conscious breach of the terms and conditions of the
policy. The Claims Tribunal rightly declined recovery rights to the
Appellant.
8. The appeal is devoid of any merit; the same is accordingly dismissed.
9. The statutory amount of Rs.25,000/- shall be refunded to the Appellant
Insurance Company.
10. Pending application also stands disposed of
(G.P. MITTAL)
JUDGE
JANUARY 13, 2015
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