Delhi High Court
National Insurance Co. Ltd. vs Kripa Shankar Sharma & Ors. on 20 January, 2015
Author: G.P. Mittal
$~6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 20th January, 2015
+ MAC. APP.660/2012
NATIONAL INSURANCE CO. LTD. ..... Appellant
Through: Mr. A.K. Soni, Advocate
versus
KRIPA SHANKAR SHARMA & ORS. ..... Respondents
Through: None
CORAM:
HON'BLE MR. JUSTICE G.P.MITTAL
G. P. MITTAL, J. (ORAL)
1. The Appellant impugns judgment dated 07.03.2012 passed by the
Motor Accidents Claims Tribunal (the Claims Tribunal) and seeks
recovery rights from the insured on the ground that there was
conscious and willful breach of the terms and conditions of the
insurance policy by the insured as proved by the Appellant Insurance
Company and therefore, the Appellant was entitled to recover the
compensation paid to Respondent no.1.
2. The Claims Tribunal dealt with the question of liability in paras 64 to
71 of the impugned judgment, which are extracted hereunder:
"64. The case of insurance company is that it had served a
notice under Order 12 Rule 8 of CPC upon owner and
driver of the vehicle to produce driving license, valid and
effective on the date of accident, original policy, route
permit which are Ex. R3W1/3 and 4 respectively.
65. Insurance company has deposed that the notices were
sent by registered post and postal slips are Ex. R3W1/5 to 7.
66. Insurance company has also relied upon the report of its
Surveyor which is Ex. R3W1/2 as per which fee of the
driving license was not entered in the records and the
Licensing Authority, Mathura gave his remarks in Form54
that DL No. 11665/MTR/06 is not issued by the said
authority in favour of the driver of the offending vehicle.
67. Merely, by sending a notice to produce driving license
the insurance company is not absolved of its responsibility
to prove breach of terms and conditions of policy.
68. When copy of driving license of the driver of offending
vehicle was available on record it was for insurance
company to summon appropriate witness from relevant
Licensing Authority to show that the driving license was
fake. Reliance can be placed on Bajaj Allianze General
Insurance Co. Ltd. v. Bhikhari Yadav, MAC APP. No.
727/11, dated 03.01.12 as well as the New India Assurance
Co. Ltd. v. Geeta & Ors. MAC APP. No. 553/07, dated
23.12.11 in this regard.
69. In the case of Bhikhari Yadav, Hon'ble High Court of
Delhi has held that:
"It is settled that in order to avoid the liability the onus
is on the insurance company to prove that there is
breach of the policy conditions by the insured. The
breach committed by the insured must be willful, e.g.
where the insured entrusts a vehicle to a duly licensed
driver and it is unlawfully driven by any other person
not holding a valid and effective driving license, it
cannot be said that the owner is guilty of willful breach.
Similarly, where a vehicle is stolen by a thief holding no
license and meets with an accident, it cannot be said
that the insured is guilty of a willful breach. Rather, the
insured himself is a victim."
70. Further, dealing with permit, the Hon'ble High Court of
Delhi has held that:
"Turning to the second limb of argument i.e. issuance
of permit to ply vehicle no. DL1G2715 on the date of
the accident, the appellant insurance company did not
summon any record from the relevant office of the
Delhi Transport Authority that on the date of the
accident, the vehicle did not have any permit to ply on
the road. Here again, the insurance company failed to
discharge the onus that there was breach of the
condition of policy in this regard."
71. Therefore, it cannot be said that the insurance company
has proved breach of terms of policy by the insurer."
3. It may be seen that the Appellant Insurance Company issued a notice
requiring the owner, Respondent no.3 herein, to produce the driving
licence of the driver and the permit of the vehicle. The Insurance
Company further examined its surveyor as R3W1 who proved the
report R3W1/2 from the licensing authority, Mathura in Form no.55
which established that the driving licence was not issued by licensing
authority, Mathura.
4. It is true that no effort was made to find out from the concerned
Transport Authority that the owner did not possess any permit. But, in
my view, the Appellant Insurance Company did whatever was in its
power to prove that there was breach of the terms and conditions of
policy as the driver was found to be driving the vehicle on the basis of
fake licence. The onus therefore, shifted on the owner, Respondent
no.3 to prove that it had taken all precautions to avoid breach of the
terms and conditions of the insurance policy. In the circumstances,
the Appellant ought to have been granted recovery rights against the
owner of the offending vehicle, Respondent no.3 herein.
5. I am supported in this view by the judgment of this Court in New
India Assurance Company Ltd. v. Sanjay Kumar & Ors., ILR (2007)
11 Delhi 733, wherein it was held as under:
"23. Where the assured chooses to run away from the
battle i.e. fails to defend the allegation of having breach
the terms of the insurance policy by opting not to defend
the proceedings, a presumption could be drawn that he
has done so because of the fact that he has no case to
defend. It is trite that a party in possession of best
evidence, if he withholds the same, an adverse inference
can be drawn against him that had the evidence been
produced, the same would have been against said person.
As knowledge is personal to the person possessed of the
knowledge, his absence at the trial would entitle the
insurance company to a presumption against the owner.
24. That apart, what more can the insurance company
do other than to serve a notice under Order 12 Rule 8 of
the Code of Civil Procedure calling upon the owner as
well as the driver to produce a valid driving licence. If
during trial such a notice is served and proved to be
served, non response by the owner and the driver would
fortify the case of the insurance company."
6. The Appellant is hence, granted recovery rights. It is made clear that
the Appellant should be entitled to compensation paid along with
interest in execution of this very judgment without having recourse to
independent proceedings for recovery.
7. The appeal is allowed in above terms.
8. Pending applications stand disposed of.
9. Statutory amount of Rs. 25,000/-, if any, shall also be refunded to the
Appellant Insurance Company.
(G.P.MITTAL)
JUDGE
JANUARY 20, 2015
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