Karnataka High Court
M/S National Insurance Company Ltd. vs Nagamma W/O Mahalingayya Mathapathi on 2 August, 2014
Author: Anand Byrareddy
Bench: Anand Byrareddy
IN THE HIGH COURT OF KARNATAKA,
GULBARGA BENCH R
DATED THIS THE 2ND DAY OF AUGUST, 2014
BEFORE
THE HONOURABLE MR.JUSTICE ANAND BYRAREDDY
MISCELLANEOUS FIRST APPEAL NO.30903/2009 (MV)
BETWEEN:
M/s National Insurance Company Limited
Through its Divisional Manager,
Gulbarga.
... PETITIONER
(Shri Manvendra Reddy, Advocate)
AND:
1. Nagamma W/o Maha Lingayya Mathapathi
Age: 25 years, Occupation: Household,
2. Veerayya S/o Maha Lingayya Mathapathi
Age: 04 years,
3. Abhishek S/o Maha Lingayya Mathapathi
Age: 02 years,
Respondent No.2 and 3
Are minors, U/g of their
Natural mother Respondent
No.1 Smt. Nagamma
2
4. Shantabai W/o Veerayya Mathapathi
Age: 55 years, Occupation: Nil,
All R/o Kondagol
Taluka: Chittapur
District: Gulbarga
Now at H.No.11-28/1
Manikeshwari Colony,
Brahmpur, Gulbarga.
5. Bhimashankar S/o Siddanna
Alias Siddappa Panashetty
Age: 41 years, Occupation: Business
And Owner of Tempo
407 bearing No. KA-32-A-5986,
R/o Kadaganchi
Taluka: Aland, District: Gulbarga.
... RESPONDENTS
( Shri Babu H. Metagudda, Advocate for respondent-1 and 4
Respondent-5 served
Respondent-2 and 3 are minors represented by respondent-1)
This Miscellaneous First Appeal is filed under Section
173 (1) of Motor Vehicles Act, 1988 against the Judgement and
Award dated 24.01.2009 passed in MVC No. 336/2008 on the
file of the II Additional Civil Judge (Senior Division) and
Motor Accident Claims Tribunal, Gulbarga, awarding
compensation of Rs. 5,11,000/- with interest at 6% p.a.
This appeal having been heard and reserved on 30.7.2014
and coming on for pronouncement of Judgment this day, the
Court delivered the following:-
3
JUDGMENT
The appellant is an insurance company, which has been saddled with the liability to pay compensation in favour of the legal representatives of a deceased victim of a motor accident. The deceased was said to be driving a mini lorry and the vehicle insured by the appellant was said to be a TATA tempo 407, which was treated as the offending vehicle and the driver of which was said to be responsible for the accident. The claim petition was said to have been resisted by the appellant, inter- alia, on the ground that the driver of the insured vehicle did not possess a valid driving licence at the time of the accident and therefore, as that was in breach of the policy conditions, the appellant - insurer sought to absolve itself of the liability. The defence of the appellant having been negatived by the Motor Accidents Claims Tribunal (MACT) the present appeal is filed. 4
2. As already stated, it is contended on behalf of the appellant that as seen from the record, the driver concerned was holding a driving licence to drive a light motor vehicle. The vehicle involved was a transport vehicle and that in the absence of the licence specifically enabling him to drive a transport vehicle, it could not be said that the driver was holding a valid driving licence to do so.
3. On the other hand, the learned counsel for the respondent - claimants vehemently refutes the contention of the appellant and seeks to canvas that the said transport vehicle was a light motor vehicle and since the driver did possess a licence to drive a light motor vehicle, there was no infirmity if the licence did not also specify that he was enabled to drive a transport vehicle. The learned counsel has placed reliance on several authorities in support of the proposition. 5
4. The short point for consideration is thus, whether a driver possessing a licence to drive a light motor vehicle is enabled to drive a transport vehicle, without the need for an endorsement to that effect, by the competent authority ?
5. It is sufficient to refer to the decided cases in this regard to answer the above.
In the case of New India Assurance Co.Ltd. v. Roshanben R. Fakir, IV (2008) ACC 759 (SC), the controversy was in respect of the licence held by a driver of an auto rickshaw delivery van. The vehicle was not being used for a private use, but was admittedly a commercial vehicle. It was described in the policy of insurance as a 'goods carrying public carrier'. In concluding that the vehicle involved was a 'transport vehicle' and that the driver did not possess a licence which was valid for a transport vehicle, the apex court has drawn attention to the following aspects : 6
a. Section 3 of the Motor Vehicles Act, 1988 (Hereinafter referred to as the 'MV Act', for brevity) requires that a person holding an effective driving licence to drive a motor vehicle, shall not, however, drive a transport ve hicle unless his driving licence specifically entitles him to do so.
b. That a 'transport vehicle' is defined under Section 2(47) of the MV Act, to mean a public service vehicle, a goods carriage, an educational institution bus or a private service vehicle. Further, in terms of sub-section (4) of Section 41 of the MV Act, that in addition to the particulars to be included in the Certificate of Registration of a vehicle, it shall also specify the type of the motor vehicle, having regard to the design, construction and use of the motor vehicle as notified by the Central Government in the Official Gazette. And that the Central Government had by notification dated 19.6.1992 and again by a notification dated 5.11.2004, 7 consistently classified a three wheeled vehicle meant for transport of passengers or goods as a transport vehicle and a three wheeled vehicle for personal use as a non-
transport vehicle. Hence the vehicle in question was a transport vehicle.
c. That in terms of Section 14 of the MV Act prescribing the currency of the term for which driving licences are issued - it was pertinent that a licence to drive a transport vehicle is issued for a period of three years at a time, whereas in the case of any other licence, it could be for 20 years. And that the licence in the case before it, was issued for a period of 20 years.
d. The view expressed in the case of National Insurance Company Ltd. v. Annappa Irappa Nesaria, IV (2008) ACC 169 (SC) was distinguished with reference to the date on which the accident had taken place in that case, and the state of the law then prevailing.
8In the case of National Insurance Company Limited v. Vidhyadhar Mahariwala and others, (2008)12 SCC 701, the controversy was as regards the currency of the licence held by the driver of a vehicle involved in a motor accident. In that, the accident had occurred on 11.6.2004. The driver's licence was initially valid for a period from 15.12.1997 to 14.12.2000 and thereafter from 29.12.2000 to 14.12.2003 and thereafter, it was again renewed from 16.5.2005 to 15.5.2008. It was therefore contended by the Insurance company that it had no liability to satisfy the claim for compensation as the driving licence of the driver of the offending vehicle was not current on the date of the accident. In the first instance, the Tribunal held that though the licence was not valid as on the date of accident, the driver was not incompetent or disqualified to drive the vehicle, and turned down the plea of the insurer.
In appeal, the High Court had confirmed the above view, relying on the judgments of the apex court in National 9 Insurance Company Limited v. Swaran Singh, (2004) 3 SCC 297, National Insurance Company Limited v. Kusum Rai, (2006) 4 SCC 250 and Oriental Insurance Company Limited v. Nanjappan, (2004)13 SCC 224. It was held that an interval in the renewal of the licence from time to time, would not absolve the insurance company of its liability. And further that where a holder of a driving licence for a 'light motor vehicle' is found to be driving a vehicle, for which he has no valid licence, in each case, on evidence led before the Tribunal, a decision has to be taken whether the fact of the driver possessing a licence for one type of vehicle, but found driving another type of vehicle, was the main or contributory cause of the accident. If on facts, it is found that the accident was caused because of some other unforeseen or intervening causes like mechanical failure and similar other causes, having no nexus with the driver not possessing the requisite type of licence, the insurer would not be allowed to avoid its liability, merely on account of a 10 technical breach of the condition pertaining to the driver of the vehicle possessing a valid driving licence.
In the appeal before the apex court, reliance was placed on the judgment in the case of Ishwar Chandra v. Oriental Insurance Company Limited, (2007)10 SCC 650, wherein it was held that the insurance company would have no liability in cases of the above nature. That view was upheld, notwithstanding the view expressed in the above said earlier judgments.
In the case of New India Assurance Company Limited v.Prabhu Lal, I (2008) ACC 54 ( SC), while noticing that in an earlier decision, in the case of Ashok Gangadhar Maratha v. Oriental Insurance Company Limited, (1999)6 SCC 620, that inspite of the fact that the driver concerned was holding a licence to ply a 'light motor vehicle', but was found driving a 'transport vehicle', but where it was still held that the insurance company was liable, was only on account of the further circumstance that there was neither pleading or proof as 11 regards the permit issued by the Transport Authority. The following observation in Ashok Gangadhar's case was cited :
"11. To reiterate, since a vehicle cannot be used as transport vehicle on a public road unless there is a permit issued by the Regional Transport Authority for that purpose, and since in the instant case there is neither a pleading to that effect by any party nor is there any permit on record, the vehicle in question would remain a light motor vehicle. The respondent also does not say that any permit was granted to the appellant for plying the vehicle as a transport vehicle under Section 66 of the Act. Moreover, on the date of accident, the vehicle was not carrying any goods, and though it could be said to have been designed to be used as a transport vehicle or goods carrier, it cannot be so held on account of the statutory prohibition contained in Section 66 of the Act."
The apex court then proceeded to answer the question whether a driver holding a licence to drive a light motor vehicle was entitled to drive a transport vehicle, without an endorsement to that effect as required under Section 3 of the MV Act and answered the same in the negative. In arriving at 12 that conclusion, the following judgments were considered and discussed.
1. National Insurance Company v. Kusum Rai and others, (2006)4 SCC 250,
2. New India Assurance Company Limited, Shimla v. Suraj Prakash, AIR 2000 HP 91,
3. Skandia Insurance Company Limited vs. Kokilaben Chandravadan, (1987)2 SCC 654
4. B.V.Nagaraju v. M/s Oriental Insurance Company Limited, (1996)4 SCC 647
5. Jitendra Kumar v. Oriental Insurance Company Limited, (2003)6 SCC 420 and,
6. National Insurance Company Limited v. Swaran Singh, (2004)3 SCC 297.
In the case of Oriental Insurance Company Limited v.Angad Kol, (2009) TAC 4(SC), the apex court has explained the reason for its view expressed in National Insurance 13 Company Limited v. Annappa Irappa Nesaria. In that, in Nesaria, the accident had occurred before 28th March 2001, from which date an amendment to the Central Motor Vehicle Rules came into force, whereby a licence granted in Form-6 required a specific authorization to drive a 'transport vehicle'. As the accident in question in Nesaria, was prior to that date, it was held thus :
"20. From what has been noticed hereinbefore, it is evident that "transport vehicle" has now been substituted for "medium goods vehicle" and "heavy goods vehicle". The light motor vehicle continued at the relevant point of time to cover both "light passenger carriage vehicle" and "light goods carriage vehicle". A driver who had a valid licence to drive motor vehicles, therefore, was authorised to drive a light goods vehicle as well.
21. The amendments carried out in the Rules having a prospective operation, the licence held by the driver of the vehicle in question cannot be said to be invalid in law."
In the case of National Insurance Company Limited v.Kaushalya Devi, I(2009) ACC 52 (SC), the scope and effect of the provisions contained in Sections 3, 4 and 10 of the MV 14 Act and the several aspects of the said provisions, vis-à-vis, the liability of the Insurance companies to reimburse the owner in respect of a claim as provided in Section 149 thereof, as dealt with by the several decisions of the apex court is reproduced thus :
"In National Insurance Co. Ltd. v. Swaran Singh & Ors. [(2004)3 SCC 297], this Court held :
"(81) Section 10 of the Act provides for forms and contents of licences to drive.
The licence has to be granted in the prescribed form. Thus, a licence to drive a light motor vehicle would entitle the holder to drive the vehicle falling within that class or description.
(82) Section 3 of the Act casts an obligation on a driver to hold an effective driving licence for the type of vehicle which he intends to drive. Section 10 of the Act enables the Central Government to prescribe the forms of driving licences for various categories of vehicles mentioned in sub-section (2) of the said section...." It was furthermore, observed :
"(83) We have construed and determined the scope of sub-clause (ii) of sub-section (2)(a) of Section 149 of the Act.
Minor breaches of licence conditions, such as want of medical fitness certificate, requirement about age of the driver and the like not found to have been the direct cause of the accident, would be treated as minor 15 breaches of inconsequential deviation in the matter of use of vehicles. Such minor and inconsequential deviations with regard to licensing conditions would not constitute sufficient ground to deny the benefit of coverage of insurance to the third parties.
(84) On all pleas of breach of licensing conditions taken by the insurer, it would be open to the Tribunal to adjudicate the claim and decide inter se liability of the insurer and insured; although where such adjudication is likely to entail undue delay in decision of the claim of the victim, the Tribunal in its discretion may relegate the insurer to seek its remedy of reimbursement from the insured in the civil court."
The decision in National Insurance Company Limited v. Swaran Singh (supra) however, was held to be not applicable in relation to the owner or a passenger of a vehicle which is insured.
11. In National Insurance Co. Ltd. v. Laxmi Narain Dhutt, 2007 ACJ 721 (SC), this Court referring to Swaran Singh's case (supra) and discussing the law on the subject, held :
"(41) In view of the above analysis the following situations emerge:
1. The decision in Swaran Singh's case (supra) has no application to cases other than third party risks.
2. Where originally the licence was a fake one, renewal cannot cure the inherent fatality.16
3. In case of the third party risks the insurer has to indemnify the amount and if so advised, to recover the same from the insured.
4. The concept of purposive interpretation has no application to cases relatable to Section 149 of the Act.
The High Courts/Commissions shall now consider the mater afresh in the light of the position in law as delineated above." [See also Oriental Insurance Company Ltd. v. Meena Variyal & Ors. 2007 ACJ 1284 (SC); Oriental Insurance Company Ltd. v. Brij Mohan & Ors. 2007 ACJ 1909(SC); and Oriental Insurance Co. Ltd. v. Prithivi Raj, 2008 ACJ 733(SC).]"
In the light of the above decisions, it is to be held that a driver holding a licence to drive a light motor vehicle is not enabled to drive a 'transport vehicle' without a specific endorsement to that effect on the form of licence. In the case on hand , it is not in dispute that there was no such endorsement and therefore the insurer is absolved of any liability to satisfy the award in favour of the claimant.
The appeal is allowed and the liability fastened on the appellant is set aside. The claimants are left to their remedy against the owner of the offending vehicle. 17
Incidentally, an argument canvassed by the learned counsel for the respondent - claimants that the Motor Vehicles (Amendment) Act, 1994, while amending Sub-section (2) of Section 10, has sought to substitute clause "(e) transport vehicle", for clauses (e) to (h) - ((e) medium goods vehicle, (f) Medium passenger motor vehicle, (g) heavy goods vehicle & (h) heavy passenger motor vehicle) and since clause "(d) light motor vehicle"
continued to find place in the said Section, therefore the 'transport vehicle' in the case on hand, which was a light motor vehicle would not require a driver of such a vehicle to possess a licence with a specific endorsement to drive a transport vehicle, and that such a requirement is only in respect of a medium or a heavy goods transport vehicle, is not tenable. With the amendment to the Central Motor Vehicle Rules, with effect from 28th March 2001, requiring such an endorsement, the matter is no longer in doubt.
18
The appeal is allowed in terms as state above.
Sd/-
JUDGE nv