Himachal Pradesh High Court
Oriental Insurance Company Ltd vs Sh. Khem Chand & Others on 27 February, 2015
Author: Mansoor Ahmad Mir
Bench: Mansoor Ahmad Mir
1 IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA .
FAO No. 538 of 2007 Decided on : 27.02.2015 _____________________________________________________ Oriental Insurance Company Ltd. .....Appellant Versus Sh. Khem Chand & others ...Respondents _____________________________________________________ Coram:
The Hon'ble Mr. Justice Mansoor Ahmad Mir, Chief Justice Whether approved for reporting? Yes.
For the appellant : Mr. Ashwani Sharma, Advocate.
For the respondents: Mr. Naveen Bhardwaj, Advocate, for respondent No. 1.
Mr. Sanjay Ranta, Advocate, vice Mr. G.S. Rathore, Advocate, for respondent No. 2.
Nemo for respondent No. 3.
_______________________________________________________ Mansoor Ahmad Mir, Chief Justice (oral) This appeal is directed against the award, dated 10th October, 2007, made by the Motor Accidents Claims Tribunal, Kullu (hereinafter referred to as "the Tribunal") in Claim Petition No. 47 of 2006, titled as Master Khem Chand versus Shri Jeevan Singh & others, whereby compensation to the tune of ` 1,29,000/- with interest @ 7% per annum from the date of the claim petition till its realization, came to be ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 2 awarded in favour of the claimant-respondent No. 1 herein .
and the insurer-Oriental Insurance Company was saddled with the liability (for short, the "impugned award").
Brief Facts:
2. The claimant had filed claim petition before the Tribunal for grant of compensation to the tune of `10,00,000/-, as per the break-ups given in the claim petition, on the ground that driver, namely, Kamaldeen had driven the offending vehicle (TATA 207) bearing registration No. HP-34B-
2539, rashly and negligently, on 21.07.2005, at about 4.05 p.m., at Sharabai, Bhunter, District Kullu, H.P., hit the claimant and caused injuries to him.
3. The owner, the driver and the insurer-Insurance Company contested the claim petition on the grounds taken in their memo of objections.
4. Following issues came to be framed by the Tribunal:
"1. Whether the petitioner sustained injury in a motor accident caused on 21.7.05 at Sharabai due to rash and negligent driving of vehicle No. HP-34B-2539 by its driver-respondent No. 2?
.....OPP ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 3 2 If issue No. 1 is proved in affirmative, to what amount of compensation the petitioner is .
entitled and from whom?
...OPP
3. Whether the driver of the offending vehicle was not holding a valid and effective driving licence at the time of accident? ...OPR-3
4. Whether the vehicle was being plied in violation of the terms and conditions of insurance policy at the time of accident? ...OPR-3 r5. Relief"
5. The claimant, the insured-owner and the driver have not questioned the impugned award, on any count.
Thus, it has attained finality, so far as it relates to them.
6. The insurer has questioned the impugned award on the ground that the driver was not having a valid and effective driving licence at the time of accident.
7. Admittedly, the driver was having licence to drive 'Light Motor Vehicle' The vehicle, which the driver was driving at the time of accident was having description 'Light Motor Vehicle', which came to be discussed by the Tribunal in paras-
18 & 19 of the impugned award.
8. A Division Bench of the High Court of Jammu and Kashmir at Srinagar, of which I (Justice Mansoor Ahmad Mir, ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 4 Chief Justice) was a member, in a case titled as National .
Insurance Co. Ltd. versus Muhammad Sidiq Kuchey & ors., being LPA No. 180 of 2002, decided on 27th September, 2007, has discussed this issue and held that a driver having licence to drive "LMV" requires no "PSV" endorsement. It is apt to reproduce the relevant portion of the judgment herein:
"The question now arises as to whether the driver who possessed driving licence for driving abovementioned vehicles, could he drive a passenger vehicle? The r answer, I find, in the judgment passed by this court in case titled National Insurance Co. Ltd. Vs. Irfan Sidiq Bhat, 2004 (II) SLJ 623, wherein it is held that Light Motor Vehicle includes transport vehicle and transport vehicle includes public service vehicle and public service vehicle includes any motor vehicle used or deemed to be used for carriage of passengers. Further held, that the authorization of having PSV endorsement in terms of Rule 41 (a) of the Rules is not required in the given circumstances. It is profitable to reproduce paras 13 and 17 of the judgement hereunder:-
"13. A combined reading of the above provisions leaves no room for doubt that by virtue of licence, about which there is no dispute, both Showkat Ahamd and Zahoor Ahmad were competent in terms of section 3 of the Motor Vehicles Act to drive a public service vehicle without any PSV endorsement and express authorization in terms of rule 4(1)(a) of the State Rules. In other words, the requirement of the State Rules stood satisfied.
...................................... .........................................
17. In the case of Mohammad Aslam Khan (CIMA no. 87 of 2002) Peerzada Noor-ud-Din appearing as witness on behalf of Regional Transport Officer did say on recall for further ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 5 examination that PSV endorsement on the licence of Zahoor Ahmad was fake. In our .
opinion, the fact that the PSV endorsement on the licence was fake is not at all material, for, even if the claim is considered on the premise that there was no PSV endorsement on the licence, for the reasons stated above, it would not materially affect the claim. By virtue of "C to E" licence Showkat Ahmad was competent to drive a passenger vehicle. In fact, there is no separate definition of passenger vehicle or passenger service vehicle in the Motor Vehicles Act. They come within the ambit of public service vehicle under section 2(35). A holder of driving licence with respect to "light Motor Vehicle"
is thus competent to drive any motor vehicle r used or adapted to be used for carriage of passengers i.e. a public service vehicle." In the given circumstances of the case PSV endorsement was not required at all."
9. The purpose of mandate of Sections 2 and 3 of the MV Act came up for consideration before the Apex Court in a case titled as Chairman, Rajasthan State Road Transport Corporation & ors. versus Smt. Santosh & Ors., reported in 2013 AIR SCW 2791, and after examining the various provisions of the MV Act held that Section 3 of the Act casts an obligation on the driver to hold an effective driving licence for the type of vehicle, which he intends to drive. It is apt to reproduce paras 19 and 23 of the judgment herein:
"19. Section 2(2) of the Act defines articulated vehicle which means a motor vehicle to which a semi-trailer is attached; Section 2(34) defines public place; Section 2(44) ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 6 defines 'tractor' as a motor vehicle which is not itself constructed to carry any load;
.
Section 2(46) defines `trailer' which means any vehicle, other than a semi- trailer and a side- sidecar, drawn or intended to be drawn by a motor car, vehicle. Section 3 of the Act provides for necessity for driving license;
Section 5 provides for responsibility of owners of the vehicle for contravention of Sections 3 and 4; Section 6 provides for restrictions on the holding of driving license; Section 56 provides for compulsion for having certificate of fitness for transport vehicles; Section 59 empowers the State to fix the age limit of the vehicles; Section 66 provides for necessity for permits to ply any vehicle for any commercial purpose; Section r 67 empowers the State to control road transport; Section 112 provides for limits of speed; Sections 133 and 134 imposes a duty on the owners and the drivers of the vehicles in case of accident and injury to a person; Section 146 provides that no person shall use any vehicle at a public place unless the vehicle is insured. In addition thereto, the Motor Vehicle Taxation Act provides for imposition of passenger tax and road tax etc.
20. ..........................
21. .........................
22. ........................
23. Section 3 of the Act casts an obligation on a driver to hold an effective driving license for the type of vehicle which he intends to drive. Section 10 of the Act enables the Central Government to prescribe forms of driving licenses for various categories of vehicles mentioned in sub-section (2) of the said Section. The definition clause in Section 2 of the Act defines various categories of vehicles which are covered in broad types mentioned in sub- subsection (2) of Section
10. They are 'goods carriage', section 'heavy goods vehicle', 'heavy passenger motor vehicle', 'invalid carriage', 'light motor vehicle', 'maxi-cab', 'medium goods vehicle', ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 7 'medium passenger motor vehicle', 'motor- cab', 'motorcycle', 'omnibus', 'private service .
vehicle', 'semi- trailer', 'tourist vehicle', 'tractor', 'trailer' and 'transport vehicle'."
10. The Apex Court in another case titled as National Insurance Company Ltd. versus Annappa Irappa Nesaria & Ors., reported in 2008 AIR SCW 906, has also discussed the purpose of amendments, which were made in the year 1994 and the definitions of 'light motor vehicle', 'medium goods vehicle' and the necessity of having a driving licence. It is apt to reproduce paras 8, 14 and 16 of the judgment herein:
"8. Mr. S.N. Bhat, learned counsel appearing on behalf of the respondents, on the other hand, submitted that the contention raised herein by the appellant has neither been raised before the Tribunal nor before the High Court. In any event, it was urged, that keeping in view the definition of the 'light motor vehicle' as contained in Section 2(21) of the Motor vehicles Act, 1988 ('Act' for short), a light goods carriage would come within the purview thereof. A 'light goods carriage' having not been defined in the Act, the definition of the 'light motor vehicle' clearly indicates that it takes within its umbrage, both a transport vehicle and a non- transport vehicle. Strong reliance has been placed in this behalf by the learned counsel in Ashok Gangadhar Maratha vs. Oriental Insurance Company Ltd., [1999 (6) SCC 620].
9. .....................
10. ..................
11. ..................
12. .................::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 8
13. .................
.
14. Rule 14 prescribes for filing of an in Form 4, for a licence to drive a motor vehicle, categorizing the same in nine types of vehicles. Clause (e) provides for 'Transport vehicle' which has been substituted by G.S.R. 221(E) with effect from 28.3.2001. Before the amendment in 2001, the entries medium goods vehicle and heavy goods vehicle existed which have been substituted by transport vehicle. As noticed hereinbefore, Light Motor Vehicles also found place therein.
r 15. .............................
16. From what has been noticed hereinbefore, it is evident that 'transport vehicle' has now 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 a light motor vehicle, therefore, was authorised to drive a light goods vehicle as well."
11. The Apex Court in a latest judgment in the case titled as Kulwant Singh & Ors. versus Oriental Insurance Company Ltd., reported in JT 2014 (12) SC 110, held that PSV endorsement is not required.
12. Having glance of the above discussions, I hold that the endorsement was not required.
13. The Apex Court in the case titled as National Insurance Co. Ltd. versus Swaran Singh and others, reported ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 9 in AIR 2004 Court 1531, has laid down principles, how can .
insurer avoid its liability. It is apt to reproduce relevant portion of para 105 of the judgment herein:
"105. .....................
(i) .........................
(ii) ........................
(iii) The breach of policy condition e.g. disqualification of driver or invalid driving licence of the driver, as contained in sub-section (2) (a)
(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or r invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time.
(iv) The insurance companies are, however, with a view to avoid their liability, must not only the available defence(s) raised in the said but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof wherefore would be on them.
(v).........................
(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 10 the cause of the accident. The Tribunals in interpreting the policy conditions would apply .
"the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under Section 149 (2) of the Act."
14. In a case titled as Lal Chand versus Oriental Insurance Co. Ltd., reported in 2006 AIR SCW 4832, the owner had performed his job whatever he was required to do and satisfied himself that the driver was having valid driving licence. The Apex Court held the insurer liable. It is apt to reproduce paras 8, 9 and 11 of the judgment herein:
"8. We have perused the pleadings and the orders passed by the Tribunal and also of the High Court and the annexures filed along with the appeal. This Court in the case of United India Insurance Co. Ltd. v. Lehru & ors., reported in 2003 (3) SCC 338, in paragraph 20 has observed that where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149(2)(a)(ii). He will, therefore, have to check whether the driver has a driving licence and if the driver produces a driving licence, which on the face of it looks genuine, the owner is not expected to find out whether the licence has in fact been issued by a competent authority or not. The owner would then take test of the driver, and if he finds that the driver is competent to drive the vehicle, he will hire the driver.
9. In the instant case, the owner has not only seen and examined the driving licence produced by the driver but also took the test of the driving of the driver and found that the driver was competent to drive the ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 11 vehicle and thereafter appointed him as driver of the vehicle in question. Thus, the .
owner has satisfied himself that the driver has a licence and is driving competently, there would be no breach of Section 149(2)(a)(ii) and the Insurance Company would not then be absolved of its liability.
10. .............................
11. As observed in the above paragraph, the insurer, namely the Insurance Company, has to prove that the insured, namely the owner of the vehicle, was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of r vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant point of time."
15. It would also be profitable to reproduce para 10 of the judgment rendered by the Apex Court in Pepsu Road Transport Corporation versus National Insurance Company, reported in (2013) 10 Supreme Court Cases 217, herein:
"10. In a claim for compensation, it is certainly open to the insurer under Section 149(2)(a)(ii) to take a defence that the driver of the vehicle involved in the accident was not duly licensed. Once such a defence is taken, the onus is on the insurer. But even after it is proved that the licence possessed by the driver was a fake one, whether there is liability on the insurer is the moot question. As far as the owner of the vehicle is concerned, when he hires a driver, he has to check whether the driver has a valid driving licence. Thereafter he has to satisfy himself as to the competence of the driver. If satisfied in that regard also, it can be said that the owner had taken reasonable care in employing a person who is qualified and ::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 12 competent to drive the vehicle. The owner cannot be expected to go beyond that, to the .
extent of verifying the genuineness of the driving licence with the licensing authority before hiring the services of the driver. However, the situation would be different if at the time of insurance of the vehicle or thereafter the insurance company requires the owner of the vehicle to have the licence duly verified from the licensing authority or if the attention of the owner of the vehicle is otherwise invited to the allegation that the licence issued to the driver employed by him is a fake one and yet the owner does not take appropriate action for verification of the matter regarding the genuineness of the licence from the licensing authority. That is what is r explained in Swaran Singh case. If despite such information with the owner that the licence possessed by his driver is fake, no action is taken by the insured for appropriate verification, then the insured will be at fault and, in such circumstances, the Insurance Company is not liable for the compensation."
16. Having said so, it cannot be said that the driver was not having a valid and effective driving licence at the time of accident.
17. The quantum of compensation cannot be said to be excessive, in any way, rather it is meager.
18. Viewed thus, no interference is required. Hence, the impugned award is upheld and the appeal is dismissed.
::: Downloaded on - 15/04/2017 17:40:15 :::HCHP 1319. Registry to release the awarded amount in favour .
of the claimant-injured, strictly as per the terms and conditions contained in the impugned award.
20. Send down the records after placing copy of the judgment on Tribunal's file.
February 27, 2014.
(hemlata)
to (Mansoor Ahmad Mir),
Chief Justice
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