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72. Therefore, the main purpose recognized under the statute is that no third party should suffer despite breach of any condition in the insurance policy between insurer and insured. Though such breach of condition is proved by the insurer against the insured, it should be treated as an inter se dispute between the insurer and the insured and the same should not affect the right of a third party, unless, there is a contribution by the third party himself in causing the breach of any condition of the policy. This is the main object and purpose of the Act and the provisions of the Act under consideration. Therefore, the purpose for which the conditions have been imposed in the policy as recognized under Section 149 (2) of the Act and the breach of those conditions are to be tested, as to, whether, the breach is referable to the cause of the accident so as to exonerate the insurer. If not, any condition imposed in the policy and breach of such a condition will not exonerate the Insurance Company so far as a third party risk is concerned. Thus, the first main test, if on ascertaining breach of a condition in the policy by the Court as to, whether the said breach is referable to the cause of accident in which case it would become a fundamental breach, then, the second test would be, whether, the victim or third party, in any manner contributed or was responsible for such breach of the condition by the insured and only thereafter, the Courts have to examine whether the Insurance Company could be directed to pay the compensation and recover from the insured or be completely absolved of its liability. This is how we understand the expressions regarding "fundamental breach"

76. Before parting with this judgment, we may also refer to waiver of breach of conditions by the insurer. Apart from specifically incorporating the conditions as enumerated in Section 149(2) of the Act, the insurer and the insured may also incorporate any other condition which is convenient and beneficial for the insurer or the insured making them inter se liable to each other. It is not that in law the insurer need not accept its liability despite there being a fundamental breach of any of the conditions of the policy by collecting additional premium or depending upon the business relationship and or good will between the insurer and the insured. Therefore, all would depend upon the relationship between the insurer and the insured. Even a fundamental breach of a condition in the policy can be waived by the insurer to accept the liability in order to enhance the business between the insurer and the insured; the insurer can undertake to discharge liability of the insured considering the large and huge business given by the insured to the insurer. Any other condition which is incorporated in the policy and breach of the said condition can also be waived by the insurer and accept its liability to satisfy an award. In such a circumstance, there should be a specific contract of waiver between the insured and the insurer and same would not, in any manner, make the insurer generally liable in all cases of breach of a condition of the policy. At the same time, there cannot be an universal waiver by the insurer in order to make it liable in all such cases. Therefore, the waiver of a breach of a condition in a policy is a special contract entered into between the insurer and the insured in order to make the insurer liable to indemnify the insured. The breach of a condition definitely gives the insurer the right to repudiate its liability or it can also elect to waive the same. If it is waived, the liability can be accepted and in such an eventuality, the courts would have no difficulty in fastening the entire liability on the insurer.

6. Further, though Shamanna's case was decided in the year 2018, the present reference being of the year 2013 also concerning, the correctness or otherwise of the decision in Subramanyam has to be decided in the above background.

7. Thus, in a nutshell, the question to be considered is, whether, the Insurance Company is liable to pay compensation and be permitted to recover the same from the insured even when there is a violation or breach of the condition of the policy under Section 149 of the Act. In other words, under what circumstances pay and recovery order could be made by the Motor Accident Claims Tribunal (hereinafter, referred to as "the Tribunal") or Court when there is breach of condition of the policy? In this regard, contention of the learned counsel for Insurance Company was that the circumstances under which a pay and recovery order could be issued must be clearly established as according to them, when a defence enumerated under Section 149 (2) of the Act is proved whether the Insurance Company would be completely absolved of its liability is not clear despite the catena of decisions. That, pay and recovery order cannot be passed by the Tribunal or the Court when there is a breach of the policy condition. It was the further contention that Hon'ble Supreme Court by exercising its power under Article 142 of the Constitution in certain cases has issued pay and recovery order to do complete justice in the matter, but such an order cannot be made by the High Court or the Tribunal. Learned counsel for the claimant has responded to the said contentions. Scheme of the Act:

(Emphasis supplied by me)

34. On a reading of the same, it becomes clear that the Hon'ble Supreme Court has laid down two tests. The breach of a policy condition, for example, by disqualification of the driver to hold a driving licence or invalid driving licence has to be proved to have been committed by the insured for avoiding liability by the insurer. In other words, in order to avoid the liability towards the 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 policy regarding use of the vehicle by a duly licensed driver or one who was not disqualified to drive at the relevant time. Thus, burden of proof of establishing breach on the part of the owner of the vehicle is on the Insurance Company. The above is the first test laid down by the Hon'ble Supreme Court. Then, there is another test enunciated. Even after proving breach of a policy condition regarding a valid licence by the driver or his qualification to drive during the relevant period on the part of the insured, the insurer would not be allowed to avoid his liability towards the insured unless the said breach or breaches is/are so "fundamental" as found to have contributed to the cause of the accident. This is having regard to the "rule of main purpose" or "main purpose rule"