How to decide a motor Accidents claim petition where defence of Invalid,Learners Licence & Fake Driving Licence and Defense ofQualification/Badge is taken:

How to decide a motor Accidents claim petition where defence of Invalid,Learners Licence & Fake Driving Licence and Defense ofQualification/Badge is taken:

Reference is required to be made to ratio laid down by Hon'ble Apex Court in the case of National Insurance Com. Ltd.V/s Swaran Singh, reported in AIR 2004 SC 1531, in Para No.105 it has been held as under:105: The summary of our findings to the various issues as raised in these petitions are as follows :

(i) Chapter XI of the Motor Vehicles Act, 1988 providing

compulsory insurance of vehicles against third party risks is a

social welfare legislation to extend relief by compensation to

victims of accidents caused by use of motor vehicles. The

provisions of compulsory insurance coverage of all vehicles are

with this paramount object and the provisions of the Act have

to be so interpreted as to effectuate the said object.

(ii) Insurer is entitled to raise a defence in a claim petition

filed under Section 163A

or Section 166 of the Motor Vehicles

Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the

said Act.

(iii) The breach of policy condition e.g. disqualification of

driver or invalid driving licence of the driver, as contained in

subsection

(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 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 establish the available

defence(s) raised in the said proceedings but must also

establish 'breach' on the part of the owner of the vehicle; the

burden of proof wherefore would be on them.

(v) The court cannot lay down any criteria as to how said

burden would be discharged, inasmuch as the same would

depend upon the facts and circumstances of each case.

(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 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.

(vii) The question as to whether the owner has taken

reasonable care to find out as to whether the driving licence

produced by the driver, (a fake one or otherwise), does not

fulfil the requirements of law or not will have to be determined

in each case.Beli Ram v/s. Rajinder Kumar – 2020 SCC

Online (SC) 769.

(viii) If a vehicle at the time of accident was driven by a person

having a learner's licence, the insurance companies would be

liable to satisfy the decree.

(ix) The claims tribunal constituted under Section 165 read

with Section 168 is empowered to adjudicate all claims in

respect of the accidents involving death or of bodily injury or

damage to property of third party arising in use of motor

vehicle. The said power of the tribunal is not restricted to

decide the claims inter se between claimant or claimants on

one side and insured, insurer and driver on the other. In the

course of adjudicating the claim for compensation and to

decide the availability of defence or defences to the insurer, the

Tribunal has necessarily the power and jurisdiction to decide

disputes inter se between insurer and the insured. The decision

rendered on the claims and disputes inter se between the

insurer and insured in the course of adjudication of claim for

compensation by the claimants and the award made thereon is

enforceable and executable in the same manner as provided in

Section 174 of the Act for enforcement and execution of the

award in favour of the claimants.

(x) Where on adjudication of the claim under the Act the

tribunal arrives at a conclusion that the insurer has

satisfactorily proved its defence in accordance with the

provisions of Sections 149(2) read with subsection

(7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the

compensation and other amounts which it has been compelled

to pay to the third party under the award of the tribunal. Such

determination of claim by the Tribunal will be enforceable and

the money found due to the insurer from the insured will be

recoverable on a certificate issued by the tribunal to the

Collector in the same manner under Section 174 of the Act as

arrears as land revenue. The certificate will be issued for the

recovery as arrears of land revenue only if, as required by subsection

(3) of Section 168 of the Act the insured fails to deposit

the amount awarded in favour of the insurer within thirty days

from the date of announcement of the award by the tribunal.

(xi) The provisions contained in subsection

(4) with proviso there under and subsection

(5) which are intended to cover specified contingencies mentioned therein to enable the insurer to recover amount paid under the contract of insurance on behalf of the insured can be taken recourse of by the Tribunal and be extended to claims and defences of insurer against insured by relegating them to the remedy before regular court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims”.

8.2 Bare reading of above referred observations makes it clear that mere absence, fake or 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. The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof wherefore would be on them. 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 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.

If a vehicle at the time of accident was driven by a person having a learner's licence, the insurance companies would be liable to satisfy the decree.

8.3 It is also held in Para 105 (ix) and (x) that Tribunal is empowered to pass and order to “Pay and Recover” against the insurer.

8.3.1 Hon'ble Full bench of the Supreme Court of India in the case of Pappu v/s. Vinod Kumar Lambha, Civil Appeal No.20962 of 2017, arising out of SLP No.29032 of 2015, dated 19.01.2018, reported in 2018 ACJ 690 (FB) has relied upon the ratio laid down in the case of Swaran Singh (supra) and held that an order of Pay and Recover can be passed. Also see Rajinder Kumar – 2020 SCC Online (SC) 769.

8.3.2 Similar view has been taken in the case of Singh Ram v/s.

Nirmala, AIR 2018 SC 1290 (FB). And also in Francisca Luiza

Rocha v/s. K. Valarmathi, 2018 ACJ 1430 (SC) (FB)

8.3.3 In a case before SC, it was a case where before the Tribunal it was proved that driver cum owner produced the fake licence and he did not stepped into the witness box and, therefore, held that driver was not holding valid licence at the time of accident passed an order of pay and recover – which was confirmed by the SC.

2018 ACJ 1264 (SC) (FB) – Singh Ram v/s. Nirmala.

Similar view has been taken in the case of Ram Chandra Singh v/s. Rajaram, 2018 ACJ 2703 (SC)

8.4 As far as, defence of insurer qua the qualification/badge of the licence is concern, same can be decided by relying upon para

Nos.42, 43 & 84 of the Swaran Singh's case. Paras 42, 43 & 84

reads as under:“

42. If a person has been given a licence for a particular type of

vehicle as specified therein, he cannot be said to have no licence

for driving another type of vehicle which is of the same category

but of different type. As for example when a person is granted a

licence for driving a light motor vehicle he can drive either a car

or a jeep and it is not necessary that he must have driving

licence both for car and jeep separately.

43. Furthermore, the insurance company with a view to avoid

its liabilities is not only required to show that the conditions

laid down under Section 149(2)(a) or (b) are satisfied but is

further required to establish that there has been a breach on the

part of the insured. By reason of the provisions contained in the

1988 Act, a more extensive remedy has been conferred upon

those who have obtained judgment against the user of a vehicle

and after a certificate of insurance is delivered in terms of

Section 147(3) a third party has obtained a judgment against

any person insured by the policy in respect of a liability

required to be covered by Section 145, the same must be

satisfied by the insurer, notwithstanding that the insurer may

be entitled to avoid or to cancel the policy or may in fact have

done so. The same obligation applies in respect of a judgment

against a person not insured by the policy in respect of such a

liability, but who would have been covered if the policy had

covered the liability of all persons, except that in respect of

liability for death or bodily injury.

84. 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 Central

Government to prescribe forms of driving licences for various

categories of vehicles mentioned in subsection (2) of said

section. The various types of vehicles described for which a

driver may obtain a licence for one or more of them are: (a)

Motorcycle without gear, (b) motorcycle with gear, (c) invalid

carriage, (d) light motor vehicle, (e) transport vehicle, (f) road

roller, and (g) motor vehicle of other specified description. The

definition clause in Section 2 of the Act defines various

categories of vehicles which are covered in broad types

mentioned in subsection (2) of Section 10. They are 'goods

carriage', 'heavygoods

vehicle', 'heavy passenger motorvehicle',

'invalid carriage', 'light motorvehicle',

'maxicab',

'medium

goods vehicle', 'medium passenger motorvehicle',

'motorcab',

'motorcycle', 'omnibus', 'private service vehicle', 'semitrailer',

'tourist vehicle', 'tractor', 'trailer', and 'transport vehicle'. In

claims for compensation for accidents, various kinds of breaches

with regard to the conditions of driving licences arise for

consideration before the Tribunal. A person possessing a driving

licence for 'motorcycle without gear', for which he has no

licence. Cases may also arise where a holder of driving licence

for 'light motor vehicle' is found to be driving a 'maxicab',

'motorcab' or 'omnibus' for which he has no licence.In each case

on evidence led before the Tribunal, a decision has to be taken

whether the fact of the driver possessing licence for one type of

vehicle but found driving another type of vehicle, was the main

or contributory cause of accident. If on facts, it is found that

accident was caused solely because of some other unforeseen or

intervening causes like mechanical failures and similar other

causes having no nexus with driver not possessing requisite type

of licence, the insurer will not be allowed to avoid its liability

merely for technical breach of conditions concerning driving

licence”.

8.5 Meaning thereby, even if driver of offending vehicle was not

qualified to ply the offending vehicle or was not having the

required badge to ply such vehicle then also insurer is liable to pay amount of compensation. Before passing any order, Tribunal has to decide whether the fact of the driver possessing licence for one type of vehicle but found driving another type of vehicle, was the main or contributory cause of accident. If on facts, it is found that accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence.

8.6 Reference is also required to be made to the decision of Hon'ble Apex Court in the case of S. Iyyapan v/s United India Insurance Com. Ltd., dated 01.07.2013. Wherein, after referring several ratios of hon'ble Apex Court, it has been held in Para No.19 that:“

In the instant case, admittedly the driver was holding

a valid driving licence to drive light motor vehicle. There is no

dispute that the motor vehicle in question, by which accident

took place, was Mahindra Maxi Cab. Merely because the

driver did not get any endorsement in the driving licence to

drive Mahindra Maxi Cab, which is a light motor vehicle, the

High Court has committed grave error of law in holding that

the insurer is not liable to pay compensation because the

driver was not holding the licence to drivethe commercial

vehicle. The impugned judgment is, therefore, liable to be set

aside”.

8.7 In the case of New India Assurance Co. Ltd. v. Roshanben

Rahemansha Fakir, reported in AIR 2008 SC 2266, it has been held that when driver of offending vehicle was holder of licence of three wheeler i.e. auto rickshaw delivery van and his licence was not meant for driving 'transport vehicle' but for goods carrying public carrier, in such case Insurer is not liable but directed the insurer to first pay entire amount of compensation with a further direction to recover the same from the insured. It has been further held that only Supreme Court has the powers under Article 142 of Constitution of India to pass an order of 'Pay and Recover'.

8.7.1. Recently Hon'ble Supreme Court in the case of Shamanna

v/s. Divisional Manager, 2018 ACJ 2163 has held that Tribunal has inherent powers to pass an order of 'Pay and Recover' and it not that only Supreme Court has such powers u/A 142 of the

Constitution of India.

8.8 Recently Hon'ble the Full Bench of the Apex Court in the case of

Mukund Dewangan v/s O.I. Com., reported in 2017 ACJ 2011 (SC) = AIR 2017 SC 3668 has held that LMV includes Transport Vehicle as per weight prescribed in Section 2(21) r/w Section 2(48) and, therefore, Driver holding LMV licence can drive all vehicles of class including Transport Vehicles and no separate endorsement is required to drive such Transport Vehicle.

Also see 2018 ACJ 1018 (SC) – Bajaj Allianz v/s. Rambha Devi,

2022 ACJ 726 (SC) 953; Jagdish Kumar v/s. UII Com. Ltd. Mukund Dewangan followed.

The ratio laid down in the case of Mukund Dewangan (supra) has

been referred to the Larger Bench 2022

ACJ 726 (SC) – Bajaj Allianz v/s. Rambha Devi