NATIONAL INSURANCE CO LTD vs Prithipati Sattiyya

NATIONAL Insurance Co. Ltd., petitioner herein, which was the opposite party before the District Forum, has filed the present Revision Petition against the order dated 5.6.2007 passed by State Consumer Disputes Redressal Commission, Hyderabad in Appeal No. 635/2007 whereby the State Commission, confirming the order of the District Forum, directed the petitioner to pay Rs. 2 lakh to the complainant/respondents with interest @ 9% from the date of submission of the claim, i.e., 20.6.2005, till realization. Rs. 10,000 have been awarded by way of compensation and Rs. 1,000 as costs.

COMPLAINANT/respondents filed the complaint with the allegations that one Prathipati Rambabau was the owner cum driver of Ambassador car bearing No. AP 5V 568. He had obtained an insurance policy including personal accident benefit of owner cum driver from the petitioner. The policy was valid from 13.7.2004 to 12.7.2005. On 9.10.2004, near Coconut Research Centre, Ambajipeta, one RTC bus bearing No. 10 Z 7162 came from the opposite side at a high speed and dashed in the car killing the insured. On 30.12.04, the first complainant intimated the petitioner about the accident and lodged the claim, which was repudiated on the ground that the insured did not have the valid driving licence at the time of the accident. Alleging deficiency on the part of the petitioner, the respondent filed the complaint before the District Forum seeking a direction to pay Rs. 2 lakh towards personal accident benefit along with interest @ 18%, Rs. 20,000 towards pain and mental agony and Rs. 2,000 towards costs.

PETITIONER, on being served, entered appearance and took the stand that the petitioner was not liable to reimburse the loss suffered by the respondents as the driver did not have the valid driving licence to drive the vehicle.

DISTRICT Forum overruled the stand taken by the petitioner and directed the petitioner to pay Rs. 2 lakh with interest @ 9% from the date of submission of the claim form by the complainants, i.e., 20.6.2005 till the date of realization. Rs. 10,000 were awarded by way of compensation and Rs. 1,000 as costs.

PETITIONER, being aggrieved, filed the appeal before the State Commission. State Commission dismissed the appeal and upheld the order passed by the District Forum.

BEING aggrieved, petitioner has filed the present Revision Petition. Respondent, in spite of service, is not present. Ordered to be proceeded ex parte.

COUNSEL for the petitioner contends that since the driving licence possessed by the driver authorized him to drive a Light Motor Vehicle (LMV) only, he was not authorized to driver a passenger/transport vehicle. Insured''s vehicle was a taxi, which would be a transport vehicle within the meaning of Section 2(47) of the Motor Vehicles Act, 1988. That since the driver did not possess the driving licence to drive the passenger/transport vehicle, the petitioner is not liable to indemnify the loss suffered by the insured. In support of this contention, learned Counsel for the petitioner relies upon the judgment of the Supreme Court in New India Assurance Co. Ltd. v. Prabhu Lal, I (2008) CPJ 1 (SC)=IX (2007) SLT 841=I (2008) ACC 54 (SC).

WE find substance in this submission. In the aforesaid judgment, the Supreme Court of India has held that Insurance Company is not liable to reimburse for the loss caused in case the driver did not possess an effective driving licence to drive the transport vehicle. In the aforesaid case, the driver had the licence to drive the LMV only, whereas he was driving a commercial vehicle to carry passengers.

LEARNED Counsel for the petitioner also relies upon an earlier judgment of the Supreme Court in National Insurance Co. Ltd. v. Kusum Rai, II (2006) CPJ 8 (SC)=III (2006) SLT 162=II (2006) ACC 19 (SC)=(2006) 6 SCC 250, wherein it has been held that if the vehicle is a taxi and the driver of the said vehicle holds a driving licence to drive LMV only without there being any endorsement for driving a transport vehicle, then the Insurance Company cannot be ordered to pay the compensation. Relevant observations of the Supreme Court in Prabhu Lal''s case (supra), are as under: "35. The learned Counsel for the Insurance Company also referred to a decision of this Court in National Insurance Co. Ltd. v. Kusum Rai and Ors., II (2006)CPJ 8 (SC), wherein this Court held that if the vehicle is a taxi which is being driven by a driver holding licence for driving Light Motor Vehicle only without there being any endorsement for driving transport vehicle, the Insurance Company cannot be ordered to pay compensation. 44. In the matter of Nasir Ahmed, (SLP No. 7618 of 2005), the vehicle was a luxury taxi- passenger carrying commercial vehicle. There also the driving licence issued in favour of the driver was to ply light Motor Vehicle (LMV) and hence the driver could not have driven the vehicle in question. In that case too, the licence was renewed for a period of twenty years i.e., from February 5, 2000 to February 4, 2020. Again, there was no endorsement as required by Section 3 of the Act. A specific plea was taken by the Insurance Company but the Authorities held the Insurance Company liable which could not have been done. The reasoning and conclusion arrived at by us in the matter of Prabhu Lal (SLP No. 7370 of 2004) would apply to the case of Nasir Ahmed. That appeal is, therefore, allowed. 45. In Chandra Parkash Saxena (SLP No. 17794 of 2004), the vehicle involved in accident was Jeep Commander made by Mahindra and Mahindra, a passenger carrying commercial vehicle, and in view of the fact that the driver was holding licence to driver light Motor vehicle (LMV), he could not have plied the Vehicle in question. For the reasons recorded hereinabove in the main matters of Prabhu Lal i.e. SLP (C) No. 7370 of 2004, the Insurance Company could not have been held liable and that appeal also deserves to be allowed."

ADMITTEDLY, in the present case, the driver had a licence to drive LMV only and there was no endorsement on the licence authorizing him to drive the taxi, which was a transport vehicle to carry passengers. Since the driver of the vehicle did not have a valid licence to drive a transport vehicle, the Insurance Company is not liable to reimburse for the loss caused to the vehicle in the accident.

FOR the reasons stated above, we allow the Revision Petition, set aside the order of the Fora below and dismiss the complaint with no order as to costs.

DEPOSIT, If any, made by the petitioner be refunded to the petitioner. Revision Petition allowed.