National Insurance Company Ltd. vs Batul and Others

Prakash Gupta, J.—This appeal is preferred by the appellant-National Insurance Company against the judgment and award dated 22.3.2007 passed by the Motor Accident Claims Tribunal, Alwar in claim case No. 157/2006 whereby the Motor Accident Claims Tribunal partly allowed claim petition and passed an award of Rs. 2,77,800. The background facts of the case in brief are that on 28.2.2006 at about 8 O''clock, the deceased, Mahesh, was driving a Tempo bearing No. FU-02-P-1859 from Sahapura to Alwar and suddenly a Tractor bearing No. RJ-25-R-686, which was being rashly and negligently driven by the Tractor driver, hit the Tempo. As a result of which, the deceased sustained multiple injuries and died on the spot.

The appellant-Insurance Company, in its reply, raised an objection that the deceased was not having a valid and effective driving licence therefore, in such a situation Insurance Company is not liable with regard to this objection, the learned Tribunal framed the following issue:

The sole contention of the learned Counsel for the appellant Insurance Company is that the learned Tribunal, while deciding issue No. 4, held that even though deceased was not having a valid and effective licence, Insurance Company was to pay compensation to the claimant first and after that the Insurance Company could recover the compensation, so given, from the owner of the vehicle and hence, learned Tribunal grossly erred in giving such a direction.

I agree with the contention of the learned Counsel for the Insurance Company. The learned Tribunal, while deciding issue No. 4, clearly held that at the time of the accident, the deceased did not have a valid and effective driving licence. In spite of that, the learned Tribunal directed the Insurance Company to pay compensation to the claimants and recover the same from the owner of the vehicle. Legally, this order is not sustainable. In New India Assurance Co. Ltd. v. Kusum & Ors., II (2000) ACC 518 (SC) : 2009 (2) WLC (SC) Civil 771 observed as under:

"Again in Deddappa and Others Vs. The Branch Manager, National Insurance Co. Ltd., held:

However, as the appellant hails from the lowest strata of society, we are of the opinion that in a case of this nature, we should, in exercise of our extraordinary jurisdiction under Article 142 of the Constitution of India, direct Respondent 1 to pay the amount of claim to the appellants herein and recover the same from the owner of the vehicle viz. Respondent 2, particularly in view of the fact that no appeal was preferred by him. We direct accordingly.

Whenever, thus, a direction has been issued by the Tribunal, it must be held to have been done in exercise of its inherent power. It would be travesty of justice, if the Insurance Company which is directed to pay the amount and then face immense difficulties in executing a decree."

Similarly in Bhuwan Singh Vs. Oriental Insurance Company Ltd. and Another, decided on 5.3.2009. The Hon''ble Apex Court observed as under:

"24. As on 5.1.2001 the appellant was not duly licensed as his learner''s licence expired on 22.12.2000. He filed an application for grant of licence much later. Insurance Company, therefore, in our opinion was not bound to reimburse him in terms of the Contract of Insurance."

In Oriental Insurance Co. Ltd. Vs. Angad Kol and Others, , the Hon''ble Apex Court in exercise of its jurisdiction under Article 142 of the Constitution directed the Insurance Company to deposit the compensation with liberty to the claimants to withdraw the same and gave Insurance Company the right to recover the said amount from the owner and driver of the vehicle.

In National Insurance Co. Ltd. Vs. Vidhyadhar Mahariwala and Others, , the Hon''ble Supreme Court observed as under:

"9. In Kusum Rai''s case (supra), it was held as follows:

This Court in National Insurance Co. Ltd. Vs. Swaran Singh and Others, clearly laid down that the liability of the Insurance Company vis-�-vis the owner would depend upon several factors. The owner would be liable for payment of compensation in a case where the driver was not having a licence at all. It was the obligation on the part of the owner to take adequate care to see that the driver had an appropriate licence to drive the vehicle. The question as regards the liability of the owner vis-�-vis the driver being not possessed of a valid licence was considered in Swaran Singh stating: (SCC pp. 336-37, para 89)"

Thus, it is clear that since, the powers under Article 142 of the constitution are exclusively conferred on the Supreme Court, the Tribunal cannot give a direction in its inherent jurisdiction or otherwise. The Insurance Company cannot be compelled to pay the amount of compensation which it would find immensely difficult to recover. A direction to do so, undoubtedly, shall result in failure of justice to the Insurance Company.

Since, it is an admitted fact that the deceased did not have a valid licence and at the time of the accident, the appellant Insurance Company stands absolved of its liability. Considering the above, the finding of the Trial Court in this regard is not sustainable in the eyes of law and this appeal deserves to be allowed and the same is hereby allowed. The appellant-Insurance Company stands absolved of its liability. There shall be no Order as to costs.