NATIONAL INSURANCE COMPANY LTD vs Sansar Chand

THERE has been delay of 38 days in filing revision petition for which an application for condonation of delay has been filed and for reasons assigned therein, the delay is hereby condoned. Petitioner Corporation has put on record proof of remittance of Rs. 5,000 to respondent and its acknowledgement by them.

SUCCINCTLY put, facts are that respondent''s vehicle bearing registration No. HP-56-B-0210 insured with petitioner Insurance Corporation, met with an accident on 3.12.2005 during subsistence of insurance policy. Allegedly, respondent having incurred expenses of Rs. 1,13,815 on repair of vehicle, lodged claim with petitioner Corporation for indemnification of loss suffered in the accident. Claim was, however, closed on its repudiation. Thereafter, a consumer complaint was filed with District Forum, which was resisted by petitioner Corporation holding that since driver who was running vehicle at the material time of accident, was holding licence for plying only light vehicle, vehicle in question being light transport vehicle, driver was not authorized to drive it without there being any endorsement by R.T.O. on driving licence. District Forum, on evaluation of pleadings of parties, having accepted contentions raised on behalf of Insurance Corporation, dismissed complaint which was reversed in appeal by State Commission, presumably treating the claim on ''non-standard'' basis, based on finding of Surveyor. It is how that petitioner Corporation is in revision.

IT is not in dispute that certain guidelines have been issued by Insurance Corporation for treating claim on ''non-standard'' basis and learned Counsel for petitioner with due emphasis on those guidelines submitted that factum of driver not holding valid driving licence being a fundamental breach of terms and conditions of policy would not be covered by guidelines which are of administrative nature. Learned Counsel for respondent would, however, draw my attention to certain citations of National Commission about treating such claims on ''non-standard'' basis when there were breach of terms and conditions of insurance policy.

TWO major issues which merits consideration are as to whether driver holding licence for light motor vehicle would be qualified to drive light transport vehicle and without dilating the issue further, I would refer to a decision of National Commission in RP 979 of 1997 in the matter of United India Insurance Company Ltd. v. Jaya Rajendra Kumar Nanda, I (2004) CPJ 25 (NC), in which observations were made that even though driver held licence for medium goods vehicle he was not eligible to drive light motor vehicle. Yet, I would refer to a decision of Hon''ble Apex Court in Civil Appeal No. 3055/2008 in the matter of Oriental Insurance Company Ltd. v. Jharu Nisha and Ors., IV (2008) ACC 781 (SC), in which case, even though a person driving a two-wheeler, who held licence to drive heavy motor vehicle was not considered eligible for a driving two-wheeler, on consideration of issue that the person driving a two-wheeler had licence for a vehicle which was totally a different class of vehicle in terms of Section 10 of M.V. Act, 1988. In view of this proposition of law, following observations were made by Hon''ble Apex Court: "In the light of above settled proposition of law, Insurance Company cannot be held liable to pay the amount of compensation to the claimants for the cause of death of Shukurullah in road accident which had occurred due to rash and negligent driving of a scooter by Ramsurat who admittedly had no valid and effective licence to drive vehicle on day of accident. Scooterist was possessing driving licence to drive Heavy Motor Vehicle and he was driving totally different class of vehicle which act of his is in violation of Section 10(2) of M.V. Act, 1988."

APPLYING ratio (supra), petitioner Insurance Corporation was not liable to indemnify loss suffered by respondent in the accident.

THE other issue which merits for consideration is that as to whether treating disqualification of the driver to be not a fundamental breach of terms and conditions of insurance policy, claim could have been settled on ''non-standard'' basis by State Commission and on this score too, one may refer to a decision of National Commission in RP 1833/2002 in the matter of National Insurance Company Ltd. v. Faquir Chand, IV (2005) CPJ 82 (NC), in which even there being a breach of terms and conditions of policy as to ''limitation for use'', contention raised about settlement of claim on ''non-standard'' basis did not find favour with National Commission. Inspiration can be drawn from other decision of National Commission in the matter of Rajiv Rathode v. Oriental Insurance Company Ltd., I (2003) CPJ 206 (NC). In case of Amarendru Sahu v. Oriental Insurance Company Ltd., 2010 STPL (WEV) 212, even in case of use of vehicle in violation of terms and conditions of policy, contentions raised about settlement of claim on ''non-standard'' basis did not find favour with Hon''ble Apex Court. There being a long precedence of decisions on this score too, finding of State Commission treating the claim "non-standard" making Insurance Company answerable to pay Rs. 51,321.75 did not bear merit. Resultantly, finding of State Commission is set aside and revision petition succeeds with no order as to cost.

DEPOSITS made by Insurance Company during pendency of proceeding shall now be dealt with in accordance to conclusive finding contained herein. Revision Petition allowed.