NEW INDIA ASSURANCE CO LTD vs Jadav Narendrabhai Jethabhai

THE New India Insurance Company Ltd., Mehsana Branch, which had figured as the opposite party in Case No. 349 of 1993 on the file of the District Forum, Mehsana has preferred this Revision Petition against an order dated 22.9.94 passed by the State Commission, Gujarat, Ahmedabad allowing Appeal No. 356 of 1993 filed before it by the complainant in the aforementioned case, setting aside the order of the District Forum, whereby the complaint had been dismissed and directing the Revision Petitioner Insurance Company to pay to the complainant a sum of Rs. 30,000/ -by way of compensation for the loss sustained by the complainant, as a result of an accidental fire which resulted in a total destruction of his auto rickshaw.

THE complainant owned an auto rickshaw bearing Registration No. GJ -1 -T -1488 and he had given it on lease to one Bhavsar Priyakant Mafatlal. While the said rickshaw was plying from Ahmedabad to Palsana at about 8 p.m. on 14th April, 1991 it caught fire due to a short circuit and was completely damaged. The complainant had insured the rickshaw, with the Revision Petitioner -Insurance Company and the policy of insurance was valid from April 17,1990 to April 16, 1991. Immediately after the occurrence of the fire accident and the consequential destruction of the rickshaw the complainant preferred a claim before the Insurance Company seeking to recover the full amount for which the rickshaw had been insured under the aforementioned policy. The said claim was repudiated by the insured on the ground that the driver Bhavsar Priyakant Mafatlal was not holding an effective driving licence on the date when the loss by fire occurred. Aggrieved by the rejection of his claim by the Insurance Company, the complainant respondent herein approached the District Forum, Mehsana seeking to recover a sum of Rs. 50,000/ - from the Insurance Company as representing the value of the auto rickshaw which had been totally destroyed. The said claim was resisted before the District Forum by the Insurance Company by contending that as per the terms of the policy the liability of the insured was excluded because of the fact that at the time of occurrence of an accident the driver of the vehicle did not possess an effective driving licence. This plea of the Insurance Company was upheld by the District Forum and consequently the complaint was dismissed by it.

ON appeal filed by the complainant before the State Commission, Gujarat, the State Commission was of the opinion that the case was fully covered by an earlier ruling of its own in Appeal No. 303 of 1993 New India Assurance Company v. Amrabhai Mulabhai Rathod, dated August 25, 1994 wherein the view had been taken that ''once the licence is renewed, it stands revived and it is effective from the date it expired''. After referring to the said earlier ruling the State Commission proceeded to state thus : - ''Since the licence renewed, the driver must have paid the requisite fees including additional fee for every year of delay under Rule 32 of Central Motor Vehicles Rules, 1989. In our opinion, therefore, the appellants claim could not have been rejected on the ground that the driver of the rickshaw did not hold effective driving licence on the date of the incident. It is further pertinent to note that the incident in which the rickshaw was destroyed did not occur on account of rash and negligent driving on the part of the driver of the rickshaw. In fact, burning of rickshaw had nothing to do with the driving thereof by the driver. The fact that the rickshaw caught fire due to short circuit is not at ail disputed if the rickshaw was destroyed due to reason which was unconnected with driving thereof, we fail to see how the appellants claim could have been rejected on the ground that the driver was not holding a valid and effective driving licence on the date of the incident.''

ON the basis of the aforesaid reasoning the appeal was allowed by the State Commission. The repudiation by the Insurance Company was held to be not bona fide and the revision petitioner -Insurance Company was directed to pay a sum of Rs. 30,000/ - together with interest at 15% per annum from July 1,1991 till date of payment besides Rs. 1000/ - by way of costs. Hence this Revision Petition by the Insurance Company. Admittedly, the driving licence of Bhavsar Priyakant Mafatlal who was driving the auto rickshaw at the time of the accident which occurred on April 14,1991 had expired as early as on 11th November, 1979. The said licence was renewed only on May 21, 1991, more than a month subsequent to the occurrence of the accident. The District Forum has recorded the finding that ''in our case the application for renewal of licence was made after 12 years and not within the period of 30 day after the date of its expiry that is on 11.11.79''. The question for consideration is whether in the context of these undisputed facts, the view expressed by the State Commission that the renewal of Bhavsar Priyakant Mafatlals driving licence granted on May 21,1991 is to be deemed to be effective from the date of expiry of the earlier licence held by him i.e. from November 11,1979.

IT is not disputed before us that under the terms of the policy the liability of the Insurance Company to compensate the insurer for any loss occurring to the vehicle is conditional on the driver of the vehicle possessing an effective licence at the time of occurrence of the loss. Section 15 of the Motor Vehicles Act, 1988 deals with the topic of renewal of driving licences. Sub -section (1) of the said section so far as it is material for our present purpose, lays down : - ''(1) Any licensing authority may, on application made to it, renew a driving licence issued under the provisions of this Act with effect from the date of its expiry. Provided that in any case where the application for the renewal of a licence is made more than thirty days after the date of its expiry, the driving licence shall be renewed with effect from the date of its renewal.''

IN the light of the clear mandate contained in the proviso to the section that in a case where the application for renewal of the licence is made more than 30 days after the date of its expiry, the driving licence shall be renewed only with effect from the date of such renewal, we find it impossible to uphold the view expressed by the State Commission that whenever a driving licence is renewed, such renewal would automatically take effect from the date of expiry of the original licence. The said view overlooks the clear terms of the proviso which are mandatory in nature. In the present case the driving licence of Bhavsar Priyakant Mafatlal had expired as early as on 11th November, 1979 and the application or renewal had been filed only after a lapse of nearly 12 years. Such being the factual situation, the renewed driving licence could be effective only from 21st May, 1991, that being the date on which the renewal was actually granted. Hence on the date when the accident occurred the driver of the vehicle was not holding an effective and valid driving licence. The Insurance Company was, therefore, fully justified in repudiating its liability in respect of the claim put forward by the complainant.

WE accordingly hold that the State Commission acted illegally without jurisdiction in interfering with the order of the District Forum which had rightly dismissed the complaint filed by the respondent herein. The Revision Petition is accordingly allowed, the order of the State Commission is set aside and that passed by the District Forum dismissing the complaint is here by restored. The parties will bear their respective costs. Petition allowed.