New India Assurance Company Ltd vs M/s Kapoor Diesels Garage Pvt Ltd

Neena Bansal Krishna, J

Regular First Appeal under Section 96 of the Code of Civil Procedure, 1908 (hereinafter referred to as ‘CPC’) has been filed against the  judgment and  decree dated 02.07.2022 whereby  the Ld.  District  Judge has decreed the Suit of the Respondent/Plaintiff for Rs.13,77,500/- along with interest @ 12% p.a. The Respondent/Plaintiff had filed CS No. 972/2017 for recovery of Rs.13,77,500/- along with interest.

The  brief  facts  as  narrated  in  the  plaint,  are  that  the  Plaintiff  was  in business of transport, for the last many years. It was the owner of Tata LPT Truck bearing No. HR-38S-9314, for which it took the Insurance Policy effective from 16.09.2013 to 15.09.2014, from the Defendant/Appellant Insurance Company. However, unfortunately, the truck met with an accident on  11.07.2014  in  which  not  only  was  the  vehicle  completely  damaged,  but its driver Salmu also died. FIR No. 0104/2014 was registered at P.S. Turuvanur (Jogi), Karnataka. The intimation about the accident, was duly conveyed to the Head Office of the Defendant/Appellant.

The investigators of the Insurance Company met the representative of the Plaintiff and had telephonic discussion about the accident. Thereafter, all the documents  required by the  Insurance Company were  duly submitted  by Plaintiff and all the formalities were completed. As per the Letter dated 10.08.2015  of  the  Defendant  Insurance  Company,  Plaintiff  surrendered  the Registration Certificate to  the TRO  and  STA  Letter  dated 01.12.2015 was submitted to the Defendant Company.

The Insurance Company sent the Letter dated 29.01.2016, stating that the driving license of the driver who drove the vehicle, was found to be fake, in  terms  of  the  Circular  issued by the  concerned  Transport  Authority. The vehicle was thus, being driven by  a person who had no valid license which  was  in  violation  of  the  policy  terms  and  conditions  and  rejected  the claim of the Plaintiff.

The Plaintiff explained that the driving license No. 6737/TV/MKG/Prof of the driver Mr. Salmu, deceased, who drove the vehicle, was verified on 23.04.2015 by the Plaintiff from the Competent Authority  and  it  was  found  that  the  driving  license  had  been  issued  to  him from  08.01.2014  to  13.01.2016,  which  covered  the  date  of  accident.  Since the accident took place on 11.07.2014, the driver was authorized to drive the HTV on the date of accident.

The Plaintiff asserted that it is a settled law that in case of the accident claim of the vehicle, if the premium has been duly received by the Insurance Company, it cannot for any reason, reject the claim. The Defendant in blatant violation of the provisions of Insurance Policy, on fictitious and legally untenable grounds, rejected the claim.

The Plaintiff claimed that the total loss claim was Rs.13,77,500/-, which was legally recoverable from the Insurance Company. Hence, the Suit was filed for recovery of Rs.13,77,500/- along with interest @ 9% p.a.

The Defendant/Appellant in its Written Statement took the preliminary objection that the claim of the Plaintiff was rightly repudiated in respect of insured vehicle, on account of violation of terms and conditions of the Insurance Policy, qua the truck involved in the accident.  The Plaintiff had  allowed  its  driver  who  had  no  valid  legal  driving license,  to  drive  the vehicle.  Consequently,  the  Insurance  Company  had  no  other  option,  but  to reject  the  claim.  It  was  asserted  that  the  Suit  did  not  disclose  any  cause  of action and the Suit was liable to be rejected.

Insofar  as  the merits  of  the  case were  concerned,  it  was  admitted that the Insurance Policy valid from 16.09.2013 to 15.09.2014, had been issued in respect of the truck, in favor of Plaintiff. The Plaintiff had accepted the  terms  of  the  Insurance  Policy.  Admittedly,  at  the  time  of accident,  the truck  was  being  driven  by driver  Salmu,  about  which  intimation  was  given to the Insurance Company.

The Surveyor, i.e. Raman Kumar of the Company was appointed, to assess  the  loss.  It  submitted  its  Report  along  with  the Claim  Form  and  the document, submitted by the Plaintiff.

The Defendant thereafter, on examination of the document submitted by the Plaintiff to the Surveyor, found that driver Salmu was holding  the  Driving  License  issued  by  Nagaland  Transport  Authority,  even though the driver was not the resident of Nagaland. As per the Circular dated 01.08.2014 effective from 30.10.2009 of Transport Commissioner, RTO  Nagaland,  Kohima,  all  the  driving  licenses  which  had  been  issued  on booklet, were to be discontinued after the introduction of Smart Card.

The driving license of Salmu was in the form of a booklet, which is not  genuine  after  30.10.2009.  The  Booklet  had  been  issued  on  14.01.2010, i.e. after 30.10.2009 and the Driving License was not as per the requisite format. The driving license was, therefore, fake. Since the driver was not having  a  valid  and  effective  driving license  at  the  time  of  alleged  accident and because the driver was under 20 years of age and was not eligible to drive a transport vehicle in the public place, the insurance claim was rejected on account of breach of terms and condition of the Insurance Policy.

On  merits,  the  defence  as  stated  above,  was  reiterated  and  it  was submitted that the Suit was without any merit.

The issues on the pleadings were framed on 06.02.2019, as under:-

(1) Whether the plaintiff is entitled to get a decree of recovery of an amount of Rs.13,77,500/- against the Defendant as prayed for? OPP

(2) Whether the plaintiff is entitled to get pendent lite and future interest thereupon?

(3) Whether the plaintiff had violated the terms and conditions of the insurance policy qua vehicle No. HR-38S-9314? OPD

(4) Relief.

The Plaintiff in support of its case, examined PW1 Shri Vikas Khanna,  its  authorised  representative  who  proved  the  Insurance  Policy  as Mark A.

The  Insurance  Company examined  DW1  Ms.  Prabha  Malhotra,  the authorised representative, who reiterated the defence as taken in the Written Statement.

The learned District Judge on consideration of the evidence, concluded that the insurance claim of the Plaintiff/Respondent had been wrongly rejected and thereby, decreed the Suit for Rs.13,77,500/- along with simple interest @  12% p.a.

Aggrieved by  the judgement,  the Appellant Insurance Company  has challenged the judgement by way of this Appeal.

The grounds of challenge are that it has not been appreciated that there was gross breach of terms and condition of the Policy.  The driver was holding  a fake driving  licence  in  which  circumstances,  Insurance  Company cannot be thrust with any liability. The Circular dated 01.08.2014 of Competent  Authority,  Nagaland  has  been  erroneously  rejected.  In  terms  of this  Circular,  the  driving  licence  issued  on  or  before  01.12.2014,  are  to  be treated as cancelled, if they were not converted into a smart card. The driving licence of the deceased driver was in a booklet form issued after 30.10.2009 and therefore, was not genuine. In these circumstances, the claim had been rightly rejected. The impugned judgement is, therefore, liable to be set aside.

Learned Counsel on behalf of the Insurance Company had argued on similar lines as the grounds of Appeal.

The Respondent had filed Written Submissions wherein it was stated that  the  learned  District  Judge  had  rightly observed  that  the  driving  licence could not be held to be fake merely because it was issued in a booklet form. The Notification of the Nagaland Transport Authority had been appreciated in the right perspective.

Furthermore, it is not the case of the Insurance Company that they had duly verified the driving licence from the Regional Transport Office or had found the same to be forged or false rather; they had relied only on the Report dated  23.04.2015  of  the  Insurance Company and  the  Notification  of Transport Authority, to assert that the driving licence was fake merely because it was not in the smart card form.

Admittedly,  the  driving  licence  of  the  deceased  driver  was  issued  on 14.01.2010 which was prior to the Notification dated 01.08.2014 and the cut-off date was 30.10.2009. The possibility of the driver holding a valid driving licence in the booklet form, cannot be ruled out. Moreover, the driver had a window up to 01.12.2014 for converting his booklet licence into a new smart card format, but unfortunately he died before then on 11.07.2014.

It was further contended that the verification of the driving licence had been carried out by the Plaintiff/Respondent, and Report Ex. PW1/H had been  obtained, wherein  the  driving  licence  of  the  deceased  driver  had been found to be genuine. This Report was submitted to the Insurance Company, on 11.05.2014. The said documents have been rightly  accepted by  the  learned  District  Judge.  The  repudiation  of  the  Insurance  Claim,  was not justified.

The further contention raised by the Appellant was that the driver was not a resident of Nagaland and was aged 20 years, but these aspects have  not  been  proven  by  the  Insurance  Company  in  the  Court.  As  per  the driving licence, the date of birth of the deceased driver, Salmu, was 04.08.1991, according to which he was about 23 years old on the date of the accident.

The  judgement  of  Abdul Salam v. Mazher Khan  wherein  it  was  held that the driving licence issued before 01.12.2014 shall be deemed to be cancelled if not converted into a smart card, is neither binding on this Court nor  is  of  any  assistance  to  the  Insurance  Company.  In  fact,  this  judgement refers to the window for conversion up to 01.12.2014. It is submitted that the Suit of the Plaintiff has been rightly decreed and there is no merit in the present appeal.

Submissions Heard and Record Perused.

It is an admitted fact that the truck of the Plaintiff had been duly insured with the Insurance Company  from 16.09.2013 to 15.09.2014. It is also not disputed that an accident took place on 11.07.2014 wherein the vehicle was totally damaged and its driver, Salmu, died in the accident. An FIR No. 0104/2014 was registered in respect of this accident. The claim had been filed by  the Plaintiff for recovery  of Rs.13,77,500/-, as being a total loss of the insured truck.

The Defendant/Appellant did not contest any of these facts. However, the claim was rejected on the sole ground that the driver was holding a licence from the Nagaland Transport Authority. As per the Notification dated 01.08.2014 of Nagaland Transport Authority, the booklet driving licences would not be valid and would be discontinued after the introduction of smart cards, and this Notification was valid from 30.10.2009.

It has been rightly pointed out by the Respondent that it is not a case where the driving licence of the deceased driver has been found to be fake, but it is sought to be invalidated solely  in terms of the Notification dated 01.08.2014, which provided that  the booklet form driving licences, shall be replaced by smart cards and the Circular was effective from 30.10.2009, after which the booklet driving licence would cease to be valid and would be discontinued.

The driving licence of the deceased driver was in the booklet form and  had  been  issued  on  14.01.2010  and  was  thereafter,  from  time  to  time, renewed and it was valid at the time of the accident.

The sole ground to consider if the driving licence of the deceased driver was fake, which has to be assessed in terms of the Notification dated 01.08.2014. The Notification mentioned that enforcing agencies had detected a large number of fake driving licences being used in the State, which has caused concern not only to road safety but also criminal activity. With a view to authenticate the genuine driving licences, it was notified that all  the  drivers  holding  driving  licences  as  a booklet  or  in  any other  manual format other than the smart card, must report to the office for the purpose of digitising their data and subsequently issuing it in smart card format. It further provided that this must be completed before 01.12.2014.

In the present case, the driving licence of the driver had been first issued on 14.01.2010 and had been renewed w.e.f. 08.01.2014 to 13.01.2016. As per the Notification dated 01.08.2014, the booklet driving licences had to be converted into a smart card up to 01.12.2014. The accident  happened  on  11.07.2014,  i.e.,  prior  to  the  last  date  for  getting  the driving licence converted into a smart card. Therefore, even as per the Notification, merely because the driver was holding a booklet form, it cannot  be  termed  as  a  fake  driving  licence.  The  driver  had  the  window  till 01.12.2014 to convert his booklet driving licence into the smart card. Merely because  it  was  in  a  booklet  form  and  not  a  smart  card,  the  driving  licence cannot  be  termed  as  fake.  Such  interpretation  is  absolutely  contrary  to  the Notification dated 01.08.2014 of the Transport Authority, Nagaland.

The learned District Judge has rightly noted that the window for converting the booklet driving licence into the smart card, was still available with the driver.

Further, the Plaintiff had obtained the Report Ex.PW1/H in respect of the genuineness of the driving licence from the Transport Authority, Nagaland,  wherein  the Regional Transport Authority  had  reported  that  the driving licence of the deceased driver was verified and found to be genuine.

While the Investigator of the Insurance Company had reported the same  to  be  fake,  but  the  onus  was  on  the  Insurance  Company  to  rebut  the testimony of the Plaintiff about the genuineness of the driving licence. Pertinently, no witness was called by the Insurance Company from the Transport  Authority,  Nagaland,  to  produce  the  records  or  to  show  that  the booklet form of driving licence in the name of the deceased driver, was fake.

The learned District Judge has rightly concluded that the Insurance Company had not been able to prove that the driving licence of the deceased driver was not genuine or that there was breach of any terms and conditions of the Insurance Policy.

Another ground on which the breach of Insurance Policy was claimed by the Insurance Company, was that the driver was 20 years old and not eligible  to  drive  the  vehicle  on  public  roads.  However,  the  driving  licence issued on 14.01.2010 mentioned the date of birth as 04.08.1991, which makes him more than 20 years as on 11.07.2014, i.e., the date of the accident.  The contention  that he was less than 20 years at the time of the accident is, therefore, disproved on the basis of the driving licence of the deceased.

The next ground on which the driving licence was claimed to be fake, was that the driver was not a resident of Nagaland. However, mere assertion is not sufficient to prove that the deceased was not residing in Nagaland, as has been rightly observed by the District Judge. No evidence whatsoever has been led by  the Insurance Company  to prove that the deceased was not a resident of Nagaland. The bald assertion that he was not a resident of Nagaland, is not enough to discharge the onus of proving the driving licence to be fake by the Insurance Company.

In the light of the aforesaid discussion, it is held that there is no merit in  the  present  Appeal,  which  is  hereby  dismissed  along  with  any  pending Application(s), if any.

The Appeal is accordingly disposed of.