New India Insurance Company vs Balwant Kumari and Others

The appeal has been submitted to set aside the award passed by the Motor Accident Claims Tribunal, Srinagar dated 21111998 in claim

petition No. 86/97 titled Ghulam Mohd and others Vs New India Assurance Company and others.

Record reveals that on 761997 respondent No. 2 was driving oil tanker No. JK02A 5582 in a rash and negligent manner and caused accident

of the oil tanker with a school going boy of the age of 15 years, namely, Sajjad Ahmad who was driving a bicycle near Nehru Park. The said

Sajjad Ahmad was injured in such a manner that he died due to the injuries.

The claim petition filed before the Motor Accidents Claims Tribunal was allowed vide award dated 21111998. It is the validity of this order,

which has been challenged in the present appeal.

The main grounds taken in the appeal are that the quantum of compensation is worked on a wrong multipliar and interest is excessive. The driver

was not having a valid driving licence. The Tribunal did not afford enough opportunity to the appellants to produce the witnesses and as such the

award 2111 1998 is liable to be set aside.

Heard learned counsel for the parties and perused the entire record.

The learned counsel for the appellant has submitted that the appellant has a statutory right to file appeal and is not liable topay compensation on

account to violation of section 149 Clause (2) (b) (II) of the Motor Vehicles Act. Submissions of learned counsel for the appellant that he has a

statutory right to file the appeal in view of the breach of section 149 Clause, (2) (b) (II), which constitutes violations of the terms and conditions of

the Insurance Policy does not seem to be made out in the present case.

Learned counsel for the appellant pointed out that he took the plea before the Tribunal that since respondent No. 2, the driver of the offending

vehicle did not have a valid driving licence, therefore, the appellants were not entitled to any compensation.

From the perusal of the impugned award as well as the record of the Tribunal, it is manifestly clear that although vague assertion has been made

in the preliminary objection to say that the Insurance Company is not liable to pay the compensation because the driver of the offending vehicle,

had no valid driving licence and was not authorised, to drive a tanker, but no evidence seems to have been produced in order to substantiate this

plea. Learned counsel for the appellant has submitted that the driving licence of respondent No. 2 has been issued from Chandigarh, which had to

be verified from the issuing authority at Chandigarh, therefore latitude should have been given by the Tribunal for getting verification from

Chandigarh. No opportunity has been given by the Tribunal, which has caused prejudice to the appellant. This submission appears to be relevant

but is devoid of any merit. On inspection of the proceedings and the record of the Tribunal, it is apparently clear that the appellant was given

sufficient opportunity to adduce eficence. Head office of the appellant as per record is in Chandigarh. Had the appellant been serious, the

verification to ascertain the genuineness of the driving licence of respondent No. 2 from the Motor Licensing Authority at Chandigarh, could have

been done by contacting the head office by Fax or telephone. This precisely has not been done and on this account no fault can be pointed out in

the award of the Tribunal. The onus to prove that the vehicle was driven by a driver without or on invalid driving licence, within the knowledge of

the owner (insured) was on the insurerappellant. This view has been taken in AIR 1999 Raj 86.

The appellant has not established by any cogent and acceptable evidence that the driver of the vehicle was not having a driving licence and,

therefore, there was a breach of section 149 (2) (b) (II) of the Motor Vehicles Act. The appellant, as such, does not seem to have any statutory

right to file the appeal.

It may be observed that even if it was shown that the driver did not have a valid driving licence, even in that eventuality the appellant could not

be absolved of the third party liability. This view has been taken in AIR 2001 Orissa 108. The relevant portion is reproduced as under:

The question as to whether there is a valid driving licence or not being essentially the question between the owner and the Insurance Company, it

is not necessary for the claimants to provew the existence of valid driving licence. The claimants can always rely on the provision of section 149 (4)

and seek compensation from the Insurance Company, ofcourse of the rider when in such a case the insurance company can claim reimbursement

from the owner"".

Learned counsel forthe appellant has further argued that the quantum of compensation is excessive and has been assessed on method and

multiplier, which is not applicable to the present case.

In order to enable the appellants to have wider defence in appeal and challenge the multiplier and the quantum of award, the appellant had to

seek permission from the Tribunal, which in the present case does not seem to have been sought by the appellantcompany. In the absence of

permission to file appeal on all available grounds, the appeal on the plea of quantum is not permissible as held by a Division Bench of this court in

case titled Anant Ram Vs A.K. Jain, reported in AIR 1999 J&K 29. The relevant portion of the judgement is reproduced as under:

Thus he prayed for upholding the award passed in appeal, which was otherwise, according to him within brackets. However, learned counsel for

respondents was not in a position to satisfy this court as to how he could maintain the appeal on quantum, except by reiterating that the judgement

of the learned single judge needs to be upheld. In the fact of the provisions of section 170 of the Motor Vehicles Act, 1988 this question need not

detain us any further as admittedly no leave was obtained by the Insurance Company from the court to contest the claim of the appellants on all

available grounds to the owner"".

The support to take this view has been drawn from judgement of Apex Court reported in AIR 1998 SC 2968. Relevant portion of the

judgement is reported as under:

It clearly shows that the Insurance Co. when impleaded as a party by the Court can be permitted to contest the proceedings on merits only if the

conditions precedent mentioned in the section are found to be satisfied and for that purpose the Insurance Company has to obtain order in writing

from the Tribunal and which should be a reasoned order by the Tribunal. Unless that procedure is followed the Insurance Company cannot have a

wider defence on merits that what is available to it by way of statutory defence. It is true that the claimants themselves had joined respondent No.

1 Insurance Company in the claim petition but that was done with a view to thrust the statutory liability on the Insurance Company on account of

the contract of the Insurance. That was not an order the court itself impleaded to avail of a larger defence on merits on being satisfied on the

aforesaid two conditions mentioned in section 170. Consequently, it must be held that on the facts of the present case respondent No. 1 Insurance

Company was not entitled to file an appeal on merits of the claim which was awarded by the Tribunal"".

In this view of the settled law and on the firm findings that no permission has been sought to file the appeal on wider grounds, the amount of

quantum cannot be challenged in appeal.

It may be observed that the Insurer has been made statutorily liable to pay compensation to the third party on proof of accident even in case

where the driver of the offending vehicle was found driving the vehicle on a fake driving licence. In AIR 2001 SC 1419the Hon'ble Supreme Court

while taking this view has held that the liability of the insurerto pay compensation to the third party is not invalidated because of the fake driving

licence, when the owner is not shown to have committed breach of the conditions of the Insurance Policy. It is further held that in case the owner is

found to have committed breach of the conditions of insurance policy by engaging a driver with a fake driving licence, even in that situation the

insurer is bound to pay compensation to the third party and recover the same from the owner.

From the reasons given above, there is no merit in this appeal which is accordingly dismissed with costs. The award impugned is upheld.

The award amount be released in favour of the claimants under rules.

Record be sent back.