Oriental Insurance Company Ltd. vs Ram Raj Singh and Others

Reva Khetrapal, J.—The only ground sought to be urged in this appeal is that the learned Motor Accident Claims Tribunal by its impugned judgment dated 05.07.2003 has wrongly awarded a sum of Rs. 1,49,000/- as compensation to the Respondent No. 1 with interest thereon despite the fact that the alleged offending bus was driven by one Brij Pal Singh, who had produced a license bearing No. B-1810/Agra/91, which was a fake license.

Reliance is placed by the Appellant in this context upon the testimony of RW1-Shri Rajeshwar Nath Tiwari, Junior Clerk, Office of RTO, Agra, U.P. recorded on 27.02.2000, the relevant portion of which reads as follows:

I have brought the relevant D/L issue register of RTO, Agra pertaining entries of issue of D/L w.e.f. 6.11.90 to 9.2.93. As per our record, no D/L was issued in the name of Brij Pal Singh S/o Mahavir Singh on 15.9.91 with the number B-1810/Agra/91.

Apart from the aforesaid evidence, admittedly no other evidence was adduced by the Appellant, and thus there is no evidence on record to show that the insured was aware of the fact that the driving license of his driver was a fake one.

The law on the subject of fake driving license is well-settled by the judgment of a three-Judge Bench of the Hon''ble Supreme Court reported in National Insurance Co. Ltd. Vs. Swaran Singh and Others, wherein it is summarized as under:

SUMMARY of FINDINGS

The summary of our findings to the various issues as raised in these petitions are as follows:

(i) ...

(ii) Insurer is entitled to raise a defense in a claim petition filed u/s 163A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the said Act.

(iii) The breach of policy condition, e.g. disqualification of driver or invalid driving license of the driver, as contained in Sub-section (2)(a)(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid drives license or disqualification of the driver for driving at the relevant time, are not in themselves defenses available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time.

(iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defense(s) raised in the said proceedings but must also establish ''breach'' on the part of the owner of the vehicle; the burden of proof where for would be on them.

(v) The court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case.

(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid license by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving license is/ are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defenses available to the insured u/s 149(2) of the Act.

(vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving license produced by the driver, (a fake one or otherwise), does not fulfill the requirements of law or not will have to be determined in each case.

In the present case, there is not an iota of evidence to show that the insured was aware of the fact that the driving license of his driver was a fake one nor there is an assertion in this regard.

In view of the aforesaid, there is no merit in the present appeal, which is accordingly dismissed.