SURESH CHANDRA DWIVEDI vs United India Insurance Co. Ltd.

-BY this appeal, under Section 15 of the Consumer Protection Act, 1986, order dated 22.10.2001 in Complaint No. 106/2000 by the District Consumer Disputes Redressal Forum, Bilaspur (hereinafter called the ''Distt. Forum'' for short) has been challenged.

UNDISPUTABLY, the complainant/appellant is the owner of Tata 407 bus bearing registration No. MP 27-C 5706. The complainant/appellant comprehensively insured the bus with the respondent/insurer for the period from 22.5.1999 to 21.5.2000 and the amount of premium was also duly paid by him. It is also not in dispute that on 30.6.1999, the said vehicle met with an accident and suffered damage. It is also further not in dispute that the complainant/appellant lodged claim with the respondent/insurer. The insurer appointed Surveyor P.K. Agrawal, who conducted spot survey and submitted his report dated 15.11.1999. Subsequently, Surveyor S.K. Ahuja was also appointed by the respondent/insurer to assess the loss who in his report dated 16.2.2000, assessed net loss to the vehicle to the tune of Rs. 87,500/-. However, the claim of the complainant/appellant was repudiated by the respondent/insurer, on the ground that the driver, Mansur Alam though was holding licence to drive the said vehicle, but as it was only renewed up to 2.2.1999 and, therefore, the said licence was not valid and effective on 30th June, 1999 when the accident took place. The complainant/appellant felt aggrieved by the repudiation of his claim by the respondent/insurer. According to him, since his vehicle was damaged in the accident, he was entitled to the amount of repairs to the tune of Rs. 4,99,470/-. It was also averred that the driver had applied for renewal of licence on 22.6.1999 and deposited necessary fee for the renewal on that day, hence the complainant claimed that he was entitled to get the amount spent by him towards repairs.

The opposite party/insurer resisted the complaint. Their averments in substance was that on the date of accident i.e., on 30.6.1999, the driver was not having valid and effective driving licence, as its term expired on 2.2.1999. Hence the respondent/insurer was not liable to pay compensation, in view of breach of terms of policy, by the complainant.

THE Distt. Forum upheld the defence as above of the respondent/insurer and held that on the date of accident, the complainant''s driver did not have valid and defective driving licence, hence he could not succeed in his claim. THE complaint was accordingly dismissed. Learned Counsel for the parties were heard and the record is perused.

IT is not in dispute that the vehicle of the complainant/appellant at the time of accident was being driven by driver Mansur Alam. Copy of the driving licence of the said driver has been filed on record which indicates that the term of the licence expired on 2.2.1999. IT also appears that subsequently, it was renewed from 2.9.1999 to 1.9.2002. IT further appears that the licence after expiry of its term on 2.2.1999, was not renewed till 2.9.1999. As noticed earlier, the accident took place on 30.6.1999. IT is, therefore, clear that the licence was not in force on that date and was renewed thereafter on 2.9.1999. The question that arises for consideration is as to whether in view of the subsequent renewal of the licence as above, there was breach of terms of policy by the complainant/appellant the owner of the vehicle? It may be noticed that the terms of the policy enumerated, that the persons who were entitled to drive the vehicle, would be any of the following: (a) the insured; (b) any other person who is driving on the insured''s order with his permission:

Provided that the person driving holds or held and has not been disqualified from holding valid and effective driving licence with all the required endorsement thereon as per the Motor Vehicles Act, 1988 and the rules made thereunder for the time being in force.

A noticed earlier, there is no dispute that the driver Mansur Alam held driving licence for driving Light Motor Vehicle, Heavy Goods Vehicle etc. and was thus entitled to drive the motor vehicle, of the complainant/appellant. As mentioned above, the driving licence was renewed up to 2.2.1999 and appears to have been renewed thereafter on 2.9.1999. It was thus not renewed during the inter-magnum period from 2.2.1999 to 2.9.1999 i.e., for a period of about 7 months. The accident occurred during the said inter-magnum period on 30.6.1999. The foregoing circumstances clearly go to show that the driver held a valid and effective driving licence to drive the type of the vehicle which met with accident and had not been disqualified from driving the said vehicle. In fact, the subsequent renewal of the licence from 2.9.1999 clearly indicates that the licence of the driver was actually renewed by the competent licensing authority, which would not have been so renewed had the driver been disqualified from driving the vehicle.

IN the foregoing circumstances, the second clause of the above term of the policy that the person driving the vehicle held licence and has not been disqualified from holding effective driving licence, is fully met by the driver Mansur Alam. Therefore, it cannot be said that the vehicle was being driven in contravention to the above quoted term of the policy. To hold so, we are fortified by the view expressed by the Karnataka High Court in K.G. Srinivasanmurthy v. Habib Khatun and Others, II (2002) ACC 510, in which a similar fact situation existed. It was held by the Karnataka High Court that the Insurance Company was liable, even if on the date of accident the licence issued to the driver had expired and it was not renewed on the date of accident, but was renewed subsequently. Therefore, the contention of the insurer that there was breach of condition of policy was repelled. The Karnataka High Court in the said case referred to the judgment of the Madras High Court in Oriental Insurance Co. Ltd. v. Indirani, I (1996) ACC 21=1995 ACJ 703, wherein the clause in the insurance policy was similar to the clause of the policy in the instant case regarding driving of the vehicle. The said clause of the insurance policy can be divided in two parts: The 1st part refers to a person holding a valid and effective driving licence at the time of the accident. The 2nd part refers to the driver who held the licence and was not disqualified from holding the licence. Even after obtaining a licence, a person may get disqualified under the provisions of the Act. It was observed by the Madras High Court that the above clause deals with two distinct parts. If a person holds valid and effect driving licence the first part of the policy would apply. The second part will necessarily apply only to cases in which the driver had a licence at some time. However, even if the term such a licence at the time of accident was not subsisting, but if such driver was not disqualified from holding the licence, then he will be covered by the second part of the above clause of the policy. Thus word ''and'' used in the said clause assumes great importance and the Insurance Company can succeed only if the person was not duly holding valid and effective licence and was also disqualified from holding a effective driving licence.

In the instant case, it was not so. As already noticed, since the driver had hold a licence and was not disqualified from holding valid and effective driving licence, it cannot be said that the clause in the policy entitling a person to drive the vehicle was in any manner violated or breached. Reference in the above connection may also be made to the decision of the Punjab & Haryana High Court in Ramesh Chand v. United India Insurance Company Ltd., I (1999) ACC 78=1997 ACJ 1331, as also in Ram Phal v. Krishna Makkar, I (1989) ACC 205=1989 ACJ 1126. Patna High Court in National Insurance Co. Ltd. v. Abha Sinha, II (1999) ACC 322=II (1999) ACJ 450, and the Karnataka High Court, in Oriental Insurance Co. Ltd. v. Mohammad Sab Ali Sab Kaladagi, II (1999) ACC 70=2000 ACJ 1223, took a similar view.

IN view of the aforementioned decisions of different High Courts, there appears to be no manner of doubt that the said clause in the insurance policy, was not breached in the instant case. The decision in Divisional Manager, Orissa Forest Development Corporation Ltd. v. Janakalata Barik and Another, III (2002) ACC 715=2002 ACJ 1187, also may be referred to in the above context. It is, therefore, clear that any person who held a driving licence and was not disqualified from holding it, is also covered under the said policy, as the person entitled to drive the vehicle. Therefore, irrespective of the expiry of the term of the licence on the date of accident as it was subsequently renewed, it cannot be held that the driver was disqualified to hold or obtain valid and effective driving licence. The insurer by incorporating the said term in the policy permitted a vehicle to be driven by the person who held driving licence prior to the date of accident and was not disqualified to hold a licence at the relevant time i.e., at the time of accident. As violation of any specified condition of policy has, therefore, taken place, the respondent/insurer was liable to reimburse the loss caused to the complainant/appellant.

THE next question that arises for consideration is as to what should be the quantum of compensation? It appears that the respondent/insurer had appointed a Surveyor who has assessed the net loss to the vehicle at Rs. 87,500/- as has been reported by him in the report dated 16.2.2000. In our view compensation, as above deserves to be granted to the complainant/appellant. We find that despite the settled position as above, the respondent/insurer still chose to repudiate the claim of the complainant/appellant put forth resulting in this long pending litigation. Obviously, respondent insurer was deficient in service in not accepting the legitimate claim of the complainant/appellant. On that count we consider it just and proper to award compensation of Rs. 5,000/- to the complainant/appellant, over and above the assessment of the loss to the vehicle as mentioned in the previous para. Accordingly, this appeal is allowed. The impugned order dismissing the complaint of the complainant/appellant is set aside. It is directed that the respondent/insurer shall pay to the complainant/appellant total compensation of Rs. 92,500/- (Rupees ninety-two thousand five hundred) which includes assessment of loss by the Surveyor as well as compensation for the deficiency in service committed as above by the respondent/insurer. The above amount of compensation shall be payable by the respondent/insurer with interest @ 9% p.a. from the date of complaint. The cost of litigation including this appeal quantified at Rs. 1,000/- (Rupees one thousand) only shall also be payable to the complainant/appellant by the respondent/insurer. Appeal allowed.