The Oriental Insurance Company Ltd. vs Muthaiah and Others

T. Mathivanan, J.—Questioning the liability of payment of compensation of Rs. 90,000/- (Rupees Ninety Thousand only) to the Respondents 1 to 5/claimants directed by the award dated 27.01.2010 and made in M.C.O.P. No. 61 of 2009 on the file of the learned Motor Accidents Claims Tribunal (Principal District Judge, Theni), the Insurance Company being the second Respondent in the claim petition has approached this Court by way of this Memorandum of Civil Miscellaneous Appeal.

The facts, which are absolutely necessary for the disposal of this appeal may be summarised as under:

That on 14.03.2009, at about 10.40 a.m., an auto bearing registration No. TN 60 D 8583 had hit against the deceased Velammal from behind, when she was proceeding by walk on the left side of Theni to Madurai road near Udayappa Trust and as a result of which, she had succumbed to injuries on the way to hospital and hence, the claimants being sons and daughter of the deceased had filed a claim petition in M.C.O.P. No. 61 of 2009 before the Motor 3 Accidents Claims Tribunal (Principal District Judge, Theni), claiming a sum of Rs. 1,50,000/- .

While the first Respondent in the claim petition being the owner of the auto remind ex parte, the second Respondent, who is the Appellant herein had contested the claim on various grounds. On appreciation of the oral and documentary evidences, the learned Motor Accidents Claims Tribunal had found that:

(1) The accident was caused due to the rash and negligent driving of the driver of the auto.

(2) The Appellant / Insurance Company with whom the auto was insured is liable to pay compensation to the claimants.

Ultimately the Claims Tribunal had proceeded to pass an award of Rs. 90,000/- directing the Appellant Insurance Company to pay this amount to the claimants with interest at the rate of 7.5% per annum from the date of petition to till the date of realisation. Hence, this appeal.

Heard both sides.

The learned Counsel for the Appellant has mainly argued that the Appellant/Insurance Company is not at all liable to pay compensation as the driver of the auto-rickshaw was not having valid and effective driving licence to drive the particular class of vehicle at the time of accident. He has also made reference to the proviso to Sections 2(47) and (10) of Motor Vehicles Act 1988, Form - 6 and Rule 16 of Central Motor Vehicle Rules 1989. He has also maintained that the policy of insurance having clearly mentioned that the vehicle in question is a transport vehicle as defined u/s 2(47) of Motor Vehicle Act 1988 and as the driver of the said vehicle did not possess a licence which was not valid for a transport vehicle, the Insurance Company cannot be forced with the liability to pay compensation to the claimants.

The learned Counsel has also adverted to that the person having (sic licence to drive) light Motor vehicle is not authorised to drive a commercial vehicle without due endorsement made by the competent authorities and that the driving licence to drive light motor vehicles is not appropriate to drive an load auto-rickshaw which is a transport vehicle.

In the given circumstance, it may be appropriate to seek the assistance of the testimonies of R.W.1 and R.W.2 as well as the documentary evidences under Ex.R.1 to R.3. Ex.R.3 is the true copy of the Motor Insurance Certificate cum Policy Schedule certified by the Senior Branch Manager.

Ex-facie the said certificate reveals that the vehicle in respect of which the Insurance Certificate cum Policy Schedule issued has been captioned as "GOODS CARRYING MOTORISED THREE WHEELERS AND PEDAL CYCLES - PUBLIC CARRIERS PACKAGE POLICY - ZONE C. It discloses that the name of the insured as S. Vellaikannu, who is the owner of the vehicle. In the first tabular column with regard to Registration Mark and Place, it is stated as TN 60 D 8583. In the 4th column under the caption of Type of Body, it is stated as "CAB LOADBODY". With regard to limitations as to use, it is stated as " the policy covers use only under a permit within the meaning of Motor Vehicle Act 1988 or such a carriage falling under Sub-Section 3 of Section 66 of the Motor vehicles Act 1988. It is also stated that " Use only for carriage of goods within the meaning of the Motor Vehicle Act". Following that certain conditions have also been stipulated about the limitation of use of the vehicle.

Under the driver''s clause it has been stated that " Any person including insured: Provided that a person driving holds an effective driving license at the time of accident and is not disqualified from holding or obtaining such a licence. Provided also that the person holding an effective Learner''s license may also drive the vehicle when not used for the transport of goods at the time of the accident and that such a person satisfies the requirements of Rule 3 of the Central Motor Vehicle Rules 1989. From this document viz., Motor Insurance Certificate cum Policy Schedule, it is clear that a person, who happens to drive the vehicle at the time of accident should have been in possession of effective driving licence. It is explicitly made clear that the vehicle has been characterized as goods carrying motorised three wheeler.

The goods carriage vehicle has been brought under the definition of Section 2(47).

It reads:

"transport vehicle" means a public service vehicle, a goods carriage , an educational institution bus or a private service vehicle;

The driving licence has been defined u/s 2(10) of the Act:

"driving licence" means the licence issued by a competent authority under Chapter II authorising the person specified therein to drive, otherwise than as a learner, a motor vehicle or a motor vehicle of any specified class or description;

Hence, it is clear from the languages coined u/s 2(10) that the driving licence is issued by a competent authority authorising a person to drive a motor vehicle or a motor vehicle of any specified class or description.

Chapter - II of the Act deals with Licensing of Drivers of Motor Vehicles. Section 3(1) explains the "Necessity for driving licence"

Section 3(1) enacts as follows:

Section 3. Necessity for driving licence. - (1) No person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to him authorising him to drive the vehicle; and no person shall so drive a transport vehicle other than a motor cab or motor cycles hired for his own use or rented under any scheme made under Sub-section (2) of Section 75 unless his driving licence specially entitles him so to do.

The 2nd portion of the proviso to Section 3 envisages that no person shall so drive a transport vehicle unless his driving licence specially entitles to drive the particular class of vehicle. In this regard this Court may refer Section 2(47) and a combined reading of Section 2(47) and Section 3(1) of the Act is very much essential to understand the intention of the legislat Ors.

It may also be relevant to refer Section 10 of the Act, Section 10 enacts as follows:

Section 10 Form and contents of licences to drive. -

(1) Every learner''s licence and driving licence, except a driving licence issued u/s 18, shall be in such form and shall contain such information as may be prescribed by the Central Government.

(2) A learner''s licence or, as the case may be, driving licence shall also be expressed as entitling the holder to drive a motor vehicle of one or more of the following classes, namely:

(a) motor cycle without gear;

(b) motor cycle with gear;

(c) invalid carriage;

(d) light motor vehicle;

(e) transport vehicle;

(i) road - roller;

(f) motor vehicle of a specified description.

(In Section 10, in Sub-section(2), Clause (e) was substituted for Clauses (e) to (h) by Act 54 of 1994 w.e.f. 14.11.1994.)

As it appears from Sub-section (2) of Section 10, a driving licence which is issued in favour of a person shall also be expressed, entitling the holder to drive a motor vehicle of one or more of the classes of vehicle enlisted in the Section. On coming to the instant case on hand the 6th Respondent herein at the time of accident had driven a transport vehicle as enlisted under Sub-clause (e) of Sub-section (2) of Section 10 of the Act.

As already discussed in paragraph 11, the transport vehicle has been defined as ''goods carriage''. From the evidence of P.W.2, it is clear that the 6th Respondent herein was driving auto laden with cement bags and for that purpose only, the certificate of insurance was issued by the Appellant Insurance Company. For driving this class of vehicle, the 6th Respondent was expected to hold an appropriate driving licence entitling him to drive.

Ex.R.1 is the letter written by the Regional Transport Officer, dated 25.12.2009, to the learned District Judge, Theni District, in which, the Regional Transport Officer has stated that the driving licence was issued to Thiru.B. Vallikannu on 27.06.2007 to drive only light motor vehicle. The letter was received from the Sub-Inspector of Police, Theni Police Station on 17.03.2009, informing that a case in crime No. 300 of 2009 u/s 304(A) IPC was registered against B. Vallikannu. Hence he had requested to cancel the driving licence issued in favour of Thiru.B. Vallikannu. It also reveals that on a memorandum received from the Regional Transport Officer, 6th Respondent B. Vallikannu had appeared before him on 25.03.2009 and submitted his explanation and his explanation was not accepted and consequently his driving licence was temporarily cancelled from 25.03.2009 to 24.09.2009.

Ex.R.2 is the colour Xerox copy of the original driving licence issued in favour of 6th Respondent B. Vallikannu and also attested by the Regional Transport Officer in which, it appears that the 6th Respondent, the owner-cumdriver of the vehicle B. Vallikannu was authorised to drive Non-Transport vehicle, which is valid upto 26.06.2027. From Ex.R.2 it is thus clear that the 6th Respondent B. Vallikannu was not authorised to drive the transport vehicle as envisaged u/s 10 of the Motor Vehicles Act.

Even if it is us not expressly entitles a person to drive a transport vehicle as contemplated u/s 11 he can apply to the licensing authority having jurisdiction in the area in which he resides for the addition of such other class or description of motor vehicle to the licence.

In the given circumstance, this Court consider that it may be relevant to lay emphasis on the decision in National Insurance Company Limited v. Kaushalya Devi and Ors. reported in 2008 (2) TNMAC 497 (SC). In this case the High Court, against whose judgment the appeal preferred before the Hon''ble Supreme Court, while holding that the driving licence of the driver Shyam Lal was not valid, has observed as follows:

Since I am of the opinion that the endorsement permitting Shyam Lal to drive Heavy Goods Vehicle was ante-dated and was not existing on the date of accident it is clear that the owner could not have handed over the vehicle to a person who held no valid driving licence. On 16.03.2000 Shyam Lal only held a licence to drive a Light Transport Vehicle and the owner could not have checked or verified the licence for driving a Heavy Goods vehicle. In fact in this case the owner has not even stepped into the witness box to say anything in this regard. Therefore, I hold that the Insurance Company was wrongly held liable to pay compensation.

While speaking on behalf of the Division Bench, the His Lordship Hon''ble Mr. JUSTICES.B. Sinha has held that:

The provisions relating to the necessity of having a licence to drive a vehicle is contained in Sections 3, 4 and 10 of the Act. As various aspects of the said provisions, vis-a-vis, the liability of the Insurance Company to reimburse the owner in respect of a claim of a Third Party as provided in Section 149 thereof have been dealt with in several decisions, it is not necessary for us to reiterate the same once over again. Suffice it to notice some of the precedents operating in the field.

His Lordship has also referred the decision in National Insurance Co. Ltd. Vs. Swaran Singh and Others, . In this case, the Hon''ble Supreme Court has held

Section 10 of the Act provides for forms and contents of licences to drive. The licence has to be granted in the prescribed form. Thus, a licence to drive a light motor vehicle would entitle the holder there to drive the vehicle falling within that class or description.

Section 3 of the Act casts an obligation on a driver to hold an effective driving licence for the type of vehicle which he intends to drive. Section 10 of the Act enables the Central Government to prescribe forms of driving licences for various categories of vehicles mentioned in Sub-section (2) of the said section.

As adumbrated in the forgoing paragraph, it is brought into light that the 6th Respondent herein being the owner-cum-driver of the vehicle was not having valid driving licence to drive the transport vehicle as evident from Ex.R-2 driving licence.

In this connection, the learned Counsel appearing for the Appellant has also adverted to that the 6th Respondent should have displayed on his chest packet a white plastic badge inscribed with his name. He has also added that at the time of accident the 6th Respondent/owner-cum -driver of the vehicle was not even in possession of the badge as required under Rule 21 of the Tamil Nadu Motor Vehicle Rules 1989. He has also added that a combined reading of Rules 7, 10, 12, 21 and 40 of Tamil Nadu Motor Vehicles Rule 1989 it reveals that apart from specific authorisation, to drive a transport vehicle, the driver should display a badge with number.

The learned Counsel for the Respondents/claimants has submitted that since the 6th Respondent was carrying cement bags in his auto for his own use no badge was required to be displayed. He has also made reference to the testimony of R.W.1 and R.W.2 in this connection. However, either it may be for his own use or for hire, when the 6th Respondent was found on the steering wheel of the vehicle, he should have been in possession of a valid and effective driving licence to drive the type of vehicle which he intended to drive.

With regard to possession or non-possession of badge it may be relevant to refer the decision in National Insurance Company Limited v. Raisa Bibi reported in AIR 1999 Orissa 78 (DB). In this case it is observed:

A combined reading of the provisions contained in Chapter 2, particularly, the provisions contained in Ss.3, 8, 9, 10, 13 and 27 of the Act shows that the licence is to be issued in accordance with rules prescribed by the Central Government. Though Rule 71 of the Orissa Motor Vehicle Rules, 1993 framed u/s 28 of the Act, contemplates that driver of a public service should wear a badge and in fact a particular dress, there is nothing in the Act or Rules framed by the Central Government that issuance of a badge to a driver is a condition precedent authorising such driver to drive a transport vehicle. The provisions in the rules prescribing for badges and uniform must be taken to be regulatory measures for identity and administrative convenience and not as a sine qua non for a valid driving licence authorising a person to drive a transport vehicle.

The Insurance Company contended that the driver of the Trekker did not have P.S.V. Badge and as such, was not authorised to drive any public service vehicle. The contention cannot be accepted. In the instant case, the Motor Vehicle Claims Tribunal has found that since it was established that the 6th Respondent/owner-cum-driver of the vehicle was used his vehicle for own use, the conditions of the policy had not been violated. The findings of the Tribunal is absolutely wrong and the 6th Respondent, as discussed in the earlier paragraph was not having valid and effective driving licence to drive the particular type of vehicle at the time of accident. Hence, the liability could not be fastened on the Insurance Company to pay the compensation to the Respondents 1 to 5 / claimants.

In this connection, several judicial pronouncements are available. As cited in the foregoing paragraph in National Insurance Company Limited v. Kaushalya Devi and Ors. reported in 2008 (2) TNMAC 497 (SC) , the High Court against whose judgment and 2 SL Ps were filed had held that the endorsement permitting driver to drive Heavy Goods Vehicle was found to be ante-dated and was not existing on the date of accident, and that the Insurance Company was wrongly held liable to pay the compensation. The decision of the Hon''ble High Court has been upheld by the Hon''ble Supreme Court. Further the Apex Court has held that the Swarn Sing however, is not made applicable in relation to the owner or passenger of a vehicle, which is insured. In this Judgment, His Lordship Hon''ble Mr. JUSTICES.P. Sinha has also referred the decision in National Insurance Co. Ltd. Vs. Laxmi Narain Dhut, , and observed that this Court referring to Swaran Singh (Supra) and discussing the law on the subject, held:

In view of the above analysis the following situations emerge:

The decision in Swaran Singh''s case (Supra) has no application to cases other than third party risks.

Where originally the licence was a fake one, renewal cannot cure the inherent fatality.

In case of Third Party risks the Insurer has to indemnify the amount and if so advised, to recover the same from the insured.

The concept of purposive interpretation has no application to cases relatable to Section 149 of the Act.

His Lordship has also observed that the High Courts/Commissions shall now consider the mater afresh in the light of the position in law as delineated above.

Ultimately, His Lordship has held that in view of the findings arrived at by the High Court, it must be held that the owner alone was liable to pay compensation to the first Respondent herein for causing death of her son by rash and negligent driving on the part of the driver of the truck.

Keeping in view of the above observations made by the Apex Court this Court has determined on the footing of Section 149 Sub-Section 2(ii) that the Insurance Company is not at all liable to pay compensation as the 6th Respondent/owner-cum-driver of the vehicle was not holding valid and effective driving licence at the time of accident as evident from Ex.R.2. The Appellant Insurance Company has also established before the Tribunal by producing the policy and other records such as the driving licence (Ex.R.2) not authorising the 6th Respondent to drive the particular type of vehicle, as well as the letter from the Regional Transport Officer to show that the 6th Respondent was not at all authorised to drive the particular class of vehicle. In this connection, it may also be relevant to refer another decision in Oriental Insurance Company Limited Tuticorin v. PetchiMuthu Asari reported in AIR 1999 Mad 413, wherein the following ratio has been laid down.

The Insurance Company would certainly disclaim liability, if the driver of the vehicle was not duly licensed to drive the said vehicle insured with the company. But, in order to prove its immunity from liability, the Insurance Company has to establish before the Court by producing the policy and other records that one of the conditions mentioned in the policy that the vehicle should not be driven by a person who is not duly licensed to drive the said vehicle on the date of the accident, was violated.

In the given case on hand, the findings of the Motor Accidents Claims Tribunal that the Appellant Insurance Company is liable to pay compensation to the tune of Rs. 90,000/- to the Respondents 1 to 5 / claimants is not in conformity with the proviso to Section 149(2)(ii) of the Act. Insofar as the quantum is concerned, it does not require any interference of this Court. It requires only with regard to the fastening of liability with the Appellant Insurance Company to indemnify the 6th Respondent/owner-cum-driver of the vehicle.

In the result, the appeal is allowed. The order of the Motor Accidents Claims Tribunal (Principal District Judge), Theni is modified as detailed below. The 6th Respondent/owner-cum-driver of the vehicle, which is involved in the accident alone is liable to pay compensation to the Respondents/claimants 1 to 5. The Appellant/Insurance Company is not liable to pay the compensation. Consequently, connected miscellaneous petition is closed. There is no order as to costs.