FAO No.3656 of 2008 -: 1 :-
IN THE HIGH COURT FOR THE STATES OF PUNJAB AND
HARYANA AT CHANDIGARH
FAO No.3656 of 2008 (O&M)
Date of decision: December 10, 2009.
Oriental Insaurance Co. Ltd.
...Petitioner(s)
v.
Rama Devi & Ors.
...Respondent(s)
CORAM:HON'BLE MR. JUSTICE RAKESH KUMAR GARG
Present: Shri D.P. Gupta, Advocate, for the appellant.
Shri Sanjeev Patyal, Advocate, for respondent No.1.
Shri Rahul Chhatwal, Advocate for respondents No.2 & 3.
Rakesh Kumar Garg, J.
This judgment shall dispose of FAO Nos.3656 and 3657 of
2008 as common questions of law on same facts arising out of the same
accident has arisen in both these appeals.
These appeals have been filed by the insurer challenging the
impugned award whereby the appellant has been held liable jointly and
severally to pay compensation to the claimants as assessed by the Tribunal.
As per the averments, on 2.6.2007, one Vijay Kumar (deceased)
and injured/claimant Rama Devi were going from their house to Una on
Nangal-Una road on motorcycle bearing registration No.HP-19-2596.
When they reached near Shivalik Avenue Chowk, Naya Nangal, one
Mahindra Utility Jeep bearing registration No.CH-03-J-7461 which was
FAO No.3656 of 2008 -: 2 :-
coming from opposite direction and was being driven by Subhash Chand
(respondent No.3) at a very high speed and in a rash and negligent manner,
hit from wrong side against the motorcycle, as a result of which Vijay
Kumar and his wife Rama Devi fell down on pucca road and thereafter
driver of the jeep along with the vehicle fled from the spot. Vijay Kumar
and his wife received multiple serious and grievous injuries. Vijay Kumar
succumbed to his injuries on 7.6.2007. Rama Devi became permanently
disabled due to the injuries sustained by her in the accident. Hence, these
claim petitions.
Upon notice, respondents No.2 and 3 filed joint written
statement denying the accident. In a separate written statement, the
appellant raised various preliminary objections including the ground that
driver Subhash Chand was not holding a valid and effective driving licence
at the time of the alleged accident. On merits all the material averments of
the claim petition were denied with a prayer to dismiss the same.
On appreciation of the evidence, the Tribunal vide impugned
awards held that the accident in question occurred due to the rash and
negligent driving of respondent Subhash Chand. It was further held that the
claimants were entitled to the compensation and the appellant along with
driver and owner of the offending vehicle were liable to pay jointly as well
as severally, compensation to the claimants. It was also held by the
Tribunal that the accident in question occurred due to the rash and negligent
driving of respondent Subhash Chand.
Feeling aggrieved from the aforesaid findings, the insurance
company has filed the present appeals on the ground that the Tribunal has
erred at law while fastening the liability to pay compensation upon the
FAO No.3656 of 2008 -: 3 :-
insurer as it was proved on record that the driver of the offending vehicle
was not having a valid and effective driving licence at the time of accident.
Elaborating his argument, learned counsel for the appellant has
argued that it was proved on record that the driver of the offending vehicle
was having a driving licence for a light motor vehicle (non-transport)
whereas the vehicle being driven by the driver was a light motor vehicle
(transport). Thus, there was a clear breach of policy condition by the owner
of the vehicle and as per settled law, a driving licence specifically granted
for a non-transport vehicle cannot be considered valid for a transport
vehicle and, therefore, judgment of the Tribunal is liable to be set aside. In
support of his case, the learned counsel has also relied upon a judgment of
the Hon’ble Supreme Court in the case of Oriental Insurance Co. Ltd. v.
Angad Kol and others, 2009 ACJ 1411,
On the other hand, learned counsel for the respondent No.2 and
3 while raising rival contentions has not disputed that the offending vehicle
is light motor vehicle (transport) and the respondent No.3 was authorized to
drive LMV (NT), however, he argued that if the driver of the vehicle is
possessing light motor vehicle licence, he is authorized to drive a light
goods carriage vehicle as well. In support of his case, learned counsel for
the respondents has relied upon judgment of the Hon’ble Supreme Court in
Ashok Gangadhar Maratha v. Oriental Insurance Co. Ltd., AIR 1999
SC 3181 and National Insurance Company v. Annappa Irappa Nesaria,
2008(1) RCR (Civil) 848.
Facts of this case are not in dispute. It is apparent from Ex.R3
the copy of registration certificate that the vehicle in question is LMV T,
i.e., light motor vehicle transport. The driving licence of the respondent
FAO No.3656 of 2008 -: 4 :-
No.3 shows that he was authorized to drive light motor vehicle, but non
transport.
Motor Vehicles Act, 1988 (hereinafter called as `the Act’) was
enacted to consolidate and amend the law relating to motor vehicles.
“Goods carriage” has been defined in Section 2(14) to mean any motor
vehicle constructed or adapted for use solely for the carriage of goods, or
any motor vehicle not so constructed or adapted when used for the carriage
of goods. The said Act also defines `heavy goods vehicle’, `heavy passenger
motor vehicle’, `medium goods vehicle’ and `medium passenger motor
vehicle’ as well as a `light motor vehicle’ in Section 2(21) of the Act to
mean:
” `light motor vehicle’ means a transport vehicle
or omnibus the gross vehicle weight of either of
which or a motor car or tractor or road-roller the
unladen weight of any of which, does not exceed
7500 kilograms.”
In Ashok Gangdhar Maratha’s case, vehicle in question was a
‘light motor vehicle’ weighing less than 6000 kilograms and the driver of the
aforesaid vehicle was holding a driving licence to drive ‘light motor vehicle’
only. The accident had taken place on 26.11.1991 and the vehicle was
completely damaged. The insurer refused to honour its commitment of
indemnifying the own damage cover under the insurance policy. While
accepting the claim of the owner, the State Consumer Commission
negatived the plea of the insurer that the vehicle was not being driven by a
person having an effective driving licence. Appeal filed by the insurer was
accepted by the National Commission holding that the driver of the
FAO No.3656 of 2008 -: 5 :-aforesaid vehicle, who was holding a driving licence for light motor vehicle
only, was not authorized to drive a transport vehicle and, thus, the insured
had committed breach of the terms of the policy and violated the provisions
of Motor Vehicles Act, 1988 in entrusting a transport vehicle to a person
who was not holding a valid driving licence to drive a transport vehicle and
as a consequence thereof, the insurer was not liable to indemnify the insured
in respect of the own damage claim. It is also not in dispute that legal
representatives of the driver had filed a petition under the Motor Vehicles
Act for compensation which was resisted by the insurer on the ground that
the driver of the vehicle did not possess a valid driving licence to drive the
vehicle and the aforesaid plea of the insurer was rejected by the Claims
Tribunal and compensation was allowed to the legal representatives of the
driver and no appeal was preferred by the insurer in that case. On the basis
of the aforesaid facts and keeping in view the provisions and the fact that it
was the case of the insurer itself that in the case of a light motor vehicle
which is a non-transport vehicle, there was no statutory requirement to have
specific authorization on the licence of the driver under Form VI of the
Rules. The Apex Court observed as under:-
“10. Definition of “light motor vehicle” as given in
clause (21) of Section 2 of the Act can apply only to
a “light goods vehicle” or a “light transport vehicle”.
A “light motor vehicle” otherwise has to be covered
by the definition of “motor vehicle” or “vehicle”
as given in clause (28) of Section 2 of the Act. A
light motor vehicle cannot always mean a light
goods carriage. Light motor vehicle can be non-
FAO No.3656 of 2008 -: 6 :-transport vehicle as well.
11. To reiterate, since a vehicle cannot be used as
transport vehicle on a public road unless there is a
permit issued by the Regional Transport Authority
for that purpose, and since in the instant case
there is neither a pleading to that effect by any party
nor is there any permit on record, the vehicle in
question would remain a light motor vehicle. The
respondent also does not say that any permit was
granted to the appellant for plying the vehicle as a
transport vehicle under Section 66 of the Act.
Moreover, on the date of accident, the vehicle was
not carrying any goods, and thought it could be
said to have been designed to be used as a transport
vehicle or goods-carrier, it cannot be so held on
account of the statutory prohibition contained in
Section 66 of the Act.
Xxxx xxxxx xxxxx xxxxx 14. Now the vehicle in the present caseweighed 5,920 kilograms and the driver had the
driving licence to drive a light motor vehicle. It is
not that, therefore, the insurance policy covered a
transport vehicle which meant a goods carriage.
The whole case of the insurer has been built on a
wrong premise. It is itself the case of the insurer
that in the case of a light motor vehicle which is a
FAO No.3656 of 2008 -: 7 :-non-transport vehicle, there was no statutory
requirement to have specific authorisation on the
licence of the driver under Form 6 under the
Rules. It has, therefore, to be held that Jadhav was
holding effective valid licence on the date of
accident to drive light motor vehicle bearing
Registration No. KA-28-567.”
In National Insurance Company Ltd. v. Annappa Irappa
Nesaria and Ors. 2008(1) RCR (Civil) 848, the vehicle involved in the
accident was a matador van which had a ‘Goods Carriage’ permit granted in
terms of Form No.7 of the Motor Vehicles Act. The said vehicle met with
an accident on 9.12.1999 causing death of one Gangawwa. A contention
was raised on behalf of the insurer that the driver of the said vehicle did not
possess an effective licence to drive a transport vehicle. However, the
Tribunal rejected the aforesaid contention of the insurer. In appeal before
the High Court, the arguments of the insurer was rejected in view of the fact
that claimants were third parties and even on the ground that there is a
violation of the terms and conditions of the policy, the insurance company
could not be permitted to contend that it has no liability. Before the Hon’ble
Supreme Court, argument was raised on behalf of the insurer that a light
motor vehicle cannot be a transport vehicle within the meaning of the
provisions of the Act. Reliance was placed upon various Forms prescribed
in terms of the Rules. The aforesaid contention of the insurer was contested
by the respondents on the ground that keeping in view the definition of the
“light motor vehicle” as contained in Section 2(21) of the Act, a “light
goods carriage” would come within the purview thereof. It was also further
FAO No.3656 of 2008 -: 8 :-contended that a “light goods carriage” having not been defined in the Act,
the definition of the “light motor vehicles” clearly indicates that it takes
within its umbrage both a transport vehicle and a non-transport vehicle. The
Apex Court after noticing various provisions of the Act and the Rules
framed thereunder, observed as under:-
“From what has been noticed hereinbefore, it is evident that
transport vehicle has now been substituted for `medium goods
vehicle’ and `heavy goods vehicle’. The light motor vehicle
continued, at the relevant point of time, to cover both, light
passenger carriage vehicle and light goods carriage vehicle.
A driver who had a valid licence to drive a light motor
vehicle, therefore, was authorized to drive a light goods
vehicle as well.
17. The amendments carried out in the Rules having a
prospective operation, the licence held by the driver of the
vehicle in question cannot be said to be invalid in law.”
Thus, the aforesaid judgments are of no help to the respondent
as the same were passed keeping in view the provisions/Rules prior to
28.3.2001 and the facts of these cases.
No doubt the definition of the `light motor vehicle’ brings
within its umbrage both `transport vehicle’ or `omnibus’, but a distinction
between an effective licence granted for transport vehicle and passenger
motor vehicle exists as per the provisions of the Motor Vehicles Act, 1988
which can be seen from the following provisions of the Act.
`Driving licence’ has been defined in Section 2(10) to mean the
licence issued by a competent authority under Chapter II authorizing the
FAO No.3656 of 2008 -: 9 :-
person specified therein to drive, otherwise than as a learner, a motor
vehicle or a motor vehicle of any specified class or description.
Section 3 provides for the necessity of driving
licence, stating:
“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 authorizing him to drive the vehicle; and no
person shall so drive a transport vehicle other than
a motor car or moter cycle hired for his own use or
rented under any scheme made under sub-section
(2) of Section 75 unless his driving licence
specifically entitles him so to do.”
Section 9 provides for grant of driving licence. Section 10
prescribes the form and contents of licences to drive which is to the
following effect :
“10. Form and contents of licences to drive.–
(1) Every learner’s licence and driving licence,
except a driving licence issued under section 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
FAO No.3656 of 2008 -: 10 :-of the following classes, namely:-
(a) to (c) …
(d) light motor vehicle;
(e) transport vehicle;
(i) road Roller;
(j) motor vehicle of a specified
description.”
The distinction between a `light motor vehicle’ and a `transport
vehicle’ is, therefore, evident. A transport vehicle may be a light motor
vehicle but for the purpose of driving the same, a distinct licence is required
to be obtained. The distinction between a `transport vehicle’ and a non-
transport can also be noticed from Section 14 of the Act. Sub-section (2) of
Section 14 provides for duration of a period of three years in case of an
effective licence to drive a `transport vehicle’ whereas in case of any other
licence, it may remain effective for a period of 20 years.
The Apex Court, in Angand Kol’s case (supra), after
considering the aforesaid various provisions of the Motor Vehicles Act,
1988 and the Rules framed thereunder has held that Section 3 of the Act
requires the driver to have a specific endorsement which would entitle him
to ply such vehicle.
The effect of the different terms of licences granted in terms of
the provisions of Section 2(14) and 2(47) was also noticed by the Apex
Court in New India Assurance Co. Ltd. v. Prabhu Lal [(2008) 1 SCC 696],
wherein it was observed as under:
“21. Now, it is the case of the Insurance Company
that the vehicle of the complainant which met with
FAO No.3656 of 2008 -: 11 :-an accident was a “transport vehicle”. It was
submitted that the insured vehicle was a “goods
carriage” and was thus a “transport vehicle”. The
vehicle was driven by Ram Narain, who was
authorised to drive light motor vehicle and not a
transport vehicle. Since the driver had no licence
to drive transport vehicle in absence of necessary
endorsement in his licence to that effect, he could
not have driven Tata 709 and when that vehicle
met with an accident, the Insurance Company
could not be made liable to pay compensation.
XXX XXX XXX
28.The argument of the Insurance Company is
that at the time of accident, Ram Narain had no
valid and effective licence to drive Tata 709.
Indisputably, Ram Narain was having a licence to
drive light motor vehicle. The learned counsel for
the Insurance Company, referring to various
provisions of the Act submitted that if a person is
having licence to drive light motor vehicle, he
cannot drive a transport vehicle unless his driving
licence specifically entitles him so to do (Section
3). Clauses (14), (21), (28) and (47) of Section 2
make it clear that if a vehicle is “light motor
vehicle”, but falls under the category of transport
vehicle, the driving licence has to be duly
FAO No.3656 of 2008 -: 12 :-endorsed under Section 3 of the Act. If it is not
done, a person holding driving licence to ply light
motor vehicle cannot ply transport vehicle. It is
not in dispute that in the instant case, Ram Narain
was having licence to drive light motor vehicle.
The licence was not endorsed as required and
hence, he could not have driven Tata 709 in
absence of requisite endorsement and the
Insurance Company could not be held liable.
29. We find considerable force in the submission
of the learned counsel for the Insurance Company.
We also find that the District Forum considered
the question in its proper perspective and held that
the vehicle driven by Ram Narain was covered by
the category of transport vehicle under Clause (47)
of Section 2 of the Act. Section 3, therefore,
required the driver to have an endorsement which
would entitle him to ply such vehicle. It is not
even the case of the complainant that there was
such endorsement and Ram Narain was allowed to
ply transport vehicle. On the contrary, the case of
the complainant was that it was Mohd. Julfikar
who was driving the vehicle. To us, therefore, the
District Forum was right in holding that Ram
Narain could not have driven the vehicle in
question.”
FAO No.3656 of 2008 -: 13 :-
In New India Assurance Co. Ltd. v. Prabhu Lal, [2008]1
SCC 696, the Apex Court distinguished its earlier judgment in Ashok
Gangadhar Maratha v. Oriental Insurance [(1999) (6) SCC 620], stating :
“In our judgment, Ashok Gangadhar’s case, 2000
ACJ 319 (SC) did not lay down that the driver
holding licence to drive a light motor vehicle need
not have an endorsement to drive transport vehicle
and yet he can drive such vehicle. It was on the
peculiar facts of the case, as the Insurance Company
neither pleaded nor proved that the vehicle was
transport vehicle by placing on record the permit
issued by the Transport Authority that the Insurance
Company was held liable.”
From the discussions made hereinbefore, it is, thus, evident that
it is proved that respondent No.3 did not hold a valid and effective driving
licence for driving a transport vehicle. Breach of conditions of the insurance
policy is, therefore, apparent on the face of the records. Therefore, findings
of the Tribunal that the respondents being owner, driver and insurer of the
offending vehicle respectively shall be liable to pay the amount of
compensation jointly and severally to the claimants, cannot be sustained in
this regard. However, keeping in view the judgment of the Hon’ble
Supreme Courtin the case of National Insurance Co. Ltd. v. Swaran
Singh, 2004 ACJ 1 (SC), the findings of the Tribunal are modified to the
extent and held that appellant shall be entitled to recover the amount of
compensation from respondents No.2 and 3.
These appeals are allowed to the extent as indicated above.
December 12, 2009. [ Rakesh Kumar Garg ] kadyan Judge