JUDGMENT
R. Banumathi, J.
1. Aggrieved against the award of compensation and apportionment of 50% of the liability to the Insurance Company, Insurance Company has preferred this appeal. For convenience, parties are referred as per their array in the claim petition.
2. Brief facts brought out in the claim petition are as follows : On 12.12.1996, at about 4.30 p.m., petitioner Santhamani was travelling in a van bearing registration No. TAM 1177 owned by the second respondent and insured with the appellant/third respondent. The van was driven in a rash and negligent manner. The State Transport Corporation bus owned by the fifth respondent bearing registration No. TCB 2757 driven by the fourth respondent in a rash and negligent manner came in the opposite direction and both the vehicles collided against each other, as a result of which, passengers in the van and the petitioner Santhamani sustained grievous injury along with others. The petitioner sustained fracture injury in her right hand. After the accident, the petitioner was admitted in Sri Ramakrishna Hospital, Coimbatore where surgery was conducted on the right humerous bone and she continued as in-patient till 16.12.1996 and thereafter, she continued treatment as out patient. Criminal case was registered against the van driver in Cr. No. 633/1996 of Puliyampatti P.S. Alleging that the accident was due to rash and negligent driving of both drivers, the petitioner filed claim petition claiming compensation of Rs. 2,30,000/-.
3. Denying the averments in the claim petition, third respondent Insurance Company has filed counter affidavit contending that the accident was due to rash and negligent driving of driver of bus TCB 2757 and Insurance Company is not liable to pay compensation. It was also contended that the driver of the van TAM 1177 had no valid licence at the time of accident and owner of the van has violated the policy conditions and therefore, the Insurance Company is not liable to pay any compensation.
4. Both driver and owner of van remained exparte. Claimant examined herself as PW-1 and eye-witness PW-2 and Dr.Periyasami was examined as PW-3. Exs.P-1 to P-8 were marked. Onbehalf of the respondent, RWs-1 and 2 were examined.
5. Upon consideration of oral and documentary evidence, the Tribunal recorded the finding that the accident was due to rash and negligent of both the vehicles and on those findings, apportioned the negligence at 50% each. Consequently, it was held that respondents 1 to 3 are jointly and severally liable to pay 50% compensation and the respondents 4 and 5 jointly and severally liable to pay 50%. Referring to [National Insurance Co. Ltd. v. Devadas and Ors.], the Tribunal held that the Insurance Company had failed to discharge the burden cast upon it to prove that the driver of the van did not possess valid driving license and that there was violation of policy condition. The Tribunal declined to accept the contention of Insurance Company that it is entitled to recover the amount from the insured, the amount so paid to the claimant.
6. The learned Counsel for the appellant Insurance Company has submitted that when van driver did not possess valid driving license, the Tribunal erred in fastening the liability upon the appellant Insurance Company. It was submitted that the Tribunal erred in holding that the insurer had not discharged the burden cast on them. In this case, they had effected publication against the second respondent for producing driving licence and also taken out summons and examined RW-2.
7. Learned Counsel for the Appellant has further submitted that no particulars were given by the claimants and therefore, the Insurance Company was not able to prove the negative. It was further argued that it is the duty of the claimant/insurer to furnish correct particulars in respect of the driving licence and without such particulars, the Insurance Company cannot prove the negative. Placing reliance upon 2007 ACJ 1067 [Ishwar Chandra and Ors. v. Oriental Insurance Co. Ltd. and Ors.], the learned Counsel has submitted that the Insurance Company if directed to pay compensation amount to the claimant/ third party, Insurance Company ought to have been given option to recover the amount from the insurer, by initiating proceedings before the executing Court.
8. The learned Counsel for the respondent claimant has submitted that in respect of third party claim, the Insurance Company has to pay and indemnify the claim of the insurer.
9. Insofar as 50% of liability apportioned on State Transport Corporation, it was stated that they have already paid their apportioned share of compensation to the claimant.
10. In the light of the contentions, the following points arise for consideration:
(1) Whether the appellant Insurance Company had discharged the onus cast upon it to prove that van driver had no valid driving licence?
(2) By allowing the person without valid driving licence to drive the van, whether there was violation of policy conditions ?
(3) As per Swaran Singh’s case 2004 ACJ (1) SC and Nanjappan’s case 2004 ACJ 721 (SC), whether the appellant Insurance Company is entitled to have a direction to recover the amount from the insurer after paying the compensation amount to the claimant.
11. There is no denying that claimant travelled in van TAM 1177. Accident was due to head on collision between the van and the bus which caused injuries to the passengers travelling in the van. It is not necessary to narrate the entire facts as to how the accident has happened and who is responsible for the accident, and who is liable to pay compensation amount. It is for the reason that these factual findings are recorded in favour of the claimant. Secondly, the question of negligence and quantum of compensation and apportionment are not under serious challenge. The claimant who was travelling in the van sustained bone fracture in her right hand and right shoulder. In respect of the injuries sustained by her, PW-2 Doctor has examined her and assessed her permanent disability at 40%. On the basis of evidence of P.W.s 1 and 2 and Ex.P-7 Disability Certificate, Tribunal fixed the disability at 40% and awarded compensation of Rs. 1,96,597/-. Out of the said compensation awarded, the appellant Insurance Company is liable to pay 50%.
12. The main plea of appellant Insurance Company is that driver of van TAM 1177 had no valid driving licence at the time of the accident and the insurer – second respondent has violated the policy conditions. It was further stated that inspite of being called upon to produce the driving licence particulars, the second respondent had not chosen to furnish necessary particulars. In respect of the accident, criminal case was registered against the van driver in Cr. No. 633/ 1996 of Puliyampatti P.S. under Sections 279 and 337 IPC. During investigation Motor Vehicles Inspector has inspected the van TAM 1177. In Ex.A-4 Motor Vehicles Inspector Report column 7, it is clearly stated that the driving licence particulars are not available.
13. Of course, burden lies upon the Insurance Company to prove that the van driver did not possess valid driving licence. To escape liability of payment of compensation, onus is always on the Insurance Company to prove that driver had no valid driving licence.
14. To discharge onus cast upon it, appellant Insurance Company has effected paper publication, calling upon the second respondent to furnish particulars of driving licence. RW-2 Junior Assistant in RTO Office – Gopi was examined. In his evidence RW-2 has stated that only if driver possesses valid licence, there will be an entry in the register maintained in RTO Office. RW-2 has further submitted that merely with reference to address, driving licence particulars cannot be furnished. Inspite of repeated summons and publication, no driving licence particulars was furnished by the second respondent – owner of the van. Therefore, it is to be inferred that the driver of the van had no valid driving licence. The Insurance Company cannot be expected to adduce any further evidence, apart from examining the official from RTO Office. The Insurance Company had taken all possible efforts to secure driving licence particulars of the first respondent. The finding of the Tribunal that “it cannot be concluded that the first respondent had no valid licence” cannot be endorsed with. Since the driving licence particulars are not furnished, it is to be inferred that Driver had no valid driving licence. Evidently, there was breach of contract of Insurance.
15. Noticing the terms and conditions of the policy vis-a-vis the relevant provisions of the Act in Swaran Singh’s Case the Supreme Court has clearly laid down that the liability of the Insurance Company vis-a-vis the owner would depend upon several factors. It was obligatory on the part of the owner to take adequate care to see that the driver had an appropriate licence to drive the licence. The question as regards the liability of the owner vis-a-vis the driver being not possessed of the valid licence was elaborately considered by the Supreme Court in (National Insurance Co. Ltd. v. Swaran Singh and Ors.), wherein the Supreme Court has held as follows:
75. …Furthermore, it is one thing to say that the insurer will be entitled to avoid its liability owing to breach of terms of a contract of insurance but it is another thing to say that the vehicle is not insured at all. If the submission of learned Counsel for the petitioner is accepted, the same would render the proviso to Sub-section (4) as well as Sub-section (5) of Section 149 of the Act otiose, nor any effective meaning can be attributed to the liability clause of the insurance company contained in Sub-section (1). The decision in Kamla’s case , has to be read in the aforementioned context.
76. Sub-section (5) of Section 149 which imposes a liability on the insurer must also be given is full effect. The insurance company may not be liable to satisfy the decree and therefore, its liability may be zero but it does mean that it did not have initial liability at all. Thus, if the insurance company is made liable to pay any amount, it can recover the entire amount paid to the third party on behalf of assured. If this interpretation is not given to the beneficent provisions of the Act having regard to its purport and object, we fail to see a situation where beneficent provisions can be given effect to. Sub-section (7) of Section 149 of the Act, to which pointed attention of the Court has been drawn by learned Counsel for the petitioner, which is in negative language may now be noticed. The said provision must be read with Sub-section (1) thereof. The right to avoid liability in terms of Sub-section (2) of Section 149 is restricted as has been discussed hereinbefore. It is one thing to say that the insurance companies are entitled to raise a defence but it is another thing to say that despite the fact that its defence has been accepted having regard to the facts and circumstances of the case, the Tribunal has power to direct them to satisfy the decree at the first instance and then direct recovery of the same from the owner. These two matters stand apart and require contextual reading.
Summarizing the findings to the various issues in Paragraph 102 the Supreme Court inter alia has held as follows:
(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.
(ii) Insurer is entitled to raise a defence in a claim petition filed under Section 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 conditions, e.g., disqualification of driver or invalid driving licence 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 driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences 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 licenced 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 defence(s) raised in the said proceedings but must also establish ‘breach’ on the part of the owner of the vehicle, the burden of proof wherefor would be on them.
(v) …
(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 licence 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 of the condition of driving licence 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 defences available to the insurer under Section 149(2) of the Act.
(vii) …
(viii) …
(ix) …
(x) Where on adjudication of the claim under the Act the Tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of Section 149(2) read with Sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third party under the award of the Tribunal. Such determination of the claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the Tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by Sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the Tribunal.
16. This aspect of the matter is also covered by the decision of the Supreme Court in [National Insurance Co. Ltd. v. Kusum Rai], wherein referring to Swaran Singh’s case, the Supreme Court has held as under:
This Court in Swaran Singh , clearly laid down that the liability of the Insurance Company vis-a-vis the owner would depend upon several factors. The owner would be liable for payment of compensation in a case where the driver was not having a licence at all. It was the obligation on the part of the owner to take adequate care to see that the driver had an appropriate licence to drive the vehicle. The question as regards the liability of the owner vis-a-vis the driver being not possessed of a valid licence was considered in Swaran Singh (supra) stating:
82. 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 Central Government to prescribe the forms of driving licences for various categories of vehicles mentioned in Sub-section (2) of said section. The various types of vehicles described for which a driver may obtain a licence for one or more of them are : (a) motor cycle without gear; (b)motor cycle with gear; (c)invalid carriage; (d)light motor vehicle; (e)transport vehicle; (f)road-roller and (g)motor vehicle of other specified description. The definition clause in Section 2 of the Act defines various categories of vehicles which are covered in broad types mentioned in Sub-section (2) of Section 10. They are ‘goods carriage’, ‘heavy goods vehicle’, ‘heavy passenger motor vehicle’, ‘invalid carriage’, ‘light motor vehicles’, ‘maxicab’, ‘medium goods vehicle, motorcab, motor cycle, omnibus, private service vehicle, semi trailer, tourist vehicle, tractor, trailer and transport vehicle. In claims for compensation for accidents, various kinds of breaches with regard to the conditions of driving licences arise for consideration before the Tribunal. A person possessing a driving licence for ‘motorcycle without gear’ (sic may be driving a vehicle), for which he has no licence. Cases may also arise where holder of driving licence for ‘light motor vehicle’ is found to be driving a ‘maxicab’, ‘motorcab’ or ‘omnibus’ for which he has no licence. In each case on evidence led before the Claims Tribunal, a decision has to be taken whether the fact of the driver possessing licence for one type of vehicle but found driving another type of vehicle, was the main or contributory cause of accident. If on facts, it is found that accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence.
17. In 2007 ACJ 1067 (cited supra), the Supreme Court has reaffirmed the position in Swaran Singh’s case and Kusum Rai’s case and has directed the Insurance Company to pay the compensation amount to the claimants with option to recover from the insurer by initiating proceedings before the executing court.
18. In view of the aforesaid discussion and keeping in view the law laid down by the Apex Court, it is held that 50% of compensation amount, as awarded by the Tribunal, shall be jointly and severally payable by the respondents 2 and 3. In view of the law laid down by the Apex Court in Swaran Singh’s case, and Kusum Rai’s case and Ishwar Chandra’s Case, Insurance Company shall be at liberty to seek recovery of the aforesaid amount from the owner of the van in the same manner as held by the Supreme Court.
19. Although this Court holds that the Appellant-Insurance Company is not liable to pay the claimed amount as the driver was not possessing a valid licence, the impugned award cannot be interfered with. In the facts and circumstances of the case and following the judgment of the Supreme Court in (National Insurance Co. Ltd. v. Swaran Singh and Ors.) and (National Insurance Co. Limited v. Kusum Rai), it is held that the Appellant-Insurance Company may recover the amount from the owner of the vehicle Respondents 1 to 3 in the same manner as was directed by the Supreme Court in the above decisions.