JUDGMENT
N. Prusty, J.
1. Even though the matter is listed for admission/hearing under Order XLI Rule 11 CPC, Learned Counsel for both the parties submit that the same can be disposed of at this stage, since the grounds of challenge in this appeal is with regard to the liability of the Insurance Company to pay the awarded amount indemnifying the owner of the vehicle, even though the driver of the vehicle was not having a valid Driving Licencewhich is violative of the terms and conditions of policy as well as the quantum of compensation and rate of interest awarded, which are on the higher side.
2. This appeal has been filed by the Opposite Party No. 2/Insurance Company challenging the award-dated 31.05.2005 passed by the Learned 2nd Motor Accident Claims Tribunal, Cuttack in Misc. Case No. 1521 of 2000, filed by the claimant/Respondent Nos. 1 and 2, who are the wife and son of one Jagannath alias Jagabandhu Pasayat, who died in a road accident caused on 08.12.2000 due to rash and negligent driving of the driver of a Truck bearing Registration No. OR11-6009.
3. The case of the claimants/Respondents is that the deceased, who died in a road accident due to rash and negligent driving of the driver of the offending vehicle, was aged about 56 years at the time of his death and was earning Rs 4000/- per month as a supervisor. The Claimant/Respondent Nos. 1 and 2 had claimed Rs. 3,00,000/- as compensation along with cost and interest.
4. In support of their case, the claimants have examined three witnesses and exhibited certain documents. On the other hand, only one witness was examined by the Opposite Parties in support of their contentions. However the Opposite Party No. 2/lnsurance Company had filed five documents namely investigation report and certified copy of the D.L., i.e. Exts. A and B, respectively and voter identity card of J. Pasayat (marked ‘X-1’) copy of voter identity card of Section Pasayat (marked as ‘Y’) and signature of Section Pasayat (marked as ‘z’)
5. The Tribunal taking into consideration all the facts and materials available on record, both oral and documentary, awarded compensation of Rs. 1,60,000/- applying 8 years multiplier, together with cost of Rs. 200/- and interest at the rate of 9 % per annum from 10.7.2003 i.e. the date the Insurance Company/Opposite Party No. 2 entered its appearance till the date of realization, assessing income of the deceased to be Rs. 2500/- per month i.e. Rs. 30,000/-per year and directed Opposite Party No. 2/lnsurance Company (Appellant) to pay the amount indemnifying the owner of the vehicle, since the vehicle was insured with it at the time of the accident.
6. Heard Mr. Goutam Mishra, Learned Counsel for the Appellant/ Insurance Company and Mr. D.K. Mohapatra, Learned Counsel for the claimants/Respondent Nos. 1 and 2 and Mr. Ranjit Mohanty, Learned Counsel for Respondent No. 3/owner of the vehicle.
7. Mr. Mishra, Learned Counsel appearing on behalf of Appellant/Insurance Company forcefully submitted that the Insurance Company is not liable to pay the Compensation indemnifying the owner of the vehicle, since the driver of the offending vehicle was not having a valid driving licence at the time of the accident, which is in violation of the terms and conditions of the policy. The sine-qua-non for fastening the liability on the insurer is that the driver of the offending vehicle must have a valid and effective driving licence at the time of the accident. In the instant case the same being absent, the insurer has to be exonerated from its liability and it is the owner of the vehicle who is only liable to satisfy the award, since he himself has violated the terms and conditions of the policy by appointing a driver, who does not possess a valid driving licence. Furthermore since right to reimburse the awarded amount from the owner of the vehicle has not been given to the insurer, the Judgment is vitiated. Learned Counsel further submits that keeping in view the age of the deceased vis-a-vis the claimants award of Rs. 1,60,000/- applying 8 multipliers is at a much higher side. So also the awarded interest at the rate of 9% per annum is on the higher side, since it was not the prevailing Bank’s rate of interest at the time of accident/filing the claim case. Hence both the amount of compensation as well as the rate of interest awarded are liable to be reduced. These submissions are strongly repudiated by Mr. Mohapatra, Learned Counsel for the Respondent Nos. 1 and 2 and Mr. Mohanty, Learned Counsel for Respondent No. 3.
8. It is submitted by the claimant-Respondents that the Tribunal was correctly awarded the amount of compensation as per the entitlement of the claimants keeping in view the evidence on record with regard to the occurrence, age and income of the deceased and his contribution to the family and finally directed the Insurance Company to pay the amount.
9. I have heard Learned Counsel for the parties at length. Perused the materials on record. So far as driving licence is concerned, not possessing a valid driving licence amounts to breach of policy condition as has been held by the Apex Court in a catena of decisions. In the instant case, the Tribunal has referred to D.L. No. 2565 of 1997-98, Cuttack and came to the conclusion that the same stood in the name of Radhakanta Mishra. But the certified copy of the said Driving Licence filed by the Appellant/Insurance Company clearly indicates that the said driving licence (Ext. B) was issued in the name of Prakash Sahoo. As such the driver of the offending vehicle was not having a valid driving licence at that point of time when the accident was caused.
10. In this regard, Hon’ble Apex Court in its decision New India Assurance Co. Simla v. Kamla and Ors. has been pleased to hold:
The position can be summed up thus: The insurer and insured are bound by the conditions enumerated in the policy and the insurer is not liable to the insured if there is violation of any policy condition. But the insurer who is made statutorily liable to pay compensation to third parties on account of the certificate of insurance issued shall be entitled to recover from the insured the amount paid to the third parties, if there was any breach of policy conditions on account of the vehicle being driven without a valid licence. Learned Counsel for the insured contended that it is enough if he establishes that he made all due enquiries and believed bona fide that the driver employed by him had a valid driving licence, in which case there was no breach of the policy condition. As we have not decided on that contention it is open to the insured to raise it before the Claims Tribunal. In the present case, if the Insurance Company succeeds in establishing that there was breach of the policy condition, the Claims Tribunal shall direct the insured to pay that amount to the insurer. In default the insurer shall be allowed to recover that amount (which the insurer is directed to pay to the claimants-third parties) from the insured person.
11. In the case of Oriental Insurance Co. Ltd. v. Nanjapan and Ors. , it has been held by the Supreme Court that
For the purpose of recovering the same from the insured, the insurer shall not be required to file a suit. It may initiate a proceeding before the concerned executing Court as if the dispute between the insurer and the owner was the subject matter of determination before the Tribunal and the issue is decided against he owner and in favour of the Insurer. Before release of the amount to the insured, owner of the vehicle shall be issued a notice and he shall require to furnish security for the entire amount, which the insurer will pay to the claimant. The offending vehicle shall be attached, as a part of the security. If necessity arises, the executing Court shall take assistance of the concerned Regional Transport Authority.
12. As such in consonance with the ratio of the decision of the Hon’ble Apex Court, even if not possessing a valid driving licence by the driver of the vehicle is a breach of policy condition, the poor claimant should not suffer for such breach of policy condition, if any. It is incumbent upon the insurer to pay the compensation first to the claimant and accordingly the Appellant Insurance Company ought to be directed to pay the amount of compensation, with liberty to realize the same from the owner of the offending vehicle, in accordance with law.
13. So far as the quantum of compensation is concerned, taking into consideration the facts and circumstances of the case in the spirit of Lok Adalat, this Court feels that a compensation of Rs. 1,40,000/- (Rupees one lakh forty thousand) instead of Rs. 1,60,000/- would be just and equitable. Apart from the aforesaid amount of Rs. 1,40,00/-, the claimant/Respondents are entitled to receive interest at the rate of 7.5% per annum from 10.07.2003, when the Insurance Company/Opposite Party No. 2 entered its appearance till the date of realization/ actual payment as well as a consolidated cost of Rs. 1500/-. Accordingly it is directed that the Insurance Company shall pay deposit the amount of compensation along with cost and interest, as above, within a period of three months hence. Out of total amount deposited, 30% of such total deposit made shall be disbursed in favour of the claimants-and the balance 70% of the amount shall be invested in an unencumberable fixed deposit for a term of six years in the names of the respective claimant-Respondents, i.e., Respondents 1 and 2 proportionately as would be fixed by the Learned Tribunal and no loan of any kind shall be sanctioned/disbursed in their favour by the concerned Bank during the entire period for which the money is kept in fixed deposit.
14. In view of the ratio of the decision of the Apex Court vis-a-vis Section 149(4) of the Motor Vehicles Act, after the entire amount of compensation is deposited along with up-to-date accrued interest and cost before the Tribunal as directed above, the Appellant/Insurance Company shall have right to proceed against the owner of the offending vehicle, for realization/recovery of the entire amount paid/deposited by it, in accordance with law, if the driver of the said vehicle was not possessing a valid driving licence to drive a truck on the date and time the accident was caused as well as shall have liberty to attach the vehicle, if the owner/insured does not participate in the proceeding and comply with the order passed in the proceeding for recovery.
15. After the entire amount is deposited before the Tribunal, as directed above, the Insurance Company shall also be at liberty to withdraw the amount of statutory deposit made by it in this Court along with up-to-date accrued interest, on proper application along with a certificate of such deposit.
16. It is made clear that after the amount is deposited in the Tribunal, if any proceeding for recovery is initiated by the Insurance Company, the same shall be considered on the basis of the evidence adduced in that proceeding.
The appeal is accordingly disposed of with the above modifications.