NEW INDIA ASSURANCE CO LTD Vs. MOHINDER SINGH

JUDGEMENT

(1.) THE Appeal is directed against a judgment dated 17.07.2009 whereby while awarding a compensation of Rs.8,46,000/- along with interest @ 7.5% per annum in favour of the First Respondent Mohinder Singh, the Appellant's plea of conscious breach of the policy on the part of the owner and avoidance of liability by the Insurance Company was rejected.

(2.) IT is urged by the learned counsel for the Appellant that it was established on record that the Respondent No.2 (Mandip Singh), the driver of the two-wheeler involved in the accident, was aged about 16 years at the time of the accident. He was thus not qualified to hold any driving licence. He was challaned for an offence under Section 4 read with Section 181 of the Motor Vehicles Act, 1988(the Act) apart from causing the accident by his rash and negligent driving. The owner did not lead any evidence as to how the driver was entrusted with the two-wheeler. Thus, the Appellant Insurance Company successfully proved the breach of the terms of the policy. The Motor Accident Claims Tribunal(the Tribunal) erred in making the Appellant liable to pay the compensation. The learned counsel for the Respondent, however, supported the judgment and states that the Insurance Company failed to prove willful and conscious breach of the terms of the policy. Thus, it could not avoid liability. While dealing with the Appellant's liability, the Claims Tribunal held as under:

(3.) THUS, it is established that there was conscious and willful breach of the terms of the policy by the Respondent No.3 and the Appellant could avoid its liability vis-a-vis the insured(Respondent No.3). But, this is no longer res integra that even in case of conscious breach of the terms of the policy, the liability of the insurer to satisfy the award in the first instance is statutory.