UNITED INDIA INSURANCE CO. LTD Vs. K. SUBRAMANIAM

JUDGEMENT

(1.) THIS appeal at the instance of United India Insurance Co. Ltd. is directed against the award of the Motor Accidents Claims Tribunal (II Additional Sub Court), Chengalpattu, in M.O.P. No. 206 of 1981. The first respondent herein filed M.O.P. No. 206 of 1981 against the appellant and respondent Nos. 2 and 3 herein praying for the award of compensation in a sum of Rs. 17,040/- in respect of the injuries sustained by him in an accident that took place on 24.12.1980 involving a tempo bearing registration No. TMU 2154, which stood registered in the name of the second respondent herein and in respect of which the appellant had issued a policy of insurance in the name of the third respondent herein. Though several defences were raised by the appellant and respondent Nos. 2 and 3, having regard to the limited scope of the appeal in which the appellant insurance company seeks to disclaim its liability for the payment of a sum of Rs. 4,900/- determined as compensation payable by it to the first respondent, it would suffice to set out the twin defences raised by the appellant. It may be immediately stated that the findings of the Tribunal that the accident took place as a result of the conjoint negligence of the first respondent and the driver of the tempo and that the first respondent is entitled to be paid compensation in a sum of Rs. 4,900/- were not challenged before this court. In its counter before the Tribunal, the appellant had raised two substantial defences, which were also repeated before this court. The first was, the driver of the vehicle was not possessed of a valid driving licence to drive a three-wheeler at the time of the accident and, therefore, no liability could be fastened upon the appellant. The second contention raised by the appellant was that the insurance cover had been issued by the appellant in the name of the third respondent herein as an individual and he had also submitted a claim, but the vehicle stood registered as per the registration certificate in the name of the second respondent and there was, therefore, no privity of contract between the appellant and the second respondent and as such, no liability could be fastened upon the appellant for the payment of compensation. The Tribunal, on a consideration of the endorsements in the licence marked as Exh. B-1, found that on the date of the accident, the driver was holding a valid licence to drive that vehicle and the appellant cannot, therefore, claim that it is not liable to pay the compensation determined. On the other defence raised by the appellant, the Tribunal took the view that under the provisions of the Motor Vehicles Act (hereinafter referred to as 'the Act'), not only the registered owner of the vehicle can take out a policy but that a person using the vehicle can also do so and under those circumstances, the fact that the vehicle stood registered in the name of the second respondent in respect of which the third respondent had taken out a policy with the appellant in his individual name would not make any difference to the liability of the appellant. Thus, overruling the defences raised by the appellant, the Tribunal directed the appellant to pay the first respondent a sum of Rs. 4,900/- towards compensation in respect of the injuries sustained by him in the accident that took place on 24.12.1980, the correctness of which is questioned by the appellant on the very same grounds as were urged by it before the Tribunal.

(2.) REFERRING to the entries in Exh. B-l, the licence held by the driver of the vehicle at the time of the accident, learned counsel for the appellant submitted that originally the driver was licensed to drive a light motor vehicle and was also authorised to drive as a paid employee a transport vehicle, but only on 16.8.1981, long after the accident took place, the driver had been authorised to drive a transport vehicle by a special endorsement on the licence and, therefore, the driver of the vehicle cannot be considered to have been duly licensed to drive a tempo on the date when the accident took place on 24.12.1980. Reliance in this connection was also placed upon the decision reported in National Insurance Co. Ltd. v. Mahadevayya (1981) TLNJ 170. In answer to this, learned counsel appearing for the respondents pointed out, adopting the reasoning of the Tribunal in para 8 of its order, that the driver had been authorised even prior to 16.8.1981 to drive a transport vehicle as a paid employee and that the licence was valid for the period of 11.8.1979 to 13.8.1982 and therefore, on 24.12.1980, when the accident took place, the driver held a valid driving licence for driving a tempo and the Tribunal was quite right in its conclusion in that regard.

(3.) LEARNED counsel for the appellant next submitted that registration certificate in respect of the vehicle stood in the name of the second respondent, but the policy had been taken out by the third respondent in his individual name and, therefore, there was no privity of contract between the appellant and the second respondent and no liability could, therefore, be fastened on the appellant on the basis of a contract of insurance. In answer to this, learned counsel for the respondents submitted that though the vehicle stood registered in the name of the second respondent, it was open to the third respondent, who was the managing partner of the second respondent and as one who was using the vehicle, to take out a policy of insurance in his own name in order to cover the risks that may arise out of the use of the vehicle.