NATIONAL INSURANCE CO LTD Vs. A BABU

JUDGEMENT

(1.) The second respondent, Insurance Company, in O.P. No. 175 of 1980 on the file of the Motor Accident Claims Tribunal, Madras is the appellant herein. The facts which are necessary for the disposal of this appeal are briefly as follows: The first respondent herein who is the owner of the motor cycle TMC 4937 drove the said vehicle rashly and knocked down the cyclist, deceased Gandhi, on 12-3-1979 at about 4.30 p.m. As a result of the injuries sustained by the said Gandhi, he dies later at the hospital on 7-5-1979. The widow and children of the deceased respondents 2 to 4 herein filed O.P. No. 175 of 1980 against the owner-cum-driver of the vehicle, the firsrt respondent herein, and the Insurance Company, the appellant. The contention of the appellant in the counter filed before the Claims Tribunal was that the first respondent had no valid driving licence at the time of the accident and that he was prosecuted, convicted and sentenced and hence the appellant was not liable. The Claims Tribunal on the basis of the oral and documentary evidence adduced before him came to the conclusion that the first respondent drove the motor cycle TMC 4937 rashly and knocked down the deceased and as a result of the same, the deceased died and awarded compensation of Rs.10,000/- against the first respondent, while dismissing the claim against the appellant holding that the first respondent violated the condition of the policy by not holding a permanent driving licence other than a learner's licence at the time of the accident. Aggrieved with the same, the claimants, respondents 2 to 4, herein filed C.M.A. No. 536 of 1982. The learned single Judge of this Court allowed the appeal and awarded compensation of Rs.26,500/- with proportionate costs against the appellant herein. The appellant has challenged the said award passed by the learned single Judge in this letters patent appeal.

(2.) The learned Counsel for the appellant, Mr. A. R. Ramanathan submitted that the learned single Judge of this Court erred in awarding compensation against the appellant when the first respondent had no valid driving licence and he was convicted on the plea to the charge under Section 3 of the Motor Vehicles Act. It was submitted that the award of compensation is against the evidence of P.W. 1, the investigating officer. According to the learned Counsel, learner's licence is not a valid licence in view of the Bench decision of this Court in Ambujam v. Hindustan Ideal Insurance Co., (1980) 2 Mad LJ 570, and even if the appellant was holding a learner's licence, the appellant, Insurance Company, is not liable in view of the said decision. Further, in view of the conviction of the first respondent under Section 3 of the Motor Vehicles Act, it is clearly established that the first respondent is not possessed of a valid licence at the time of the accident. As per the terms of the Insurance Policy, the first respondent should possess the permanent driving licence other than the learner's licence and in the absence of permanent driving licence, the Insurance Company cannot be held liable.

(3.) As regards the contention of the appellant that the first respondent had no valid driving licence and that he was prosecuted under Sec.3 of the Motor Vehicles Act and as such, as per the terms of the Policy, he is not liable to pay any compensation, it is the uniform decision of various High Courts and the Supreme Court that the onus of proof in regard to breach of condition in the policy is on the insurer and not on the claimant or the owner of the vehicle. In Bishen Devi v. Sirbakash Singh, 1979 Acc CJ 496 , it was observed: 'Under See. 96(2)(b)(ii) the insurer can defend a claim for compensation on the ground that the vehicle was driven by a person who was not duly licensed. Apart from making the averment in his written statement the insurer did not take any steps to establish that the vehicle was driven by a person who was not properly licensed . ..... It is the duty of the insurer to have substantiated his plea.' In Indian Mutual Ins. Co. now merged in the United India Fire and General Ins. Co. Ltd. v. Vijaya Ramulu, 1978 Acc CJ 366 (Andh Pra), it was held that the onus is on the insurer to prove that the driver, who drove the vehicle at the time of the accident, did not possess a valid driving licence. It was further held that it was not enough for the insurer to have merely given notice to the owner to produce the driver for evidence. They ought to have approached the Road Transport Authority and proved on their own that the driver was not duly licensed. The insurers ought to have taken steps to examine the driver. Hence, for these reasons, the insurer could not be absolved of their liability, merely on the basis of their pleading that the driver was not duly licensed. In United India Fire and Genl. Ins. Co. Ltd. v. Surindasinh Gurasinh, 1982 Acc CJ (supp) 2909 , it was held: 'The onus is on the insurer to plead and prove that the driver who drove the vehicle at the time of the accident did not have a valid driving licence. The mere averment to that effect in the written statement, or a mere suggestion to a witness with regard to it in cross-examination, is not sufficient to discharge the burden on the insurer. Following the observation of the Supreme Court in 1979 Acc CJ 496, it was held the insurer had to discharge the burden satisfactorily to escape liability.' In Narchinva V. Kamat v. A.A.D. Martins, 1985 Acc CJ 397, it was held: 'The insurance company asked the driver while cross-examining him, to produce the driving licence, but the driver failed to do so. It was held that the burden on the insurer could not be said to have been discharged by a mere question in cross-examination. The driver was under no obligation to furnish such information to enable the insurer to wriggle out of their liability. Further, the Road Transport Authority, which issues the driving licence, keeps a record of the licences issued and renewed by it. The insurer could have produced the evidence to substantiate their allegations. It was therefore held that, the insurer having failed to discharge their burden, their liability under the contract of insurance remained intact and unhampered. They were bound to satisfy the award.' In the instant case, though the insurance company, the appellant herein, issued a notice to the first respondent to produce his driving licence, it was not produced. As rightly observed by the learned single judge, it was not produced because it is established by the evidence of the investigating officer P. W. 1 seized the learner's licence of the first respondent during investigation and that he was having the same in his possession. When P.W. 1 was in the witness box, he was not asked to produce the licence. Further, no steps were taken to summon the records from the Regional Transport Officer who issued the licence to prove the fact that the first respondent was not having a valid licence at the time of the accident. In the instant case, much reliance was Placed on the admission of the 1st respondent, R.W. 2. R.W. 2 has stated in the chief-examination that he was having the learner's licence at the time of the accident and that it is a comprehensive one. But in cross-examination, he has stated that he did not know the date on which the licence was obtained and also the period of licence. He has also stated that the licence was not in force at the time of the accident. He has further admitted that he was fined Rs.50/- for driving the vehicle without a licence. In reexamination, he has stated that he has filed a revision against the said conviction. He would further state that he was a mechanic and that he was driving the motor cycle for five years. R.W. 1, the senior assistant attached to the office of the Insurance Company, appellant, would state that he does not know whether the first respondent was having a learner's licence at the time of the accident. P.W. 1 investigating officer, has stated in chiefexamination that the first respondent was having learner's licence and that the said licence was from 24-11-1978 to 22-7-1979. He would state that it expired. But, it has to be noted that the accident was on 12-3-1979. If that period was taken into consideration, the learner's licence was in force. It is the evidence of R.W. 2 that the said licence was seized by police. The learned Counsel for the appellant relied on the above evidence and submitted that in view of the evidence of R.W. 2 that he was convicted for not possessing valid licence, the appellant, insurance company, is absolved from liability. It has been held in New India Assurance Co, Ltd. v. Deen Dayal, 1986 Acc CJ 251(Raj); Abdul Zabbar v. Ram Swarun, 1985 Acc CJ 594 (Raj); and New India Assurance Co. Ltd. v. Mandar Madhav Tambe, 1986 Acc CJ 874 (Bom), that the mere admission of a driver; who is a respondent, that he had no licence cannot bind the claimants. It is for the insurer to lead positive evidence to discharge their burden. If they failed to do so, they cannot avoid their liability. In New India Assurance Co. Ltd. v. Subbu, 1987 Acc CJ 108 (Mad), the insurer came up on appeal on the ground that the driver did not hold a valid driving licence to drive a medium goods vehicle, namely, a trailer-tractor since the driver held only a licence to drive a light motor vehicle. It was held that the mere admission of the driver in the witness box that he held a licence to drive only a light motor vehicle, was not sufficient. The Insurance Company was held as having failed to discharge its burden to prove that the driver did not have a valid driving licence, since the liability of the insurance company was to the claimants who were the victims of the accident and not to the driver. The driver having failed to produce the licence and the insurance company having failed to summon the available records, the possibility of the driver supporting the insurance company could not be ruled out. In the instant case, the learned Counsel for the appellant relied on the admission of the owner-cum-driver of the vehicle about his non-possessing a valid driving licence at the time of the accident. But, no steps have been taken either to summon the licence from the investigating officer or from the authorities concerned. As pointed out in the above decisions, any admission made by the non-claimants and the respondents is not binding on the claimants. The burden is on the Insurance Company to prove that the driver of the vehicle was not having valid licence and that there was breach of the condition of the policy and as such the insurance company was not liable. Even in respect of alleged conviction under Sec. 3 of the Motor Vehicles Act, in similar circumstances, a Bench of the Karnataka High Court in United India Fire and Genl. Insurance Co. Ltd., Bangalore v. Nagarathna, 1982 Acc CJ 237 , held that apart from the certified copy of the plea of guilty recorded in the Criminal Court, nothing else is produced to show that the driver had no licence. As pointed out by the Andhra High Court in Indian Mutual Ins. Co. now merged in the United India Fire and General Ins. Co. Ltd. v. Vijaya Ramulu, 1978 Acc CJ 366 (Andh Pra), it was for the Insurance Company to summon the driver. The Insurance Company should have summoned the Road transport Authority to produce the relevant licence, if any or at any rate ought to have obtained the endorsement of the Road Transport Authority that the driver had no licence and in the absence of any record, there is no case (to) exonerate the Insurance Company on the basis of the conviction of the driver for not possessing driving licence on his admission. In the instant case, it is not in dispute that prior to the date of the accident, the first respondent was a mechanic and he was driving vehicle for a number of years. He was having learner's licence from 24-11-1978. For arguments' sake even if the case of the appellant is admitted that the licence expired and the first respondent was not having a valid licence as it was not in force, the question is whether the insurance company is absolved from liability. In New India Assurance Co. Ltd. v. C. B. Shankar, 1966 Acc CJ 82 (Mad), this Court held that the onus is on the insurer to plead and prove that the vehicle was driven by a person without a valid driving licence. In order to escape liability not only should the insurer prove that the driver of the vehicle was not holding a licence at the time of the accident but also that he was a disqualified from holding or obtaining a licence or that he never had any licence at all. Merely proving that on the date of the accident, the driver did not have a licence and that he pleaded guilty is not enough to hold that the insurance company is not liable. In the above case, the driver was charged under Section 3 and the owner of the vehicle under Sec. 5 of the M. V. Act for contravention of the said provision. Both pleaded guilty and were convicted. The insurer was held liable on the ground that they had failed to prove that the driver was disqualified from holding or obtaining a licence or never had any licence at all. It was observed that by merely causing a notice to be served on the onwer of the vehicle and the counsel for the owner of the vehicles for the production of the driver's licence would not enable the insurer to discharge their onus. It was so held in United India Fire and General Ins. Co. Ltd. v. Ayisa, 1979 Acc CJ 526 (DB) (Mad) and Srinivasa Roadways, Madurai v. Saroja, 1975 Acc CJ 265. It is not the case of the appellant Insurance Company, that the first respondent was disqualified from holding or obtaining licence and that he never had licence at all. In the instant case, the finding of the learned single Judge is that the first respondent was having a licence which was in force in view of the evidence of R.W. 1 and that the Insurance Company has not discharged their burden by adducing evidence that the first respondent was not having any subsisting licence at the time of the accident. In view of,the ratio laid down in the above decisions, the admission of the first respondent and the conviction awarded to the first respondent are not sufficient to absolve the Insurance Company as the Insurance Company has not discharged the onus by taking steps to summon the very licence either from P.W. 1 or from the Road Transport Authorities who issued the licence.