IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE R.BASANT & THE HONOURABLE MRS. JUSTICE M.C.HARI RANI WEDNESDAY, THE 20TH JANUARY 2010 / 30TH POUSHA 1931 MACA.No. 1472 of 2004 ----------------------- OPMV.2117/1994 of MOTOR ACCIDENT CLAIMS TRIBUNAL, PALAKKAD .................... APPELLANT/RESPONDENT: V.R. RAVEENDRAN, S/O. VELAYUDHAN NAIR, VALIYARAKKANCHATHU VEEDU, PERUVEMBA P.O., PALAKKAD DISTRICT. BY ADV. SRI.S.V.BALAKRISHNA IYER, SENIOR ADVOCATE SRI.K.JAYAKUMAR SRI.P.B.KRISHNAN SRI.HARISH R. MENON RESPONDENTS: 1. M. SAROJINI, W/O. LATE K.A. CHANDRAN, AGED 51, RIVER VIEW HOUSE, KALLAMPARAMBA, P.O. DHONI, PALAKKAD. 2. SHYAM PRASAD, S/O. LATE K.A.CHANDRAN (NOW MAJOR 27 YEARS) RIVER VIEW HOUSE, KALLAMPARAMBA, P.O. DHONI, PALAKKAD. 3. C. KRISHNA KUMAR, S/O.LATE K.A.CHANDRAN (NOW MAJOR 24 YEARS) RIVER VIEW HOUSE, KALLAMPARAMBA, P.O. DHONI, PALAKKAD. 4. BINU, S/O. LATE VISWANATHAN MANNARAKKAL MECHIL VEEDU, OLAVANNA AMSOM, IRINGALLUR DESOM, KOZHIKODE (NOW RESIDING AT QUARTER NO 141 (G) SHORANUR RAILWAY QUARTERS, SHORANUR) (DRIVER OF MOTOR CYCLE KL 9A 298). 5. THE NEW INDIA ASSURANCE COMPANY LTD., ANIKODE, CHITTUR. ADV. SRI.V.CHITAMBARESH FOR R1-R3 SRI.T.C.SURESH MENON FOR R1-R3 SRI.JACOB SEBASTIAN FOR R4 SRI.KKM.SHERIF FOR R5 SRI.A.A.ZIYAD RAHMAN FOR R5 SRI.MATHEWS JACOB SRI.GEORGE CHERIAN THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 20/1/2010 , THE COURT ON THE SAME DAY PASSED THE FOLLOWING: R.BASANT & M.C. HARI RANI,JJ ============================== M.A.C.A. NO. 1472 OF 2004 ============================ DATED THIS THE 20TH DAY OF JANUARY 2010 JUDGMENT Basant,J. The 2nd respondent before the Tribunal who is the owner of a Motor Cycle involved in the accident is the appellant. His vehicle was involved in an accident. At the time of the accident, the 4th respondent was riding the motor cycle and one Ramkumar, the son of the first respondent and brother of respondents 2 and 3 was riding as pillion. In the accident the 4th respondent and the said Ramkumar suffered injuries. Ramkumar succumbed to the injuries suffered by him. Mother and brothers of Ramkumar (hereinafter referred to as the claimants) staked a claim for compensation against the 4th respondent(the rider), the appellant (the owner) and the 5th respondent (the Insurer). An amount of Rs.2,60,000/- was claimed as compensation. Binu, (i.e. the 4th respondent) the alleged rider of the motor cycle took up a contention that, not he, but the M.A.C.A.1472/2004 -2- deceased was riding the motor cycle at the time of the accident. The appellant/owner took up a contention that the rider of the vehicle was at the relevant time riding the vehicle without his permission or authorisation. According to him, he is employed in the Railways. He had gone for his work on 12-4-1994 after entrusting the vehicle to the workshop of RW3 for repairs. He had returned from work only on 14-4-1994. He had then come to know that the accident had taken place on 13-4-1994. In short, he contended that the rider of the vehicle did not have his authority to ride the vehicle and hence he is not liable to compensate the claimants. 2. The Insurer admitted that there was a comprehensive policy issued in respect of the vehicle issued to the owner/appellant at the relevant time. It was a comprehensive policy. However, the Insurer contended that the Insurer is not liable as the rider, the first respondent at the relevant time did not have a valid driving licence. The Insurer thus disputed the liability to satisfy the claim. There was of course dispute regarding the quantum of compensation payable also. M.A.C.A.1472/2004 -3- 3. The first claimant examined herself as PW1. Exts.A1 to A8 were produced. The only document relevant to our consideration is Ext.A6 as per which the police after investigation had filed final report indicting the 4th respondent herein as the rider of the vehicle alleging that he was guilty of culpable rashness and negligence. 4. On the side of the respondents, RWs.1 to 4 were examined and Exts.B1 to B8 were marked. Exts.X1 to X2(a) were also marked. 5. The appellant/owner had staked a claim before the Insurance Company claiming payment of amounts towards the loss suffered by the vehicle which was covered by the comprehensive policy of insurance. Ext.B7 is the policy of insurance and Ext.B6 is the claim staked by the appellant before the Insurance company claiming amounts for damage suffered by his vehicle. Along with the same, he had produced before the Insurance Company Ext.B8 photocopy of the driving licence of the rider, i.e. the 4th respondent herein. M.A.C.A.1472/2004 -4- 6. The Insurance Company took the stand that the 4th respondent did not have a valid driving licence. The Insurance Company examined RW1 an official of the Motor vehicle department which allegedly had issued Ext.B1 driving licence which is the original of Ext.B8. Ext.X1 to X2(a) were produced and marked through RW1 to substantiate the contention of the Insurance Company that Exts.B1/B8 driving licence was a fake and non-genuine driving licence. 7. The appellant examined himself in support of his contention that he had entrusted the vehicle on 12-4-1994 to the workshop where RW3 is the mechanic. He examined RW3 as a witness in support of that contention. He examined RW4 an d proved Exts.X2 and X2(a) to fortify his contention that he was on duty from 12-4-1994 to 14-4-1994 and was not available in the locality when the accident took place. RW3 was examined to confirm that the vehicle had been entrusted for repairs to the workshop and that the 4th respondent and the deceased Ramkumar had taken the vehicle from the workshop during the absence of the appellant who had gone on duty. M.A.C.A.1472/2004 -5- 8. The Tribunal came to the conclusion that the claimants are entitled to an amount of Rs.1,94,250/- as compensation along with interest and costs. It must be noted straightaway that the said finding/direction is not assailed by anyone before us. The Tribunal found that the contention of the appellant/owner that the vehicle was being driven by the 4th respondent without the consent and authority of the appellant/owner is not acceptable. The Tribunal further found that the 4th respondent did not have a valid driving licence and that Exts.B1/B8 produced by the appellant before the Insurance Company along with Ext.B6 claim was a fake and non-genuine driving licence. According to the Tribunal, the Insurer has in these circumstances successfully established breach of the condition under Section 149(2)(a)(ii) of the Motor Vehicles Act, 1988 that the rider of the motor cycle did not have a valid driving licence at the time of the accident. However,as the policy was a comprehensive policy of insurance notwithstanding the fact that the deceased was the pillion rider, the Tribunal proceeded to direct the Insurance Company to pay compensation due to the claimants. But the Insurance Company M.A.C.A.1472/2004 -6- was permitted to recover the amount from the owner, i.e.the appellant herein. 9. We have heard all counsel. The learned counsel for the appellant/owner assails the impugned direction to him to pay the amount to the Insurance Company on the following specific grounds: 1. The 4th respondent rider had no authority to use the vehicle of the appellant and in these circumstances the appellant cannot be mulcted with liability for the tortious act committed by the 4th respondent. 2) At any rate, the Insurer has not succeeded in establishing that there was “breach” of the policy condition falling within Section 149(2)(a)(ii) of the Motor Vehicles Act and hence the permission granted to the Insurance Company to recover the amount from the appellant after making payment to the claimants is not justified. M.A.C.A.1472/2004 -7- 10. We shall now proceed to consider the challenge raised on these grounds. We may incidentally mention that the learned counsel for the Insurance Company attempted to advance an ingenious contention though the same does not appear to be supported by the pleadings raised. The counsel contends that the policy of insurance is a comprehensive policy of insurance. Under the compulsory policy of insurance, the liability of the pillion rider is not covered. Breach under Section 149(2)(a)(ii) of the Act need be established by the Insurer strictly only in a case where the liability is compulsorily insurable and not in the case of a liability outside the compulsory policy of insurance on the basis of a voluntary comprehensive policy of insurance issued by the insurer to the insured. The counsel proceeds further to contend relying on the decision in United India Insurance Co.Ltd. v. Rakesh Kumar Arora & Ors., (A.I.R.2009 S.C.24) that the decision in National Insurance Co.Ltd. v. Swaran Singh [2004(1)K.L.T.781(SC)] is not applicable in such a case where the insurer's liability arises not from the statutory stipulations in a compulsory policy of M.A.C.A.1472/2004 -8- insurance but from a voluntary policy of insurance issued to the insured. 11. We feel that the said question deserves deeper consideration. But however in the absence of specific pleadings raised and evidence adduced, we are not persuaded to go into that question which is not seen canvassed even before the Tribunal. The contract of insurance has not been produced. Though the contention raised by Advocate Ziyad Rahman is interesting, we are not proceeding to delve deeper into that contention in the absence of adequate pleadings and evidence. 12. We now proceed to consider the grounds of challenge raised by the appellant/owner. The first contention is that the appellant had not authorised the 4th respondent to ride his vehicle. Evidence of the owner as RW2; workshop mechanic,RW3 and the representative of the employer (Railways)of the appellant as RW4 are, of course, available. This indicates that RW2 had gone for his work on 12-4-1994 after entrusting the vehicle to RW3 for repairs. RW2 had returned only on 14-4-1994 and the accident had taken place on M.A.C.A.1472/2004 -9- 13-4-1994. The vehicle was taken from the workshop of RW3 by deceased Ramkumar and the 4th respondent and the vehicle had met with the accident on 13-4-1994. 13. The appellant wants the court to believe that RW3 had handed over the vehicle to the deceased and the 4th respondent without permission, consent or authority of the appellant. RW3 appears to have obliged RW2 by subscribing to that version. We have assessed and evaluated the acceptability of the contention. Less said about the contention better, according to us. Absolutely no objection is taken by the appellant/RW2 at any point of time against the conduct of RW3 permitting the deceased and the 4th respondent to take the vehicle from RW3. Even while examining RW3, it is not brought out at all that RW3 had contumaciously handed over the vehicle to the deceased and the 4th respondent. Nay, what is more relevant is that in Ext.B6 claim for money from the Insurance Company for own damage of the vehicle, it is not even remotely suggested that the rider of the vehicle was riding the vehicle without authority, permission or consent of the owner. At that stage, it appears that this M.A.C.A.1472/2004 -10- defence was not even contemplated. It was admitted in Ext.B6 claim form that the 4th respondent was riding the vehicle and it was not asserted that there was anything contumacious on the part of the 4th respondent in riding the vehicle or RW3 in releasing the vehicle to him and the deceased. The subsequent conduct of the appellant in having submitted Ext.B6 claim to the Insurer and in not having raised his little finger against RW3 or the 4th respondent clearly indicates and points out the availability of permission/consent to ride the vehicle to the 4th respondent from the appellant. We are unable, on the touchstone of probabilities, to accept the contention that the 4th respondent and the deceased had without any permission, consent or authority of the appellant taken away of the vehicle from RW3 as to justify and accept the contention that the appellant had no responsibility for the negligent act allegedly committed by the 4th respondent which led to the accident. It must be noted straight away while assessing probabilities that 4th respondent and the deceased were admittedly friends/colleagues of the appellant. That circumstance is indeed M.A.C.A.1472/2004 -11- crucial. The first contention raised must in these circumstances fail. 14. It has been laboriously urged before us by the learned counsel for the appellant that the mere fact that the appellant after coming to know the accident did not initiate proceedings against RW3 or the 4th respondent (or the deceased) cannot be reckoned as a relevant circumstance to draw any adverse inference against him. The totality of circumstances have to be taken into consideration. When the available inputs are tested and measured on the touchstone/yardstick of a reasonable and prudent person, we find it absolutely safe to conclude that the appellant's permission/consent/authority was certainly there for the 4th respondent and the deceased to take the vehicle from RW3 and use the same. The challenge raised on the first ground must, in these circumstances, fail. 15. We now come to the challenge raised on ground No.2. After the decision in Swaran Singh (supra), there can be no dispute or doubt about the propositions of law that are applicable. Breach under Section 149(2)(a)(ii) of the Motor M.A.C.A.1472/2004 -12- Vehicles Act is to be proved primarily by the Insurance company. The mere fact that the rider did not have a driving licence or the driving licence which he had was fake or non-genuine does not ipso facto establish the breach of the stipulations contemplated under Section 149(2)(a)(ii) of the Act. It is for the Insurance Company to not only establish that the rider had no driving licence but it is upto them to further prove that there was wilful/contumacious breach on the part of the owner. 16. We feel that it would only be apposite straightaway to refer to propositions (iii) to (v) which appear in the summary of findings in paragraph 102 in Swaran Singh (supra). We extract (iii) to (v) below “(iii) The breach of policy conditions, e.g. disqualification of driver or invalid driving licence of the driver, as contained in sub-s(2)(a) (ii) of S.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. M.A.C.A.1472/2004 -13- To avoid its liability towards inured, 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 policy regarding use of vehicles by duly licensed 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) The court cannot lay down any criteria as to how said burden would be discharged,inasmuch as the same would depend upon the facts and circumstances of each case.” 17. We feel compellingly persuaded to refer paragraphs 62 and 63 which to a certain extent explains the approach/ course which we must make/follow while considering the question whether there has been contumacious/wilful breach on the part of the owner/insured. M.A.C.A.1472/2004 -14- We extract paragraphs 62 & 63 below: “62. The proposition of law is no longer res integra that the person who alleges breach must prove the same. The insurance company is, thus, required to establish the said breach by cogent evidence. In the event the insurance company fails to prove that there has breach of conditions of policy on the part of the insured, the insurance company cannot be absolved of its liability. [See Sohan Lal Passi (1996ACJ 1044(SC)]. 63. Apart from the above, we do not intend to lay down anything further, i.e. degree of proof which would satisfy the aforementioned requirement inasmuch as the same would indisputably depend upon the facts and circumstances of each case. It will also depend upon the terms of contract of insurance. Each case may pose different problem which must be resolved having regard to a large number of factors governing the case including conduct of parties as regard duty to inform, correct disclosure, suppression, fraud on the insurer, etc. It will also depend upon the facts as to M.A.C.A.1472/2004 -15- who is the owner of the vehicle and the circumstances in which the vehicle was being driven by a person having no valid and effective licence. No hard and fast rule can therefore be laid down. If in a given case there exists sufficient material to draw an adverse inference against either the insurer or the insured, the Tribunal may do so. The parties alleging breach must be held to have succeeded in establishing the breach of conditions of contract of insurance on the part of the insured by discharging its burden of proof. The Tribunal, there cannot be any doubt, must arrive at a finding on the basis of the materials available on records.” 18. With all the inputs available, we have to decide whether the mutual burden resting on the insurer and the owner have been discharged and whether the insurer is entitled to recover the amount under the proviso to Section 149(4) of the Motor Vehicles Act. 19. To undertake the evaluation, we must first of all note that the appellant has advanced an unsatisfactory contradictory M.A.C.A.1472/2004 -16- version which does not inspire confidence in the mind of the court. Initially, a contention was raised that the deceased and the 4th respondent had taken away the vehicle from the workshop without permission, consent or authority of the appellant and that hence the appellant is not liable to pay any compensation to the victims. This contention has to be considered in the light of the earlier statement made in Ext.B6 claim form that the first respondent was riding the vehicle. In that claim form it was not contended that the first respondent was acting without permission, consent or authority when he drove the vehicle. An attempt was made to contend that the 4th respondent had a valid driving licence. After making laborious attempt, the insurer has been able to establish, by the evidence of RW1 and Ext.X1, that the said driving licence Exts.B1/B8 is a false and fake one. 20. We have already entered a finding that this version of the appellant cannot be accepted. The deceased and the 4th respondent, it is not now disputed,were colleagues/ friends of the appellant. The appellant even now has not chosen to initiate any proceedings against the workshop owner for unauthorised M.A.C.A.1472/2004 -17- handing over of the vehicle to the 4th respondent and the deceased. It is, in these circumstances,that we have come to the conclusion that the theory that the deceased and the 4th respondent had taken away the vehicle unauthorisedly, cannot be accepted. 21. It is now contended that, at any rate, the appellant had bona fides and he cannot be held to have committed breach of the stipulations in Section 149(2)(a)(ii) of the Motor Vehicles Act. We note, first of all, that there is no honest contention at any point of time that the deceased and the first respondent were permitted to take the vehicle under the bona fide impression that they had valid driving licences. In this context, we must appreciate the contention that RW3 was instructed not to hand over the vehicle to anyone. The meek support received by the appellant from RW3 when he was examined on oath, notwithstanding the theory, has no legs to stand on. The express or implied consent of the appellant to RW3 to handover the vehicle to the 4th respondent and the deceased has to be inferred by any prudent mind. No heavier burden can M.A.C.A.1472/2004 -18- obviously be cast on the insurer to avoid liability. It is not a case where the victim in whose favour the compassion of law flows will be deprived of compensation. The available inputs clearly suggest that the appellant had permitted the 4th respondent and the deceased to take the vehicle. While so, handing over the vehicle the appellant either knew that they did not have driving licence, or contumaciously did not apply his mind to that aspect of the matter. Subsequently, it is found that he attempted to rely on a fake driving licence allegedly issued in the name of the 4th respondent. At any rate, bona fides is not a virtue, we can discover or invent in the hands of the appellant considering the course of conduct adopted by him. 22. That the driving licence relied on the appellant is a fake one is proved beyond doubt. That the appellant had authorised, at least impliedly, the 4th respondent and the deceased Ramkumar to take the vehicle from the workshop is as clear as daylight. We are, in these circumstances, satisfied that the reasonable burden which alone can be cast on the insurer to prove breach of the condition under Section 149(2)(a)(ii) of M.A.C.A.1472/2004 -19- the Motor Vehicles Act has been satisfactorily established by the insurer on the basis of the materials placed before the court. We do not find any merit in the contention that the breach has been proved and consequently the insurer in these circumstances should not have been granted right to recover the compensation amount paid by the insurer to the victim under the proviso to Section 149(4) of the Motor Vehicles Act. 23. The challenge raised on the second ground must also in these circumstances fail. 24. We record that the learned counsel for the appellant has referred to our attention to the decisions in 1. Oriental Insurance Co.Ltd. v. Niraudeen, 2008(2)KLT 291 2. Moidu.P.T. v.Oriental Insurance Co.Ltd. and others,[2007(4)ILR 790] 3. Lal Chand v. Oriental Insurance Co.Ltd. [2006(4)KLT17(SC)] 4. National Insurance Co.Ltd. v. Swaran Singh [2004(1)KLT 781] M.A.C.A.1472/2004 -20- 5. Ram Babu Tiwari v. United Indian Insurance Co.Ltd.[(2008)8 S.C.C.165] 6. Oriental Insurance Co.Ltd. v. Prithvi Raj [(2008) 2 S.C.C. 338] 7. United India Insurance Co.Ltd. v. Gian Chand,[AIR 1997 S.C.3824] 8. Sohan Lal Passi v. P.Sesh Reddy [ (1996) 5 S.C.C.21] 9. Kashiram Yadav. v. Oriental Fire and General Insurance Co. [(1989)4 S.C.C. 128] and 10. Skandia Ins.Co.Ltd. v. Kokilaben Chandravadan, [AIR 1987 S.C.1184]. 25. We need only mention that we have anxiously considered these decisions, but are unable to agree that the burden on the appellant as insisted by the decision in Swaran Singh(supra), the relevant passages of which we have already extracted above can in any way be held to be discharged M.A.C.A.1472/2004 -21- satisfactorily. We do not also accept that the 4th respondent was driving the vehicle at the relevant time without the authority/permission and consent of the appellant. 26. We are not adverting to all these decisions in detail in this judgment. We have gone through the same. There is no dispute on the principles of law. That the owner shall have no vicarious liability, if the tort-feasor is not acting under the authority of the owner is well settled. That the insurer must prove breach under Section 149(2)(a)(ii) is trite. Whether that burden has been discharged or not is a question of fact to be decided in each case. We have on facts taken a view against the appellant/owner on the basis of the evidence available in the instance case. 27. In the result, this appeal is dismissed. R. BASANT, JUDGE ks. M.C. HARI RANI, JUDGE M.A.C.A.1472/2004 -22- R. BASANT, JUDGE M.C. HARI RANI,JUDGE ks.