IN THE HIGH COURT OF HIMACHAL PRADESH SHIMLA. FAO No. 8 of 2008 Reserved on : 22nd December, 2008 Date of Decision : 25th February, 2009 Kuldip Sharma …Appellant. Versus: Sandeep Batra & Ors. …Respondents. Coram: The Hon’ble Mr.Justice Sanjay Karol, Judge. Whether approved for reporting?1 Yes For the appellant : Mr. Sanjeev Kuthiala, Advocate with Ms. Ambika Kotwal, Advocate. For respondent No.3: Mr. Narender Sharma, Advocate. SANJAY KAROL, JUDGE. The owner of the vehicle, Shri Kuldip Sharma has filed the present appeal assailing the impugned Award dated 7.11.2007 passed by the Motor Accidents Claims Tribunal-I, Sirmaur District at Nahan, H. P., in MAC Petition No. 116-MAC/2 of 2005 titled as Sandeep Batra v. Kuldip Sharma & Ors., whereby a sum of Rs.55,700/- along with interest @ 7.5% per annum has been awarded as compensation to the claimant. The liability to pay the compensation has been fastened upon the owner as it was found that the driving licence of Shri Narotam Singh who was driving the vehicle in question had not been renewed at the time of the accident and, therefore, the insurer 1 Whether reporters of Local Papers may be allowed to see the judgment? 2 Oriental Insurance Co. Ltd., was not liable to have indemnified the owner. The claimant Shri Sandeep Batra filed a Claim Petition under Section 166 of the Motor Vehicles Act, 1988 (hereinafter referred to as ‘the Act’). On 29.9.2005, the claimant was driving his motor cycle No. HP-18A-0411 and was hit by vehicle No.HP-18B-0232 near the Leprosy Ward on Nahan- Shimla road. The offending vehicle was being driven by Shri Narotam Singh in a rash and negligent manner which caused the accident, in which the claimant received injuries. He had to undergo medical treatment at Zonal Hospital, Nahan, where he was admitted from 29.9.2005 to 3.10.2005. He incurred medical expenditure for his treatment and thus, claimed a sum of Rs.3 lacs as compensation. The petition was opposed by the owner denying any negligence of the driver. In a separate reply, the driver opposed the petition alleging negligence on the part of the claimant alone. The existence of the accident was, however, admitted. The insurer of vehicle No. HP 18 B-0232 opposed the petition, inter alia, on the ground that the material terms and conditions of the insurance policy stood breached, hence, they were not liable to indemnify the insured. Based on the pleadings of the parties, the Tribunal framed the following issues:- 3 1. Whether the petitioners was driving motor cycle No.HP-18-A-0411 from Resin Factory to Nahan on dated 29.9.2005 at about 2.45 PM, he was knocked down by truck No.HP-18B- 0232 being driven by respondent No.2 in a rash and negligent manner and as a consequence thereof petitioner sustained injuries to his person, as alleged? ……….OPP 2. If issue No.1 is proved in affirmative, whether the petitioner is entitled to compensation, if so to what extent and from whom? …..OPP 3. Whether the driver of the offending vehicle was not possessed of valid and effective driving licence as alleged? ….OPR-3 4. Whether the owner of the vehicle in question was not having valid and effective driving licence policy on the date of accident, as alleged? …OPR-3 5. Whether the petition has been filed in collusion with respondents No.1 and 2 by the petitioner as alleged? …..OPR-3 6. Whether the petition is not maintainable in the present form, as alleged? …..OPR-3 Opportunity to adduce evidence was afforded to the parties. Appreciating the material on record (oral and documentary), the Tribunal held that Shri Narotam Singh had driven the vehicle in question in a rash and negligent manner which caused the accident in which the claimant received injuries. While deciding issue No.2, the Tribunal held that the petitioner sustained fracture of upper end tibia left leg and remained as an indoor patient w.e.f. 29.9.2005 to 3.10.2005 and 4 continued with his medical treatment even thereafter. Hence, the following compensation was awarded:- i) Pain and suffering = Rs. 5,500.00 ii) Loss of enjoyment of life = Rs. 7,000.00 iii) Loss of earning = Rs.29,750.00 iv) Medical expense = Rs. 3,500.00 v) Taxi charges = Rs. 500.00 vi) Special diet and attendant = Rs. 9,450.00 Thus, in all a sum of Rs.55,700/- along with interest @ 7.5% per annum was awarded. The vehicle in question was held to have been insured in terms of the insurance policy Ext.RX and issue No.4 was decided accordingly. However, while deciding issue No.3, it was held that since the driver was not possessing a valid and effective driving licence as on the date of accident and the material terms and conditions of the insurance policy stood breached, hence, the owner alone was liable to pay the awarded compensation. Issue No.5 appears not to have been pressed by the parties and was decided as such. With regard to issue No.6, nothing on record was shown as to how the petition was not maintainable. Mr. Sanjeev Kuthiala, learned counsel for the appellant has referred to the statement of the owner Shri Kuldip Singh (PW-3) to contend that prior to the engagement of the driver the owner had verified the existence of the driving licence 5 and, therefore, keeping in view the ratio of law laid down by the Apex Court in Lal Chand v. Oriental Insurance Co. Ltd. {2006(7) SCC 318}, Sukhbir Singh vs. National Insurance Co. Ltd. {2006(2) Latest HLJ (HP) 1337}, New India Assurance Co. Ltd., v. Rekha Devi & Ors. {2004 ACJ 1704}, Zile Singh vs. Mukesh Kumar & Ors. {2008 ACJ 1395}, Oriental Insurance Co. Ltd. vs. Prithvi Raj {2008(2) SCC 338} & Oriental Insurance Co. Ltd. vs. Sudhakaran K. V & Ors.{2008(7) SCC 428}, the findings returned by the Tribunal on issue No.3 are perverse. Mr. Narender Sharma, learned counsel for respondent No.3 has supported the award for the reasons set out therein. The factum of the accident; the negligence of the driver Shri Narotam Singh; the injuries sustained by the claimant Shri Sandeep Batra, is not in dispute. The amount of compensation has also not been disputed. The scope of the present appeal is narrow as according to Mr. Kuthiala, the liability is that of the insurer and not the owner. I have heard the learned counsel for the parties and also perused the record. For the purposes of adjudication of the present appeal, the statements of Shri Rangi Ram (RW-1), Clerk of RLA, Nahan and owner Shri Kuldip Sharma (RW-2) are necessary. RW-2 has deposed that from the year 2004 he had employed Shri Narotam Singh as driver and at the time of 6 employment he had seen the driving licence issued by the RLA, Nahan. He had taken the driving test and in terms of the licence, Shri Narotam Singh was entitled to drive heavy transport vehicle. RW-1 has deposed that the driving licence No.OLA-HP- 18, Licence No.DL/N/10378/2000 dated 14.9.2000 (Ext.RW-1/A) was issued in the name of Shri Narotam Singh and he was entitled to drive LMV/HTV vehicle. The licence was valid w.e.f. 22.3.2002 upto 21.3.2005. The same was renewed w.e.f. 12.1.2006 to 11.1.2009. However, with regard to the intervening period i.e. 21.3.2005 to 12.1.2006 the licence was not renewed. He clarified that the grace period within which the licence can be renewed is 30 days, but however, for the renewal of the licence penalty had been paid by the driver. Thus, it stands proved that in the year 2004 at the time of employment the driver did not have a valid and effective driving licence but however, as on the date of accident i.e. 29.9.2005, he had no licence to drive the vehicle in question which eventually was renewed on 12.1.2006. Section 15(1) of the Act is clear that “any renewal on the application for renewal of the licence would not relate back from the date of expiry.” As such, in the facts and circumstances of the case, the renewal of the licence on 12.1.2006 i.e. after the expiry of the validity of the licence, would be of no consequence insofar as the instant accident is concerned. Therefore, the insurer could not have indemnified the insured. 7 The Apex Court in Ishwar Chandra and others vs. Oriental Insurance Co. Ltd. & Others {2007(10) SCC 650} has held that where an application for renewal of licence was filed after 30 days from the date of expiry, it shall be renewed from the date of the renewal. In that case, as on the date of the accident the licence which had expired on 27.8.1994 was got renewed only after 28.3.1995, the date of the accident, therefore, it was held that it could not be said that the driver had a valid licence on the date of the accident or that the Insurance Company was liable to indemnify the insured. The Court, however, directed the insurer to pay the amount of compensation to the claimants with an option to recover the same from the insured by initiating proceedings before the executing Court. A similar view with regard to the recovery of the amount from the insured was also taken by the Apex Court in Oriental Insurance Co. Ltd. vs. Nanjappan & Others {2004(13) SCC 224}. It is true that the owner had verified the validity and the effectiveness of the driving licence but, however, it was also his duty to have ensured that the licence stood renewed upon its expiry or the driver did not drive the vehicle thereafter. He is stated to have seen the licence and, therefore, it was expected of him to have also seen the date of expiry/ validity. His statement that he had seen the licence as on the date of employment would be of no consequence. 8 No doubt, in Lal Chand (supra), the Apex Court has held as under:- “Mr. M. K. Dua, learned counsel appearing for the respondent-Insurance Company submitted that the appellant has no case on merits as the order of the High Court is well supported by the law laid down by this Court in the case of New India Assurance Co. Ltd. versus Kamla & Ors., etc., reported in 2004(4)SCC 342. He would further submit that the licence issued to the driver was found to be fake and the High Court gave categorical finding that the driver was not holding a valid driving licence and that the appellant committed breach of terms and conditions of the insurance policy. He, therefore, submitted that the order passed by the High Court is not liable to be interfered with. We have perused the pleadings and the orders passed by the Tribunal and also of the High Court and the annexures filed along with the appeal. This Court in the case of United India Insurance Co. Ltd. versus Lehru & ors., reported in 2003 (3) SCC 338, in paragraph 20 has observed that where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149(2)(a)(ii). He will, therefore, have to check whether the driver has a driving licence and if the driver produces a driving licence, which on the face of it looks genuine, the owner is not expected to find out whether the licence has in fact been issued by a competent authority or not. The owner would then take test of the driver, and if he finds that the driver is competent to drive the vehicle, he will hire the driver. In the instant case, the owner has not only seen and examined the driving licence produced by the 9 driver but also took the test of the driving of the driver and found that the driver was competent to drive the vehicle and thereafter appointed him as driver of the vehicle in question. Thus, the owner has satisfied himself that the driver has a licence and is driving competently, there would be no breach of Section 149(2)(a)(ii) and the Insurance Company would not then be absolved of its liability. We respectfully agree and following the above ruling, we allow the appeal filed by the owner of the vehicle and absolve him from any liability as ordered by the High Court. It is now brought to our notice that the entire compensation has already been deposited and the same has been withdrawn by the claimants. No other point has been urged by both sides. We, therefore, allow the appeal and order no costs.” But, however, the facts and circumstances were different. The Apex Court was dealing with the case where the owner of the vehicle had proved to have taken care and caution to verify the licence. The existence of the licence was not issue before the Court as the only issue was as to whether the owner is required to verify the genuineness of the driving licence. It was in these circumstances, relying upon the statement of the owner the Court came to the conclusion that the principles of law laid down in National Insurance Co. Ltd. vs. Swaran Singh & Others {2004(3) SCC 297}, had not been complied with by the insurer. The facts in the present case, however, are totally different. It is not the genuineness or the 10 fakeness of the licence which is in issue. It is a case where the driver did not possess licence as on the date of accident. In Sukhbir Singh (supra), the Court came to the conclusion that there was no material on record to suggest the findings that the owner of the vehicle knew that the driver was driving the vehicle without a valid driving licence. It was in these circumstances the Court found that for these reasons, the judgment is clearly distinguishable. In the present case as has been noticed hereinabove, the owner had reasons to know that the licence was to expire on 21.3.2005 as he himself had seen the licence prior to its expiry. Section 3 of the Act clearly stipulates that no person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to him to drive the vehicle. It also mandates that no person shall drive a transport vehicle unless his driving licence specifically entitles him to do so. The vehicle in question was being driven by the employee in contravention of the provisions of the Act, resulting into breach of the terms of the insurance policy. The findings returned by the Tribunal are in consonance with the settled provisions of Law and it cannot be held that there is any error or perversity in the impugned award. 11 For the aforesaid reasons, the appeal is dismissed. ( Sanjay Karol ), Judge. 25th February, 2009. (rana)