IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No.503 of 1995 Date of decision:29.06.2010 The New India Assurance Company Limited ....Appellant versus Ram Kishan and others ...Respondents II. FAO No.504 of 1995 The New India Assurance Company Limited ....Appellant versus Gulshan and others ...Respondents CORAM: HON’BLE MR. JUSTICE K. KANNAN ---- Present: Mr. Inderjeet Sharma, Advocate, for the appellant. None for the respondents. ---- 1. Whether reporters of local papers may be allowed to see the judgment ? 2. To be referred to the reporters or not ? 3. Whether the judgment should be reported in the digest ? ---- K.Kannan, J. (Oral) 1. Both the cases take up the same issue that the original licence that had been issued, was a fake one and a renewal subsequently made cannot validate a licence. In this case, the Tribunal relied on a decision of this Court in National Insurance Company Limited Verus Sucha Singh and others-1994(1) PLR 140, to the effect that if the renewal was true, the fact that the original licence was a fake will not FAO No.503 of 1995 - 2 - make a difference. This is not a correct statement of law in the light of decisions of the Hon'ble Supreme Court in United India Insurance Company Limited Versus Davinder Singh-(2007) 8 SCC 698 and National Insurance Company Limited Versus Swaran Singh-2004(3) SCC 297. In this case, the question is whether there had been a breach of contract by the insured by entrusting the vehicle to the person who did not have a valid driving licence. It shall not be merely sufficient for an Insurance Company to plead that it was a fake one. It should also show from evidence that the owner had committed a breach by not taking appropriate steps to ensure to himself that the driver was holding a valid driving licence. The Insurance Company does not place on record any evidence of the owner or how the owner had committed a breach. The point has been so stated by the Hon'ble Supreme Court in Swaran Singh's case (supra) where the Court held “the owner of a motor vehicle in terms of Section 5 of the Act has a responsibility to see that no vehicle is driven except by a person who does not satisfy the provisions of Section 3 or 4 of the Act. In a case, therefore, where the driver of the vehicle, admittedly, did not hold any licence and the same was allowed consciously to be driven by the owner of the vehicle by such person, the insurer is entitled to succeed in its defence and avoid liability. The matter, however, may be different where a disputed question of fact arises as to whether the driver had a valid licence or where the owner of the vehicle committed a breach of the terms of the contract of insurance as also the provisions of the Act by consciously allowing any person to drive a vehicle who did not have a valid driving licence. In a given case, FAO No.503 of 1995 - 3 - the driver of the vehicle may not have any hand in the accident at all e.g. a case where an accident takes place owing to a mechanical fault or vis major.” 2. The appeal by the Insurance Company cannot, therefore, be accepted and therefore it is dismissed. There shall be however no directions as to costs. (K.KANNAN) JUDGE 29.06.2010 sanjeev