IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA FAO No. 412 of 2007 Decided on: 14.09.2011 Oriental Insurance Co. Ltd. …Appellant. Versus Puri Devi & others …Respondents. Coram The Hon’ble Mr. Justice Deepak Gupta, J. Whether approved for reporting?1 No. For the appellant: Mr. G.C. Gupta, Senior Advocate, with Mr. Pawan Sharma, Advocate. For the respondents: Mr. R.K. Gautam, Senior Advocate, with Mr. Vikrant Chandel, Advocate, for respondents No. 1 to 6. Mr. G.S. Rathore, Advocate, for respondent No. 7. Mr. Pawan Gautam, Advocate, for respondent No. 8. Deepak Gupta, J. (Oral) This appeal by the Insurance Company is directed against the award dated 31.07.2007, passed by the Motor Accident Claims Tribunal, Kullu, whereby he awarded compensation of ` 2,07,000/- in favour of the claimants and directed the Insurance Company to satisfy the award. 1 Whether the reporters of local papers may be allowed to see the Judgment? Yes. : 2 :- 2. In this appeal by the Insurance Company, two points have been raised. Firstly that the claimants have failed to prove that the deceased was travelling in the vehicle, which admittedly was a commercial vehicle, as owner of the goods and secondly that the driver did not have a valid driving licence to drive the vehicle in question. 3. As far as the first issue is concerned, Mr. G.C. Gupta, learned Senior Counsel appearing for the Insurance Company, submitted that the claimants have miserably failed to prove that the goods which were being carried in the vehicle belonged to the deceased. He further submits that as per the statement of RW-6, Investigating Officer, his investigation had shown that deceased had taken a lift and was not travelling in the vehicle as owner of the goods. It is also contended that merely because some instruments of carpentry were found in the vehicle would not by itself mean that the deceased was travelling as owner of the goods. 4. By now, the law is well settled that it is predominant purpose for which the vehicle was hired, which has to be seen while determining whether the deceased was travelling in the vehicle as owner of the goods or not. If only some personal belongings or instruments of business which are not of huge weight or bulk are carried, that itself will not mean that the person is travelling as owner of the goods. To give an example; in case a person travels in a truck and only one briefcase or -: 3 :- suitcase is carried in the truck, it will not mean that he has hired the truck for carriage of his personal belongings. 5. In the present case, the claimants in their claim petition stated that the deceased had hired the vehicle and boarded the same from Batala and was carrying iron wire rolls, carpentry items and other household items in the same. The owner and driver in their written statements did not deny this assertion. However, the Insurance Company, in its written statement, took the plea that the deceased was an unauthorized/ gratuitous passenger and was not covered under the terms of the policy. With regard to the averments made in para 10, the Insurance Company denied the allegation made therein and again reiterated that the deceased was a gratuitous passenger. 6. Coming to the evidence, the claimant appearing as PW-2 stated that her husband had hired the vehicle in question to bring house hold goods as well as goods relating to his trade and after loading the goods at Batala in Punjab, he was returning to his house. She obviously is not an eye witness of the occurrence and her statement is general in nature. However being the wife, she would have some knowledge as to why her husband had gone to Batala. PW-5, Shri Tarlok Chand, was a bystander and according to him, he saw the accident and in the back of the jeep, rolls of wire and other goods relating to carpentry were loaded. He admits that in his presence, no list regarding the items was prepared. -: 4 :- 7. The next relevant witness is RW-6, Shri Ravinder Nath, who is the Head Constable and carried out the investigation with regard to FIR No. 106/05 relating to the accident in question. According to him, in his investigation, he found that the deceased was sitting in the rear of the vehicle and that in the front cabin, the driver Kamal Deen and conductor Dilshaad were sitting. He further states that according to his investigation, the deceased had taken a lift in the vehicle and no luggage of the deceased was lying in the vehicle. However, surprisingly, this witness further states that in his investigation, he also found that the driver and conductor had not permitted the deceased to take a lift but he had forcibly boarded the vehicle in question. This is not even the stand of the owner or the driver. No reliance can be placed on the statement of this witness because except for making a vague reference to the investigation, he has not stated that as to on what basis or on the basis of whose statement he came to this conclusion. It was necessary to refer to the statements and then only some reliance could have been placed on his statement. Even more importantly, this witness admits that there were rolls of iron wires loaded in the vehicle. He gives no explanation as to who was the owner of these iron wires. If he had carried out the investigation, he should have also investigated as to who was the owner of the iron wires. Thus, what stands proved on record is that the iron wires were being carried in the vehicle. These -: 5 :- were rolls of iron wires and if iron wires were being carried, then the vehicle was being hired for carriage of the iron wires. The claimants in the claim petition itself had stated that the vehicle had been hired for carrying the rolls of iron wires and other house hold goods. The owner and driver had admitted this assertion. If the Insurance Company wanted to dispute this assertion, it should have summoned the record from the owner or the other record, such as log book, GR book, etc. to show who had hired the vehicle. 8. Mr. G.C. Gupta, learned Senior Counsel, has also contended that the suggestions were put to the witnesses that the vehicle had been hired for carriage of goods, but there is no suggestion put to the witnesses that goods were actually being carried in the vehicle. In my view, this is hair splitting, whereas when the statements are read as a whole alongwith the pleadings, it is apparent that the case set up is that the vehicle was hired for carriage of the iron wires and other equipments. 9. The next contention raised by Mr. G.C. Gupta, learned Senior Advocate, is that the driver did not have a valid driving licence to drive the vehicle since he was only entitled to drive a light motor vehicle and not transport vehicle. 10. The undisputed fact is that the vehicle in question was a commercial vehicle, therefore, it is a transport vehicle within the meaning of the Motor Vehicles Act. The driving licence of the driver has been exhibited as Ex. RW-2/A and it -: 6 :- clearly shows that it was issued for light motor vehicle (non transport), i.e., it was not issued for transport vehicle. 11. The question whether a person holding a licence to drive a Light Motor Vehicle is entitled or not entitled to drive a transport vehicle has been the subject matter of a number of decisions. 12. A Full Bench of this Court dealt with a similar question and disposed of the reference in view of the judgments of the Apex Court rendered in National Insurance Co. Ltd. V. Kusum Rai and others, (2006) 4 SCC 250 & National Insurance Company Ltd. V. Annappa Irappa Nesria and others, (2008) 3 SCC 464. 13. It is contended by Mr. G.C. Gupta, learned Senior Counsel, that the present case is squarely covered by the judgment rendered in Kusum Rai’s case. On the other hand the contention of Mr. G.S. Rathore, Advocate, is that the case is squarely covered by Annappa Irappa’s case. 14. In Kusum Rai’s case (supra) the Apex Court was dealing with the question as to whether the Insurance Company could be held liable in a case where the driver driving the taxi, a commercial vehicle, did not hold a driving licence entitling him to drive a commercial vehicle. In para 11, the Apex Court held as follows: “11. It has not been disputed before us that the vehicle was being used as a taxi. It was, therefore, a commercial vehicle. The driver of the said vehicle, -: 7 :- thus, was required to hold an appropriate licence therefor. Ram Lal who allegedly was driving the said vehicle at the relevant time, as noticed hereinbefore, was holder of a licence to drive a Light Motor Vehicle only. He did not possess any licence to drive a commercial vehicle. Evidently, therefore, there was a breach of condition of the contract of insurance. The Appellant, therefore, could raise the said defence.” 15. Thereafter, the Apex Court in New India Assurance Company Ltd. Vs. Prabhu Lal, (2008) 1 SCC 696, also took a similar view. However, it would be pertinent to mention that, that this case arose out of proceedings under the Consumer Protection Act. The Apex Court in that case held as follows: “33. In our considered view, the State Commission was wrong in reversing the finding recorded by the District Forum. So far as Ashok Gangadhar is concerned, we will deal with the said decision little later but from the documentary evidence on record and particularly, from the permit issued by the Transport Authority, it is amply clear that the vehicle was a 'goods carrier' [Section 2(14)]. If it is so, obviously, it was a 'transport vehicle' falling under clause (47) of Section 2 of the Act. The District Forum was, therefore, right in considering the question of liability of the Insurance Company on the basis that Tata 709 which met with an accident was 'transport vehicle'. xxx xxx xxx xxx 38. We find considerable force in the submission of the learned counsel for the Insurance Company. We also find that the District Forum considered the question in its proper perspective and held that the vehicle driven by Ram Narain was covered by the category of transport vehicle under Clause (47) of Section 2 of the Act. Section 3, therefore, required the driver to have an endorsement which would entitle him to ply such vehicle. It is not even the case of the complainant that there was such endorsement and Ram Narain was allowed to ply transport vehicle. On the contrary, the case of the complainant was that it was Mohd. Julfikar who was driving the vehicle. To us, therefore, the District Forum was right in holding that Ram Narain could not have driven the vehicle in question. -: 8 :- xxx xxx xxx xxx 41. In our judgment, Ashok Gangadhar did not lay down that the driver holding licence to drive a Light Motor Vehicle need not have an endorsement to drive transport vehicle and yet he can drive such vehicle. It was on the peculiar facts of the case, as the Insurance Company neither pleaded nor proved that the vehicle was transport vehicle by placing on record the permit issued by the Transport Authority that the Insurance Company was held liable.” 16. If the matter had ended here the case could have been decided very easily but the Apex court in National Insurance Company Ltd. V. Annappa Irappa Nesria and others, (2008) 3 SCC 464 has not only considered these points but also considered the effect of the amendment made in the Motor Vehicles Act. After considering the entire law the Apex Court held as follows: “20. From what has been noticed hereinbefore, it is evident that 'transport vehicle' has now been substituted for 'medium goods vehicle' and 'heavy goods vehicle'. The light motor vehicle continued, at the relevant point of time, to cover both, 'light passenger carriage vehicle' and 'light goods carriage vehicle'. A driver who had a valid licence to drive a light motor vehicle, therefore, was authorised to drive a light goods vehicle as well. 21. The amendments carried out in the Rules having a prospective operation, the licence held by the driver of the vehicle in question cannot be said to be invalid in law.” 17. The Apex Court therefore held that w.e.f. 28.3.2001 a specific endorsement to drive a transport vehicle is necessary but prior to that date such endorsement was not necessary since a light motor vehicle in its definition as it existed prior to said date included a light transport vehicle. It is thus obvious that the endorsement is required only after 28.3.2001. -: 9 :- 18. In Oriental Insurance Co. Ltd. vs. Angad Kol and others, 2009 ACJ 1411, the Apex Court again held that when a driver is given a licence to drive a Light Motor Vehicle (LMV) it would include in its ambit both transport and non- transport vehicles. The Apex Court further went on to hold that for the licence to be effective it should be expressly stated or it should be clearly implied that the licence is valid to drive a transport or non-transport vehicle. In that case, the licence had been issued for LMV only and was valid for 20 years. The Apex Court held that this means that the licence had been issued for a non transport vehicle since a licence for a transport vehicle could only be issued for only three years at a time. It, therefore, went on to hold that the driver did not hold a valid and effective driving licence to drive a transport vehicle. 19. Therefore, following the decision of the Apex Court in National Insurance Company Ltd. V. Annappa Irappa Nesria and others, (2008) 3 SCC 464 it is held that the Insurance Company is not liable to indemnify the insured and is not liable to pay the amount of compensation since the accident in the present case occurred after 29.3.2001. 20. The second question raised before me is whether the Insurance Company should be asked to satisfy the award and recover the amount from the insured. 21. Mr. R.K. Gautam, Senior Advocate, appearing for the claimants, has placed reliance on the judgment of the Apex -: 10 :- Court in Kusum Lata and others Vs. Satbir and others, AIR 2011 Supreme Court 1234, relevant portion of which reads as follows:- “ x x x x x x x x x x x x x x x x x x xx x x x x x x x x 13. In respect of the dispute about licence, the Tribunal has held and, in our view rightly, that the Insurance Company has to pay and then may recover it from the owner of the vehicle. This Court is affirming that direction in view of the principles laid down by a three-Judge Bench of this Court in the case of National Insurance Company Limited v. Swaran Singh and others, reported in (2004) 3 SCC 297 (AIR 2004 SC 1531). 14. The appeal is, therefore, allowed. The judgments of the Tribunal and the High Court are set aside. The Insurance Company is to pay the aforesaid amount in the form of a bank draft in the name of appellant No.1 with interest as aforesaid within a period of six weeks from date and deposit the same in the Tribunal. This direction should be strictly complied with by the Insurance Company. x x x x x x x x x x x x x x x x x x x x x” 22. On the other hand Mr. G.C. Gupta, learned Senior Counsel for the appellant, has relied upon a judgment delivered by this Court itself in The Oriental Insurance Co. Ltd. Vs. Smt. Meera and others, Latest HLJ 2010 (HP) 156 wherein this Court held that this Court cannot direct the insurance company to satisfy the award once it has not been held liable. The reasoning given by this Court was based on the judgment of the apex Court in Civil Appeal arising out of SLP (C) No. 10694. 23. In the aforesaid case, the Apex Court had set aside the similar directions of this Court directing the insurance company to satisfy the award on the ground that the Apex Court had given directions in various cases in exercise of its powers -: 11 :- under Article 142 of the Constitution and such powers are not vested in the High Court. 24. Now, the Apex Court in Kusum Lata & Ors. Vs. Satbir and Ors., AIR 2011 Supreme Court 1234 has clearly held that in case where there is violation of the driving licence, then the insurance company can be asked to satisfy the award with liberty reserve to it to recover the amount from the owner of the vehicle. Following the ratio of the Apex Court, the insurance company is directed to satisfy the award but it shall be at liberty to recover the same from the owner. It is clarified that the insurance company will not have to file separate suit or proceedings to recover the amount and can recover the amount from the owner by filing execution proceedings. 25. In view of the aforesaid discussion, the appeal is partly allowed in the aforesaid terms. No costs. (Deepak Gupta) Judge September 14, 2011 (rajni)