F.A.O.NO. 484 OF 1999 and 1 FA.O.NO.485 OF 1999 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH F.A.O.NO. 484 OF 1999 Date of decision: 1st July, 2010 New India Assurance Co. Ltd. .........Appellant Versus Sita Wanti and others ........Respondents FA.O.NO.485 OF 1999 New India Assurance Co. Ltd. .........Appellant Versus Sita Wanti and others ........Respondents Before: HON'BLE MR. JUSTICE K.KANNAN Present: Mr. P.S.Saini, Advocate, for the appellants. None for the respondents. 1. Whether Reporters of local papers may be allowed to see the judgment? Yes/No 2. To be referred to the Reporters or not?Yes/No 3. Whether the judgment should be reported in the Digest? Yes/No K.KANNAN,J.(Oral) 1. Both the appeals address the same issue for exclusion of liability for the fact that the driver did not have a valid driving license. 2. The liability of the Insurance Company is a case of fake license or a renewal of a license which was a fake one have F.A.O.NO. 484 OF 1999 and 2 FA.O.NO.485 OF 1999 been considered by the Hon'ble Supreme Court in several cases and the decisions in National Insurance Co. v Swaran Singh (2004) 3 SCC 297 and United Indian Insurance v Divinder Singh (2007) 8 SCC 297 are instructive. In the latter judgment, it has been held that a renewal of a fake driving license is no license at all and hence the insurer shall not be liable. 3. It was even held earlier by the Hon'ble Supreme Court, while referring to the effect of a renewal of forged license, in New India Assurance Co., Shimla v. Kamla, (2001) 4 SCC 342. 4. The owner has remained ex parte and no evidence is available about his bona fides of enquiry regarding the possession of driving license as suspect through the evidence let in through the Licensing Authority. 5. The Tribunal also held that the renewal was fake but it get it renewed without making of provision for right of recovery on the ground that the driver had processed a valid driving license and therefore, the fact that it was not properly renewed cannot be fastened with liability. This reasoning conflicts with the decision of the Hon'ble Supreme Court referred to above. 6. Even if the insurance company is not liable, the duty to satisfy the award of the claimants cannot be doubted. In such a situation, the liability to satisfy the award will be accompanied with a right of recovery from the owner/insured/ This cannot be F.A.O.NO. 484 OF 1999 and 3 FA.O.NO.485 OF 1999 doubted in anyway, as specifically provided by the decision of the decision of the Supreme Court while dealing with the effect of proviso to section 149(4) and section 149(5) of the M.V.Act in New India Assurance Co. Shimla v. Kamla (2001) 4 SCC 342. 7. Under the circumstances, the Insurance Company shall not be liable to indemnify the insured. The liability is to satisfy the claim under the award with a right of recovery against the insured. The award of the Tribunal is modified and the appeals are allowed to the above extent only. [K.KANNAN] JUDGE 1st July, 2010 Shivani Kaushik