THE HON’BLE SRI JUSTICE G.V.SEETHAPATHY CIVIL MISCELLANEOUS APPEAL No.3678 OF 2002 DATED: 26-11-2009 Between: The New India Assurance Company, Rep., by its Branch Manager, H.D.I.C. Complex, R.S.Road, Kurnool. ..... APPELLANT And Samala Bhagya & 6 others. .....RESPONDENTS JUDGMENT: This appeal is directed against the order, dated 29-09-2000, in O.P.No.314 of 1997 on the file of the Motor Vehicles Accidents Claims Tribunal-cum-Additional District Judge, Adilabad, wherein the claim of the respondents 1 to 5 was allowed in part awarding compensation of Rs.4,71,000/- on account of the death of the deceased-Samala Shanker, who died in a motor vehicle accident that occurred on 08-10-1996. 2. Heard learned counsel appearing for the appellant and the learned counsel appearing for the respondents. Perused the record. 3. The 1st claimant is the wife; claimants 2 and 3 are the children and claimants 4 and 5 are the parents of the deceased-Samala Shanker. According to the claimants, on 08-10-1996 at about 3.30 p.m., when the deceased- Samala Shanker was riding Yamaha motor cycle bearing No.AP 1A-5863 and was proceeding towards Mancherial along with another-J.Shankaraiah, as pillion rider, near Itikyal bus stage a lorry bearing No.AP 21 U 4613 came from Luxettipet and dashed the motor cyclist due to the rash and negligent driving of the lorry by its driver, as a result of which the deceased sustained grievous injuries including head injury and died while undergoing treatment at area hospital, Godavarikhani. 4. The owner of the lorry remained ex parte. The appellant-insurer filed a counter opposing the claim and denying the liability to pay the compensation, inter alia, contending that the deceased was not having valid driving licence. 5. During enquiry, P.Ws.1 and 2 were examined and Exs.A1 to A9 were marked. On behalf of the claimants, R.Ws.1 and 2 were examined and Exs.B.1 to B6 were marked. 6. On a consideration of the evidence available on record, the Tribunal held that the accident occurred due to the rash and negligent driving of the lorry by its driver. The said finding is not seriously challenged. The Tribunal further held that the claimants are entitled for a total compensation of Rs.4,71,000/-. 7. The deceased was stated to be working as an employee in the Singareni Collieries Limited. Ex.A5-salary certificate shows that he was a General Mazdoor earning wages of Rs.3649.67 ps per month. Ex.A7-certificate issued by the SCC Limited shows the date of birth of the deceased as 05-07-1961. Thus, by the date of the accident, the deceased was aged 35 years. The Tribunal, based on Ex.A5, has taken the income of the deceased as Rs.2600/- per month and after deducting 1/3rd thereof towards personal expenses of the deceased, estimated the contribution of the deceased to the family at Rs.28,800/- per month. By applying the multiplier ‘16’, which is applicable as per the II Schedule of the Motor Vehicles Act, 1988 (for brevity, ‘the Act’), the Tribunal estimated the loss of dependency in a sum of Rs.4,60,800/-. By granting a sum of Rs.2500/- towards funeral expenses; Rs.2500/- towards loss of estate and Rs.5200/- towards loss of consortium, the Tribunal awarded a total compensation of Rs.4,71,000/-. The quantum of compensation, which is assessed in accordance with law, does not call for any interference. 8. The main contention of the learned counsel for the appellant-insurer is that the driver of the lorry was not having valid licence. Thus, the owner of the vehicle has violated the terms and conditions of the policy and therefore the insurer is not liable to pay the compensation. 9. In support of their plea, the appellant-insurer examined R.W.1-Senior Assistant Worker in the office of R.T.O., Adilabad, who deposed that on verification of the records-the copy of the driving licence-Ex.B2, it was found that it was not issued from his office during the relevant period and the file number also was not tallying. The Tribunal also found that based on Exs.B2 and 3 it was prima facie established that the driver of the lorry was not having a valid driving licence to drive the lorry. The Tribunal however held that there is no material on record to show that the owner of the vehicle had knowledge that Ex.B2-licence of the driver was a fake one. The burden lies on the appellant-insurer to establish that in spite of having knowledge that the licence was a fake one, still the owner has entrusted the vehicle to the driver. 10. As held in DIVISIONAL MANAGER, NEW INDIA ASSURANCE COMPANY LIMITED, ONGOLE v. TUMU GURAVA REDDY AND OTHERS [1] the burden squarely lies on the appellant-insurer to establish that there has been conscious violation of the terms and conditions of the policy on the part of the owner of the vehicle. There is absolutely nothing on record to suggest that the owner had knowledge of the fact that the driver was having fake licence with him and in spite of the said knowledge he entrusted the vehicle to the driver. In the absence of such evidence, the plea of the appellant-insurer that there was conscious violation of the terms and conditions of the policy on the part of the owner of the vehicle remains unsubstantiated. The appellant-insurer has failed to discharge the burden cast on him and when the insurance cover is available for the vehicle as on the date of the accident, the innocent victims of the accident cannot be penalized or deprived of the fruits of the beneficial piece of legislation on the ground that the driver was not having a valid driving licence as on the date of the accident. 11. In NATIONAL INSURANCE COMPANY LIMITED v. SWARAN SINGH AND OTHERS[2] the apex Court held that: “A fake or forged licence is as good as no licence but the requirement to establish the defence is that the insurer must prove that the owner was guilty of the wilful breach of the conditions of the insurance policy or the contract of insurance. The defence to the effect that the licence held by the person driving the vehicle was a fake one, would be available to insurance companies, but whether despite the same, the plea of default on the part of the owner has been established or not, whether the insured did not take reasonable and adequate care and caution to verify the genuineness or otherwise of the licence held by the driver, would be a question which will have to be determined in each case”. 12. In view of the principles laid down in the above decision, it must be held that the appellant-insurer shall pay the amount of compensation initially to the claimants and then recover the same from the owner of the vehicle. 13. In the circumstances, the impugned award is modified accordingly with a direction to the appellant- insurer to pay the amount of compensation to the claimants and then recover the same from the owner of the vehicle. 14. In the result, the appeal is disposed of with the direction as stated above. There shall be no order as to costs. _______________________ G.V.SEETHAPATHY, J 26th November, 2009 Tsy [1] 1999 (6) ALD 256(DB) [2] (2004) 3 SUPREME COURT CASES 297