IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA FAO No.: 595 of 2008 Date of decision : 12.5.2011 National Insurance Company …Appellant Versus Sunita Devi and others …Respondents. Coram The Hon’ble Mr. Justice Deepak Gupta, Judge. Whether approved for reporting?1 No. For the Appellant: Ms. Seema Sood, Advocate. For respondent No.1 to 5: Mr. Vikas Bhardwaj, Advocate. For respondents 6: None For respondent No.7. Mr. Rajesh Mandhotra, Advocate Deepak Gupta, J. (oral) 1. The only question which arises in this case is whether the driver of the vehicle in question held a valid and effective driving licence on the date of the accident or not. 2. The accident out of which the present petition arises took place on 5.6.2005. It is also not disputed that the offending vehicle was a Mahindra Balero Pickup Jeep. Therefore, it was a transport vehicle. It is also not disputed that the driver of the vehicle Balwant Singh was entitled to drive Light 1 Whether the reporters of the local papers may be allowed to see the Judgment? Yes 2 Motor Vehicles. There was no endorsement on the licence permitting him to drive the transport vehicle. The learned Tribunal, however, held the Insurance Company liable on the ground that a light motor vehicle is a motor vehicle and merely because the vehicle was a transport vehicle would not amount to violation of the terms of the Act and the Policy and therefore, the Insurance Company could not escape its liability. The learned Tribunal, in my view, committed a grave error and has not taken into consideration a number of judgements. There was some dispute with regard to this aspect earlier but this dispute now stand settled. 3. 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. 3 4. It is contended by Mr. Vikas Bhardwaj, Advocate that the present case is squarely covered by the judgment rendered in Annappa Irappa’s case. On the other hand the contention of Ms Seema Sood, Advocate is that the case is squarely covered by Kusum Rai’s case. 5. 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, 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.” 6. Thereafter, the Apex Court in New India Assurance Company Ltd. Vs. Prabhu Lal, 4 (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'. 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. 41. In our judgment, Ashok Gangadhar did not lay down that the driver holding licence to drive a 5 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.” 7. 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.” 8. The Apex Court therefore held that w.e.f. 28.3.2001 the endorsement to drive a 6 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. 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 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 7 not hold a valid and effective driving licence to drive a transport vehicle. 10. Mr. Vikas Bhardwaj, learned counsel for respondents No. 1 to 5 contends that the import of the aforesaid decision is that it will apply to licenses issued after 29.3.2001 and not to the licenses issued prior to the said date, even though the accident may have taken place after 29.3.2001. I am unable to agree with the submission. The law laid down by the Apex Court is very clear that on and with effect from 29.3.2001 no person can be said to hold an effective driving licence to drive a transport vehicle if he only holds a licence entitling him to drive a light motor vehicle without endorsement thereupon that he is entitled to drive a transport vehicle. 11. 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 8 compensation since the accident in the present case occurred after 29.3.2001. 12. In view of the above discussion, the appeal has to be allowed and the same is allowed and the Insurance Company is exonerated from its liability. The amount deposited by the Insurance Company be refunded to it. The owner and driver of the vehicle are liable to satisfy the award. No order as to costs. May 12, 2011 ( Deepak Gupta ) (vt) Judge.