F.A.O.NO. 4641 OF 2002 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH F.A.O.NO. 4641 OF 2002 Date of decision:10th September, 2010 The National Insurance Company Ltd., Regional Office-II, S.C.O. Nos. 337-340, Sector 35, Chandigarh, through its Assistant Administrative Offier. .......Appellant Versus Smt. Kanti and others ........Respondents BEFORE: HON'BLE MR. JUSTICE K.KANNAN Present: Mr. Harsh Aggarwal, Advocate, for the appellant. None for the appellants. 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. The Insurance Company is on appeal contending that the owner was guilty of breach of terms of the policy by using the insured's vehicle for a commercial purpose when it was insured only as a private vehicle. I find the contention of the insurer to be wholly unreasonable. The claim was at the instance of representatives of a third party and not by any person who was using insured's vehicle for a commercial purpose. The breach of terms of policy that could exclude the liability for the insurer must have a bearing to the accident itself. This was illustrated in the judgment of the Hon'ble Supreme Court in National F.A.O.NO. 4641 OF 2002 2 Insurance Co v Swaran Singh (2004) 3 SCC 297, where the Court held that even if a driver did not have a valid driving licence, it will not always exclude the liability for the insurer and illustrated the principle by reference to two examples namely of an accident due to a mechanical defect or an accident due to an act of god. In both the incidents the Hon'ble Supreme Court held that even if the driver had not been duly licenced, the insurer was still be liable. 2. When the claim was made by a third party to the insured's vehicle, it will be no defence for an insurer to contend that the insured's vehicle was used as a commercial vehicle and not as a private vehicle. In such a situation it was not relevant whether the vehicle was used as a commercial or a private vehicle. The relevance was whether the driver drove the vehicle negligently or not. If there was negligence on his part, a third party claim will be perfectly justified and even the insurer will have a right of protection by the policy of the insurance. The award casting the liability on the insurer under circumstances is justified and the appeal is dismissed. [K.KANNAN] JUDGE 10th September, 2010 Shivani Kaushik