TMI Blog2001 (3) TMI 1014X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to pay the award amount to the claimants. We are told that the amount was paid by the appellant to the claimants. Now the Claims Tribunal has to decide the next question whether the insurance company is entitled to recover that amount from the owner of the vehicle on account of the vehicle being driven by a person who had no valid licence to drive the vehicle. For that purpose we remit the case to the Claims Tribunal. - Appeal (civil) 2387 of 2001, Appeal (civil) 2388 of 2001, Appeal (civil) 2389 of 2001 - - - Dated:- 27-3-2001 - K.T. Thomas R.P. Sethi, JJ. JUDGMENT: THOMAS, J. Leave granted. If a fake driving licence happened to be renewed by the statutory authorities, would the fakeness of the original document get legally sanctified? If it cannot, would the Insurance Company be liable to pay compensation in respect of a motor accident occurred while the vehicle was driven by a person holding such a sham licence? These are the main questions involved in these appeals. An accident occurred on 1.3.1993 when a truck, driven by the 8th respondent (Liaqat Ali) capsized. Three inmates of the vehicle died in the accident. Legal heirs of those three deceased ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or a period of three years with effect from the date of its expiry. One Anil Chawla, legal officer of the appellant insurance company at Shimla, was examined as RW-4 and he said that on enquiry it was found that SDM, Paonta had not issued any driving licence to Liaqat Ali and hence the document produced by the 8th respondent as his driving licence is a forged document. The driver Liaqat Ali was not examined before the Claims Tribunal. But the owner of the truck gave evidence to the effect that he engaged the 8th respondent for driving the truck only after satisfying himself that R-8 had a valid licence. He admitted that the said satisfaction is based entirely on looking at the questioned document. The Claims Tribunal repelled the contention of the insurance company for which the following observations have been made: Evidently, it was for the New India Assurance Company to prove that the truck driver did not have valid driving licence on the date of accident. Apparently, the truck driver had a valid driving licence on the date of accident because the same had been issued in his favour by the SDM, Rohru. Admittedly, whenever a licence is renewed, the Licensing Authority is req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application for permission to lead evidence for proving that the licence produced by the 8th respondent was a fake one. But that application was rejected by the Claims Tribunal basing on the decision of a Division Bench of the High Court of Punjab and Haryana (which is reported in National Insurance Co. Ltd. vs. Sucha Singh and ors. {1994 (1) ACJ 374}. As per the said decision if a licence is renewed it gets validated in view of the provisions of Section 15 of the Motor Vehicles Act and the Insurance Company would be liable to reimburse the insured the compensation amount paid to the victims. The Claims Tribunal thereupon held that if the licence was validly renewed by a licensing authority then it cannot be presumed that the licence was a fake one. On the said reasoning the Claims Tribunal dismissed the application of the Insurance Company for leading evidence to show that the document produced by the 8th respondent was forged. Learned counsel submitted that the aforesaid decision of the Division Bench (National Insurance Co. Ltd. vs. Sucha Singh) was overruled by the Full Bench of the same High Court in National Insurance Co. Ltd. vs. Santro Devi (supra). Incidentally, we m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that even if the driving licence of 8th respondent is proved to be not genuine it would not be enough for absolving the Insurance Company from liability. On the other hand, learned counsel for the appellant Insurance Company, banking on the provisions contained in Section 149 of the Act, submitted that the insurer will get complete exoneration from liability on proof of breach of any one of the conditions of the policy of insurance. We have to examine this contention as a decision on the same is necessary before deciding whether the appellant Insurance Company must be given a further opportunity to substantiate that the document is a forged one. Chapter XI of the Act contains provisions for insurance of motor vehicles against third party risk. Sections 145 to 164 are subsumed in the said chapter. Section 146 of the Act imposes a prohibition against use of a motor vehicle in public place unless the vehicle is covered by a policy of insurance complying with the requirements enumerated in the Chapter. Some categories of vehicles are exempted from the aforesaid compulsion, but we are not concerned with any such category now. The details regarding the requirements of the policy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... important and hence that is also extracted below: If the amount which an insurer becomes liable under this section to pay in respect of a liability incurred by a person insured by a policy, exceeds the amount for which the insurer would apart from the provisions of this section be liable under the policy in respect of that liability, the insurer shall be entitled to recover the excess from that person. A reading of the proviso to sub-section (4) as well as the language employed in sub-section (5) would indicate that they are intended to safeguard the interest of an insurer who otherwise has no liability to pay any amount to the insured but for the provisions contained in Chapter XI of the Act. This means, the insurer has to pay to the third parties only on account of the fact that a policy of insurance has been issued in respect of the vehicle, but the insurer is entitled to recover any such sum from the insured if the insurer were not otherwise liable to pay such sum to the insured by virtue of the conditions of the contract of insurance indicated by the policy. To repeat, the effect of the above provisions is this: When a valid insurance policy has been issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies and believed bona fide that the driver employed by him had a valid driving licence, in which case there was no breach of the policy condition. As we have not decided on that contention it is open to the insured to raise it before the Claims Tribunal. In the present case, if the Insurance Company succeeds in establishing that there was breach of the policy condition, the Claims Tribunal shall direct the insured to pay that amount to the insurer. In default the insurer shall be allowed to recover that amount (which the insurer is directed to pay to the claimants - third parties) from the insured person. We may point out that as per the order passed by this Court on 6.3.2000, the appellant Insurance Company was directed to pay the award amount to the claimants. We are told that the amount was paid by the appellant to the claimants. Now the Claims Tribunal has to decide the next question whether the insurance company is entitled to recover that amount from the owner of the vehicle on account of the vehicle being driven by a person who had no valid licence to drive the vehicle. For that purpose we remit the case to the Claims Tribunal. An opportunity shall be afforded to the part ..... X X X X Extracts X X X X X X X X Extracts X X X X
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