9911796707
TMI Blog2004 (1) TMI 703X X X X Extracts X X X X X X X X Extracts X X X X ..... to establish that the insured has committed a breach of contract of insurance as envisaged under Sub-clause (ii) of Clause (a) of Sub-section (2) of Section 149 of the Act, the insurance company shall be entitled to realise the awarded amount from the owner or driver of the vehicle, as the case may be, in execution of the same award having regard to the provisions of Sections 165 and 168 of the Act. However, in the event, having regard to the limited scope of inquiry in the proceedings before the Tribunal it had not been able to do so, the insurance company may initiate a separate action therefore against the owner or the driver of the vehicle or both, as the case may be. Those exceptional cases may arise when the evidence becomes available to or comes to the notice of the insurer at a subsequent stage or for one reason or the other, the insurer was not given opportunity to defend at all. Such a course of action may also be resorted when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage. Although, as noticed hereinbefore, there are certain special leave petitions wherein the persons having the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case. (vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply the rule of main purpose and the concept of fundamental breach to allow defences available to the insured u/sn 149(2) of the Act. (vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver, (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case. (viii) If a vehicle at the time of accident was driven by a person having a learner s licence, the insurance companies would be liable to satisfy the dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , relegating them to the remedy before, regular court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims. Thus, these petitions are dismissed but without any order as to costs. X X X X Extracts X X X X X X X X Extracts X X X X ..... t exceeding 50cc may be driven in a public place by a person after attaining the age of sixteen years. (2) Subject to the provisions of Section 18, no person under the age of twenty years shall drive a transport vehicle in any public place. (3) No learner's licence or driving licence shall be issued to any person to drive a vehicle of the class to which he has made an application unless he is eligible to drive that class of vehicle under this section. 5. Responsibility of owners of motor vehicles for contravention of sections 3 and 4. --No owner or person in Charge of a motor vehicle shall cause or permit any person who does not satisfy the provisions of Section 3 or Section 4 to drive the vehicle. 6. Restrictions on the holding of driving licences. -- (1) No person shall, while he holds any driving licence for the time being in force, hold any other driving licence except a learner's licence or a driving licence issued in accordance with the provisions of Section 18 or a document authorising, in accordance with the rules made under Section 139, the person specified therein to drive a motor vehicle. (2) No holder of a driving licence or a learner's licence sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) is a habitual criminal or a habitual drunkard; or (b) is a habitual addict to any narcotic drug or psychotropic substance within the meaning of the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of l985); or (c) is a person whose licence to drive any motor vehicle has, at any time earlier, been revoked, it may, for reasons to be recorded in writing, make an order refusing to issue a driving licence to such person and any person aggrieved by an order made by a licensing authority under this sub-section may, within thirty days of the receipt of the order, appeal to the prescribed authority. (9) Any driving licence for driving a motor cycle in force immediately before the commencement of this Act shall after such commencement be deemed to be effective for driving a motor cycle with or without gear. Form and contents of licences to drive. - (1) Every learner's licence and driving licence, except a driving licence issued under Section 18, shall be in such form and shall contain such information as may be prescribed by the Central Government. (2) A learner's licence or, as the case may be, driving licence shall also be expressed as entitling the holder t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the age of forty years, the same shall be accompanied by a medical certificate in the same form and in the same manner as is referred to in Sub-section (3) of Section 8, and the provisions of Sub-section (4) of Section 8 shall, so far as may be, apply in relation to every such case as they apply in relation to a learner's licence. (2) An application for the renewal of a driving licence shall be made in such form and accompanied by such documents as may be prescribed by the Central Government. (3) Where an application for the renewal of a driving licence is made previous to, or not more than thirty days after the date of its expiry, the fee payable for such renewal shall be such as may be prescribed by the Central Government in this behalf. (4) Where an application for the renewal of a driving licence is made more than thirty days after the date of its expiry the fee payable for such renewal shall be such amount as may be prescribed by the Central Government: Provided that the fee referred to in Sub-section (3) may be accepted by the licensing authority in respect of an application for the renewal of a driving licence made under this sub-section if it is satisfied that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of third party risks. Sub-section (1) of Section 149 postulates that in the event of a certificate of insurance has been issued in terms of Section Sub-section (3) of Section 147 a judgment or award in respect of any such liability is obtained by the insured, the insurer notwithstanding its entitlement to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment debtor, in respect or the liability, together with any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments. Sub-section (2) of Section 149 of the Act, however, seeks to make an exception thereto. Sub-sections (4), (5) and (7) of Section 149 read thus : "(4) Where a certificate of insurance has been issued under Sub-section (3) of Section 147 to the person by whom a policy has been effected, so much of the policy as purports to restrict the insurance of the persons insured thereby by reference to any condition o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) is, or has been, a Judge of a High Court, or (b) is, or nas peen a District Judge, or (c) is qualified for appointment as a High Court Judge [Or as a District Judge]. (4) Where two or more Claims Tribunals are constituted for any area, the State Government, may by general or special order, regulate the distribution of business among them." Section 168 of the Act provides as follows : "168. Award of the Claims Tribunal.- On receipt of an application for compensation made under Section 166, the Claims Tribunal shall, after giving notice of the application to the insurer and after giving the parties (including the insurer) an opportunity of being heard, hold an inquiry into the claim or, as the case may be, each of the claims and, subject to the provisions of Section 162 may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom compensation shall be paid and in making the award the Claims Tribunal shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them, as the case may be; Provided that where such applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gian Chand and Ors. : AIR 1997 SC 3824 . (4) Once the defence by the insurer is established in the proceedings before the Tribunal, it is bound to discharge the insurer and fix the liability only on the owner and/or the driver of the vehicle. (5) Once it is held that the insurer has been able to establish its defence, the Tribunal or the Court cannot direct the insurance companies to pay the awarded amount to the claimant and in turn recover the same from the owner and the driver of the vehicle. The decisions of this Court in New India Assurance Co., Shimla v. Kamla and Ors. etc. : [2001]2SCR797 and United India Insurance Company Ltd. v. Lehru and Ors. : [2003]2SCR495 wherein it has been held that the court is entitled to issue a direction upon the insurer to satisfy the award and thereafter recover the same from the owner of the vehicle do not lay down the correct law and should be overruled. The learned counsel appearing on behalf of the respondents, who are third party claimants on the other hand, submitted: (i) that the Parliament deliberately used two different expressions 'effective licence' in Section 3 and 'duly licensed' in Sub-section (2) of Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would be on the insurer. (vii) With a view to avoid its liabilities it is not sufficient for the insurer to show that the person driving at the time of accident was not duly licensed but it must further be established that there was a breach on the part of the insured. Reliance, in this connection, has been placed on Nareinva V. Kamath and Anr. v. Alfredo Antonio Doe Martins and Ors. : [1985]3SCR951 , Skandia Insurance Company Ltd. v. Kokilaben Chandevadan and Ors. : [1987]2SCR752 , Sohan Lal Passi v. P. Sesh Reddy and Ors. : AIR 1996 SC 2627 and United India Insurance Company Ltd. v. Lehru and Ors. : [2003]2SCR495 . Before we deal with various contentions raised by the parties it is desirable to look into the legislative history of the provisions for its interpretation. The relevant provisions of the Act indisputably are beneficent to the claimant. They are in the nature of a Social Welfare Legislation. Chapter XI of the Motor Vehicles Act, 1988, inter alia, provides for compulsory insurance of vehicles in relation to the matters specified therefore. The provision for compulsory insurance indisputably has been made inter alia with a view to protect the right of a third party. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t have injured was one personal to himself, and there was no privity of any sort between the injured person and the insurers. The injured person had no interest either at law or in equity in the insurance money, either before or after it was paid by the insurers to the assured. In a case where the assured became bankrupt and if the injured person had not already obtained judgment and levied execution of his claim for damages his only right was to move in the bankruptcy or the winding-up of proceedings. The beneficial provisions of the aforementioned English Statutes were incorporated by the Parliament of India while enacting the Motor Vehicles Act, 1939 which has also since been repealed and replaced by the Motor Vehicles Act, 1988. Concededly different types of insurance covers are issued containing different nature of contract of insurance. We are, however, in this batch of cases mainly concerned with third party right under the policy. Any condition in the insurance policy, whereby the right of the third party is taken away, would be void. Indisputably such a benefit to a third party was provided under the Statute keeping in view the fact that the conditions in the assured' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry says...to any unlooked for mishap or occurrence...this is the proper test..." In Halsbury's Laws of England, Fourth Edition Reissue, it is stated: "An injury caused by the willful or even criminal act of a third person, provided the assured is not a party or privy to it, is to be regarded as accidental for the purposes of the policy, since from the assured's point of view it is not expected or designed." In Colinvaux's Law of Insurance (6th Edition) page 304, the following illustration is given : "If a man walks and stumbles, thus spraining his ankle, the injury is accidental for while he intends to walk he does not intend to stumble. In Hamlyn v. Crown Accidental Insurance the assured's injury was due to stooping forward to pick up a marble dropped by a child as it rolled from him. He stood with his legs together, separated his knees, leaned forward and made a grab at the marbie, and in doing so wrenched his knee. The injury was held by the Court of Appeal to be accidental, on the ground that the assured did not intend to get into such a position that he might wrench his knee." At para 17-13 of the said treatise it is stated : "Accident includes neglige ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Insurance Company is limited to the statutory requirement, an unlimited or higher liability can be imposed on it. The liability could be statutory or contractual. A statutory liability cannot be more than what is required under the statute itself. However, there is nothing in Section 95 of the Act prohibiting the parties from contracting to create unlimited or higher liability to cover wider risk. In such an event, the insurer is bound by the terms of the contract as specified in the policy in regard to unlimited or higher liability as the case may be. In the absence of such a term or clause in the policy, pursuant to the contract of insurance, a limited statutory liability cannot be expanded to make it unlimited or higher. If it is so done, it amounts to rewriting the statute or the contract of insurance which is not permissible." For the aforementioned reasons, the provisions contained in Chapter XI of the Motor Vehicles Act, 1988 must be construed in that light. Sub-section (1) of Section 149, casts a liability upon the insurer to pay to the person entitled to the benefit of the decree as if he were the judgment debtor. Although the said liability is subject to the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action on any of the grounds mentioned therein. However, Clause (a) opens with the- words 'that there has been a breach of a specified condition of the policy', implying that the insurer's defence of the action would depend upon the terms of the policy. The said sub-clause contains three conditions of disjunctive character, namely, the insurer can get away from the liability when (a) a named person drives the vehicle; (b) it was being driven by a person who did not have a duly granted licence; and (c) driver is a, person disqualified for holding or obtaining a driving licence. We take note of the fact that whereas in Section 3 the words used are 'effective licence', it has been differently worded in Section 149(2) i.e. 'duly licensed'. If a person does not hold an effective licence as on the date of the accident, he may be liable for prosecution in terms of Section 141 of the Act but Section 149 pertains, to insurance as regard third party risks. A provision statute which is penal in nature vis-a-vis a provision which is beneficent to a third party must be interpreted differently. It is also well known that the provisions contained in different expre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tificate of insurance is delivered in terms of Section 147(3) a third party has obtained a judgment against any person insured by the policy in respect of a liability required to be covered by Section 145, the same must be satisfied by the insurer, notwithstanding that the insurer may be entitled to avoid or to cancel the policy or may in fact have done so. The same obligation applies in respect of a judgment against a person not insured by the policy in respect of such a liability, but who would have been covered if the policy had covered the liability of all persons, except that in respect of liability for death or bodily injury. Such a breach on the part of the insurer must be established by the insurer to show that not only the insured used or caused or permitted to be used the vehicle in breach of the Act but also that the damage he suffered flowed from the breach. Under the Motor Vehicles Act holding of a valid driving licence is one of the conditions of contract of insurance. Driving of a vehicle without a valid licence is an offence. However, the question herein is whether a third party involved in an accident is entitled to the amount of compensation granted by the Motor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anything he should not have done or is not amiss in any respect how can it be conscientously posited that he has committed a breach It is only when the insured himself places the vehicle in charge of a person who dies not hold a driving licence, that it can be said that he is 'guilty' of the breach of the promise that the vehicle will be driven by a licensed driver. It must be established by the insurance company that the breach was on the part of the insured and that it was the insured who was guilty of violating the promise or infringement of the contract. Unless the injured is at fault and is guilty of a breach, the insurer cannot escape from the obligation to indemnify the insured and successfully contented that he is exonerated having regard to the fact that the promisor (the insured) committed a breach of his promise. Not when some mishap occurs by some mischance. When the insured has done everything within his power inasmuch as he has engaged a licensed driver and has placed the vehicle in charge of a licensed driver, with the express or implied mandate to drive it himself, it cannot be said that the insured is guilty of any breach." In B.V. Nagaraju v. Oriental Ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merchantman and a privateer; a smaller but still very substantial difference between the risk involved in insuring an explosive and non-explosive demolition; and a very exiguous difference between the risks of insuring when a driver was under or over twenty-one. He then observed : "The law provides that licences to drive motor vehicles may be given to persons of specified ages, the ages varying with the class of the vehicle; and when a person is driving a vehicle of the category which by his age he is entitled to drive, there is, I think, some presumption that, as far as age reflects on competency., he is competent to drive it. Certainly this would be an honest and reasonable view for an insured person to take in a case where he had not been expressly limited by the terms of the policy to the employment of drivers over 21. Certain categories of vehicles may not, by law, be driven by persons under 21, and as the framework of the proposal form was apt to cover an application for insurance of such vehicle, he might reasonably consider that Q.9 was designed to all attention to this tact. If insurers take a different view as to the proposer age of drivers from the view of the law, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, may not be proper to apply the rules for interpretation of a contract for interpreting a statute. The correctness of the decision rendered in Skandia 's case (supra) was questioned and the matter was referred to a three-Judge Bench to which we shall advert to a little later. Gjan Chand's case (supra) relied on behalf of the petitioner is of not much assistance. Therein this Court was dealing with peculiar fact situation obtaining therein. In that case the insured admittedly did not have any driving licence and in that situation, the insurance company was held to be not liable. The Bench noticed the purported conflict between the two sets of decisions but did not refer the matter to a larger Bench. It merely distinguished the cases on their own facts stating : "Under the circumstances, when the insured had handed 'over the vehicle for being driven by an unlicensed driver, the Insurance Company would get exonerated from its liability to meet the claims of the third party who might have suffered on account of vehicular accident caused by such unlicensed driver. In view of the aforesaid two sets of decisions of this Court, which deal with different fact situations, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsured was guilty of an infringement or violation of a promise. The insurer has also to satisfy the Tribunal or the Court that such violation or infringement on the part of the insured was wilful. If the insured has taken all precautions by appointing a duly licensed driver to drive the vehicle in question and it has not been established that it was the insured who allowed the vehicle to be driven by a person not duly licensed, then the insurance company cannot repudiate its statutory liability under Sub-section (1) of Section 96..." A bare perusal of the provisions of Section 149 of the Act leads to only one conclusion that usual rule is that once the assured proved that the accident is covered by the compulsory insurance clause, it is for the insurer to prove that it comes within an exception. In MacGillivray on Insurance Law it is stated: "25-82 Burden of Proof: Difficulties may arise in connection with the burden of proving that the facts of any particular case fall within this exception. The usual rule is that once the assured has proved that the case comes within the general risk, it is for the insurers to prove that it comes within an exception. It has therefore been sug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... end upon the fact as to who is the owner of the vehicle and the circumstances in which the vehicle was being driven by a person having no valid and effective licence. No hard and fast rule can therefore be laid down. If in a given case there exists sufficient material to draw an adverse inference against either the insurer or the insured, the Tribunal may do so. The parties alleging breach must be held to have succeeded in establishing the breach of conditions of contract of insurance on the part of the insurer by discharging its burden of proof. The Tribunal, there cannot be any doubt, must arrive at a finding on the basis of the materials available on records. In the aforementioned backdrop, the provisions of sub-sections (4)and (5) of Section 149 of the Motor Vehicles Act, 1988 may be considered as the liability of the Insurer to satisfy the decree at the first instance. A beneficent statute, as is well known, must receive a liberal interpretation [See Bangalore Water Supply & Sewerage Board etc. v. A. Rajappa and Ors. etc. : (1978)ILLJ349SC , Steel Authority of India Ltd. and Ors. v. National Union Waterfront Workers and Ors., ITI Ltd. v. Siemens Punjab Communications Network ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shed by a judgment it is not permissible to look beyond the determination in order to establish the basis of the liability. In United Insurance Co. Ltd. v. Jaimy and Ors. 1998 ACJ 1318 it is stated: "Section 149(2) relates to the liability of the insurer and speaks of a situation in regard to which no sum shall be payable by an insurer to whom notice of bringing of any such proceeding is given, could defend the action stated in the said statutory prevision. The contention in the context would be found in section 149(2)(a) in the event of a breach of a specified condition of the policy enabling the insurer to avoid liability in regard thereto. In the process in regard to the right of the insurer to recover the amount from the insured, it would have to be seen by referring to section 149(4) successfully recovered from the insured. Section 149(4) says that where a certificate of insurance is issued, so much of the said policy as purports to restrict the insurance of the persons insured thereby by referring to any of the conditions mentioned and it is precisely enacted in regard thereto and that the liability covered by Section 2(b) as are required to be covered by the policy woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvinced that the statute causes any hardship. First the insurer has the right, provided he has reserved it by the policy, to defend the action in the name of the assured and if he does so, all defences open to the assured can then be urged by him and there is no other defence that he claims to be entitled to urge. He can thus avoid all hardship if any, by providing for a right to defend the action in the name of the assured and this he has full liberty to do. Secondly, if he has been made to pay something which on the contract of the policy he was riot bound to pay, he can under the proviso to Sub-section (3) and under Sub-section (4) recover it from the assured. It was said that the assured might be a man of straw and the insurer might not be able to recover anything from him. But the answer to that is that it is the insurer's bad luck. In such circumstances the injured person also would not have been able to recover the damages suffered by him from the assured the person causing the injuries... Similar view has been taken in Skandia's case (supra), Sohan Lal Passi's case (supra), Kashiram Yadav and Anr. v. Oriental Fire and General Insurance Co. Ltd. and Ors. : [1989 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction (2) of Section 149 of the Act. It is an independent provision and must be read in the context of Section 96(4) of the Motor Vehicles Act, 1939. Furthermore, it is one thing to say that the insurer will be entitled to avoid its liability owing to breach of terms of a contract of insurance but it is another thing to say that the vehicle is not insured at all. If the submission of the learned counsel for the petitioner is accepted, the same would render the proviso to Sub-section (4) as well as Sub-section (5) of Section 149 of the Act otiose, nor any effective meaning can be attributed to the liability clause of the insurance company contained in Sub-section (1). The decision in Kamla's case (supra) has to be road in the aforementioned context. Sub-section (5) of Section 149 which imposes a liability on the insurer must also be given its full effect. The insurance company may not be liable to satisfy the decree and, therefore, its liability may be zero but it does mean that it did not have initial liability at all Thus, if the insurance company is made liable to pay any amount it can recover the entire amount paid to the third party on behalf of the assured. If this interp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of accident. In that case, it was held that the owner and insurer both were jointly and severally liable. In New India Assurance Co. Ltd. v. Jagtar Singh and Ors. Hon'ble M. Srinivasan, CJ, as His Lordship then was, dealing with the case where a duly licensed driver was driving a vehicle but there was a dispute as to who was driving the vehicle. In that case the court referred to the judgment in Kashiram Yadav v. Oriental Fire & General Insurance Co. Ltd. and expressed its agreement with the views taken therein. In National Insurance Co. Ltd. v. Ishroo Devi and Ors. where there was no evidence that the society which employed the driver was having knowledge that the driver was not holding a valid licence, it was held the insurance company is liable. The court relied upon the decisions of this Court in Kashiram Yadav's case (supra), Skandia's case (supra) and Sohan Lal Passi's case (supra). WHEN THE: PERSON HAS BEEN GRANTED LICENCE FOR ONE TYPE OF VEHICLE BUT AT THE RELVANT TIME HE WAS DRIVING ANOTHER TYPE OF VECHILE : Section 10 of the Act provides for forms and contents of licences to drive. The licence has to be granted in the prescribed form. Thus, a licence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reach of conditions concerning driving licence. We have construed and determined the scope of Sub-clause (ii) of Sub-section (2) of Section 149 of the Act. Minor breaches of licence conditions, such as want of medical fitness certificate, requirement about age of the driver and the like not found to have been the direct cause of the accident, would be treated as minor breaches of inconsequential deviation in the matter of use of vehicles. Such minor and inconsequential deviations with regard to licensing conditions would not constitute, sufficient ground to deny the benefit of coverage of insurance to the third parties. On all pleas of breach of licensing conditions taken by the insurer, it would be open to the tribunal to adjudicate the claim and decide inter se liability of insurer and insured; although where such adjudication is likely to entail undue delay in decision of the claim of the victim, the tribunal in its discretion may relegate the insurer to seek its remedy of reimbursement from the insured in the civil court. WHERE THE DRIVER'S LICENCE IS FOUND TO BE FAKE: It may be true as has been contended on behalf of the petitioner that a fake or forged licence is as g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew of 'duly licensed' as such a licence is also granted in terms of the provisions of the Act and the rules framed thereunder. It is now a well-settled principle of law that rules validly framed become part of the statute. Such rules are, therefore, required to be read as a part of main enactment. It is also well-settled principle of law that for the interpretation of statute an attempt must be made to give effect to all provisions under the rule. No provision should be considered as surplusage. Mandar Madhav Tambe's case (supra), whereupon the learned counsel placed reliance, has no application to the fact of the matter. There existed an exclusion clause in the insurance policy wherein it was made clear that the Insurance Company, in the event of an accident, would be liable only if the vehicle was being driven by a person holding a valid driving licence or a permanent driving licence 'other than a learner's licence'. The question as to whether such a clause would be valid or not did riot arise for consideration before the Bench in the said case. The said decision was rendered in the peculiar fact situation obtaining therein. Therein it was stated that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be correct. Such defence can certainly be raised but it will be for the insurer to prove that the insured did not take adequate care and caution to verify the genuineness or otherwise of the licence held by the driver. Our attention has also been drawn on an unreported order of this Court in Malla Prakasarao v. Malla Janaki and Ors. : (2004)3SCC343 which reads as under : "It is not disputed that the driving licence of the driver of the vehicle had expired on 20th November, 1982 and the driver did not apply for renewal within 30 days of the expiry of the said licence, as required under Section 11 of the Motor Vehicles Act, 1939. It is also not disputed that the driver of the vehicle did not have driving licence when the accident took place. According to the terms of contract, the Insurance Company has no liability to pay any compensation where an accident takes places by a vehicle driven by a driver without driving licence. In that view of the matter, we do not find any merit in the appeal. The appeal fails and is, accordingly dismissed. There shall be no order as to costs." In that case, the Court presumably as in the case of Mandar Madhav Tambe's case (supra), was conce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t stage or for one reason or the other, the insurer was not given opportunity to defend at all. Such a course of action may also be resorted when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage. Although, as noticed hereinbefore, there are certain special leave petitions wherein the persons having the vehicles at the time when the accidents took place did not hold any licence at all, in the facts and circumstances of the case, we do not intend to set aside the said awards. Such awards may also be satisfied by the petitioners herein subject to their right to recover the same from the owners of the vehicles in the manner laid down therein. But this order may not be considered as a precedent. Although in most of the case, we have not issued notices in view of the fact that the question of law has to be determined; we have heard counsel for the parties at length at this stage. SUMMARY OF FINDINGS : The summary of our findings to the various issues as raised in these petitions are as follows: (i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to the insured under Section 149(2) of the Act. (vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver, (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case. (viii) If a vehicle at the time of accident was driven by a person having a learner's licence, the insurance companies would be liable to satisfy the decree. (ix) The claims tribunal constituted under Section 165 read with Section 168 is empowered to adjudicate all claims in respect of the accidents involving death or of bodily injury or damage to property of third party arising in use of motor vehicle. The said power of the tribunal is not restricted to decide the claims inter se between claimant or claimants on one side and insured, insurer and driver on the other. In the course of adjudicating the claim for compensation and to decide the availability of defence or defences to the insurer, the Tribunal has necessarily the power and jurisdiction to decide disputes inter se between insurer and the insured. The decision rendered on the claims and disputes inter se between ..... X X X X Extracts X X X X X X X X Extracts X X X X
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