Fake driving licence defence fails unless insurer proves wilful breach or lack of reasonable care by the insured.

Under Section 149(2)(a)(ii) of the Motor Vehicles Act, 1988, an insurer may raise a defence based on a driver not being duly licensed, but a fake, invalid, or unverifiable licence does not by itself defeat liability. To avoid liability against the insured, the insurer must prove negligence, lack of reasonable care, or wilful breach of the policy condition. The insured is expected to verify that the driver holds a licence and appears competent, but is not required to obtain independent verification from the licensing authority unless there is reason to doubt authenticity or notice has been given. On these principles, mere non-verification is insufficient.

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Issues: Whether the insurer could avoid liability on the ground that the driver's licence was fake or unverifiable, and whether the insured had failed to exercise reasonable care in employing the driver.

Analysis: Under Section 149(2)(a)(ii) of the Motor Vehicles Act, 1988, the insurer may raise the defence that the driver was not duly licensed, but mere absence, invalidity, or fake nature of the licence does not by itself absolve liability. To succeed against the insured, the insurer must prove that the insured was negligent, failed to exercise reasonable care, or was guilty of wilful breach of the policy condition. The insured is expected to check that the driver holds a licence and appears competent, but is not required to make independent verification with the licensing authority unless there is reason to oubt the licence's authenticity or the insurer has put the insured on notice.

Conclusion: The insurer failed to establish wilful breach or lack of reasonable care on the part of the insured, and could not avoid liability.

Ratio Decidendi: To repudiate liability for an allegedly fake or invalid driving licence, the insurer must prove that the insured failed to exercise reasonable care or was guilty of wilful breach of the policy condition; mere non-verification from the licensing authority is insufficient.

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