TaxTMI 
TaxTMI 
2018 (5) TMI 2189
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....nd negligent manner hit the motor cycle of the deceased as a result of which he sustained multiple injuries, and eventually, succumbed to the same when being taken to the hospital. The claim put forth was sought to be sustained on many a basis which need not be adverted to. 2. The insurer, the first Respondent herein, opposed the claim on the ground that the vehicle in question was driven in violation of the terms of the insurance policy and further the driver was not having a valid and effective driving license and, therefore, it was not obliged to indemnify the insured. That apart, a stand was taken that the vehicle did not have the permit on the date of the accident. On behalf of the owner of the vehicle and driver, assertions were made that the vehicle was insured with the first Respondent as per the insurance policy, that the vehicle was registered and the driver had the requisite driving licence. Additionally, copy of the route permit of the offending truck was brought on record. 3. The tribunal noted that the vehicle was purchased in September 2012 and insured on 20.12.2012. It was registered on 26.02.2013. The accident, as stated earlier, occurred on 19.02.2013. The t....
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.... 7. The conclusions recorded by the tribunal and further confirmed by the High Court clearly show that the accident occurred on 19.02.2013 and the competent authority issued the permit on 27.02.2013. In this regard, Sections 2(28) and 2(31) of the Act that define "motor vehicle" or "vehicle" and "permit" are reproduced below: (28) "motor vehicle" or "vehicle" means any mechanically propelled vehicle adapted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding twenty-five cubic centimeters; (31) "permit" means a permit issued by a State or Regional Transport Authority or an authority prescribed in this behalf under this Act authorising the use of a motor vehicle as a transport vehicle; On a perusal of both the definitions, it is quite clear that a permit has to be issued by the competent aut....
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....ny transport vehicle used for any other public purpose as may be prescribed by the State Government in this behalf; (g) to any transport vehicle used by a person who manufactures or deals in motor vehicles or builds bodies for attachment to chassis, solely for such purposes and in accordance with such conditions as the Central Government may, by notification in the Official Gazette, specify in this behalf; (h) x x x x (i) to any goods vehicle, the gross vehicle weight of which does not exceed 3,000 kilograms; (j) subject to such conditions as the Central Government may, by notification in the Official Gazette, specify, to any transport vehicle purchased in one State and proceeding to a place, situated in that State or in any other State, without carrying any passenger or goods; (k) to any transport vehicle which has been temporarily registered Under Section 43 while proceeding empty to any place for the purpose of registration of the vehicle; (l) x x x x (m) to any transport vehicle which, owing to flood, earthquake or any other natural calamity, obstruction on road, or unforeseen circumstances, is required to be divert....
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.... excludes liability for injury caused or contributed to by conditions of war, civil war, riot or civil commotion. A further defence that can be availed of by the insurer is that the policy is void on the ground that it has been obtained by non-disclosure of the material fact or by representation of act which is false in the material particular. 11. On a perusal of the written statement filed by the owner and the driver, it is evident that the factum of accident having been caused by the vehicle in question had been denied. That apart, there is also a denial of liability that relates to the manner in which the accident had occurred as alleged in the claim petition. It was the specific assertion of the insurer before the tribunal that the vehicle was running in contravention of the provisions of the Act, for it did not possess a route permit. The tribunal, on the basis of the materials brought on record to the effect that the route permit was issued on 27.02.2013 and the accident occurred on 19.02.2013, returned a finding that the vehicle in question did not have the permit. As stated earlier, the High Court has affirmed the same. 12. Learned Counsel for the Appellants would su....
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....ctors governing the case including conduct of parties as regards duty to inform, correct disclosure, suppression, fraud on the insurer etc. It will also depend 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, therefor, 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 the 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. 71. 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 to the liability of the insurer to satisfy the decree at the first instance. x x x 83. Sub-section (5) of Section 149 which imposes a liability on the insurer must also be given its full effect....
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....h regard to licensing conditions would not constitute sufficient ground to deny the benefit of coverage of insurance to third parties. The other category of cases that the Court addressed to included cases where the licence of the driver is found to be fake. In that context, the Court expressed its general agreement with United India Insurance Co. Limited v. Lehru (2003) 3 SCC 338 and stated thus: 92. ... In Lehru case the matter has been considered in some detail. We are in general agreement with the approach of the Bench but we intend to point out that the observations made therein must be understood to have been made in the light of the requirements of the law in terms whereof the insurer is to establish willful breach on the part of the insured and not for the purpose of its disentitlement from raising any defence or for the owners to be absolved from any liability whatsoever.. 16. The three-Judge Bench summed up its conclusions and we think it appropriate to reproduce the relevant part of the same: 110. (iii) The breach of policy condition e.g. disqualification of the driver or invalid driving licence of the driver, as contained in Sub-section (2)(a)(ii) o....
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....e of the accident, whereas the permitted seating capacity of the motor vehicle of the Appellant was only 1 + 1. The two-Judge Bench referred to Oriental Insurance Co. Ltd. v. Meena Variyal and Ors. (2007) 5 SCC 428 and expressed the view that in order to avoid liability, the insurer must establish that there was breach on the part of the insured. 19. The obtaining fact situation is sought to be equated with the factual score in the said case. In this regard, it is useful to refer to the Bench decision in HDFC Bank Limited v. Reshma and Ors. (2015) 3 SCC 679. The issue that arose before the Court was whether the financier was liable to pay the compensation or it was the liability of the borrower. The tribunal had returned the finding that the duty of the financier was to see that the borrower did not neglect to get the vehicle insured and, therefore, it was jointly and severally liable along with the owner. The High Court had concurred with the said conclusion. The Court referred to Purnya Kala Devi v. State of Assam and Ors. (2014) 14 SCC 142 that has dealt with the definition of the term "owner" as contained in Section 2(30) of the Act. In the said case, the vehicle in question....
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....legislature is quite clear to the effect that a registered owner of the vehicle should not be held liable if the vehicle is not in his possession and control and there was evidence on record that the Respondent No. 2, plied the vehicle without the insurance in violation of the statutory provision contained in Section 146 of the Act, the High Court could not have mulcted the liability on the financier and finally, the financer was absolved of the liability. 23. In the case at hand, it is clearly demonstrable from the materials brought on record that the vehicle at the time of the accident did not have a permit. The Appellants had taken the stand that the vehicle was not involved in the accident. That apart, they had not stated whether the vehicle had temporary permit or any other kind of permit. The exceptions that have been carved out Under Section 66 of the Act, needless to emphasise, are to be pleaded and proved. The exceptions cannot be taken aid of in the course of an argument to seek absolution from liability. Use of a vehicle in a public place without a permit is a fundamental statutory infraction. We are disposed to think so in view of the series of exceptions carved out ....