Ram Chandra Singh vs Rajaram

REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 8145 OF 2018 (Arising out of SLP(C) No.6760/2017)

Ram Chandra Singh …..Appellant(s)

:Versus:

Rajaram and Ors. ....Respondent(s)

JUDGMENT

A.M. Khanwilkar, J.

1. The singular question involved in this appeal against the

judgment and order dated 28th November, 2016 passed by the

High Court of Judicature at Allahabad in First Appeal From

Order No.3290 of 2016, is whether the Motor Accident Claims

Tribunal, Firozabad, was right in holding that the insurer was

not liable as the driver had a fake licence.

Signature Not Verified Digitally signed by

2. Shorn of unnecessary details, the respondent Nos.1 to 5 DEEPAK GUGLANI Date: 2018.08.14 11:58:16 IST Reason:

filed a motor accident claim before the Motor Accident Claims 2

Tribunal, Firozabad, bearing M.A.C.P. No.169 of 2012,

consequent to the death of Sanoj Kumar on account of motor

accident which occurred on 10th May, 2012 at 6.30 A.M., when

he was going for his morning walk towards Mustafabad

Chauraha. At that time, the driver of Bolero loader bearing

registration No.UP-71/0084 while driving the vehicle in a high

speed and in rash and negligent manner, hit the deceased

from behind. The Tribunal partly allowed the claim petition

and awarded compensation amount of Rs.6,27,000/-, but

absolved the Oriental Insurance Company Ltd. (for short, “the

insurer”) on the finding that the offending vehicle was driven

by one Shivgyani (respondent No.6) who did not have a valid

driving licence. The Tribunal, however, directed the insurer to

pay the compensation amount as determined in terms of the

award dated 24th August, 2016, with liberty to recover the

same from the vehicle owner (appellant herein) and the driver

(respondent No.6) jointly and severally.

3. The appellant, being the vehicle owner, alone filed an

appeal before the High Court of Judicature at Allahabad which 3

was dismissed on the finding that the counsel for the

appellant did not dispute that the driving licence was found to

be fake and no evidence was adduced before the Court to show

that the driving licence was genuine. This concurrent view is

the subject matter of challenge in the present appeal.

4. It is contended by the appellant that even if the finding of

the Tribunal, that the driving licence relied upon by the owner

of the vehicle and driver was fake, is maintained as it is, even

then the Tribunal could not have absolved the insurer and

made the owner of the vehicle liable, in the absence of a clear

finding that the owner of the vehicle was aware about the

factum of fake licence and despite the same, he made no

attempt to take corrective measures, including to verify the

genuineness thereof. In absence of such a finding, the insurer

cannot be straightaway absolved. In support of this

proposition, reliance was placed on PEPSU Road Transport

Corporation Vs. National Insurance Company1, and

Premkumari and Ors. Vs. Prahlad Dev and Ors.2.

1 (2013) 10 SCC 217 2 (2008) 3 SCC 193 4

5. The counsel for the insurer submits that the appellant

having admitted the fact that the driving licence was fake and

failing to produce any other evidence to prove otherwise,

cannot be heard to make any grievance about the finding

recorded by the Tribunal and affirmed by the High Court

absolving the insurer from the liability to pay the

compensation amount.

6. We have heard Mr. S.R. Singh, learned senior counsel

appearing for the appellant and Mr. Abhishek Gola, learned

counsel appearing for the respondents.

7. We have perused the entire pleadings and the evidence

on record as also the judgments of the Tribunal and the High

Court. It is noticed that the insurer had taken a specific plea

in the written statement filed before the Tribunal, that the

driving licence of the driver was not a valid licence. In the

alternative, it was asserted that the owner of the vehicle must

produce the driving licence so that it can be verified from the

licencing authority. Additionally, the insurer placed on record 5

an investigation report, verification report and photocopy of

the driving licence to establish the fact that the driving licence

relied upon by the owner and the driver was fake and not

valid. For, it was authenticated that no such driving licence

was issued by the authority concerned.

8. It is also noticed that in the oral evidence, the appellant

had stated that he had seen the photocopy of the driving

licence of Shivgyani and was also satisfied about his driving

skills, before employing him as the driver for driving the

vehicle. In his cross-examination by the insurer, the appellant

stated thus:

“……I have not sold the vehicle. Driver Shiv Gyani was working with me from February 2012. He was permanent resident of District – Fatehpur. I never got verified the driving licence of Shiv Gyani. ……… This was not in my knowledge that he has no driving licence. This is incorrect to say that I provided my vehicle to him to drive despite I was aware that he has bogus licence. I am aware of this that licence is issued on the address one resides. ……………This is incorrect to say that I am giving false evidence to save my skin.”

9. The Tribunal while answering issue No.3, however, made

no attempt to analyse the pleadings and evidence on record to

ascertain whether the appellant (owner) was aware of the fake 6

driving licence possessed by the driver (respondent No.6). The

Tribunal merely adverted to the investigation and verification

report and found that the stated driving licence was invalid.

The High Court also made no attempt to enquire into the

relevant aspect, as has been consistently expounded by this

Court and restated in PEPSU Road Transport Corporation

(supra). Even in the case of Premkumari (supra), the Court

after considering the judicial precedents opined as follows:

“It is clear from the above decision when the owner after verification satisfied himself that the driver has a valid licence and was driving the vehicle in question competently at the time of the accident there would be no breach of Section 149(2)(a)(ii), in that event, the insurance company would not then be absolved of liability. It is also clear that even in the case that the licence was fake, the insurance company would continue to remain liable unless they prove that the owner was aware or noticed that the licence was fake and still permitted him to drive.”

10. The decision in PEPSU Road Transport Corporation

(supra) was relied upon by the appellant before the High Court

which, however, distinguished the same by observing that it

was on the facts of that case, where the Court opined that

there was no evidence to prove that the driving licence

produced by the authorities was fake. That approach, in our 7

opinion, is manifestly wrong. Whereas, even in that case, the

Court was called upon to deal with the similar question as is

involved in this appeal. In that case, the Court first adverted to

the decision in United India Insurance Co. Ltd. Vs. Lehru

and Ors.3, and then to the three-Judge Bench decision in

National Insurance Co. Ltd. Vs. Swaran Singh & Ors.4. Paragraphs 99-101 of Swaran Singh (supra) have been

extracted, which read thus:

“99. So far as the purported conflict in the judgments of Kamla and Lehru is concerned, we may wish to point out that the defence to the effect that the licence held by the person driving the vehicle was a fake one, would be available to the insurance companies, but whether despite the same, the plea of default on the part of the owner has been established or not would be a question which will have to be determined in each case.

100. This Court, however, in Lehru must not be read to mean that an owner of a vehicle can under no circumstances have any duty to make any enquiry in this respect. The same, however, would again be a question which would arise for consideration in each individual case.

101. The submission of Mr Salve that in Lehru case, this Court has, for all intent and purport, taken away the right of an insurer to raise a defence that the licence is fake does not appear to 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.”

3 (2003) 3 SCC 338 4 (2004) 3 SCC 297 8

The Court then went on to advert to a two-Judge Bench

decision of this Court in National Insurance Co. Ltd. Vs.

Laxmi Narain Dhut,5 before dealing with the facts of the case

before it.

11. Suffice it to observe that it is well established that if the

owner was aware of the fact that the licence was fake and still

permitted the driver to drive the vehicle, then the insurer

would stand absolved. However, the mere fact that the driving

licence is fake, per se, would not absolve the insurer.

Indubitably, the High Court noted that the counsel for the

appellant did not dispute that the driving licence was found to

be fake, but that concession by itself was not sufficient to

absolve the insurer.

12. As aforementioned, in the present case, neither the

Tribunal nor the High Court has bothered to analyse the

pleadings and evidence adduced by the parties on the crucial

matter. Be that as it may, in this appeal, the limited grievance

5 (2007) 3 SCC 700 9

of the appellant-owner of the vehicle is about unjustly

absolving the insurer merely on the finding that the driving

licence of the driver (respondent No.6) was fake. No other

aspect has been raised by the appellant nor do we intend to

analyse or consider the same.

13. We, therefore, deem it appropriate to relegate the parties

before the High Court for fresh consideration of the appeal

filed by the appellant (owner) only on the question of liability of

the owner or of the insurer (respondent No.7) to pay the

compensation amount.

14. We make it clear that the High Court shall not examine

any other issue in the remand proceedings. For, the

compensation amount, as determined and directed by the

Tribunal, has already been made over to the claimants.

15. Accordingly, we set aside the impugned judgment and

order passed by the High Court of Judicature at Allahabad

and restore the First Appeal From Order No.3290 of 2016, to

the file of the High Court to its original number for being 10

decided afresh, on the limited question of whether the liability

to pay compensation amount, is cast upon the appellant

(owner of the vehicle) or respondent No.7 (insurer). That aspect

be decided on its own merits in accordance with law. We may

not be understood to have expressed any opinion, either way,

on the efficacy of the pleadings and the evidence produced by

the parties adverted to in this judgment or in any other

evidence on record. All questions in that behalf are left open.

16. The appeal is allowed in the aforementioned terms with

no order as to costs.

.………………………….CJI.

(Dipak Misra)

…………………………..….J. (A.M. Khanwilkar) New Delhi;

August 14, 2018.