JUSTICE V.K.JAIN, PRESIDING MEMBER (ORAL)

          No one is present for the complainant/respondent despite service having been affected on her on 29.01.2019.  I have therefore, heard the learned counsel for the petitioner and have considered the record.

2.      The husband of the complainant/respondent was a farmer whose life was covered under a welfare scheme of the Government.  He having died in a road accident on 02.08.2015, a claim was lodged for payment of the benefit available under the said policy in the event of his death.  The claim having not been paid, the complainant/respondent who is the widow of the deceased, approached the concerned District Forum by way of a Consumer Complaint seeking benefit of Rs.1,00,000/- with compensation etc.

3.      The complaint was resisted by the petitioner company primarily on the ground that the deceased had died while driving a vehicle and that the complainant had failed to produce the Driving License of the deceased meaning thereby that he was not holding a valid Driving License at the time he died in an accident. 

4.      The District Forum, having allowed the complaint, the petitioner approached the concerned State Commission by way of an appeal.  The said appeal also having been dismissed, the petitioner is before this Commission. 

5.      The insurance policy under which the life of the deceased was covered, to the extent it is relevant, reads as under:

          Part III : General Exclusions

          PROVIDED ALWAYS THAT the Company shall not be liable under this Policy for –

          3. (vi) driving any vehicle without a valid driving license;

          Part IV : General Terms & Conditions

          2. Observance of Terms and Conditions

The due observance and fulfillment of the terms, conditions and endorsements of this Policy insofar as they related to anything to be done or complied with by the Insured/Insured Person/s shall be a condition precedent to any liability of the Company to make any payment under this Policy.

6.      Tripartite agreement executed between the Government, the petitioner and Deccan Insurance & Re-insurance Brokers Pvt. Ltd., also shows that in the event of accident where the driver did not have a valid Driving License, the farmers, except the one who was driving, were eligible for the claim. 

7.      It would thus be seen that as far as the deceased was concerned, in case he died in a road accident while himself driving a vehicle without possessing a valid Driving License, no benefit in the event of his death was payable.

8.      No Driving License was produced by the complainant despite opportunity having been given for this purpose.  The inevitable inference therefore, is that the driver was not holding a valid Driving License at the time he met with an accident while driving a vehicle.  Therefore, no claim under the policy was payable in the event of his death. 

9.      The question involved in this petition came to be considered by this Commission in RP No.2086 of 2016 Sharda Bai Vs. Manager, Liberty Videocon General Insurance Company Limited & Ors. decided on 03.03.2017. In that case, the husband of the complainant had an account with a Co-operative Bank which had taken a Group Personal Accident Policy for its account holders.  He was driving a tractor when the said tractor met with an accident resulting in his death.  A claim for payment of the benefit available under the Group Insurance Policy taken by the Co-operative Bank was then submitted.  The claim was repudiated on the ground that the deceased did not possess any effective and valid Driving License at the time he met with an accident.  Being aggrieved, the complainant approached the concerned District Forum by way of a Consumer Complaint.  The complaint was resisted by the insurer on the grounds on which the claim had been repudiated.  The District Forum having dismissed the Consumer Complaint, the complainant approached the concerned State Commission by way of an appeal.  The said appeal also having been dismissed, she approached this Commission by way of a Revision Petition.  Dismissing the complaint, this Commission held as under:

4.      Admittedly, no driving license of the deceased husband of the complainant was provided to the insurer.  No driving license of the deceased was filed before the District Forum. Had the deceased possessed a valid driving license on the date he met with an accident, the complainant could easily have obtained its particulars from the concerned Transport Authority even if it is assumed that neither the original driving license nor its copy was available with her.  That having not been done, there is no escape from the conclusion that the deceased did not possess a valid and effective driving license on the date he met with an accident.  It is not in dispute that driving a vehicle without a valid driving license constituted a breach of terms of the Group Insurance Policy taken by the bank.

5.      In National Insurance Co. Ltd. Vs. Laxmi Narain Dhut (2007) 3 SCC 700, the Hon’ble Supreme Court noted as under:

“24.   In the background of the statutory provisions, one thing is crystal clear i.e. the statute is beneficial one qua the third party.  But that benefit cannot be extended to the owner of the offending vehicle.  The logic of fake licence has to be considered differently in respect of the third party and in respect of own damage claims.

36.    The inevitable conclusion therefore is that the decision in Swaran Singh case has no application to own damage cases.  The effect of fake licence has to be considered in the light of what has been stated by this Court in New India Assurance Co. V. Kamla.  Once the licence is a fake one the renewal cannot take away the effect of fake licence.  It was observed in Kamla case as follows: (SCC p. 347, para 12)

12.    As a point of law we have no manner of doubt that a fake licence cannot get its forgery outfit stripped off merely on account of some officer renewing the same with or without knowing it to be forged.  Section 15 of the Act only empowers any licensing authority to ‘renew a driving licence issued under the provisions of this Act with effect from the date of its expiry’.  No licencing authority has the power to renew a fake licence and, therefore, a renewal if at all made cannot transform a fake licence as genuine.  Any counterfeit document showing that it contains a purported order of a statutory authority would ever remain counterfeit albeit the fact that other persons including some statutory authorities would have acted on the document unwittingly on the assumption that it is genuine”.

37.    As noted above, the conceptual difference between third-party right and own damage cases has to be kept in view.  Initially, the burden is on the insurer to prove that the licence was a fake one.  Once it is established the natural consequences have to flow.

38.    In view of the above analysis the following situations emerge:

1.     The decision in Swaran Singh case has no application to cases other than third-party risks.

2.     Where originally the licence was a fake one, renewal cannot cure the inherent fatality.

3.     In case of third-party risks the insurer has to indemnify the amount, and if so advised, to recover the same from the insured.

4.     The concept of purposive interpretation has no application to cases relatable to Section 149 of the Act.

The High Courts/Commission shall now consider the matter afresh in the light of the position in law as delineated above.”       

In National Insurance Co. Ltd. Vs. Om Prakash Jain Civil Appeal No. 6248 of 2009 decided on 14.09.2009, the Hon’ble Supreme Court referring to its earlier decision in Laxmi Narain Dhut (supra) and Swaran Singh (supra) specifically held as under:

        “In National Insurance Company Limited Vs. Laxmi Narain Dhut [2007 (3) S.C.C. 700], it has been clearly laid down that the decision in the case of National Insurance Company Ltd. Vs. Swaran Singh & Anr. [2004 (3) S.C.C. 297] has no application to the cases other than third-party risks and where originally licence was a fake, renewal thereof cannot validate the same.  In the present case, the complaint was filed for damage of the vehicle of the insured and not the third party risk.  The District Forum and State Commission have concurrently held that the original licence of the driver was fake.  This being the position, the District Forum was justified in dismissing the complaint and the State Commission committed an error by awarding compensation to the respondent”. 

          In the aforesaid case, the complaint was filed by the insured himself seeking compensation for the damage caused to his vehicle, which had met with an accident.  It was found that the driving licence possessed by the driver of the vehicle was a fake licence.  The National Commission having decided in favour of the complainant, the matter was taken by the insurance company to the Apex Court.

In United India Insurance Co. Ltd. Vs. Davinder Singh (2007) 8 SCC 698, the respondent owned a vehicle which he had got insured from the appellant United India Insurance Co. Ltd.  The said vehicle met an accident with a truck.  It was being driven by a person, who did not possess a valid licence.  The owner of the vehicle filed a complaint before the District Forum, seeking compensation for the damages caused to his vehicle.  This Commission have ruled in his favour.  The matter was taken to the Hon’ble Supreme Court by way of an appeal.  Allowing the appeal filed by the insurance company, the Apex Court inter-alia held that the fora below had committed an error in holding the insurance company liable to indemnify the owner of the vehicle with regard to the losses sustained by him.  During the course of the judgment, the Hon’ble Supreme Court, inter-alia observed as under:

“10.  It is, thus, axiomatic that whereas an insurance company may be held to be liable to indemnify the owner for the purpose of meeting the object and purport f the provisions of the Motor Vehicles Act, the same may not be necessary in a case where an insurance company may refuse to compensate the owner of the vehicle towards his own loss.  A distinction must be borne in mind as regards the statutory liability of the insurer vis-à-vis the purport and object sought to be achieved by a beneficent legislation before a forum constituted under the Motor Vehicles Act and enforcement of a contract qua contract before a Consumer Forum”.       

In Oriental Insurance Co. Ltd. V. Meena Variyal (2007) 5 SCC 428, the Hon’ble Supreme Court referring to its earlier decision in Swaran Singh, 2004(3) SCC 297 held as under:    

“It is difficult to apply the ratio of this decision to a case not involving a third party.  The whole protection provided by Chapter XI of the Act is against third-party risk.  Therefore, in a case where a person is not a third party within the meaning of the Act, the insurance company cannot be made automatically liable merely by resorting to Swaran Singh ratio.  This appears to be the position.  This position was expounded recently by this Court in Naitonal Insurance Co. Ltd. Vs. Laxmi Narain Dhut.  This Court after referring to Swaran Singh and discussing the law summed up the position thus : (Laxmi Narain Dhut case, SCC p. 719 para 38)

The legal proposition emerges from the above referred decisions of the Hon’ble Supreme Court is that though the insurance company is liable to a third-party even if the vehicle, at the time it meets with an accident is being driven by a person who does not possess a valid driving licence, the position would be different in a case where compensation is sought by the insured himself, for the damage caused to his vehicle.  Wherever, the insured himself is the claimant, the insurance company is not liable to reimburse him for the damage caused to the vehicle, if it is found that the driver of the vehicle did not possess a valid licence at the time the vehicle met with an accident.”

6.      In “National Insurance Co. Ltd. vs. Jarnail Singh & Ors.” [JT 2001 (Supp. 2) SC 218], the driving licence of the driver, who drove the vehicle had expired on 16.05.94.  The vehicle met with an accident on 20.10.94 and the driving licence was renewed only with effect from 28.10.96.  It was held that the proviso of subsection (1) of section 15 became applicable to the case and since the driver had no effective licence to drive the vehicle on the date of the accident, the policy condition was violated and the insurance company was not liable to pay any amount to the insured.  The aforesaid decision was quoted and applied by the Hon’ble Supreme Court in “New India Assurance Co. Ltd. vs. Suresh Chandra Aggarwal” [AIR 2009 SC 2987].  In Suresh Chandra Aggarwal (supra), the driver of the vehicle was not holding an effective licence at the time it met with an accident since the said licence had already expired on 25.10.91, whereas the accident took place on 29.02.92.  The policy condition applicable in that case required that the person entitled to drive the vehicle should hold or should have held a driving licence and should not be disqualified from holding an effective driving licence.  It was noted that though the driving licence had expired on 25.10.91, 4 months prior to the accident it was got renewed only with effect from 23.03.1992 and the driver had not applied for the renewal of the licence within 30 days of its expiry.  Referring to the proviso of section 15 sub-section (1) of the Motor Vehicles Act, it was held that in such a case, the licence could be renewed only from the date of its renewal and in the interregnum period between expiry of the licence and the date of its renewal, there was no effective licence in existence.  The decision of this Commission holding the Insurance Company liable was, therefore, set aside by the Hon’ble Supreme Court.

10.    For the reasons stated hereinabove, I hold that in the event of death of the insured himself, in an accident at the time he is driving a vehicle without holding a valid and effective Driving License, no benefit under such a policy would be available.  Had the accident resulted in death of someone other than the insured himself, or had he himself not been driving the vehicle, the position would have been entirely different.  But, where the insured himself is driving a vehicle without possessing a valid Driving License and the vehicle meets with an accident resulting in his death, no benefit under such a policy would be available. 

11.    For the reasons stated hereinabove, the impugned orders cannot be sustained and are accordingly set aside.  The complaint is therefore, dismissed with no order as to costs.  

          The amount deposited by the petitioner with the District Forum in terms of an interim order of this Commission be refunded to the petitioner alongwith interest which may have accrued on that amount.