Sh.S.S. Panesar, President

1.       Sh.Raju Grover has brought the instant complaint under section 12 of the Consumer Protection Act, 1986 on the allegations that he got the insurance for his vehicle TATA LPT-1109 bearing registration No. PB-02BQ-9474 from Opposite Party covering the risk period from 10.5.2014 to 9.5.2015. Said vehicle was to be used by the complainant for earning his livelihood by means of self employment. Said vehicle unfortunately met with an accident near Makhu on 5.6.2014 while going from Amritsar to Kot Ise Khan and the police authorities were also informed and the Opposite Party was immediately intimated and the Opposite Party appointed its surveyor who surveyed the said vehicle at the Authorised Service Centre  of TATA company M/s.Cargo Motors and the vehicle was the case of total loss. It is pertinent to mention over here that the IDV of the vehicle in question is Rs.6,60,000/-, meanwhile the Opposite Party made the settlement with the complainant that the insurance company will pay Rs.4,86,000/- to the complainant and the salvage will be kept by the complainant. The complainant made several futile visits to the Opposite Party to settle the genuine claim as settled, but the Opposite Party instead of settling the genuine claim of the complainant repudiated the genuine claim of the complainant on a frivolous ground vide their letter dated 14.5.2015 that the driving license is found to fake which is infact not. Said repudiation is against the true facts and Opposite Party without ascertaining the correct facts and preposition of law, repudiated the genuine claim of the complainant. Vide instant complaint, the complainant has sought the following reliefs.

a)       Opposite Party be directed to pay the claim of Rs.4,86,000/- alongwith interest @ 12% per annum from 14.5.2015 till realization, as settled between the parties.

b)      Opposite Party be directed to pay the compensation of Rs.50,000/- to the complainant.

c)       Opposite Party be directed to pay the adequate cost of the present litigation.

d)      Any other relief to which the complainant is found under the law, equity and justice be also allowed. 

Hence, this complaint.

2.       Upon notice, Opposite Party appeared and contested the complaint by filing  written statement taking preliminary objections therein inter alia that the vehicle in question was a commercial vehicle and a heavy goods vehicle and had been used for commercial purposes only by the complainant and was a goods carrying vehicle. The complainant does  not come under the ambit of consumer under the Consumer Protection Act and the complaint is not maintainable and is liable to be dismissed on this score only; that the driver of the vehicle in question namely Rajinder Singh son of Surjan Singh who was  driving the vehicle in question  at the time of alleged accident was not holding any legal, valid and effective driving license to drive the vehicle and this fact was well in the knowledge of the complainant, therefore, there is major breach of the  terms and conditions of the motor policy contract, the exclusions contained therein as well as the mandatory provisions of the Motor Vehicle Act. Hence, as per the standard provisions of the Motor Policy as well as statutory provisions of Motor Vehicle Act, the Opposite Party is not liable to pay any claim and the claim of the complainant has rightly been repudiated by the Opposite Party vide letter dated 14.5.2015; that the complainant is guilty of breach of the major terms of the contract and the Opposite Party is not liable to pay the claim. As per the record of DTO Office, Amritsar and as per his report dated 8.5.2015, the driving license is fake and DL No. 1663 dated 4.6.2010 in the name of Rajinder  Singh son of Surjan Singh not renewed by the said office  and is  fake as per the report of DTO, Amritsar. There is no entry regarding renewal of the alleged driving license of Rajinder Singh. The driver of the vehicle, in the relevant register of DTO, Amritsar and the alleged driving license is fake and factitious one. Opposite Party appointed an investigator namely Sanjeev Kaushik and as per the report of the said investigator also dated 11.5.2015, driving license was not renewed by the office of DTO, Amritsar and  fake as per office record. Hence, as per the terms and conditions of the contract of  insurance between the complainant and replying Opposite Party, the Opposite Party is not liable to pay any alleged claim to the complainant. So, as per the terms and conditions of the policy, the Opposite Party is unable to entertain the claim. The complainant cannot take the benefit of his own wrong. The complainant is guilty of negligence; that the present complaint is nothing, but to the misuse of the process of the court; the complainant is estopped by his own act and conduct from filing the present complaint. On merits, the Opposite Party took almost same and similar pleas as taken up by them in the preliminary objections. It is denied that Opposite Party made the settlement with the complainant that insurance company will pay Rs.4,86,000/- to the complainant as alleged. It is further denied that alleged vehicle was the case of total loss as alleged. Both the parties to the insurance policy are bound by the terms and conditions of the insurance policy contract. The complainant has wilfully breach the conditions of the insurance policy, hence the Opposite Party is not liable to pay the alleged claim under the law. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint with cost was made.

3.       In his bid  to prove the case, complainant tendered into evidence  affidavit Ex.C-1 in support of the allegations made in the complaint and also produced copies of documents Ex.C2  to Ex.C6  and closed his evidence.

4.       On the other hand, to rebut the evidence of the complainant, the Opposite Party tendered into evidence the affidavit of Sh.S.S.Gill, Divisional Manager Ex.OP1 alongwith copies of documents Ex.OP2 to Ex.OP5 and closed the evidence on behalf of the Opposite Party.

5.       We have heard the ld.counsel for the parties and have carefully gone through the evidence on record.

6.       On the basis of evidence on record, ld.counsel for the Opposite Party Sh.Sanjay Kapoor, Advocate has vehemently contended that driving license of driver namely Rajinder Singh son of Surjan Singh  of vehicle number PB-02BQ-9474 belonging to the complainant, has been found to be fake. It is settled principle of law that when the driver of the insured vehicle was not holding a valid driving license,  the insurance company is under no liability to pay any insurance claim.  No doubt, in this case, the vehicle in dispute met with an accident and a sum of Rs.4,86,000/- was incurred on its repair, but however, in view of the fact that the driving license of Rajinder Singh driver was fake in view of the report received from DTO, Amritsar (Ex.OP3), the claim of the complainant has rightly been  repudiated by the Opposite Party vide repudiation letter, copy whereof is Ex.C2 on record. The complainant has got no case. In this connection, the Opposite Party has placed reliance upon Sardari & Ors. Appelalnts Vs. Sushil Kumar & Ors. Respondents 2008(2) CPC page 432 (SC), wherein it has been laid down that 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.  It has further been laid down that the Act, however, itself provides for the cases where the insurance company can avoid its liability. Avoidance of such liability would largely depend upon violation of the conditions of contract of insurance. Where the breach of conditions  of contract is ex-facie apparent from the records, the court will not fasten the liability on the Insurance Company. In certain situations, however, the court while fastening the liability on the owner of the vehicle may direct the Insurance Company to pay to the claimants the awarded amount with liberty to it to recover the same from the owner.  Further reliance has been placed on Geeta Bhatia, Appellant Vs. Oriental Insurance Company Limited & Anr. Respondents 2008(2) CPC page 558 (UT, Chandigarh), wherein it has been laid down that we are of the clear view that the repudiation of the claim by the respondent/ OPs for the reason that the driver was not holding effective driving license for driving two –wheeler is justified. In view of the aforesaid contentions, ld.counsel for the Opposite Party has vehemently contended that there is no deficiency in service on the part of the Opposite Party and the claim of the complainant has been rightly repudiated by the Opposite Party and as such, the complaint is liable to be dismissed and the same may be dismissed accordingly.

7.       However, in the case in hand, the only question involved in the matter has been whether the fake driving license of the driver was sufficient for repudiating the insurance  claim? However, reply to this query is answered in the negative. It is none of the case of the Opposite Party that the owner of the vehicle knew that driving license of the driver Rajinder Singh was fake. It was none of the duty of the owner of the vehicle to visit the office of DTO for determining the veracity of driving license held by the driver. In such a situation, the insurance claim can not be denied to the complainant simply because the driving license  was found to be fake subsequently that too during investigation conducted by the insurer while settling insurance claim.  Reliance in this connection can be had on United India Insurance Company Vs. Lehru AIR 2003 SC 1292, in this case the effect of a fake license was directly under consideration before the Supreme Court. What was held and is relevant for the present case  is extracted herebelow.

“When an owner is hiring a driver he will therefore have to check whether the driver has driving license. If the driver produces a driving license which on the face of it looks genuine, he owner is not expected to find out whether  the license has in act been issued by a competent authority or not. The owner would then take the test of the driver. If he finds that the driver is competent to driver the vehicle, he will hire the driver. We find it rather strange that insurance companies expect owners to make enquiries with RTO’s which are spread all over the country, whether the driving license shown to then is valid or not. Thus where the owner has satisfied himself that the driver has a license and is driving competently there would be no breach of section 14((2)(a)(ii). The insurance company would not then be absolved of liability. If it ultimately turns out that the license was fake the insurance company would continue to remain liable unless they prove that the owner/ insured was aware or had noticed that the license was fake and still permitted that person to drive.

Further reliance in this connection can be had on Oriental Insurance Company Limited Vs. Meena Variyal, IV (2007) ACC 335 (SC), wherein it has been laid down that mere absence of or production of fake or invalid driving license or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third party. The insurance company to avoid liability, must not only establish the available defence raised in the proceeding concerned but must also establish breach on the part of the owner of the vehicle for which the burden of proof would rest with the insurance company. Whether such a burden had been discharged, would depend upon the facts breach on the part of the insured concerning a policy condition, the insurer would not be allowed to avoid its liability towards the insured unless the said beach of condition is so fundamental as to be found to have contributed to the cause of the accident. This                 view of Hon’ble Supreme Court has been followed in the latest jugement of Hon’ble Apex Court in case Lakhmi Chand Vs. Reliance General Insurance II (2016) CPJ 3 (SC), wherein it has been held that  it becomes very clear from a perusal of the above mentioned case law of this Court that  the insurance company, in order to avoid liability must not only establish  the defence claimed in the proceedings concerned, but also establish breach on the part of the owner/ insured of the vehicle for which the burden of proof would rest with the insurance company. In the instant case, the respondent- company has not produced any evidence on record to prove that the accident occurred on account of the overloading  of passengers in the goods carrying vehicle. Further, as has been held in the case of B.V.Nagaju (supra) that  for the insurer to avoid his liability, the breach of the policy must be so fundamental in nature that it brings the contract to an end. In the instant case,  it is undisputed that the accident was infact caused on account of the rash and negligent driving of the offending vehicle by its driver, against whom a criminal case vide FIR No. 66 of 2010 was registered for the offences referred to  supra under the provisions of the IPC. These facts have not been taken into consideration by  either the State Commission  or National Commission while exercising their jurisdiction and setting aside the order of the District Forum. Therefore, the judgement and order of  the National Commission dated 26.4.2013 passed in the Revision Petition No. 2032 of 2012 is liable to be set aside, as the said findings recorded in the judgement are erroneous in law.

8.       From the aforesaid discussion, it transpires that the claim of the complainant has been wrongly repudiated by the Opposite Party. Opposite Party is held to be deficient in service. It is not disputed that the complainant has incurred an expenses of Rs.4,86,000/- on the repair of the vehicle in dispute and has filed the claim with the Opposite Party for the said amount which has wrongly been repudiated by the Opposite Party. As such, the complainant is entitled to the amount of Rs.4,86,000/- as insurance claim from the Opposite Party and the complaint stands allowed accordingly. The Opposite Party is directed to pay the insurance amount of Rs.4,86,000/- alongwith interest @ 9% per annum from the date of filing the complaint until full and final recovery. The costs of litigation are assessed at Rs.3000/-. Compliance of this order be made within 30 days from the receipt of copy of the order; failing which, the complainant shall be at liberty to get the order executed through the indulgence of this Forum.Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room. Case could not be disposed of within the stipulated period due to heavy pendency of the cases in this Forum.

Announced in Open Forum