JK was the owner of the Maruti Van bearing which was insured with Oriental Insurance Company. On 25.4.1996 at about 9.30 p.m. while returning from Gaya to Jehanabad the vehicle in question, driven by JK, caught fire due to mechanical reasons and due to the said fire the said vehicle was burnt beyond repair. An intimation of this accidental fire was made to the Oriental Insurance Company on 14.5.1996. With the said
intimation, the appellant also lodged a claim with the respondent for payment of damages. The Insurance Company as per its letter repudiated the said claim of the appellant solely on the ground that the driver did not have a valid licence at the time of the incident in question.
JK filed a complaint with the District Forum and the District Forum, after hearing the parties came to the conclusion that the accidental fire due to which the appellant’s vehicle got damaged was not caused due to any act of the appellant’s driver but was due to mechanical fault, therefore, it held the contention of the Insurance Company that the appellant’s driver did not hold a valid licence could not be a ground to repudiate the claim, accordingly, ordered the payment of damage, compensation and cost as stated herein
above.
In an appeal filed by the Insurance Company, the State Commission reversed the said judgment holding that the driver of the vehicle did not have a valid driving licence and his original licence was a fake which was inadvertently renewed by the District Transport Officer, therefore, held that the Insurance Company was justified in repudiating the claim of the appellant.
A revision petition filed by the appellant against the said judgment of the National Commission came to be dismissed by the National Commission by the impugned order wherein the National Commission placed reliance on a judgment of this Court in the case of New India Assurance Company Ltd., Shimla vs. Kamla &
Ors. (2001 4 SCC 342).
Against the above judgment of the National Commission, the appellant(JK) filed an Appeal before the Hon’ble Supreme Court (Appeal (civil) 4647 of 2003 judgement dt.17-07-2003) which observed as below:
“So far as the facts of this case are concerned, there is hardly any dispute, therefore, we can safely proceed on the basis that the vehicle in question was damaged due to a mechanical fault and no fault of the driver. For the purpose of argument, we may also proceed on the basis that the driver of the car did not have a valid driving licence.
Question then is : can the Insurance Company repudiate a claim made by the owner of the vehicle which is duly insured with the Company, solely on the ground the driver of the vehicle who had nothing to do with the
accident did not hold a valid licence ? Answer to this question, in our opinion, should be in the negative. Section 149 of the Motor Vehicles Act, 1988 on which reliance was placed by the State Commission, in our opinion, does not come to the aid of the Insurance Company in repudiating a claim where driver of the
vehicle had not contributed in any manner to the accident. Section 149(2)(a)(ii) of the Motor Vehicles Act empowers the Insurance Company to repudiate a claim wherein the vehicle in question is damaged due to an accident to which driver of the vehicle who does not hold a valid driving licence is responsible in any manner.
It does not empower the Insurance Company to repudiate a claim for damages which has occurred due to acts to which the driver has not, in any manner, contributed i.e. damages incurred due to reasons other than the act of the driver
Verdict: Insurance Company could not have repudiated the claim of the appellant. For the reasons stated above, this appeal succeeds, the impugned judgments of the National Commission and the State Commission are set aside and that of the District Forum is restored.
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