IFFCO TOKIO GENERAL INS CO LTD v. ROSHAN LAL & ORS

1. The present Appeal has been filed on behalf of the Appellant under Section 173 of the Motor Vehicle Act, 1988 [hereinafter referred to as ‘MV Act’] impugning the Award dated 06.12.2018 modified by Order dated 08.01.2019 titled Roshan Lal & anr. v. Rakesh & Ors. [hereinafter referred to as “Impugned Award”] passed by the learned Presiding Officer, MACT, Rohini Courts, New Delhi.

2. Learned Counsel appearing on behalf of the Appellant, at the outset, submits that the challenge in the present Appeal is limited to one aspect, that no recovery rights were granted by the learned MACT against the driver and the owner of the offending vehicle, who are Respondent Nos. 3 and 4.

3. None appears on behalf of the Respondents despite service.

4. Briefly, the facts are that on 28.07.2009, the deceased was going on a motorcycle along with a friend. The motorcycle met with an accident with a three-wheeler scooter [TSR] (hereinafter referred to as “offending vehicle”). The offending vehicle was being driven by Respondent No.3, when it hit the motorcycle of the deceased from the opposite direction and as a result of the collision the deceased and his friend fell on the road and sustained injuries. The deceased was taken to the hospital for treatment where he succumbed to injuries on 29.07.2009.

5. The deceased was a 20 year old mechanic earning Rs. 15,000 per month from doing private repair work by repairing Auto, Scooter and Motorcycle(s). The Claim Petition was filed before the learned MACT being MAC Petition No. 4325/19. The claim was contested and an Impugned Award dated 06.12.2018 as modified by Order dated 08.01.2019 was passed by the learned MACT. By the Impugned Award, the directions were passed to make payment of compensation in the sum of Rs. 6.68 lakhs along with interest @ 9%.

6. As stated above, the challenge in the present Appeal is limited to the ground that no recovery rights have been granted to the Appellant against the owner and the driver of the offending vehicle, Respondent Nos. 3 and 4 respectively. 6.[1] Although service was effected on the Respondent Nos. 3 and 4, none have appeared on behalf of the Respondent Nos. 3 and 4 for the last several dates. Accordingly, the Respondents are proceeded ex-parte.

7. Learned Counsel appearing on behalf of the Appellant has submitted that the driving license held by Respondent No. 3 was for Motorcycle and Light Motor Vehicles (commercial) only and not a three wheeler (TSR), as was submitted by the Respondent No. 3. It is contended by the learned Counsel for the Appellant that a separate license is required for driving of a three wheelers/TSR. 7.[1] Learned Counsel further submits that this contention was raised by the Appellant before the learned MACT, however, the contention was rejected.

8. Learned Counsel for the Appellant submits that the learned Tribunal has erred in going into a discussion on the difference between Light Motor Vehicle (LMV) and Light Goods Vehicle (LGV). Learned Counsel has relied upon the judgment of the Supreme Court in Mukund Dewangan v. Oriental Insurance Company Ltd[1], to contend that the Supreme Court has held that when a driver is holding a driving license which is valid for a LMV, whereas the vehicle involved is LGV, the insurance company is not entitled to any recovery rights.

9. Learned Counsel for the Appellant has further contended that the finding as given by the learned MACT that a person who had license to drive a light motor vehicle could also have the ability to drive a three wheeler or TSR is not correct. In this behalf, learned Counsel seeks to rely upon the judgment dated 10.02.2023 passed by a Coordinate Bench of this Court in HDFC ERGO General Insurance Co. Ltd. vs. Bindu Paswan & Anr[2] wherein the Coordinate Bench gave a finding that the Tribunal ought not to have presumed that a person holding a licence for a LMV (Comm) was automatically competent to drive a two-wheeler. The Coordinate Bench also emphasized that the skills and licence requirements for the two categories are distinct under the Motor Vehicles Act.

10. This Court has examined the Impugned Award. It is apposite to set out paragraphs 26 to 29 of the Impugned Award where this issue is discussed. The learned Tribunal held that the TSR falls in the category of a light motor vehicle and thus, the driving license for a commercial Light Motor Vehicle [LMV] [Comm.] was the valid license. Thus, it was held that the Insurance Company is not liable to claim breach of terms and conditions of the insurance policy. Reliance has also been placed on a circular of the Ministry of Road Transport and Highways, Government of India dated 16.04.2018 wherein the 2 categories of light motor vehicle licenses have been done away with. The relevant extract of the Impugned Award is below:

was holding a driving licence which was valid for LMV, whereas the vehicle involved is light goods vehicle (LGV), the insurance company is not entitled to any recovery rights. Similar view has been taken by Hon'ble Delhi High Court in "New India Assurance Company Limited Vs. Subhash Rastogi & Ors.", MAC APP No. 438/2009 decided on 25.07.17 and in another decision in the case of " Ram Narayan Verma Vs. Rajani & Ors. (Reliance General Insurance Company Ltd.), MAC APP No. 478/2017 decided on 27.07.17.

29. Furthermore, the difference between the category of LMV(NT) and that of LMV (Commercial) has been done away with by Ministry of Road Transport and Highways, Government of India vide its Circular No. RT- 11021/44/2017-MVL dated 16.04.2018, while following the dictum of law laid down by Hon'ble Apex Court in Mukund Dewangan's case (supra). That being so, the insurance company is held liable to pay the compensation amount to the petitioners. It cannot be allowed to escape from its liability to indemnify the insured so far as payment of compensation amount is concerned. Hence, it is held that the insurance company is liable to pay the compensation amount as it is duty bound to indemnify the insured under the law. Issue no. 2 is decided accordingly.” [Emphasis supplied]

11. An examination of the provisions of Section 10 of the MV Act shows that licenses are issued in 7 categories in terms of Section 10 of the MV Act. Section 10(2)(d) of the MV Act provides that a license can be issued to drive a motor vehicle categorised as a light motor vehicle. Section 2(21) of the MV Act defines light motor vehicle to be a transport vehicle category which when unladen, has a weight of less than 7,500 kgs. Section 2(21) and Section 10(2) of the MV Act are set out below: