National Insurance Co. Ltd. v. Kripa Shankar Sharma & Ors.

1. The Appellant impugns judgment dated 07.03.2012 passed by the Motor Accidents Claims Tribunal (the Claims Tribunal) and seeks recovery rights from the insured on the ground that there was conscious and willful breach of the terms and conditions of the insurance policy by the insured as proved by the Appellant Insurance Company and therefore, the Appellant was entitled to recover the compensation paid to Respondent no.1. 2015:DHC:601

2. The Claims Tribunal dealt with the question of liability in paras 64 to 71 of the impugned judgment, which are extracted hereunder:

70. Further, dealing with permit, the Hon'ble High Court of Delhi has held that: “Turning to the second limb of argument i.e. issuance of permit to ply vehicle no. DL1G2715 on the date of the accident, the appellant insurance company did not summon any record from the relevant office of the Delhi Transport Authority that on the date of the accident, the vehicle did not have any permit to ply on the road. Here again, the insurance company failed to discharge the onus that there was breach of the condition of policy in this regard.”

71. Therefore, it cannot be said that the insurance company has proved breach of terms of policy by the insurer.”

3. It may be seen that the Appellant Insurance Company issued a notice requiring the owner, Respondent no.3 herein, to produce the driving licence of the driver and the permit of the vehicle. The Insurance Company further examined its surveyor as R3W[1] who proved the report R3W1/2 from the licensing authority, Mathura in Form no.55 which established that the driving licence was not issued by licensing authority, Mathura.

4. It is true that no effort was made to find out from the concerned Transport Authority that the owner did not possess any permit. But, in my view, the Appellant Insurance Company did whatever was in its power to prove that there was breach of the terms and conditions of policy as the driver was found to be driving the vehicle on the basis of fake licence. The onus therefore, shifted on the owner, Respondent no.3 to prove that it had taken all precautions to avoid breach of the terms and conditions of the insurance policy. In the circumstances, the Appellant ought to have been granted recovery rights against the owner of the offending vehicle, Respondent no.3 herein.

5. I am supported in this view by the judgment of this Court in New India Assurance Company Ltd. v. Sanjay Kumar & Ors., ILR (2007)

11 Delhi 733, wherein it was held as under:

6. The Appellant is hence, granted recovery rights. It is made clear that the Appellant should be entitled to compensation paid along with interest in execution of this very judgment without having recourse to independent proceedings for recovery.

7. The appeal is allowed in above terms.