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Judgment
A.N. Divecha, J.—The short question arising in this appeal is whether or not the insurance company can escape its liability under the pretext
that the insured did not have a valid permit for plying his transport vehicle and that the insured did not have in his possession the certificate of fitness
as to its roadworthiness on the date of the accident more particularly when that was found to be the position on the date of issuance of the policy
of insurance.
The facts giving rise to the present appeal may be summarised thus: On 22nd February, 1981, a boy aged about 8 years met with a fatal
accident by hit of one truck bearing R.T.O. registration No. GTB 4205 (''the offending vehicle'' for convenience) belonging to the appellant and
driven by respondent No. 3 at the relevant time. The parents of the deceased victim of the accident filed their claim petition before the Motor
Accidents Claims Tribunal (Main) at Surat (''the Tribunal'' for convenience) claiming the damages in the sum of Rs. 9,999/- from the driver, the
owner and the insurer of the offending vehicle. They were arraigned in the proceeding as opponent Nos. 1, 2 and 3 respectively. The claim petition
was registered as Motor Accidents Claims Petition No. 258 of 1981. Since the claim was below Rs. 10,000/-, it was ordered to be decided on
affidavits and on the basis of the documentary evidence that may be produced on record. The necessary affidavits were filed by and on behalf of
the parties in the proceeding. The necessary documentary evidence was also produced. After hearing the parties, the Tribunal, by its judgment and
order passed on 20th February, 1982, accepted the claim petition to the extent of Rs. 8,000/- and ordered its recovery from the driver and the
owner of the offending vehicle and not from its insurer. The aggrieved owner of the offending vehicle has thereupon preferred this First Appeal
before this Court challenging the correctness of the judgment and order passed by the lower Tribunal.
The ground on which the lower Tribunal has chosen not to fasten the liability of the claim with the insurer was that the insured owner of the
offending vehicle did not possess on the date of the accident the fitness certificate for roadworthiness of the offending vehicle and also the permit
for plying his transport vehicle. Mr. Sanjanwala for the appellant has submitted that the defence based on absence of the certificate of
roadworthiness of the offending vehicle or absence of any permit to ply it on the road is not available to the insurer u/s 96 (2) of the Motor
Vehicles Act, 1939 (''the Act'' for brief). According to Mr. Sanjanwala, if the owner of the transport vehicle did not have any permit as required
u/s 22 of the Act, he would incur a penal liability u/s 123 thereof, but that does not furnish any ground to the insurer to avoid his liability under the
contract of insurance as provided in the Act. Mr. Gehani on the other hand has submitted that the insurer can certainly take up a defence in answer
to the notice of the claim petition served to him based on the ground that the vehicle in question did not possess any roadworthiness certificate or
did not possess the necessary permit for plying it on the road.
Section 96 (2) of the Act enumerates several defences available to the insurer of the vehicle involved in the accident covered by the contract of
insurance in answer to the notice of the claim petition served to him. These defences relate to cancellation of the contract, to use of the vehicle
contrary to a permit or for organised racing and speed testing, or for a purpose not allowed by the permit, or its driving by some person not
holding a driving licence or not qualified to hold a licence or concealment of a material fact or representation of the fact which was false in some
material particular at the time of obtaining the insurance coverage. No defence on the ground of absence of any certificate of fitness of the vehicle in
question or absence of any permit for plying it on the road by itself is available to the insurance company u/s 96 (2) of the Act. Absence of any
permit for plying a vehicle or absence of any certificate of fitness as to its roadworthiness can be a ground of defence provided the case is made
out that this factual position was concealed at the time of obtaining the insurance coverage with respect to the vehicle in question. It was the case of
the insurance company before the lower Tribunal that material particulars with respect to absence of the permit to ply the vehicle in question on the
road or absence of any certificate of fitness as to its roadworthiness were concealed by the insured at the time of obtaining the insurance coverage
with respect to the vehicle in question from the insurance company. No such was taken in the written statement filed by and on behalf of the
insurance company in the proceedings before the lower Tribunal. The use of the vehicle in question contrary to its permit is different from absence
of such permit. The use of the vehicle in question contrary to the permit is a ground of defence. It cannot be equated with absence of any such
permit. I am, therefore, of the opinion that such defence by itself is not available to the insurer of the vehicle in question, and as such it ought not to
have been used by the lower Tribunal to allow the insurance company to escape its liability with respect to the claim awarded to the claimants in
the case.
Insurance company can be fastened with the liability of the claim also on one more ground. It filed its written statement in the proceeding at Exh.
In para 4 thereof, it has contended that the vehicle was insured for the period from 25th September, 1980 to 24th September, 1981 but it was
driven without the fitness certificate and the road permit from the R.T.O. from 15th October, 1979. It would mean that on the date of the issuance
of the policy of insurance on 25th September, 1980, there was no valid permit with the insured for plying his vehicle. It is the case of the insurance
company itself that the vehicle was being plied without any fitness certificate and any road permit from 15th October, 1979. It thus becomes clear
that the vehicle was covered with insurance by the insurance company though it did not have any valid permit or any fitness certificate with respect
to its roadworthiness. After having accepted the insurance coverage despite absence of any valid permit or any fitness certificate as to
roadworthiness, it does not lie in its mouth to come out with a defence that the vehicle in question did not have any permit nor did it have any
certificate of fitness as to its roadworthiness.
Mr. Sanjanwala for the appellant has also submitted that the driver of the offending vehicle was not at all responsible for the accident in question
as he was not negligently driving it at the relevant time. This submission is not acceptable in view of the clear-cut evidence on record pointing the
finger of guilt of negligence towards the driver of the vehicle in question. The ocular account given by respondent No. 1 herein in his affidavit with
respect to his version of the accident in the light of the panchnama on record has been rightly accepted by the lower Tribunal. As against this, the
driver of the offending vehicle did not step into the witness-box for giving his version of the accident in question. In that view of the matter, no
interference is called for with respect to the finding of negligence recorded by the lower Tribunal against the driver of the offending vehicle holding
him responsible for the accident in question.
In the result, this appeal is partly accepted. Respondent No. 4 is also held liable to answer the award made in Motor Accidents Claims Petition
No. 258 of 1981 decided by the lower Tribunal on 20th February, 1982. The award of the lower Tribunal accordingly stands modified. There
shall be no order as to costs on the facts and in the circumstances of the case.