National Insurance Company Ltd. vs Kushal Singh and Others

Deepak Gupta, J.—In this appeal by the Insurance Company two points have been raised. Firstly, that the driver was driving a transport vehicle and since his licence was not endorsed to drive a transport vehicle he was not holding an effective driving licence and secondly that the vehicle had been transferred by the owner, who had taken out the Insurance Policy in favour of another person and hence the Insurance Company is not bound to indemnify the insured or to pay the compensation.

As far as the first question is concerned, this Court in a number of cases including FAO No. 124 of 2007 titled as Oriental Insurance Company v. Lekh Ram and Ors. decided on 5.4.2011 has dealt with the matter in detail and following the judgment of the Apex Court in National Insurance Company Ltd. Vs. Annappa Irappa Nesaria and Others, has held that the endorsement to drive a transport vehicle is necessary only on or w.e.f 28.03.2001 and prior to that date such endorsement was not necessary. Therefore, this plea of the Insurance Company is rejected.

As far as the second contention is concerned, a Division Bench of this Court in FAO (MV) No. 43 of 1994 titled as Ishwar Lal Chaudhary and Anr. v. National Insurance Company and Ors. decided on 18.6.2008 held that even when a vehicle is transferred and the transfer is not reflected in the official record of the motor vehicle department both the actual owner as well as the registered owner are jointly and severely liable to pay the compensation. The Insurance Company in such circumstances cannot escape its liability to pay rd compensation to the 3 party. Reference in this behalf may be made to Vinod Kumar and Anr. v. Nirmala Devi and Anr. Latest HLJ 2009 (HP) 317. Therefore, the Insurance Company could not escape its liability.

In view of the above discussion, the appeal filed by the Insurance Company is rejected. No costs.