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PETITIONER: NEW INDIA ASSURANCE CO. LTD.

       Vs.

RESPONDENT: MANDAR MADHAV TAMBE & ORS.

DATE OF JUDGMENT14/12/1995

BENCH: BHARUCHA S.P. (J) BENCH: BHARUCHA S.P. (J) KIRPAL B.N. (J)

CITATION:  1996 AIR 1150            1996 SCC  (2) 328  1996 SCALE  (1)400

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      This is an appeal by special leave against the judgment of the  Bombay High  Court upholding  the liability  of  the appellant  Insurance  Company  to  pay  the  amount  of  the appellant  Insurance   Company  to   pay   the   amount   of compensation awarded  to respondent  No.1 who  had  suffered some injuries as a result of an accident.      On 4th  July, 1979,  an accident occurred involving two scooters. One  scooter  No.(MTM  6327)was  being  driven  by respondent No.1  (the claimant )and the other (BYZ 5348) was being driven  by  respondent  No.3.  As  a  result  of  this accident respondent No.1 suffered some injuries and he filed an application before the Motor Accident Claims Tribunal for compensation.      The appellant  contested the  said application.  It was contended on  its behalf that on 22nd July, 1977, respondent No.3 had  obtained a learner’s licence, which enabled him to drive for  the purpose of learning to drive. The validity of this learner’s  licence had  expired on 21st November, 1977. When the  accident took  place on 4th July, 1979, respondent No. 3  was neither holding a driving licence as contemplated by the  Motor Vehicles  Act, 1939,  nor  was  he  holding  a learner’s licence.  It appears  that soon after the accident respondent No.  3 obtained  a fresh learner’s licence on 7th July, 1979  and thereafter,  on 9th  July, 1979,  obtained a driving licence.      The Motor  Accident Claims  Tribunal,  vide  its  award dated 2nd  June, 1984, came the conclusion that the accident had occurred  due to  the negligence  of respondent No.3. It found that  respondent No.1  was entitled to compensation of Rs. 2,60,000/-.  An award  was accordingly  passed directing respondents 1 to 3 therein,including the appellant Insruance company, to  jointly  or  separately  pay  the  said  amount together with interest at the rate of 6% per annum.      The appellant  filed an  appeal against the said award.

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The main  contention which  was not duly licensed to drive a scooter, and  therefore, in  view of  the provisions  of the Motor Vesicles Act and clause which had been inserted in the Insurance Policy,  the insurance company was absolved of all liability. This  exclusion clause  in the  policy which  the appellant company relied upon, is follows:      "Provided that  the person driving holds      a valid  driving licence  at the time of      the accident  or had  held  a  permanent      driving licence  (other than a learner’s      licence) and  is not  disqualified  from      holding such a licence."      The High  Court came to the conclusion that the Act did not contemplate the grant of a permanent driving licence. It then proceeded  to hole  that the  term ‘duly  licensed’  in section 96(2)(b)(ii)  of the Act would include the holder of a learner’s  licence if he had once held such a licence then the aforesaid exclusion clause would not be Applicable. While granting leave to appeal this Court made it cleat that the leave  was being  granted  on  the  condition  that  the appellant herein  herein would pay the amount awarded to the claimant, irrespective of the result of the case.      On behalf of the appellant it has been contended by Mr. Suri  that  at  the  time  when  the  accident  of  occurred respondent No.3  did not hold any licence. This being so the aforesaid  provisions  in  the  insurance  policy  and  also Section 96(2)(b)(ii)  of the  Act absolved  the appellant of any liability.      Learned counsel  for the  respondent  relied  upon  the observations of  the judgment  under appeal  and also  on  a similar view  taken in  the decision  of the  High Court  of Himachal Pradesh  In United Insurance Company Lty. Vs. Tilak Ram &  Ors. 1985  ACJ 481  and submitted observations of the judgment under  appeal and  also on  a similar view taken in the decision of the High Court of Himachal Pradesh in United India insurance  Company Ltd.  vs. Tilak Ram and others 1985 ACJ 481  and submitted that inasmuch as respondent no.3. had held a  learner’s licence at one point of time the insurance company was  liable to  pay the amount of compensation which sad been award.      The two questions which arise for consideration in this appeal  are,  firstly.  whether  the  appellant  company  is entitled to invoke the provisions of Section 96(2)(b)(ii) of the said  Act, secondly  whither the  above quoted exclusion clause  in  the  insurance  policy  absolves  the  appellant company of any liability in the present case.      In order  to appreciate  the first  contention,  it  is necessary to refer to appreciate the first contention, it is necessary to appreciate the first to the relevant provisions of the  said Act. Section 96(2)(b)(ii), on which reliance is placed by the appellant, reads as under:      "(2) No  sum  shall  be  payable  by  an      insurer under sub-section (I) in respect      of any  judgment unless  before or after      the commencement  of the  proceedings in      which  the  judgment  is  court  of  the      bringing  if   the  proceedings,  or  in      respect   so long as execution is stayed      thereon  pending   an  appeal;   and  an      insurer to  whom notice  of the bringing      of any  such  proceedings  is  so  given      shall be   entitled  to be  made a party      thereto and  to defend the action on any      of the following grounds, namely:      (a)----------------

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    (b) That  there has  been  breach  of  a      specified condition of the policy, being      one of the following conditions, namely:      (1)----------------------------      (ii) a  condition exclusing driving by a      named person  or persons  or by a person      who is  not  duly  licenced  or  by  any      person  who  had  been  driving  licence      during the  period of  disqualification:      of"        This clause, inter alia, uses the expression "driving licence" which  therm has  been defined  in Section 2(5A) of the Act as follows:      "Driving  Licence"  means  the  document      issued by  a competent  authority  under      Chapter  II   authorising   the   person      specified  therein   to  drive  a  motor      vehicle  or   a  motor  vehicle  of  any      specified class or description."          Section  3 inter alia provides that no person shall drive motor  vehicle unless  him. Section 7 provides for the grant of  a driving  licence  and  sub-section  (6)  thereof states that  no driving  licence  shall  be  issued  to  any applicant unless  he passes,  to  the  satisfaction  of  the licensing authority,  the test  of competence  to  drive  as specified in  the 3rd Schedule. It is clear, therefore, that a valued  driving licence  as contemplated  by the  said Act would be  one id issued in accordance with the provisions of chapter II  of the Motor Vehicles Act, 1939, after a driving test hes  been held.  A person  who holds  only a  learner’s licence  is   one  who   has  not  taken  the  driving  test successfully. Chapter  II of  the Acts  does  not  made  any mention of  a learner’s  licence,except in  Section 21(2)(c) which enables  the State  Government to  frame rules,  inter alia,  for  the  issue  of  temporary  licences  to  persons receiving instruction in driving. It is in view of this that in the  Bombay Motor  Vehicles Rules  a permission (Rule 16) has been made, the relevant portion of which is as under:      "16.Learner’s driving licence-         (i) .  Sub-Section (I)  of Section  3      shall not  apply to any person driving a      motors vehicle  in a public place during      the course  of receiving  instruction or      gaining experience  in driving  with the      object of  presenting  himself  for  the      test  required  by  sub-section  (6)  of      Section 7 so long as -         (i) the  driver is  the holder  of  a      learner’s driving  licence in Eorn L Lt.      to those  rules entitling  him to  drive      the vehicle.      (ii) + + + +      (iii) there is besides the driver in the      vehicle  as  instructor  a  person  duly      licenced  to   drive  the   vehicle  and      sitting in such a position as to be able      readily to stop the vehicle."      From the  aforesaid it  is clear that what was obtained by respondent  No.3 from  the authorities  under the Act was not a  licence within  the meaning  of Section  2(5A) of the said Act. He had obtained a learner’s licence allowed him to be on  the road  subject to  his fulfilling  the  conditions contained therein.  One of the important conditions was that if he was driving a motor vehicle then there must be besides him in  the vehicle  as an instructor a person duly licenced

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to drive  the vehicle and sitting insuch a position as to be able readily  to stop  the vehicle."  It is  clear from this that two  learners by  themselves cannot be in one car which is which  is being  driven by  one of  them. If  the learner having a learner’s licence under the rules is to drive a car then he  must have  sitting besides  in a person who is duly licensed. This  clearly shows  that a  "driving licence"  as defined in  the Act  is different  from a  learner’s licence issued under  Rule 96.  In other  words, a  person would  be regarded as  being duly  licensed only  if he has obtained a licence under  Chapter II  of the  Motor Vehicles  Act and a person who  has obtained  a temporary  licence which enables him to  leant driving cannot be regarded as having been duly licensed. The  decision of  the single judge of the Himachal Pradesh High  Court in United India insurance Company’s case (supra) to  which he  hes taken a contrary view must be held to have been incorrectly decided.       Apart  from the  fact that  a learner  having  such  a licence  would   not  be  regarded  as  duly  licensed,  the aforesaid clause in the insurance policy makes it abundantly cleat that  the  insurance  company,  in  the  event  of  an accident, would be liable only if the vehicle was being by a person holding  a valid  driving licence  or    a  permanent driving licence  "other  than  a  learner’s  licence".  This clause specifically  provides that  even if  respondent No.3 had held  a current  learner’s licence  at the  time of  the accident, the  appellant would not be liable. In the present case it is case it is clear that the respondent No.3 did not have a  permanent learner’s  licence before  the date of the accident and  he had  held only  a learner’s  licence and it leaped nearly  two years before the accident. The High Court observed that  the Act  did  not  contemplate  a  "permanent diving licence"  because a driving licence is valid only for a certain period after  which it has to be renewed. This may be so,  but the use of the words "permanent driving licence" licence"   in the  insurance policy  was to  emphasis that a temporary or a learner’s licence holder would not be covered by the  insurance policy.  The intention  and meaning of the policy clearly is that the person driving the Vehicle at the time of  the accident  must be  one  who  holds  a  ‘driving licence’ within  the meaning  of Section  2(5A) of  the Act. This being  so, we are unable to with the conclusions of the High that  the appellant  was liable to pay the amount which had been  award  in  favour  of  respondent  No.1.  For  the aforesaid reasons,  the appeal  is allowed but with no order as to  costs. Having  regard to the condition imposed at the time of  the grant of special leave that irrespective of the outcome of  this appeal,the  amount awarded  will be paid by the appellant  to the  claimants, no  other  relief  can  be granted to the appellant.