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Case Number

First Appeal No. 427 of 1984

Advocates

Rajni H.Mehta
K.F.Dalal

Judges

Hon'ble Mr. Justice Manharlal Bhikhalal Shah
Hon'ble Mr. Justice Ramesh Amritlal Mehta

Acts

Rule 16 of the Bombay Motor Vehicles Rules
Sub-section (6) of Section 7, (i)
(1) Sub-section (1) of Section 3
Motor Vehicles Act, 1939
MOTOR VEHICLES ACT
Traffic Act, 1960
Sub-rule (7)

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Smart Summary

Summary of Legal Opinion

Factual and Procedural Background

This is an appeal by the driver (appellant No. 1) and the owner of the offending vehicle (appellant No. 2) against an award of the Motor Accidents Claims Tribunal which had exonerated the insurer (respondent No. 2) from liability to indemnify the insured-owner on the ground that the driver did not hold a valid licence at the time of the accident.

Facts shown in the opinion: the driver possessed a learner's driving licence (Ex. 40) issued under Rule 16 of the Bombay Motor Vehicles Rules. The learner's licence was produced and exhibited by consent. The licence was for a heavy motor vehicle, was issued on 17 March 1980 and valid until 16 September 1980. The accident occurred on 11 May 1980 in Surat District, State of Gujarat. The offending vehicle was a motor truck (heavy motor vehicle) insured under a policy (Ex. 41) for the period 5 January 1980 to 4 January 1981.

The Tribunal had held the insurer not liable on the basis that the driver held only a learner's licence. The appellants appealed that decision.

Procedurally, an application (C.A. No. 1410 of 1984) was filed by the appellants to lead additional evidence to show that another person holding a permanent licence was present in the vehicle; the Court rejected that application as unnecessary for deciding the appeal and discharged the rule.

Legal Issues Presented

Whether the Motor Accidents Claims Tribunal was correct in holding that when the driver held only a learner's licence at the time of the accident, the insurance company was not liable to indemnify the insured owner.
How the policy provision (requiring the person driving to hold a valid driving licence at the time of the accident or to have held a permanent driving licence previously and not be disqualified) should be interpreted in relation to a learner's licence.

Arguments of the Parties

Appellants' Arguments

The driver (appellant No. 1) held a valid learner's licence (Ex. 40) issued under Rule 16 of the Bombay Motor Vehicles Rules, valid in the State of Gujarat and in force on the date and at the place of the accident (11 May 1980, Surat, Gujarat).
The licence covered the class of vehicle involved (heavy motor vehicle) and the insurance policy (Ex. 41) was also in force on the date of the accident.
Accordingly, the learner's licence should be treated as a valid driving licence for the purposes of attracting the insurer's liability under the policy.

Respondent (Insurer)'s Arguments

The insurer contended that a learner's driving licence cannot be regarded as a valid licence for the purpose of insurance coverage under the policy.
The insurer also argued that, in any event, the learner's licence was not a licence to drive a transport vehicle (implying that the policy's requirement was not met), and therefore the insurer was not liable under the policy.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Public Prosecutor v. Albert, 1972 A.C.J. 381 (High Court of Singapore)	Considered whether a learner/provisional licence holder who failed to display 'L' plates and whose provisional licence was expired was "permitted" to drive under rules for purposes of insurance clause; held non-compliance amounted to breach of policy.	The Court distinguished this authority on the facts: in that case there was a breach (no 'L' plates, expired provisional licence). In the present case there was no proven breach of licence conditions or policy terms, so the Singapore decision did not defeat insurer liability here.
Chanchalben & Ors. v. Shailesh Kumar Pandurao Thakore & Ors., 1974 ACJ 398 (Division Bench of this Court)	Held that the expression "the person driving holds a licence to drive" includes a learner driver (i.e., provisional/learner licences fall within the concept of "licence").	The Court found this ratio directly applicable and relied on it to support the proposition that a learner's licence is a licence for the purposes of the insurance clause; this case was used as primary domestic authority endorsing inclusion of learner drivers.
Rendlesham v. Dunne: Pennine Insurance Co. Ltd. (1964) 1 Lloyd's Rep. 192 (Westminster County Court)	Judicial support (in England) for treating a provisional licence as falling within the meaning of "licence" in insurance/driver contexts.	Referenced by the Division Bench in Chanchalben to support the view that 'licence' cannot be restricted to a full licence; used as comparative authority supporting the inclusion of provisional licences.
Ishwar Devi v. Reoti Raman and Anr., 1978 A.C.J. 340 (Allahabad High Court)	Interpreted policy language to hold that a learner licence is a valid licence and that even an expired learner licence may qualify where the clause speaks of "has held" a licence and the person is not disqualified.	Cited to show further judicial support for treating learner licences as valid for insurance purposes; used to corroborate the Court's interpretation (though the present case involved a valid learner licence, so less radical application of Ishwar Devi was required).

Court's Reasoning and Analysis

The Court examined the policy clause (Ex. 41) which sets two alternatives for attracting insurer liability:

The person driving holds a valid driving licence at the time of the accident; or
The person had held a permanent driving licence in the past (other than a learner's licence) and is not disqualified from holding or obtaining such a licence.

The Court reasoned as follows:

The first alternative requires that the driver hold a valid driving licence at the time of the accident, but it does not require that such a licence be a permanent (full) licence. Thus, a learner's licence is not excluded by the plain language of that alternative.
Under Rule 16 of the Bombay Motor Vehicles Rules, Section 3(1) of the Motor Vehicles Act does not apply to a person driving during instruction or while gaining experience if certain conditions are met (e.g., possession of a learner's licence in Form LLr, presence of an instructor licensed to drive, display of prescribed plates). The present learner's licence (Ex. 40) is in Form LLr and valid in Gujarat.
All factual preconditions for validity were satisfied in this case: the learner's licence was valid in time (expiry 16 September 1980), valid in place (State of Gujarat, where the accident occurred), and covered the class of vehicle involved (heavy motor vehicle).
The insurer bore the onus to demonstrate a breach of licence conditions or of policy terms sufficient to relieve it of liability. The insurer did not prove any such breach in this case (for example, non-display of plates or disqualification), and the Tribunal record did not establish such facts.
The Court relied on prior authorities (notably Chanchalben) holding that the phrase "holds a licence" includes learner/provisional licences, and on other supportive decisions (Ishwar Devi and the English decisions referred to) to interpret the policy provision in favour of treating a valid learner's licence as a "valid driving licence" for the first alternative of the policy clause.
Applying these principles to the facts, the Court concluded that the driver held a valid learner's licence authorizing him to drive a heavy motor vehicle at the time and place of the accident, and hence the insurer's attempt to escape liability on the ground that the driver had only a learner's licence failed.
Regarding the appellants' application to lead additional evidence (C.A. No. 1410 of 1984) to show presence of another person with a permanent licence, the Court held such additional evidence unnecessary: the insurer had the onus to prove any breach or disqualification, it had not done so, and therefore the proposed evidence was not required to decide the appeal; the application was rejected.

Holding and Implications

Core Ruling: The appeal is allowed: the insurer (respondent No. 2) is liable to indemnify the insured owner for the accident caused by the driver who held a valid learner's licence at the time of the accident.

Direct consequences and orders made by the Court:

The judgment and award of the Motor Accidents Claims Tribunal, insofar as it exonerated the Insurance Company (respondent No. 2), is quashed and reversed.
The Insurance Company (respondent No. 2) is held jointly and severally liable to satisfy the award of Rs. 30,000/- with running interest at the rate of 6% from the date of the application (16 July 1980) until deposit with the Tribunal, together with costs.
The Insurance Company is directed to deposit with the Tribunal the entire amount of compensation with interest and costs of both courts within three months from the date of the judgment.
Distribution/investment directions: 1/10th of the total amount (compensation, costs and interest) is to be paid to the claimant (widow of the deceased Ramavtar) by account-payee cheque in her name; the remainder is to be invested by the Tribunal in a long-term fixed deposit, with periodic interest payable to the claimant by account-payee crossed cheque. The Tribunal is directed to ensure remittance to the claimant residing in a distant interior village in Bihar.
The application to lead additional evidence (C.A. No. 1410 of 1984) was rejected as unnecessary; the rule was discharged; no order as to costs on that interlocutory application.

Implications for precedent and broader law: The decision rests on interpretation of the policy clause and established authorities that treat learner/provisional licences as falling within the term "licence" for purposes of insurance coverage. The opinion applies existing authorities to the facts; it does not announce a novel legal principle beyond those applications. The immediate effect is to reverse the Tribunal's exoneration of the insurer and to make the insurer responsible for satisfying the award as directed above.

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Maganbhai Sampatbhai Mali And Another v. Narkali, Widow Of Ramavtar Lochan Gupta And Another

1. This appeal by the driver and the owner of the offending vehicle is directed against the award of the Motor Accidents Claim Tribunal exonerating the insurer-respondent No. 2 from the liability to indemnify the insured-owner of the vehicle on the ground that the driver of the offending vehicle-appellant No. 1 was not holding a valid licence at the time of the accident. There is no dispute that the appellant-driver was holding a learner's licence for driving heavy motor vehicle. The learner's licence of the appellant No. 1 was produced by the insurer and exhibited at Ex. 40 by consent of the parties. The Tribunal has held that the insurer company would not be liable when the vehicle was driven by a person holding a learner's licence.

2. Therefore the question is whether the Tribunal was right in holding that when a driver holds only a learner's licence at the time of the accident whether the Insurance Co. would be liable to indemnity the insured owner. The policy Ex. 41 contained following provision as regards driver:

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 or obtaining such a licence.

3. Ex. 40 is the learner's licence and was valid and in force at the time of the accident. It is a licence issued under Rule 16 of the Bombay Motor Vehicles Rules and it is 'valid in the State of Gujarat'. The appellant No. 1 Maganbhai Sampatbhai Mali is licenced to drive as a learner heavy motor vehicle and this driving licence was valid upto 16th day of September 1980. It was issued on 17th March 1980. The accident had occurred on 11th May 1980. The vehicle in question was a motor truck (heavy motor vehicle) insured by its owner-appellant No. 2 with insurer-respondent No. 2. The period of insurance was from 5-1-1980 to 4-1-81. Thus on the date of the accident 11th May 1980 the policy was in force and the learner's licence was also in force and the licence was valid throughout the State of Gujarat and the accident has also occurred in the State of Gujarat.

4. Chapter II of the Motor Vehicles Act provides for licensing of drivers of motor vehicles and Section 3(1) reads as under:

3. Necessity for driving licence:

(1) No person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to himself authorizing him to drive the vehicle; and no person shall so drive a motor vehicle as a paid employee or shall so drive a transport vehicle unless his driving licence specially entitles him so to do.

5. Section 7 deals with grant of driving licence and Section 8 prescribes the form and contents of driving licence. Section 8(2) provides for different classes of vehicles which entitles holder of the driving licence to drive that class of motor vehicle and Form D is in respect of driving licence. However these are the provisions for permanent driving licence. Rule 16 of the Bombay Motor Vehicles Rules provides for learner's driving licence and it slates that Section 3(1) of the Act shall not apply to any person driving motor vehicle in a public place during the course of his instructions or of any experience in driving with the object of presenting himself for the test required by Section 7(6) of the Act.

Rule 16 Sub-rule (1)(i) to (iii) reads as under:

16. Learner's driving licence:

(1) Sub-section (1) of Section 3 shall not apply to any person driving a motor vehicle in a public place during the course of receiving instruction or of gaining experience in driving with the object of presenting himself for the test required by Sub-section (6) of Section 7,

(i) the driver is the holder of a learner's licence in Form LLr to these rules entitling him to drive the vehicle;

(ii) there is beside the driver in the vehicle as instructor a person duly licensed to drive the vehicle and sitting in such a position as to be able to stop the vehicle;

(iii) there is affixed both to the front rear of the vehicle a plate or card as set forth below:.

6. Sub-rule (7) has been deleted with effect from 31st May 1979 and is therefore not applicable in the present case. From L Lr of the learner's licence is set out in the present case. Form L Lr of the learner's licence is set out in the Schedule to the Rules. The present licence (Ex. 40) is in that form. It states that it is valid in the State of Gujarat and the classes of vehicles are shown in Clause (a) to (f) and the relevant applicable Clause (f) refers to 'heavy motor vehicle'. There is no separate learner's licence for heavy passenger motor vehicle or heavy goods vehicle. There is only one category of heavy motor vehicle and there are no separate categories of goods or passenger heavy vehicles. The form of the application is also in the same way confined to one category of heavy motor vehicle.

7. The contention of the respondent No. 2 Insurer is that the learner's driving licence of the driver-appellant No. 1 cannot be said to be a valid licence for the purpose of insurance coverage and in any case it was not a licence for driving a transport vehicle and, therefore, the Insurance Company is not liable under the policy. The relevant clause of the policy is quoted above. It is in two parts; namely;

(i) the person driving holds a valid driving licence at the time of the accident, or

(ii) had held a permanent driving licence other than a learner's licence and is not disqualified from holding or obtaining such a licence.

8. Thus at the time of the accident the driver is required to hold a valid driving licence and such licence is not necessarily a permanent driving licence. The second contingency is that at the time of the accident the driver had no valid licence in force but had in past held a permanent driving licence and is not disqualified from holding or obtaining such a licence. Therefore at the time of the accident even though driver may not hold an effective driving licence but if he had held in past a permanent driving licence the Insurance Company would still be liable to indemnify the owner, if such person without an effective licence is not disqualified from holding such a licence. But this condition of permanent driving licence is applicable only in case of a person who had held the permanent driving licence in the past and it was not effective at the time of the accident. At the time of the accident if the person has valid driving licence that is sufficient to attract the liability of the Insurance Company and such driving licence is not necessarily a permanent driving licence and a learner's licence is not excluded. Learner's licence is also a driving licence and a valid driving licence. It cannot be said that learner's licence is not a valid driving licence. This driving licence which is valid not only having been issued by the competent authority under the law, but also valid in point of time and place (valid at the time of the accident and valid at the place of the accident). The accident had occurred on 11th May 1980 and the learner's licence was valid upto 16th September 1980. The accident had occured in Surat District in State of Gujarat and the learner's driving licence is valid throughout the State of Gujarat. It is a licence to drive a heavy motor vehicle. The offending vehicle which is the insured truck is a heavy motor vehicle. Thus all the conditions of validity of a driving licence are fulfilled, and the appellant No. 1-driver was holding such a valid driving licence while driving the offending vehicle at the time of the accident and, therefore the Insurance Company cannot escape the liability to indemnify the insured in respect of the present claim.

9. In the case of Public Prosecutor v. Albert see 1972 A.C.J. 381 the High Court of Singapore held in a criminal case where the accused was charged with an offence of using motor cycle without there being in force in relation to the user a policy of insurance in respect of third party risk. The accused was holding a driving licence which had already expired on 7th October 1969 and there being no 'L' plates displayed on the front and rear and he had a policy of insurance covering third party risk which was valid at the material date and the relevant clause read as follows:

Provided that the person driving is permitted in accordance with the licensing or other laws or regulations to drive the motor vehicle or has been so permitted and is not disqualified by order of a court of law or by reason of any enactment or regulation in that behalf from driving the motor vehicle.

10. This clause is, to some extent, similar to the present clauses in the policy. The question of law reserved for consideration of the court was whether or not a learner driver who drives his motor vehicle whilst in possession of an expired provisional driving licence and who failed to display 'L' plates or otherwise infringes the licensing rules or ether regulations governing learner drivers is guilty of an offence under the Act ? and it was held that if a person drives even during the period when his provisional driving licence is in force, his motor cycle on the road without displaying 'L' plates, he is not permitted in accordance with the rules to drive his motor cycle and, therefore, he has committed breach of the policy of insurance. In the present case there is no such breach of any rule or term of policy. The driving licence is in force and the Insurance Company has not proved breach of any terms of licence or of any rule.

11. In the case of Chanchalben and Ors. v. Shailesh Kumar Pandurao Thakore and Ors. 1974 ACJ 398 the Division Bench of this court had an occasion to consider the expression "the person driving holds a licence to drive the motor cycle" and had held that it includes not only fully qualified and regularly licensed driver but it also means a learner driver. The relevant observations of the Division Bench are as under:

The Form L Lr. appended to the said Rules also state that the applicant (who is to be named by him) is licensed to drive as a learner. Driving, therefore, is common both to a fully qualified driver as well as to a learner. Whereas a fully qualified driver drives a vehicle either for making an income or for pleasure, as in the case of an owner-driver, a learner drives a vehicle in order to learn driving. Therefore, both drive a motor vehicle with different objects in view. The difference in the objects with which they drive a vehicle cannot cloud the concept of driving in the case of a learner. For the reasons stated above, we are of the opinion that the expression 'the person driving holds a licence to drive the motor cycle' means not only a fully qualified and regularly licensed driver but it also means a learner driver. Mr. Vakil has invited our attention to a passage in Fire and Motor Insurance by E.R. Hardy Ivamy, 1968 Edition, at p. 231, under the caption 'Licence includes Provisional Licence' it has been stated that the expression 'licence' includes a Provisional licence. The aforesaid observation made by the learned author has been based upon the decision of the Westminster County Court in Rendlesham v. Dunne: Pennine Insurance Co. Ltd. (1964) 1 LLoyd's Rep. 192. In that decision Judge Herbeit of the Westminster County Court has held that the meaning of the word 'licence' cannot be restricted to 'full licence'. Indeed, his decision has been based upon Road Traffic Act, 1960 of Great British. The scheme of the Motor Vehicles Act, 1939 is largely similar to Road Traffic Act, 1960. Mr. Vakil has also invited our attention to Road Traffic Offences by G.S. Wilkinson, 5th Edition. At P. 196, it has been observed that the expression 'who helds or has held a driving licence' includes a driver who has once held a licence, even though such a licence was provisional. That observation has also made by the learned author on the strength of the aforesaid decision of the Westminster County-Court in Rendlesham v. Dunne. We have made reference to the aforesaid two books just to show that in my matter, which raise such questions, there is identical thinking in England also.

12. This ratio is clearly and directly applicable to the present case. It was also a case of a learner's licence and Insurance Company was held liable to indemnify the owner due to the accident committed by the negligence of the learner driver.

13. In the case of Ishwar Devi v. Reoti Raman and Anr. 1978 A.C.J. 340, the Division Bench of Allahabad High Court dealt with similar question on the following term in the policy:

Provided that the person driving holds a licence to drive the motor cycle or has held and is not disqualified for holding or obtaining such a licence.

14. This clause was much wider than the clause is our policy. On the interpretation of that clause, the learner licence was held to be a valid licence; even an expired learner licence was held to be a licence once held and the person is not being disqualified for obtaining or holding such a licence. In the present case the driver was holding a valid and effective learner licence. Therefore, there is no need to go to the extent to which Allahabad High Court had to go but the fact remains that Allahabad High Court has also held that learner licence was valid driving licence. In the present case the policy also makes a distinction between permanent licence and provisional licence. A provisional licence is a learner licence and that risk is covered if at the time of the accident even if a driver holds learner licence.

15. In view of the aforesaid discussion it is clear that the appellant driver was holding a valid learner licence to drive heavy motor vehicle and therefore the risk of accident caused by such a driver is covered by the policy of Insurance and, therefore, the respondent No. 2 insurer is liable to indemnify the appellants to satisfy the award.

16. In the result the appeal succeeds and is allowed and the judgment and award of the Motor Accidents Claims Tribunal, in so far as it exonerates the Insurance Company-respondent No. 2, is quashed and reversed and the Insurance Company-respondent No. 2 is held jointly severally liable so as to satisfy the award of Rs. 30,000/- with running interest at the rate of 6% from the date of the application i.e. 16th July 1980 till the amount is deposited with the Tribunal with costs throughout. The second respondent Insurance Company is directed to deposit with the Tribunal the entire amount of compensation with interest and costs of both the courts within three months from today. Out of the total amount of compensation costs and interest, 1/10th of the amount to be paid to the claimant widow of the deceased Ramavtar by an account payee cheque in her name and rest of the amount shall be invested by the Tribunal in long term fixed deposited and the periodical interest shall be paid to the claimant regularly by account payee crossed cheque in her name. The Tribunal shall see that the amount of compensation paid to her and the periodical interest is remitted to the claimant who is residing at a distant interior village in Bihar. Since the amount is required to be invested by the Tribunal, there is no question of any loan or over-draft or other facility being availed on the said amount.

17. Appeal is accordingly allowed with costs.

18. C.A. No. 1410 of 1984 is filed by the appellants for leading additional evidence. By this application an attempt is made by the driver and owner to lead additional evidence to show that at the time of the accident the driver was accompanied by another person holding a permanent licence. For that purpose reliance is also sought to be placed on the F.I.R. recorded contemporaneously showing the presence of Vasant Rao in the vehicle. The appellants propose to examine said Vasant Rao and to prove his permanent licence and his presence in the vehicle at the time of the accident. This application is opposed by the Insurance Company. We also do not feel that it is necessary for the applicants to lead this additional evidence to enable the court to pronounce the judgment. The onus is on the Insurance Company to establish its defence. It is for the Insurance Company to show and prove that there was any breach of rule or condition of the licence or condition of the policy so as to exonerate the Insurance Company from the liability. The Insurance Company has not raised such contention and not led such evidence and, therefore, there is no question of relating any such case and, therefore, this additional evidence is not at all necessary. The Insurance Company had already led the evidence in the trial court and also has this opportunity of cross-examining these additional witnesses. However, the Insurance Company has chosen to oppose this application. We do not feel that this additional evidence is necessary to enable us to pronounce the judgment. Therefore, this application is rejected. Rule is discharged. No order as to costs.

Maganbhai Sampatbhai Mali And Another v. Narkali, Widow Of Ramavtar Lochan Gupta And Another

Summary of Legal Opinion

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellants' Arguments

Respondent (Insurer)'s Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Maganbhai Sampatbhai Mali And Another v. Narkali, Widow Of Ramavtar Lochan Gupta And Another

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