Insurer Cannot Be Exonerated Only On Ground That Driver Did Not Possess Requisite Endorsement To Drive Offending Vehicle: Karnataka HC

The Karnataka High Court has recently set aside the award of a Motor Vehicles Tribunal which had exonerated the insurer only on the ground that the driver of the offending vehicle did not possess the requisite endorsement to drive the offending vehicle and had a licence to drive a light motor vehicle. 

A bench of Justice N S Sanjay Gowda of the Karnataka High Court was hearing an appeal under Section 173(1) of the Motor Vehicles Act preferred by the owner of the offending vehicle challenging the award of Rs.11,70,000/- granted for the death of one Govinda Rao.

It was argued that the owner's vehicle was not involved and assuming that the vehicle was involved, the insurer will have to be fastened with the liability, as the vehicle was insured. 

The Tribunal had exonerated the insurer only on the ground that the driver of the offending vehicle did not possess the requisite endorsement to drive the offending vehicle and that he possessed a licence to drive a light motor vehicle.

The High Court placed reliance on the dictum of the Supreme court in Mukund Dewangan vs. oriental Insurance Company Limited, wherein it was held that a person who has a driving licence to drive a light motor vehicle could also drive a transport vehicle that has an unladen weight less than 7500 kg and the insurance company will have to accept the liability to pay the compensation even if the driver of the offending vehicle did not possess the requisite endorsement to drive a transport vehicle.

Applying the above ratio, the High Court set aside the award and held that the insurance company was liable to satisfy the compensation.

Allowing the appeal, the High Court said that "the appellant would have to pay the interest for the delay period of 778 days on the compensation awarded by the Tribunal. He shall not, however, be liable to pay the compensation and also the interest upto the date of disposal of the claim petition by the Tribunal". 

The High Court directed transfer of statutory amount deposited by the appellant to the Tribunal. "The Tribunal shall pay the interest on the award amount for 778 days from out of this amount and refund, the excess amount, if any," it said. 

Cause Title-Sri V Nagaraju v. Smt. Sarojamma & Ors.

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