NEW INDIA ASSURANCE CO. LTD. versus MANDAR MADHAV TAMBE AND ORS.

Citation: [1995] SUPP. 6 S.C.R. 687 · Decided: 14-12-1995 · Supreme Court of India · Bench: S.P. BHARUCHA, B.N. KIRPAL · Disposal: Appeal(s) allowed
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Judgment (excerpt)

NEW INDIA ASSURANCE CO. LTD. 
A 
v. 
MANDAR MADHAV TAMBE AND ORS. 
DECEMBER 14, 1995 
[S.P. BHARUCHA AND B.N. KIRPAL, JJ.] 
B 
Motor Vehicle Act, 193!)-Sections 96(2)(b)(ii), 2(5-A) & Bombay 
Motor Vehicle Rules, 195r>-Rule 16--0btaining driving licence during the 
period of disqualification-Wliether company is entitled to invoke the 
provision-Special provision in the insurance Policy-Whether the insurance C 
Policy absolves the insurance Company of any liability. 
WORDS & PHRASES : 
Driving Licenc~Meaning of-Section 2(5-A), Motor Vehicle Act, 
~ 
D 
An accident occurred involving two scooters. Respondent No. 1 filed 
an application before the Motor Accident Claims Tribunal for compensa-
tion. The respondent No. 3 had a learner's licence, which had expired one 
and half year before the accident. Therefore, when the accident took place E 
Respondent No. 3 was neither holding a driving licence nor holding a 
learner's licence. Soon after the accident he obtained a fresh learner's 
licence and within two days obtained a driving licence. The Tribunal made 
an award directing respondent Nos. 1 to 3 including the insurance Com-
pany, to jointly or separately pay the amount awarded together with 
interest at the rate of 6% per annum. On appeal the High Court held that F 
the Act did not contemplate the grant of a permanent driving licence and 
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 
exclusion clause would not be applicable. 
Being aggrieved by the judgment of the High Court, the ap1iellant G 
filed Petition for Special Leave to Appeal. The two questions which arise 
for consideration in this appeal are: (i) Whether the appellant company 
is entitled to invoke the provisions of Section 96(2)(b)(ii) of the Motor 
Vehicle Act (ii) Whether the exclusion clause in the Insurance Policy 
absolves the appellant company of any liability. 
687 
H 
688 
SUPREME COURT REPORTS [1995] SUPP. 6 S.C.R. 
A 
Allowing the Appeal, this Court 
B 
HELD : 1. A valid driving licence as contemplated by the Motor 
Vehicle Act would be one, which is issued in accordance with the provisions 
of chapter II of the Motor Vehicies Act, 1939, after a driving test has been 
held. [691-F] 
2. A person would be regarded as being dnly licenced only if he has 
obtained a licence under Chapter Hof the Motor Vehicles Act and a person 
who has obtained a temporary licence which enable him to learn driving 
cannot be regarded as having been duly licencesed. (692-FJ 
C 
United India Insurance Co. Ltd. v. 
Tilak Ram, (1985) ACJ 481 
overruled. 
3. The use of the words "permanent driving licence" in the insurance 
policy was to emphasise that a temporary or a learner's licence holder 
D 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 
accident must be one who holds a 'driving licence' within the meaning of 
Section 2(5A) of the Act. (693-C] 
4. Insurance Company, in case of an accident, would be liable only 
E if a person holding a valid driving licence or a permanent driving licence 
"other than a learner's licence" was driving the vehicle. (693-A] 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3486/86. 
From the Judgment and Order dated the 5th February, 1986 of the 
F 
High Court of Judicature at Bombay in First Appeal No. 965 of 1984. 
G 
S.M. Suri and Pramod Dayal for the Appellants. 
M.D. Adkar, S.D. Singh and Ejaj Maqbool for Respondent No. 1, 
B.N. Naik and A.M Khanwilkar for Respondent No. 2. 
The following Order of the Court was delivered : 
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 compensation awarded to respondent No. l who had 
H suffered some injuries as a result of an accident. 
NEW INDIAASSURANCE CO. LTD. v. M.M. TAMBE 
689 
On 4th July, 1979, an accident occurred iovolving two scooters. One A 
scooter No. (MTM 6327) was being driven by respondent No. 1 (the 
claimant) and the other scooter (BYZ 5348) was being driven by respon-
dent 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. 
B 
The appellant contested the said application. It was contended on its 
behalf that on 22nd July, 1977, respondent No. 3
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