NEW INDIA ASSURANCE CO. LTD. versus SURESH CHANDRA AGGARWAL

Citation: [2009] 10 S.C.R. 885 · Decided: 10-07-2009 · Supreme Court of India · Bench: D.K. JAIN · Disposal: Appeal(s) allowed

Judgment (excerpt)

[2009] 10 S.C.R. 885 
; 
NEW INDIA ASSURANCE CO. LTD. 
A 
v. 
SURESH CHANDRA AGGARWAL 
(Civil Appeal No. 44 of 2003) 
JULY 10, 2009 
B 
[D.K. JAIN AND B. SUDERSHAN REDDY, JJ.] 
" 
Motor Vehicles Act, 1988: 
ss. 3,5 and 15(1), proviso - Renewal of driving licence -
c 
Effective date - HELD : If a licence is renewed within 30 days 
of its expiry, renewal dates back to the date of its expiry- But, 
when an application for renewal of a licence is fifed after more 
than 30 days of its expiry, the proviso to s. 15(1) is attracted 
and the licence is renewed only with effect from the date of D 
its renewal and in the interregnum there is no effective licence 
- In the instant case, proviso to s.15(1) is attracted and there 
was no valid and effective licence on date of accident -
Besides, the driver having died in accident, his driving licence 
could not have been renewed thereafter - Special condition 
E 
of insurance policy having been violated, the insurer was not 
liable to indemnify the claimant for the loss suffered due to 
damage of insured vehicle -
Judgment of National 
Commission allowing the claim set aside - Consumer 
Protection Act, 1986 - Insurance of motor car. 
F 
A comprehensive insurance policy in respect of a 
motor car of the complainant was valid from 31st May, 
1991 to 30th May, 1992. The said vehicle met with an 
accident on 29th February, 1992 resulting in death of the 
driver and extensive damage to the car. The claimant G 
lodged a complaint for Rs.1 lac with the appellant-insurer, 
1 
which repudiated the claim on the ground that special 
condition no. 5 of the insurance policy was violated as 
the driver did not have a valid and effective driving licence 
885 
H 
886 
SUPREME COURT REPORTS 
[2009] 10 S.C.R. 
A on the date of the accident as his licence was valid only 
up to 25th October, 1991. The claimant filed a complaint 
before the District Consumer Disputes Redressal Forum 
contending that the licence was valid from October 26, 
1988 to October 25, 1991 and then from 23rd March 1992 
B to 22nd March, 1995. The District Forum allowed the 
claim. The appeal of the insurer was dismissed by the 
State Commission and its revision was also dismissed by 
the National Commission. Aggrieved, the insurer filed the 
appeal. 
c 
Allowing the appeal, the Court 
HELD: 1.1. From a plain reading of s.15 of the Motor 
Vehicles Act, 1988, it is clear that if an application for 
renewal of a driving licence is made within 30 days of the 
.. 
D date of its expiry, the licence continues to be effective 
• 
and valid without a break as the renewal dates back to 
the date of its expiry; whereas, when an application for 
renewal is filed after more than 30 days of its expiry, the 
proviso to sub-section (1) of s. 15 of the Act gets 
E attracted and the licence is renewed only with effect from 
the date of its renewal and, thus, in the interregnum 
between the date of expiry of the licence and the date of 
its renewal, there is no effective licence in existence. The 
provision is clear and admits of no ambiguity. In the 
F instant case, as per the certificate issued by the licensing 
authority, the driving licence of the deceased driver had 
expired on 25th October, 1991 and it was renewed with 
effect from 23rd March, 1992. Thus, it stands proved that 
the driver did not hold an effective and valid driving 
G licence, as required in the terms and conditions 
governing the policy, on the date of accident i.e. 29th 
February, 1992. [Para 16] [893-C-H; 894-A] 
H 
1.2. Furthermore, the claimant not only committed 
breach of the terms of the policy, he also violated 
NEW INDIA ASSURANCE CO. LTD. v. SURESH 
887 
CHANDRA AGGARWAL 
provisions of s. 5 of the Act by entrusting the vehicle to A 
a person who did not hold a valid licence on the date of 
the accident. It is also significant to note, although it was 
not pleaded by the appellant, that the licence could not 
have been renewed w .e.f. 23rd March, 1992 after the 
death of the licence-holder on 29th February, 1992. B 
Therefore, the appellant was not liable to indemnify the 
claimant for the loss suffered by him in the accident of 
' 
the insured vehicle. The decision of the National 
Commission cannot be sustained and is set aside. 
[Para 17 and 21] [894-B-D; 895-G] 
c 
National Insurance Co. Ltd. vs. Jamail Singh & Ors. JT 
2001 (Suppl.2) SC 218, relied on. 
New India Assurance Company Ltd. vs. Prabhu Lal 
' 
(2008) 1 SCC 696, referred to. 
D 
• 
Ashok Gangadhar M

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