Principle Of Pay And Recover To Be Applied In Cases Where Driver's License Not Proved: Karnataka High Court

The Karnataka High Court has held that in cases where it is not proved that deceased driver of a vehicle involved in a road accident possessed valid driving licence, the Claims Tribunal will have to apply principles of 'pay and recover' by directing the insurance company to deposit the compensation amount and recover it later from the owner of the vehicle.

A single judge bench of Justice T.G. Shivashankare Gowda partly allowed the appeal filed by the New India Assurance Company Limited and modified the award passed by the Commissioner for Workmen's Compensation, Chitradurga District.

As per factual matrix of the case, deceased Ghouse was employed as driver in a lorry owned by S.M.Nooruddin. Ghouse died on spot when the said lorry capsized. His legal representatives approached the Commissioner seeking compensation under Section 22 of the Workmen Compensation Act. The claim was opposed by the Insurance Company but the Commissioner awarded compensation of Rs.4,23,580 with interest.

The insurance company contended that the driving licence of the deceased was not found at the spot and no material was placed before the Commissioner regarding valid driving licence held by the deceased. Thus it was contended that the owner allowed a person to drive the vehicle without a valid driving licence and thereby violated the terms and conditions of the policy.

The claimants argued that the primary burden of proving non-holding of valid driving licence by the deceased is on the Insurance Company.

The bench noted that there exists an employer-employee relationship and thereby, the petitioners are entitled to claim compensation as dependents under Section 22 of the Workmen's Compensation Act, 1923. Following which it upheld the finding of the Tribunal in regards to quantum of compensation.

Noting that neither the petitioners nor the owner or the Insurance Company were able to secure the driving licence of the deceased, the Court reconsidered the correctness of fastening of liability on the Insurance Company and held,

“In the case on hand, the petitioners claim that the deceased was holding a valid driving licence, but there is no evidence in proof of it. There is no allegation that the owner was negligent or not verified the driving licence of the deceased nor it is a case of fake licence. Under such circumstances, it is a case for applying the principle of 'pay and recovery'.”

Accordingly, Court allowed the appeal in part and directed that under the principle of 'pay and recovery' the Insurance Company shall deposit the compensation and recover it from the owner of the lorry.

Appearance: Advocate B.C.Seetharama Rao for Appellant.

Advocate K.Shashikanth Prasad FOR R1 TO R5.

Citation No: 2024 LiveLaw (Kar) 37

Case Title: The New India Assurance Company Limited AND Sadika & Others

Case No: MFA NO. 9827 OF 2012

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