Delhi High Court – Orders
M/S Uttaranchal Pest Control vs Nawal Singh & Ors(M/S Oriental … on 25 March, 2026
$~10
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ MAC.APP. 256/2019, CM APPL. 7513/2019 & CM APPL.
7515/2019.
M/S UTTARANCHAL PEST CONTROL .....Appellant
Through: Mr. Ankit Kumar Vats, Adv.
versus
NAWAL SINGH & ORS(M/S ORIENTAL INSURANCE CO LTD)
.....Respondent
Through: Mr. Janender Kumar Chumbak, Ms.
Radhika and Ms. Soumya Mathur,
Advs. for R-1 to 3.
Mr. J.P.N. Shahi, Adv. for R-5.
CORAM:
HON'BLE MR. JUSTICE ANISH DAYAL
ORDER
% 25.03.2026
1. This appeal has been filed by appellant/owner of the offending vehicle
challenging recovery rights, which have been granted by the Motor
Accidents Claims Tribunal [‘MACT’], Saket Court in Suit No. 4086/2016,
whereby compensation to the tune of Rs.7,00,000/-, alongwith interest at 9%
was awarded to the claimants. Recovery rights have been granted on account
that driving licence of respondent no.4/driver had not been produced by
either respondent no.4/driver or appellant/owner of the offending vehicle.
2. The accident occurred on 9th October 2014, at about 07.00 pm, when
Smt. Rajwati, (‘deceased’) was returning home from her duty at NSG
Manesar by walking on the left side of the road. When she reached near in
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Kalawati Hospital situated at Delhi Jaipur Highway, she was hit by one
motorcycle bearing no. DL-3SCH-6103 coming from Pachgoan Chowk
driven by respondent no.4/driver in a rash and negligent manner. The
deceased sustained grievous injuries and was taken to Sunrise Hospital
where she succumbed to her injuries. Claim petition was filed by her
husband and sons (‘claimants’)
3. A defence had been raised by respondent no.5/Insurance Company
that respondent no.4/driver of offending vehicle bearing registration no. DL-
3SCH-6103 was not holding a valid and effective driving licence and,
therefore, there had been a violation of the Insurance Policy.
4. MACT had noted that a verification report had been requisitioned by
counsel for respondent no.5/Insurance Company and the said verification
report has been exhibited as Ex. R3W1/1.
5. The Court has perused the said verification report and confirms that
the driving licence had not been issued by the Licensing Authority, Jind, as
stated in the driving licence, which had been produced later.
6. Moreover, appellant/owner had deposed that he had engaged
respondent no.4/driver after looking at his driving licence; however, no
driving licence was produced, nor was the driving license produced pursuant
to notice under Order XII Rule 8 of Code of Civil Procedure, 1908 (‘CPC‘).
7. In this light, Mr. J.P.N. Shahi, counsel for respondent no.5/Insurance
Company states that absolutely no attempt has been made by
appellant/owner to place the driving licence of respondent no.4/driver that
he had engaged, on record, or to verify the same in any manner, or to make
reasonable efforts to confirm that it was a valid driving licence. Therefore,
the rights of recovery had been rightly granted.
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8. Mr. Ankit Kumar Vats, counsel appearing on behalf of appellant/
owner, states that respondent no.4/driver had left the employment of
appellant/owner after the accident and therefore, he was not in possession of
the driving licence for it to be provided.
9. However, he states that he had seen the driving licence, but there was
no occasion for him to verify or cross-check the same.
10. Mr. Vats, counsel for appellant/owner placed reliance upon the
decision of the Supreme Court in United India Insurance Co. Ltd. v. Lehru,
(2003) 3 SCC 338 to state that while hiring a driver, the owner is not
expected to find out whether the license has been issued by a competent
authority or not. However, this decision may not aid the argument put forth
by Mr. Vats, counsel for appellant/owner, as the issue dealt with by the
Supreme Court in Lehru was of insurer’s liability and the Supreme Court
categorically stated that even if the driving license turns out to be fake, the
Insurance Company would continue to be liable to innocent third party, but
may be able to recover from the insured, if the owner/insured had noticed
that the license was fake and permitted the driver to drive.
11. The duty of owner to reasonably verify the driver’s license has been
discussed in a catena of judgments.
12. A Three-Judge Bench of the Supreme Court in National Insurance
Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 discussed the liability of
insurer in cases of a fake or forged license. As regards the duty of owner to
verify the genuineness of a driving license, the Supreme Court elaborated
upon the decision in Lehru (supra) to hold that the defence of a fake driving
license can be raised by the insurer after having proved that the owner did
not take adequate care and precaution to verify the driving license. Duty of
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an owner to make a reasonable enquiry would therefore, still stand. Relevant
observations of the Court are extracted as under:
“Where the driver’s licence is found to be fake
92. It may be true as has been contended on behalf of the
petitioner that a fake or forged licence is as good as no
licence but the question herein, as noticed hereinbefore, is
whether the insurer must prove that the owner was guilty of
the wilful breach of the conditions of the insurance policy or
the contract of insurance. In Lehru case [(2003) 3 SCC 338
: 2003 SCC (Cri) 614] the matter has been considered in
some detail. We are in general agreement with the approach
of the Bench but we intend to point out that the observations
made therein must be understood to have been made in the
light of the requirements of the law in terms whereof the
insurer is to establish wilful breach on the part of the
insured and not for the purpose of its disentitlement from
raising any defence or for the owners to be absolved from
any liability whatsoever. We would be dealing in some
detail with this aspect of the matter a little later.
…
100. This Court, however, in Lehru [(2003) 3 SCC 338 :
2003 SCC (Cri) 614] must not be read to mean that an
owner of a vehicle can under no circumstances have any
duty to make any enquiry in this respect. The same,
however, would again be a question which would arise for
consideration in each individual case.
101. The submission of Mr Salve that in Lehru case [(2003)
3 SCC 338 : 2003 SCC (Cri) 614] , this Court has, for all
intent and purport, taken away the right of an insurer to
raise a defence that the licence is fake does not appear to be
correct. Such defence can certainly be raised but it will be
for the insurer to prove that the insured did not take
adequate care and caution to verify the genuineness or
otherwise of the licence held by the driver.”
13. Upholding the principle of ‘pay and recover’, the Supreme Court in
Swaran Singh held that even where the insurer succeeds in establishing a
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statutory defence under Section 149(2) of the Motor Vehicles Act, 1988, the
liability to satisfy the award vis-à-vis the third-party claimant subsists at first
instance, with liberty reserved to the insurer to recover the amount from the
insured/owner or driver of the offending vehicle. The Court, after an
elaborate consideration of the statutory scheme and prior precedents,
reaffirmed that the principle of ‘pay and recover’ had consistently held the
field and should not be unsettled. Emphasising the need for certainty in the
law governing third-party rights, the Court observed as under:
“104. It is, therefore, evident from the discussions made
hereinbefore that the liability of the insurance company to
satisfy the decree at the first instance and to recover the
awarded amount from the owner or driver thereof has been
holding the field for a long time.
105. Apart from the reasons stated hereinbefore, the
doctrine of stare decisis persuades us not to deviate from
the said principle.
106. It is a well-settled rule of law and should not ordinarily
be deviated from. (See Bengal Immunity Co. Ltd. v. State of
Bihar [AIR 1955 SC 661 : (1955) 2 SCR 603] , SCR at pp.
630-32, Keshav Mills Co. Ltd. v. CIT [AIR 1965 SC 1636 :
(1965) 2 SCR 908] , SCR at pp. 921-22, Union of
India v. Raghubir Singh [(1989) 2 SCC 754 : (1989) 3 SCR
316] , SCR at pp. 323, 327, 334, Gannon Dunkerley and
Co. v. State of Rajasthan [(1993) 1 SCC 364] , Belgaum
Gardeners Coop. Production Supply and Sale Society
Ltd. v. State of Karnataka [1993 Supp (1) SCC 96 (1)]
and Hanumantappa Krishnappa Mantur v. State of
Karnataka [1992 Supp (2) SCC 213 : 1992 SCC (Cri)
667].)”
14. Reliance may also be placed upon the decision of the Supreme Court
in National Insurance Co. Ltd. v. Geeta Bhat, (2008) 12 SCC 426 where
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the Supreme Court dealt with defences available to an insurer in cases of a
fake driving license. While holding that the Insurance Company shall be
liable towards third parties, liberty will be granted to recover the same from
the driver and owner. The Supreme Court also went on to observe the duty
of an owner to make a reasonable enquiry about the validity of a driving
license. Relevant paragraph is extracted as under:
“7. An owner of the vehicle is bound to make reasonable
enquiry as to whether the person who is authorised to drive
the vehicle holds a licence or not. Such a licence not only
must be an effective one but should also be a valid one. It
should be issued for driving a category of vehicle as
specified in the Motor Vehicles Act and/or Rules framed
thereunder.”
(emphasis added)
15. Burden on appellant/owner of onus to prove that they had engaged the
driver after checking the driving license and believing that the
appellant/owner had engaged the driver in good faith, was not discharged, as
noted by the MACT. Reliance in this regard may be placed on the decision
of this Court in New India Assurance Co. Ltd. v. Sanjay Kr. & Ors.
2007:DHC:315 where the Court noted that after the Insurance Company has
established breach of terms of insurance policy, the onus is on the owner to
prove before the MACT by either producing the driving license or showing
lack of knowledge. Relevant observations of the Court are extracted as
under:
“22. Thus, where the insurance company alleges that the
term of the policy of not entrusting the vehicle to a person
other than one possessing a valid driving licence has been
violated, initial onus is on the insurance company to prove
that the licence concerned was a fake licence or was not aThis is a digitally signed order.
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valid driving licence. This onus is capable of being easily
discharged by summoning the record of the Licencing
Authority and in relation thereto proving whether at all the
licence was issued by the authority concerned with
reference to the licence produced by the driver. Once this is
established, the onus shifts on to the assured i.e. the owner
of the vehicle who must then step into the witness box and
prove the circumstances under which he acted;
circumstances being of proof that he acted bona fide and
exercised due diligence and care. It would be enough for the
owner to establish that he saw the driving licence of the
driver when vehicle was entrusted to him and that the same
appeared to be a genuine licence. It would be enough for
the owner, to discharge the onus which has shifted on to his
shoulders, to establish that he tested the driving skill of the
driver and satisfied himself that the driver was fit to drive
the vehicle. Law does not require the owner to personally
go and verify the genuineness of the licence produced by the
driver.
23. Where the assured chooses to run away from the battle
i.e. fails to defend the allegation of having breached the
terms of the insurance policy by opting not to defend the
proceedings, a presumption could be drawn that he has
done so because of the fact that he has no case to defend. It
is trite that a party in possession of best evidence, if he
withholds the same, an adverse inference can be drawn
against him that had the evidence been produced, the same
would have been against said person. As knowledge is
personal to the person possessed of the knowledge, his
absence at the trial would entitle the insurance company to
a presumption against the owner.
24. That apart, what more can the insurance company do
other than to serve a notice under Order 12 Rule 8 of the
Code of Civil Procedure calling upon the owner as well as
the driver to produce a valid driving licence. If during trial
such a notice is served and proved to be served, non
response by the owner and the driver would fortify the case
of the insurance company.”
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(emphasis added)
16. Mr. J.P.N. Shahi, counsel for Insurance Company states that as per his
information, driving licence which was sought to be verified by the
investigator had been taken from the chargesheet, but there was no attempt
by the owner of the offending vehicle to produce a valid licence of it’s
driver. The owner cannot be seen to insulate themselves from liability by
merely contending that they could not procure the licence from an errant
driver. Moreover, the investigator of the insurance company has verified the
licence which was available as part of the chargesheet and found it to be not
issued from the Licensing Authority, Jind.
17. In this view of the matter and in the opinion of this Court, the MACT
was not amiss in granting recovery rights, considering that it is the
appellant’s/owner’s duty to, at the very least, make reasonable efforts to
check the driving licence, which was not properly discharged nor was an
attempt made to produce a valid driving licence before the MACT.
18. Accordingly, appeal stands dismissed.
19. Compensation awarded by the MACT stands confirmed and shall be
disbursed, along with the accrued interest, as per directions given by the
MACT.
20. Pending applications, if any, are rendered infructuous.
21. Statutory deposit, if any, be refunded to appellant/owner.
22. Order be uploaded on the website of this Court.
ANISH DAYAL, J
MARCH 25, 2026/MK/sp
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