Court rules that insurance claim rejection based on non-conversion to smart card format unjustified; driving licence deemed genuine and valid at the time of accident.
In a significant ruling, the Delhi High Court has dismissed an appeal by New India Assurance Company Ltd., thus upholding the decision of the District Judge to award Rs. 13,77,500 to M/s Kapoor Diesels Garage Pvt. Ltd. The court found that the insurance company's rejection of an accident claim was unjustified. This decision stems from an incident where a truck insured by the company was involved in an accident, resulting in total damage and the death of the driver, Mr. Salmu.
The insurer had repudiated the claim on the basis that the driver held a booklet form driving licence, which was deemed invalid under a Nagaland Transport Authority Notification requiring conversion to smart card format. However, the court held that the driving licence could not be termed as fake merely because it was not converted into a smart card, especially when the deadline for conversion had not yet expired.
The court emphasized that the driver’s licence, issued on 14.01.2010, was valid at the time of the accident on 11.07.2014, and the driver had until 01.12.2014 to convert it into a smart card format. Furthermore, the court noted that the plaintiff had obtained a verification report from the Regional Transport Authority, Nagaland, confirming the genuineness of the licence, which the insurance company failed to rebut with any evidence or witnesses.
Additionally, the court dismissed other grounds of rejection by the insurance company, including the age of the driver and his residence. The insurer alleged that the driver was underage and not a resident of Nagaland, but the court found no evidence to support these claims. The court concluded that the insurance company did not discharge its onus of proving the licence fake.
Upholding the District Judge’s decision, the court ordered the insurance company to pay the decreed amount along with interest, dismissing the appeal as having no merit.
Bottom Line:
Insurance claim cannot be repudiated solely on the ground that the driver held a booklet form driving licence instead of a smart card, especially when the booklet licence was valid at the time of the accident and the deadline for conversion to a smart card had not yet expired.
Statutory provision(s): Code of Civil Procedure, 1908.
