The Supreme Court, in the case of Amrit Paul Singh & Anr. v. TATA AIG General Insurance Co. Ltd. & Ors., decided on 17th May, 2018, has held that plying of the transport vehicles in public without permit is a statutory breach and if such vehicles get involved in an accident, the insurer will be absolved of liability to pay.

1. Supreme Court Rules Absence of Permit is Statutory Breach under the Motor
Vehicles Act, 1988
The Supreme Court, in the case of Amrit Paul Singh & Anr. v. TATA AIG General
Insurance Co. Ltd. & Ors., decided on 17th
May, 2018, has held that plying of the transport
vehicles in public without permit is a statutory breach and if such vehicles get involved in
an accident, the insurer will be absolved of liability to pay.
In the present case, the offending truck had hit a motorcycle and resultantly caused the
death of driver of the motorcycle. A claim petition was preferred by the legal
representatives of the deceased under section 166 of the Motor Vehicles Act, 1988 before
the Motor Accident Claims Tribunal, Pathankot claiming compensation to the tune of Rs.
36,00,000/-.
The Motor Accident Claims Tribunal held that since the truck was being plied without
permit, a statutory breach of policy conditions under the Motor Vehicles Act, 1988 had
occurred and therefore, the insurer is not liable to pay compensation. The Tribunal
directed that an amount of Rs. 15,63,120/-
shall be paid by the insurer along with interest
at the rate of 9% from the date of award till its realization and the same be
recovered from the owner and driver of the vehicle.
Aggrieved, the owner of the truck filed the appeal before the Punjab and Haryana High
Court. The Punjab and Haryana High Court upheld the order of the Tribunal.
The Supreme Court also rejected the contentions of the owner and upheld the orders of
the Tribunal and the High Court and ruled as follows:

2. In the case at hand, it is clearly demonstrable from the
materials brought on record that the vehicle at the time of the
accident did not have a permit. The exceptions under Section 66 of the Act
cannot be taken aid of in the course of an argument to seek absolution
from liability. Use of a vehicle in a public place without a permit
is a fundamental statutory infraction. We are disposed to think
so in view of the series of exceptions carved out in Section 66.
The situations carved out in the said section 66
cannot be equated with absence of license or
a fake license or a license for different kind of vehicle, or, for that
matter, violation of a condition of carrying more number of
passengers. It does
not require the wisdom of the “Tripitaka”, that the existence of a
permit of any nature is a matter of documentary evidence.
Nothing has been brought on record by the insured to prove that
he had a permit of the vehicle. In such a situation, the onus
cannot be cast on the insurer. Therefore, the Tribunal as well as
the High Court were correct in directing that the insurer was required to pay the
compensation amount to the claimants with interest with the
stipulation that the insurer shall be entitled to recover the same
from the owner and the driver. The said directions are in consonance with
the pay and recover principle.
Surabhi Aggarwal
Senior Associate
The Indian Lawyer