1 CGHC010186302020 2026:CGHC:31310 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR MAC No. 1007 of 2020 United India Insurance Company Limited, Bramh Road, Ambikapur, District Sarguja, Chhattisgarh, Through Authorized Signatory, Manager T.P. Hub United India Insurance Company Limited, T.P. Hub/Divisional Office, LIC Building, Magharpara Chowk, Bilaspur, Chhattisgarh ... Appellant versus 1 - Amresh Kumar Singh, Aged About 42 Years, R/o. Village Mungiya, P.S. Tandva, Aurangabad, Bihar, At Present R/o. Ramanujganj Square, Ambikapur Through Arun Singh (Jai Maa Transporters) Ambikapur District Sarguja, Chhattisgarh……..(Claimant) 2 - Shekh Aurangjeb, S/o. Shekh Tahir, Aged About 45 Years, R/o. Bazarpara, Kusmi, District Balrampur, Chhattisgarh……..(Driver) 3 - Vishwanath Agrawal, S/o. Manilal Agrawal, R/o. Ambikapur Road, Patthalgaon, District Jashpur, Chhattisgarh. 4 - The New India Insurance Company Limited, Ambikapur, District Sarguja, Chhattisgarh ... Respondents ASHOK SAHU Digitally signed by ASHOK SAHU Date: 2026.07.23 17:20:59 +0530 2 For Appellant : Mr. B.N.Nande & Mr. Abhishek Mishra, Advocates For Respondent No.1 : Ms. Ananya Chatterjee, Advocate on behalf of Mr. R.R. Soni, Advocate For Respondents No.2 : Mr. Amarnath Pandey, Advocate (Single Bench) Hon'ble Shri Justice Sanjay K. Agrawal Judgment on Board 22.07.2026 1. The appellant/insurance company has preferred this appeal under Section 173 of the Motor Vehicles Act, 1988 against the impugned award dated 03.02.2020 passed by learned Seventh Additional Motor Accident Claims Tribunal, Sarguja (Ambikapur) in Claim Case No.166/ 2018 by which the claim application of the claimant has been allowed and liability has been fastened upon the insurance company to pay the amount of compensation. 2. Mr. B.N.Nande & Mr. Abhishek Mishra, learned counsel for the appellant/insurance company, would submit that the transport licence was expired on 09.10.2017 and applied for renewal on 12.11.2017, therefore, the principles of pay & recover laid down in National Insurance Company Limited v. Swaran Singh & Others 1 and Ram Babu Tiwari v. United India Insurance Co. Ltd. & Others2 would apply. 1 (2004) 3 SCC 297 2 2008(8) SCC 165 3 3. Mr. Amarnath Pandey, learned counsel for the driver & owner, would submit that the learned Claims Tribunal has rightly fastened the liability upon the insurance company and the principle of pay & recover would not apply. 4. I have heard learned counsel appearing for the parties, considered their rival submissions made herein-above and went through the records with utmost circumspection. 5. Proviso to Section 14 & 15 of the Motor Vehicles Act, 1988 [unamended] provides as under :- “14. Provided that every driving licence shall, notwithstanding its expiry under this sub-section, continue to be effective for a period of thirty days from such expiry.” “15. Provided that in any case where the application for the renewal of a licence is made more than thirty days after the date of its expiry, the driving licence shall be renewed with effect from the date of its renewal. Provided further that where the application is for the renewal of a licence to drive a transport vehicle or where in any other case the applicant has attained the age of forty years, the same shall be accompanied by a medical certificate in the same form and in the same manner as is referred to in sub-section (3) of section 8, and the provisions of sub-section (4) of section 8 shall, so far as may be, apply in relation to every such case as they apply in relation to a learner’s licence.” 6. Admittedly, Ex.P-3 i.e. transport licence of the driver was expired on 09.10.2017 and within 30 days on 08.11.2017, he did not apply for renewal as per proviso to Section 14 of the Motor Vehicles Act 4 and applied on 12.11.2017 i.e. after a period of 30 days, therefore, proviso to Section 15 of the Motor Vehicles Act would also not apply. 7. Consequently, neither the proviso to Section 14 nor proviso of Section 15 would apply, as the licence stood renewed from 19.11.2017 and accident occurred on 17.11.2017. Therefore, the principles of pay & recovery would apply in light of the decision of the Supreme Court in Swaran Singh (supra) and similarly in Ram Babu Tiwari (supra), it has been held at para 17 & 18 as under :- 17. It is beyond any doubt or dispute that only in the event an application for renewal of licence is filed within a period of 30 days from the date of expiry thereof, the same would be renewed automatically which means that even if an accident had taken place within the aforementioned period, the driver may be held to be possessing a valid licence. The proviso appended to sub-section (1) of Section 15, however, clearly states that the driving licence shall be renewed with effect from the date of its renewal in the event the application for renewal of a licence is made more than 30 days after the date of its expiry. It is, therefore, evident that as on renewal of the licence on such terms the driver of the vehicle cannot be said to be holding a valid licence, the insurer would not be liable to indemnify the insured. The second proviso appended to sub-section (4) of Section 15 is of no assistance to the appellant. It merely enables the licensing authority to take a further test of competent driving and passing thereof to its satisfaction within the meaning of sub-section (3) of Section 9. It does not say that the renewal would be automatic. It is, therefore, a case where a breach of the contract of insurance is established. 5 This aspect of the matter has been considered by this Court in National Insurance Co. Ltd. v. Kusum Rai & Ors. [(2006) 4 SCC 250 : holding: “11. It has not been disputed before us that the vehicle was being used as a taxi. It was, therefore, a commercial vehicle. The driver of the said vehicle, thus, was required to hold an appropriate licence therefor. Ram Lal who allegedly was driving the said vehicle at the relevant time, as noticed hereinbefore, was holder of a licence to drive a light motor vehicle only. He did not possess any licence to drive a commercial vehicle. Evidently, therefore, there was a breach of condition of the contract of insurance. The appellant, therefore, could raise the said defence.” It was furthermore held: “14. This Court in Swaran Singh [(2004) 3 SCC 297 : 2004 SCC (Cri) 733 : AIR 2004 SC 1531] clearly laid down that the liability of the insurance company vis-à-vis the owner would depend upon several factors. The owner would be liable for payment of compensation in a case where the driver was not having a licence at all. It was the obligation on the part of the owner to take adequate care to see that the driver had an appropriate licence to drive the vehicle.” It was opined: “16. In a case of this nature, therefore, the owner of a vehicle cannot contend that he has no liability to verify the fact as to whether the driver of the vehicle possessed a valid licence or not.” 18. The principle laid down in Kusum Rai [(2006) 4 SCC 250 : (2006) 2 SCC (Cri) 214] has been reiterated in Ishwar Chandra v. Oriental Insurance Co. Ltd. [(2007) 10 SCC 650 : (2008) 1 SCC (Cri) 591], referring to sub- section (1) of Section 15 of the Act, this Court stated the law, thus: “9. From a bare perusal of the said provision, it would appear that the licence is renewed in terms of the said Act and the rules framed thereunder. The 6 proviso appended to Section 15(1) of the Act in no uncertain terms states that whereas the original licence granted despite expiry remains valid for a period of 30 days from the date of expiry, if any application for renewal thereof is filed thereafter, the same would be renewed from the date of its renewal. The accident took place 28-4-1995. As on the said date, the renewal application had not been filed, the driver did not have a valid licence on the date when the vehicle met with the accident.” 8. In that view of the matter, the principle of “pay and recover.” would apply. The appellant/insurance company would firstly pay the amount of compensation within a period of 45 days from the date of receipt of a copy of this order to the claimant and thereafter, recover the same from the driver & owner of the offending vehicle. Rest of the conditions of the impugned award shall remain intact. 9. Accordingly, this appeal is partly allowed to the extent as indicated herein-above. Sd/- (Sanjay K. Agrawal) Ashok Judge