1 2026:CGHC:20203 HIGH COURT OF CHHATTISGARH AT BILASPUR MAC No. 1432 of 2016 Divisional Manager, The New India Insurance Company Ltd. Raipur Division Office No.1, First Floor, Madina Building, Kutchery Chowk, Raipur, Distt. Raipur, Chhattisgarh, Through Authorised Signatory, The New India Insurance Company Ltd, Divisional Office Second Floor, Rama Trade Centre, in front of Rajeev Plaza, Dist. Bilaspur, Chhattisgarh ................Insurer (Non-applicant No. 3) ... Appellant versus 1 - Krishna Kumar Sahu S/o Late Pushau Ram Sahu, Aged About 43 Years R/o Gram Nisda, Thana- Arang, District Raipur, Chhattisgarh, Chhattisgarh. 2 - Sohadra Bai Sahu W/o Shri Krishna Kumar Sahu, Aged About 41 Years R/o Gram Nisda, Thana- Arang, District Raipur, Chhattisgarh. 3 - Lokesh Kumar Sahu S/o Shri Krishna Kumar Sahu, Aged About 20 Years R/o Gram Nisda, Thana- Arang, District Raipur, Chhattisgarh. 4 - Kishore Kumar Sahu S/o Krishna Kumar Sahu, Aged About 18 Years R/o Gram Nisda, Thana- Arang, District Raipur, Chhattisgarh .................Claimants. 5 - Hem Singh Chouhan S/o Shri Alakh Singh Chouhan, Aged About 35 Years R/o Village Age Post Lakhouli Bhatapara, Police Station- Arang, District- Raipur, Chhattisgarh...............Driver (Non-applicant No.1). 6 - Yugal Kishore Sharma S/o Shri Lok Nath Sharma, Aged About 37 Years R/o Suman Colony Arang, Distt. Raipur, Chhattisgarh ....Owner (Non- applicant No.2) ... Respondents For the appellant : Mr. B. N. Nande, Advocate For respondent no.5 : Mr. S. P. Sahu, Advocate 2 (Hon’ble Shri Justice Sanjay Kumar Jaiswal) Judgment on Board 30/04/2026 1. This appeal under Section 173 of Motor Vehicles Act, 1988 (for short “MV Act”) has been filed seeking modification or setting aside the award dated 20.07.2016 passed by the learned VIII MACT, Raipur, in Claim Case No.127/2015 as against the appellant. 2. As per the pleadings of the claim application filed under Section 166 & 140 of the MV Act, the claimants/respondents 1 to 4 herein are the parents and siblings of deceased. On 06.01.2015 deceased Dugeshwar who was pillion rider with rider of motorcycle Deman Lal Sahu was going to Shriram Auto Centre Showroom. At about 1.00 p.m., the offending vehicle Hywa Truck bearing Regn.No.C.G.04-HQ- 8625 driven by respondent no.5 Hem Singh in a rash and negligent manner hit the motorcycle from behind and ran over crushing deceased’s head, due to which, he died on the spot. The claimants being legal heirs of deceased filed claim application seeking a total compensation of Rs. 27 lakhs on various heads. 3. The learned claims Tribunal after appreciating the facts and evidence granted a total compensation of Rs. 5,86,000/- with annual interest @ 6% from the date of claim petition till the date of payment. While passing the impugned award, the Tribunal has found that the insurer admitted the fact that the offending vehicle was insured under its policy for the period from 12.12.2014 to 11.12.2015; it is not proved that the owner and driver violated the policy conditions 3 and the Insurance Company will be liable for the owner’s liabilities. Therefore, being the insurer of the offending vehicle the appellant is primarily responsible for paying the above compensation amount of Rs. 5,86,000/-. Hence the appeal has been filed for modification/setting aside that part of the order. 4. The submission of learned counsel for the appellant is that the owner of the offending vehicle had no permit from the RTA at the time of accident, therefore, there was fundamental breach of insurance policy. He further contends that the learned Tribunal has failed to appreciate the evidence of witness Ramchandra Kunjam, (NA-3) who being an official of RTA, Raipur had categorically deposed that at the time of accident, no permit was issued. The permit was issued on 07.01.2015 effective from 08.01.2015 to 07.01.2020 whereas the accident occurred on 06.01.2015. He relies on a case law reported in Amrit Paul Singh v. TATA AIG General Insurance Co. Ltd. (2018) 7 SCC 558 and contends that driving a transport vehicle without a permit violates Section 66 of the Motor Vehicles Act, 1988 and the appellant/ insurer is not liable if the vehicle did not have a valid permit. 5. Learned counsel for respondent no.5 submits that the Tribunal has rightly fastened the liability on the appellant/insurance Company which cannot be said to be unjust or unreasonable as the owner had already paid the permit fee of Rs.1500/- and submitted the application for permit on 15.12.2014 that is much before occurrence of accident. 6. Heard learned counsel for the parties, considered their rival 4 submissions and perused the record with utmost circumspection. 7. To prove the fact that at the time of the accident respondent No. 5 was driving the said vehicle in breach of policy conditions, witness Ramchandra Kunjam (Assistant Grade-II, Transport Department, R.T.O., Raipur) was examined on behalf of the insurer. In his examination-in-chief before the Court, he has deposed that the permit for vehicle No. CG-04/HQ-8625 was issued for the entire State of Chhattisgarh on 07.01.2015 and was valid for the period from 08.01.2015 to 07.01.2020. He has further stated that the goods- carrier permit for the said vehicle was neither valid nor it was issued as of 06.01.2015. He signed the true copy of the permit, marked as Exhibit D-1 (from point 'A' to 'A'). However, in Paragraph 5 of his cross-examination, this witness admitted the fact that the permit fee of Rs. 1500/- for the said vehicle had been deposited online on 15.12.2014 by a Challan and the application form was submitted on the same date. Therefore, the learned claims Tribunal held that since the fee for the Goods Carrier Permit of the offending vehicle was deposited by the owner on 15.12.2014 that is approximately 20 days prior to the alleged date of the accident occurred on 06.1.2015 , it cannot be held that on the alleged date of the accident, the vehicle was driven in violation of the insurance terms. 8. The case law relied on by the learned counsel for the appellant in Amrit Paul Singh v. TATA AIG General Insurance Co. Ltd. (supra) shows that the accident occurred on 19.02.2013 and the competent authority issued the permit on 27.2.2013. In that case, Hon’ble Supreme Court held that operating a vehicle without a valid permit 5 constitutes a fundamental breach of the insurance policy, allowing the insurer to avoid liability. However, applying the “pay and recover” principle, the Court ruled that the insurer must first pay the third- party compensation and is subsequently entitled to recover that amount from the vehicle owner / insured. Paras 7 and 24 of the said decision are relevant and quoted hereinbelow: “7. The conclusions recorded by the Tribunal and further confirmed by the High Court clearly show that the accident occurred on 19.02.2013 and the competent authority issued the permit on 27.2.2013. In this regard, sections 2(28) and 2(31) of the MV Act that define “motor vehicle” or vehicle” and “permit” are reproduced below: “Section 2.(28) “motor vehicle” or “vehicle” means any mechanically propelled vehicle adapted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding twenty-five cubic centimetres; Section 2(31) “permit” means a permit issued by a State or Regional Transport Authority or an authority prescribed in this behalf under this Act authorising the use of a motor vehicle as a transport vehicle.” On a perusal of both the definitions, it is quite clear that a permit has to be issued by the competent authority under the Act for use of a motor vehicle as a transport vehicle. The emphasis is on the words “use” as well as “transport vehicle” 24. 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 appellants had taken the stand that the vehicle was not involved in the accident. That apart they had not stated whether the vehicle had temporary permit or any other kind of permit. The exceptions that have been carved out under Section 66 of the Act, needless to emphasise, are to be 6 pleaded and proved. The exceptions 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 dispose to think so in view of the series of exceptions carved out in Section 66. The said situations cannot be equated with absence of licence or a fake licence or a licence for different kind of vehicle, or, for that matter, violation of a condition of carrying more number of passengers. Therefore, the principles laid down in Swaran Singh and Lakhmi Chand in that regard would not be applicable to the case at hand. That apart, the insurer had taken the plea that the vehicle in question had no permit. 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 had directed 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 principles stated in Swaran Singh and other cases pertaining to pay and recover principle.” (Emphasis Supplied) 9. In the instant case it is not in dispute that the accident occurred on 06.01.2015 and the competent authority issued the permit on 07.01.2015 vide Ex.D-1 which would be effective from 08.1.2015 to 07.01.2020. As far as the issue of the vehicle owner having deposited the permit fee on 15.12.2014, is concerned, it cannot be concluded on this basis alone that the offending vehicle possessed a valid permit on the date of the accident, January 6, 2015. This is because the mere payment of the fee does not constitute the sole condition for the issuance of a permit. Consequently, the 7 permit subsequently issued on January 7, 2015, cannot be deemed to have retrospective effect. Therefore, it is clear that the offending vehicle at the time of the accident did not have a valid permit. It is settled norm that operating the vehicle in a public place without permit constitutes a fundamental breach of the insurance policy. Hence, the onus cannot be cast on the insurer. 10. In view of the dictum laid down by the Supreme Court in Amrit Paul Singh’s case (supra) and also taking note of the facts and circumstances of the present case, particularly the fact that at the time of accident, the vehicle was insured with Insurance Company/appellant, it is directed that the Insurance Company shall first pay the amount of compensation awarded to the claimants and then recover the same from the owner/driver of the offending vehicle. 11. In the result, the appeal is partly allowed. The impugned award stands modified to the above extent and rest of the award shall remain intact. Sd/- Sanjay Kumar Jaiswal Judge Rao