Case Title:
M/s Bajaj Alliance General Insurance Co. Ltd. VERSUS Rambha Devi & Ors.
Date of Order:
6th November 2024
Bench:
CJI DR. DHANANJAYA Y. CHANDRACHUD, JUSTICE HRISHIKESH ROY, PAMIDIGHANTAM
Subject:
The Supreme Court addressed whether Light Motor Vehicle (LMV) licenses permit drivers to operate transport vehicles under 7,500 kg without additional endorsements. The case highlighted the balance between road safety and economic impact. A nuanced ruling deferred to the Union Government for policy review, leaving the Mukund Dewangan interpretation in effect for now.
Important Provisions
Section 3 of the Motor Vehicles Act, 1988
(1) No person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to him authorising him to drive the vehicle; and no person shall so drive a transport vehicle [other than 1[a motor cab or motor cycle] hired for his own use or rented under any scheme made under sub-section (2) of section 75] unless his driving licence specifically entitles him so to do.
(2) The conditions subject to which sub-section (1) shall not apply to a person receiving instructions in driving a motor vehicle shall be such as may be prescribed by the Central Government.
Section 4(1) of the Motor Vehicles Act, 1988:
(1) No person under the age of eighteen years shall drive a motor vehicle in any public place:
Provided that 1[a motor cycle with engine capacity not exceeding 50cc] may be driven in a public place by a person after attaining the age of sixteen years.
(2) Subject to the provisions of section 18, no person under the age of twenty years shall drive a transport vehicle in any public place.
(3) No learners licence or driving licence shall be issued to any person to drive a vehicle of the class to which he has made an application unless he is eligible to drive that class of vehicle under this section.
Section 14 Of Motor Vehicle Act-
Currency of licences to drive motor vehicles: (1) A learner’s licence issued under this Act shall, subject to the other provisions of this Act, be effective for a period of six months from the date of issue of the licence.
(2) A driving licence issued or renewed under this Act shall,— (a) in the case of a licence to drive a transport vehicle, be effective for a period of three years: 1*** 2 [Provided that in the case of licence to drive a transport vehicle carrying goods of dangerous or hazardous nature be effective for a period of one year and renewal thereof shall be subject to the condition that the driver undergoes one day refresher course of the prescribed syllabus; and;] (b) in the case of any other licence,— (i) if the person obtaining the licence, either originally or on renewal thereof, has not attained the age of 3[fifty years] on the date of issue or, as the case may be, renewal thereof,— (A) be effective for a period of twenty years from the date of such issue or renewal;or (B) until the date on which such person attains the age of 3[fifty years], whichever is earlier;
Introduction
The Supreme Court of India in the case Bajaj Alliance General Insurance Co. Ltd. v. Rambha Devi re-examined the important issue that involved the interpretation of provisions of the Motor Vehicles Act, 1988, specifically those pertaining to the driving license.
It posed the question as to whether LMV license holders were allowed to drive transport vehicles weighing up to 7,500 kilograms without a specific endorsement. This not only raised issues regarding insurance claims but also questions on road safety and the gross economic effect on the drivers who relied on LMV licenses.
Facts
In this appeal, the appellant, Bajaj Alliance General Insurance Co. Ltd., challenges litany of orders directing payment to claimants in accidents caused by drivers holding LMV licenses but with no endorsements specified for transport vehicles.
The insurance company contended that such compensation decrees were founded upon an egregious misreading of the laws regarding license by the MV Act and relied fundamentally on the authority cited in Mukund Dewangan v. Oriental Insurance Co. Ltd. in 2017.
The petitioners, however, who mainly included the original petitioner, Rambha Devi, defended the legality of the said awards as based on valid and sound Mukund Dewangan interpretation, whereby LMV license holders could drive transport vehicles in so far as the gross vehicle weight was less than 7,500 kg.
The controversy set out a balance between the legal technicalities of licensing and other more relevant concerns of policy in regard to the safety of the citizenry and the economic livelihoods.
Arguments of the Respondents (Bajaj Alliance and Insurance Companies)
Respondents, through senior counsel, pleaded that Mukund Dewangan's judgment had a fundamental error in it. They pleaded that such judgments utterly disregard the salient provisions of the MV Act such as Sections 3 and 10, where it provides a clear-cut distinction between LMV license and the transport vehicle.
In the petitioners' view, section 3 explicitly requires drivers to have a license that authorizes them to operate a certain class of vehicle. In fact, the petitioners said that transport vehicles needed more than mere authorization because of the increased responsibility of transporting either persons or goods.
The petitioners add that the legislative history of the MV Act does not help them. They explain that the amendment of 1994 affirms the insistence on separate licensing for transport vehicles. They rely on Section 4, which prescribes a minimum age for the purpose of driving transport vehicles, and Section 8, which requires a medical certificate.
These provisions, petitioners assert, are what ensure that only fit physical and mental individuals are at the driving wheels of vehicles that could pose significant public safety risks.
The insurance companies also relied on the principle of Generalia Specialibus Non-Derogant, whereby specific legal provisions override the general ones. They claimed that the licensing requirements for transport vehicles were set to be more stringent than for LMVs, arguing this was meant to address safety concerns in specific ways.
The petitioners further relied on Nathi Devi v. Radha Devi Gupta, which held that every word in the statute must be given meaning and sense, implying that Mukund Dewangan made certain provisions of the MV Act superfluous.
The policy stand was that the petitioners wanted strict license norms for the safety of roads. According to them, the Mukund Dewangan interpretation had invited multiple accidents in the shape of under-qualified drivers driving on the road, which goes against the spirit of the MV Act.
The insurance companies also argued that their purse took the brunt due to claims arising from accidents when the very same accidents could have been prevented if the driver was suitably licensed.
Arguments of the Respondents (Petitioners and Drivers)
The respondents who are represented by advocate Rambha Devi and others felt that the decree of Mukund Dewangan interpreting the MV Act was wrong. "As per the statute, its vehicles are essentially classified basis of weight only and since LMVs cover up to 7,500 kgs, LMV license holders must be permitted to drive transport vehicles in this weight category."
They further argued that the statute is silent on the separate endorsement for transport vehicles that have a gross vehicle weight of 7,500 kg or more. In this light, the judgment of the High Court of Mukund Dewangan was analogous to the legislative intent.
They pointed out the economic fallout of an adverse decision. Most drivers, who are in rural and semi-urban areas, rely on LMV licenses to survive. If a separate endorsement was held to be required, thousands of drivers would be rendered unemployed: their fundamental right to livelihood under Article 21 of the Constitution would be prejudiced.
The respondents relied on Article 19(1)(g), which guarantees the right to practice any profession, and submitted that restrictive readings of the MV Act should not be made.
Contending that the said interpretation had been given by setting up this precedent of Mukund Dewangan, the respondents urged that it was the responsibility of the government to put this interpretation in place by amending the relevant rules and publishing notifications.
Relying on the submission made by placing reliance on the observation made by the court in Aphali Pharmaceuticals Ltd. v. State of Maharashtra, it urged that an interpretation should be given to the MV Act that furthers economic activity and obviates unnecessary regulatory hurdles.
These respondents have dismissed safety concerns as an exaggeration. "Safety is not an issue anymore," they say, reminding everyone that LMV drivers still undergo stringent tests and comply with traffic laws. The issue is not the licensing framework but how it is enforced, they add. They claim that further prohibition of informal operations would bear disproportionately against marginalized groups already excluded from formal employment.
Court's Analysis
The Supreme Court made a detailed analysis of the MV Act, and the arguments put forth. The bench, comprising five judges, admitted that the matter involved a lot of complexity in interpreting the licensing provisions. The court admitted that Sections 3 and 10 mandate specific endorsements for driving transport vehicles but noted that the definitions of the Act are based on the weight of the vehicle.
The bench referred to the legislative intent of the MV Act. It held that the object of the MV Act is both protective, on the one hand of road safety and, on the other, to compensate for the victim of accidents.
The court placed reliance on earlier decisions like Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan and Sohan Lal Passi v. Sesh Reddy to illustrate the protective intent of the Act. The court also referred to the decision of Charan Lal Sahu v. Nandkishore Bhatt, where the court again emphasized the requirement of strict compliance with the provisions relating to licensing to guard public safety.
The court, however, did not remain insensitive to the economic arguments of the respondents. It felt that a change in the interpretation of the MV Act would mean far-reaching consequences for the livelihood of thousands of drivers. A bench said the policies followed by the government accepting Mukund Dewangan's verdict indicated legislative approval at some level.
The court deliberated on the principle of Generalia Specialibus Non-Derogant, which agreed that specific licensing requirements for transport vehicles serve a vital safety function. At the same time also recognized that the weight-based classification scheme in the MV Act complicates the issue. The practical problems are there of getting separate endorsements for transport vehicles, especially in rural areas where access to licensing authorities is limited.
The bench observed that the MV Act needs to be interpreted harmoniously by balancing the need for safety with the economic reality. In referring to strict norms of licensing among heavy vehicles, it said that the same may not be the case for lighter transport vehicles.
It further observed that several countries follow weight-based classifications just like ours, and for those, they are allowed to operate certain transport vehicles under an LMV license.
Conclusion
In a nuanced order, the Supreme Court refused to pass an order of judgment but asked the Union Government to review the policy. The court recognized the cogency of both sides and the impact that would have on public safety and livelihood. The court urged the government to rethink the licensing provisions of the MV Act and consider amendments to further clarify the law. So, till such time such a review is conducted, the ruling in Mukund Dewangan will prevail.
