HIND SAMACHAR LTD. (DELHI UNITversusNATIONAL INSURANCE COMPANY LTD. & ORS.

                [2025] 11 S.C.R. 126 : 2025 INSC 1204

                 Hind Samachar Ltd. (Delhi Unit)
                                v.
             National Insurance Company Ltd. & Ors.
                (Civil Appeal No(s). 12442-12446 of 2024)
                               08 October 2025
             [K. Vinod Chandran* and N.V. Anjaria, JJ.]


                           Issue for Consideration
       Challenge to the “pay and recovery” directions issued by the High
       Court in favour of the insurer and against the insured owner of
       the truck.

                                  Headnotes†
       Motor Vehicle Accident Claim – Collision of a truck and
       Matador van killed nine people and injured two – Tribunal
       found the driver of both vehicles compositely negligent at the
       rate of 75:25 – Insurance companies paid the compensation
       to the claimants however, filed appeal – High Court issued
       “Pay and recovery” directions in favour of the insurer of the
       truck and against the appellant-insured owner of the truck,
       accepting the claim of the insurer that the appellant-owner
       of the vehicle, had colluded with its driver to obtain a fake
       licence – Challenge to:
       Held: High Court erred in mulcting the liability on the owner of
       the truck – Even if the licence is fake, the insurance company is
       liable to pay compensation, if they fail to prove that the insured
       had deliberately committed breach in entrusting the vehicle to a
       driver who had a fake licence – The owner of a vehicle employing
       a driver can only look at the licence produced by the person
       seeking employment and is not expected to verify from the licence
       issuing authority whether the licence is fake or not – The insurance
       company from the totality of the circumstances has to bring out
       the absence of due diligence in the employment of the driver or
       the entrustment of the vehicle, to prove breach by the insured,
       which is totally absent in the present case – High Court erred in
       finding that there was collusion between the employer and the
       employee merely for reason of the driving licence having been
       produced by the employer and the driver having not contested the
* Author
[2025] 11 S.C.R.                                                            127

                   Hind Samachar Ltd. (Delhi Unit) v.
                National Insurance Company Ltd. & Ors.

     claim – The vicarious liability to satisfy the damages caused by the
     negligence of the employee is on the employer, the later of whom
     has to contest the matter – Not only was the driving licence, as
     issued to the driver produced, but, a certificate showing its further
     renewal was also produced – Order of the High Court set aside,
     insofar as the rights of recovery of the award amounts granted to
     the insurer. [Paras 7, 16-18]

     Motor Vehicle Accident Claim – Plea of the respondent-
     insurance company that unlike the usual practice of the driver
     producing the driving licence, the owner’s representative
     produced it before the Tribunal which indicated a collusion:
     Held: No substance in the argument of the insurer that a collusion
     can be validly inferred since the driving licence was produced by
     the owner – In fact, the owner of the truck is not an individual and
     is a company – Undisputedly, even if the tortfeasor is the driver,
     the liability for any negligence of the driver rests on the owner
     of the vehicle, vicariously – There can be no suspicion raised
     merely because the owner had produced the driving licence before
     Court – It only indicates that the owner had been diligent enough
     to procure the driving licence from the driver and produce it before
     the Tribunal, so as to validly raise a case for indemnification by
     the insurer. [Para 12]

                              Case Law Cited
     United India Insurance Company v. Lehru and Ors. [2003] 2 SCR
     495 : (2003) 3 SCC 338; National Insurance Co. Ltd. v. Swaran
     Singh [2004] 1 SCR 180 : (2004) 3 SCC 297; PEPSU RTC v.
     National Insurance Co. Ltd. [2013] 9 SCR 266 : (2013) 10 SCC
     217; IFFCO Tokio General Insurance Co. Ltd. v. Geeta Devi [2023]
     14 SCR 62 : 2023 SCC OnLine SC 1398 – relied on.
     New India Assurance Co. v. Kamla [2001] 2 SCR 797: (2001) 4
     SCC 342 – referred to.

                                 List of Acts
     Motor Vehicles Act, 1988.

                             List of Keywords
     Truck; Matador van; Collision; “Pay and recovery”; Fake driving
     licence; Fake licence; Driver of the offending vehicle; Owner of
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       vehicle; Insured owner of the truck; Absence of due diligence;
       Employment of driver; Entrustment of vehicle; Breach by the
       insured; Insurance company liable to pay compensation; Composite
       negligence.

                             Case Arising From
       CIVIL APPELLATE JURISDICTION: Civil Appeal No(s).
       12442-12446 of 2024
       From the Judgment and Order dated 28.04.2016 of the High Court
       of Delhi at New Delhi in RFA No. 148 of 2007, MACAP Nos. 163
       and 278 of 2007, MACAP Nos. 302 and 304 of 2015
       With
       Civil Appeal No(s). 12449-12451, 12460-12462, 12463-12464,
       12455-12457, 12465-12467, 12458-12459, 12447-12448 and
       12452-12454 of 2024

                          Appearances for Parties
       Advs. for the Appellant:
       Gopal Shankaranarayan, Sr. Adv., Sayid Marzook Bafaki, Angad
       Mehta, Swapnil Gupta, Tushar Srivastava, Madhav Gupta.
       Advs. for the Respondents:
       Dr. Manish Singhvi, Sr. Adv., Ambhoj Kumar Sinha, Ms. Neeti
       Bhardwaj, Mayank Grover, Shantanu Krishna, Ms. Pratibha Vyas,
       Shree Pal Singh, Abhimanyu Tiwari, Siddhant Saroha, Siddhant
       Awasthy, Rohan Chaudhary, Rahul Singh, Ms. Sakshi Mittal, Faisal
       Sherwani.

                  Judgment / Order of the Supreme Court

                                  Judgment

       K. Vinod Chandran, J.

1.     The appellant is the owner of a truck, involved in an accident in which
       nine persons lost their lives and two sustained injuries; passengers in
       another vehicle, a Matador van. The appeal is against the “pay and
       recovery” directions granted to the insurance company which had
       insured the truck. The breach complained of and found in favour of
       the insurance company by the High Court was of the driver of the
[2025] 11 S.C.R.                                                        129

                       Hind Samachar Ltd. (Delhi Unit) v.
                    National Insurance Company Ltd. & Ors.

      offending vehicle having produced a fake driving licence. The High
      Court was considering also the quantum appeals in which some
      modifications were made, with which we are not concerned. The
      insurance companies; both of the truck and the Matador van; found
      to be compositely negligent, apportioned at the rate of 75:25, had
      paid the compensation to the claimants.
2.    Mr. Gopal Shankaranarayan, learned Senior Counsel appearing for
      the appellant contended that the Tribunal despite having noticed the
      two driving licences produced directed the insurance company to
      indemnify the owner of the vehicle, which is perfectly in order looking
      at the binding precedents. The High Court has gone on surmises and
      conjectures in presuming that the owner of the vehicle, the appellant
      herein, had colluded with its driver to obtain a fake licence based on
      a register produced from the office of the District Transport Officer,
      Gurdaspur, which by reason of many interpolations made therein
      could not have been relied upon. The testimony of the witness, a
      Clerk from the office of DTO was against the certificate issued by the
      very same office, which had also indicated that the driving licence
      issued was later renewed.
3.    The High Court had also observed that the driving licence seized
      from the driver of the vehicle, at the accident spot, was a different
      one and also proved to have been not issued from the office of RTO,
      Alwar. The same was produced by the Clerk of the record room in
      Tis Hazari Court, Delhi with the specific statement in the deposition
      that it was seized by them. The Tribunal had specifically noticed
      that the Clerk of the record room or the Court staff could not have
      made any such seizure. The learned Senior Counsel relied upon
      the decisions of this Court in United India Insurance Company v.
      Lehru and Ors.1, National Insurance Co. Ltd. v. Swaran Singh2
      and PEPSU RTC v. National Insurance Co. Ltd.3 and IFFCO Tokio
      General Insurance Co. Ltd. v. Geeta Devi4.
4.    Dr. Manish Singhvi, learned Senior Counsel appearing for the
      respondent-insurance company pointed out that both the licences
      produced; by the police and that produced by the owner, were found


1    (2003) 3 SCC 338
2    (2004) 3 SCC 297
3    (2013) 10 SCC 217
4    2023 SCC OnLine SC 1398
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       to be fake. The registered owner of the truck, hence, can be safely
       found to have been negligent while entrusting the vehicle to the driver.
       It is vehemently contended that unlike the usual practice of the driver
       producing the driving licence, here, the owner’s representative had
       produced it before the Tribunal which clearly indicates a collusion.
       The driver was not examined before the Tribunal. The Clerks of both
       DTO Gurdaspur and RTO Alwar had deposed that the licences said
       to have been issued from their office respectively R1W1/1 and A2
       were not actually issued from the said offices. There is absolutely
       no reason to interfere with the finding of the High Court, and the
       insurance company is definitely entitled to recover the amounts from
       the appellant-owner of the truck.
5.     Suffice it to notice that the accident occurred on 26.01.1993 at 02:00
       am at an intersection when the two vehicles, a truck and the Matador
       van carrying ten passengers collided. The claim petitions filed before
       the Tribunal were all of the passengers in the Matador van, including
       the driver. Nine petitions were filed for compensation for death
       occasioned and two, for the injuries sustained as also one petition for
       the damage caused to the Matador van. Before the Tribunal, the first
       respondent-the driver of the truck, the second respondent-its owner
       and the third respondent-the insurer, were impleaded, as originally
       filed. On objection being raised by the insurer, alleging negligence
       on the Matador van driver also, the owner and the insurer of the
       van were impleaded subsequently as the 4th and 5th respondents.
6.     The Tribunal looked at the FIR, analysed the deposition of PW-3,
       an injured in the accident who was travelling in the Matador, and
       examined the site plan to find composite negligence on the driver of
       both vehicles at the rate of 75:25. The compensation was determined
       and appeals were filed by both the insurance company and the
       owners of the vehicle, challenging respectively the liability and the
       quantum. As we noticed, we are only concerned with the “pay and
       recover” directions issued by the High Court in favour of the insurer
       and against the insured owner of the truck.
7.     Lehru (supra) was a case in which though an allegation of the driving
       licence produced being fake was raised, the same was not proved
       before the Tribunal. The trite law was noticed that even if the licence
       is fake, the insurance company is liable to pay compensation, if they
       fail to prove that the insured had deliberately committed breach in
       entrusting the vehicle to a driver who had a fake licence. New India
[2025] 11 S.C.R.                                                                131

                       Hind Samachar Ltd. (Delhi Unit) v.
                    National Insurance Company Ltd. & Ors.

      Assurance Co. v. Kamla5 wherein despite finding breach, the insurer
      was directed to pay compensation to the third parties, but, enabled
      recovery from the insured was noticed. It was categorically held
      that whether the insured would be protected by such an order was
      left open to be considered on the facts of each case. It was held in
      Lehru and Ors. (supra) that: -
             “18……we are thus in agreement with what is laid down
             in the aforementioned cases viz. that in order to avoid
             liability it is not sufficient to show that the person driving at
             the time of accident was not duly licensed. The Insurance
             Company must establish that the breach was on the part
             of the insured.”
8.    In Swaran Singh (supra), a three Judge Bench of this Court,
      considered the purported conflict in Kamla (supra) and Lehru and
      Ors. (supra) to hold as under: -

             “99. So far as the purported conflict in the judgments of
             Kamla (2001) 4 SCC 342 and Lehru (2003) 3 SCC 338 is
             concerned, we may wish to point out that the defence to
             the effect that the licence held by the person driving the
             vehicle was a fake one, would be available to the insurance
             companies, but whether despite the same, the plea of
             default on the part of the owner has been established or
             not would be a question which will have to be determined
             in each case.”
9.    In PEPSU RTC (supra) it was held so on the facts arising in the
      said case, as under: -
             “11. On facts, in the instant case, the appellant employer
             had employed the third respondent Nirmal Singh as driver
             in 1994. In the process of employment, he had been put
             to a driving test and he had been imparted training also.
             The accident took place only after six years of his service
             in PRTC as driver. In such circumstances, it cannot be
             said that the insured is at fault in having employed a
             person whose licence has been proved to be fake by
             the Insurance Company before the Tribunal. As we have


5    (2001) 4 SCC 342
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          already noted above, on scanning the evidence of the
          licensing authority before the Tribunal, it cannot also be
          absolutely held that the licence to the driver had not been
          issued by the said authority and that the licence was fake.
          Though the appellant had also taken a contention that the
          compensation is on the higher side, no serious attempt
          has been made and according to us justifiably, to canvas
          that position.”
10. In Geeta Devi (supra) this Court deprecated the practice of the
    insurance companies blithely claiming that the deceased vehicle
    owner did not conduct due diligence while employing a driver; which
    is not a condition prescribed either in the statute or in the insurance
    policy, despite the wealth of precedents. It was held so in paragraph
    15, as under: -

          “15. Applying the afore-stated edicts to the case on hand,
          it may be noted that the petitioner-insurance company did
          not even raise the plea that the owner of the vehicle allowed
          Ujay Pal to drive the vehicle knowing that his licence was
          fake. Its stand was that the accident had occurred due to
          the negligence of the victim himself. Further, the insurance
          policy did not require the vehicle owner to undertake
          verification of the driving licence of the driver of the vehicle
          by getting the same confirmed with the RTO. Therefore,
          the claim of the petitioner-insurance company that it has
          the right to recover the compensation from the owners of
          the vehicle, owing to a willful breach of the condition of
          the insurance policy, viz., to ensure that the vehicle was
          driven by a licenced driver, is without pleading and proof.”
11. Now, coming to the facts of this case, A2 was produced by R3W1,
    a Clerk of the record room in Tis Hazari Court as was pointed out
    by the appellant. While referring to his deposition, the Tribunal had
    in paragraph 179 specifically stated that neither the Clerk nor the
    Court could have seized the driving licence at the time of accident.
    It is also stated in paragraph 184 that: ‘Interestingly, the police had
    seized the driving licence A2 from the driver of the Tempo issued
    from Alwar, renewed on 18.04.1990 till 17.04.1993’. We would, for the
    moment, assume that it is a typographical error and the statement
    is that A2 was seized from the driver of the truck itself. Even then,
[2025] 11 S.C.R.                                                         133

                   Hind Samachar Ltd. (Delhi Unit) v.
                National Insurance Company Ltd. & Ors.

     there is no evidence to substantiate the seizure having been made,
     nor even the seizure mahazar produced, which the police would
     have recorded if such seizure had been made at the accident spot
     or from the driver, later on.
12. We do not find any substance in the argument of the respondent-
    insurer that a collusion can be validly inferred since the driving
    licence was produced by the owner. In fact, the owner of the truck is
    not an individual and is a company, as we see from the cause title.
    Undisputedly, even if the tort-feasor is the driver, the liability for any
    negligence of the driver rests on the owner of the vehicle, vicariously.
    There can be no suspicion raised merely because the owner had
    produced the driving licence before Court. It only indicates that the
    owner had been diligent enough to procure the driving licence from
    the driver and produce it before the Tribunal, so as to validly raise
    a case for indemnification by the insurer.
13. The office of the DTO, Gurdaspur had also issued a certificate
    indicating that the driving licence No.5288 issued in the name
    of the first respondent was so issued on 05.04.1991 valid from
    05.04.1991 to 04.04.1994 and, thereafter renewed from 11.08.1994
    to 10.08.1997 vide entry No.2903 dated 11.08.1994, produced along
    with the additional documents by the appellant and marked before
    the Tribunal as R-1.
14. The driving licence issued from the office of DTO Gurdaspur was
    produced as R1W1/1 and R3W3 was a Clerk from the office of DTO
    Gurdaspur who claimed that Exhibit R1W1/1 was not issued from
    their office and no amount was deposited in the name of R1 towards
    driving licence fees in their office on 21.08.1990. Immediately, we
    have to notice that the date 21.08.1990 has no nexus with the date
    of issuance of R1W1/1, which was first issued on 05.04.1991 and
    the renewal effected on 11.08.1994.
15. Further, it is to be noticed that the DL register produced from the office
    of DTO Gurdaspur was full of interpolations. A colour photograph
    of 1st respondent was found in the register but the name shown
    was different. In cross examination, it has come out that there were
    interpolations and deletions made as against other entries too. Also
    on the ground of there being no possibility of a colour photograph in
    the year 1990, the High Court found collusion between the owner and
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       the driver. The collusion at best can be only alleged for the production
       of the licence and not with respect to the entrustment of the vehicle.
16. As has been noticed in Geeta Devi (supra) there is no pleading or
    substantiation of due diligence having not been employed at the
    time of entrustment. R1W1 was the Advertising In-charge of the
    appellant who produced the licence before the Court as Exhibit
    R1W1/1. The certificate issued by the RTO Gurdaspur was also
    marked as R1 which we referred to from the additional documents.
    In cross examination, there was only a bland suggestion made to
    the witness that the Directors of R2 knew that R1 possessed only a
    fake driving licence. There were no questions put to the witness, who
    was examined on behalf of the owner, as to the actual entrustment
    of the vehicle or whether R1 was employed regularly or temporarily
    and when such employment commenced, which are crucial insofar
    as proving or disproving due diligence by the owner at the time of
    engagement of the driver and the entrustment of the vehicle. As has
    been rightly held by the precedents above noticed, the owner of a
    vehicle employing a driver can only look at the licence produced by
    the person seeking employment and is not expected to verify from
    the licence issuing authority whether the licence is fake or not.
17. The insurance company from the totality of the circumstances has
    to bring out the absence of due diligence in the employment of the
    driver or the entrustment of the vehicle, to prove breach by the
    insured, which is totally absent in the present case. The High Court
    had erred in finding that there was collusion between the employer
    and the employee merely for reason of the driving licence having
    been produced by the employer and the driver having not contested
    the claim. The driver, as has been noticed in a number of decisions
    of this Court, would have kept himself away from the box, for fear of
    incriminating himself; since a prosecution was pending against him.
    In any event, the vicarious liability to satisfy the damages caused
    by the negligence of the employee is on the employer, the later of
    whom has to contest the matter. Not only was the driving licence, as
    issued to the driver produced, but, a certificate showing its further
    renewal was also produced. In fact, we specifically notice that the
    renewal made is not an automatic renewal which has to be carried
    out within 30 days of the expiry of a driving licence, as per the Motor
    Vehicles Act and the Rules made thereunder. Herein the validity
    period of the licence, originally issued expired on 04.04.1994 and
    the renewal was on 11.08.1994.
[2025] 11 S.C.R.                                                       135

                      Hind Samachar Ltd. (Delhi Unit) v.
                   National Insurance Company Ltd. & Ors.

18. We find absolutely no reason to sustain the order of the High Court,
    mulcting the liability on the owner of the truck. We set aside the order
    of the High Court, insofar as the rights of recovery of the award
    amounts granted to the insurer. The other directions, as issued by
    the Tribunal and modified by the High Court, including determination
    of the award amounts would stand undisturbed.
19. The appeals stand allowed.
20. Pending application, if any, shall stand disposed of.

     Result of the case: Appeals allowed.




     †
         Headnotes prepared by: Divya Pandey