Verdict

In Supreme Court, Civil Appellate 
Civil Appeal 841 of 2018 (and several other SLPs)
Bajaj Alliance General Insurance Co Ltd . . . . . . . . . . . . . Appellant
V/s
Rambha Devi & Others . . . . . . . . . . . . . . . . . . . . . . . . . . . Respondent(s)  

In November 2018, Supreme Court gave its verdict on an important issue that attracted the above appeal as well as several other SLPs between 2017 and 2024 and also necessitated deliberations on this issue by the central govt.

BACKGROUND

• The Motor Vehicles Act (MV Act), applicable across India, was first enacted in October 1988.
• Based on the provisions of MV Act, the Central Motor Vehicle Rules were notified in July 1989.
• The first Amendment to the MV Act was the ‘Amendment 54 of 1994’. Among the various amendments made, the main was: the classifications ‘medium goods vehicle’, ‘medium passenger vehicle’, ‘heavy goods vehicle’ and ‘heavy passenger vehicle’ were jointly replaced by single classification ‘transport vehicle’.  
• The next Amendment to MV Act was introduced as a Bill in 2017 but was opposed and got lapsed.
• This 2017 Amendment Bill was reintroduced in the next parliament and became an Act in 2019.

FACTS  OF THE CASE

• Various Courts passed contradicting Judgments on the classification of vehicles under the MV Act. therefore, a Division bench of the Supreme Court in ‘Mukund Dewangan v/s Oriental Insurance Co Ltd’ (2016) 4 SCC 298 (‘Dewangan Case’) referred the case to a 3-Judge bench in 2017 on the core issue of: whether a ‘light motor vehicle’ (LMV) can be classified as ‘transport vehicle” (TrV)?
• The 3-judge bench passed the following Judgment:
  1. LMV includes TrV whose gross vehicle weight (GVW) does not exceed 7500 kg.
  2. License holder of LMV can also drive TrV or Omnibus with GVW below 7500 kg; he can also drive a motor car or a tractor or a road roller whose unladen weight (UL) is below 7500 kg. 

• In 2018, the (present) Civil Appeal was opened by another 2-Judge bench, to address the contradictions that persisted. This bench contended that the previous 3-judge bench was not presented with other important and relevant provisions of MV Act and Rules. This bench referred the case to another 3-Judge bench for revisiting the ratio i.e. reasoning of the previous 3-judge bench. The new 3-judge bench concurred with the contention of the 2-judge bench but referred the entire case afresh to a 5-judge bench of the Supreme Court.
• Meanwhile, based on the judgement of the 3-judge bench on the Dewangan Case of 2016-2017, the Central government issued notifications in 2018 and 2021 for implementation.

ISSUES UNDER CONSIDERATION BY 5-JUDGE BENCH

1. Whether a driver holding an LMV license (for vehicles with a gross vehicle weight of less than 7,500 kgs) as per Section 10(2)(d), which specifies ‘Light Motor Vehicle’, can operate a ‘Transport Vehicle’ without obtaining specific authorization under Section 10(2)(e) of the MV Act, specifically for the ‘Transport Vehicle’ class;
2. Whether the second part of Section 3(1) which emphasizes the necessity of a driving license for a ‘Transport Vehicle’ overrides the definition of LMV in Section 2(21) of MV Act? Is the definition of LMV contained in Section 2(21) of MV Act unrelated to the licensing framework under the MV Act and the MV Rules;
3. Whether the additional eligibility criteria prescribed in the MV Act and MV Rules for ‘transport vehicles’ would apply to those who are desirous of driving vehicles weighing below 7,500 kgs and have obtained a license for LMV class under Section 10(2)(d) of the MV Act;

ANALYSIS & JUDGMENT
While analysing the MV Act, Rules and judicial precedents, the Apex Court analysed judgements passed in several cases including but not limited to:

• Kulwant Singh v. Oriental Insurance Co. Ltd (2015a) 2 SCC 186
• S. Iyyapan v. United India Insurance Co. Ltd (2013) 7 SCC 62
• India Assurance Company v Prabhu Lal (2008) 1 SCC 696

Based on its analysis and observations, the Apex Court held as follows:

1. Certain provisions of MV Act were ignored in equating LMV and TrV in terms of classification of the vehicles and eligibility of license holder to drive them
2. Irrespective of the specifications of GVW and UL in MV Act, skill set required for driving LMV and TrV are different. As such, there must be differentiation between License holders of LMV and TrV.
3. In any case, by virtue of the MV Amendment Act 54 1994, no person can be given Learner Licence for a TrV unless he is holding a license to drive LMV for at least one year.
4. However, any interpretation of the provisions of MV Act must consider:
   i) safety of users of public transport.
   ii) rapid evolution of transport sector and infrastructure technology.
   iii) livelihood of LMV Licensees, who have been operating TrV as per central govt notifications issued based on the Dewangan Case for over 6 years since the notification; insisting on fresh Licence for driving TrV will deprive them of their jobs.
   iv) No empirical data has been established to prove that LMV License holders driving TrV have caused significant road accidents.
5. The Apex Court was of the view that the Central govt was right in issuing notifications based on the Dewangan Case. However, the Attorney General has clarified the following during his deliberations with the 5-judge bench:
   i) The notifications are not in accordance with the real intent of the legislation of MV Act.
   ii) The notifications are not to be treated as a policy declaration by the Central government.
   iii) The Central government recognises the need to issue fresh guidelines/notifications to fill the gaps in the Dewangan Case judgement as well as in the provisions of the MV Act.

Accordingly, the 5-judge bench concluded that:
a) Licensee of LMV can continue to drive TrV with GVW below 7500 kg only. In other words, the judgment in the Dewangan Case of 2016-2017 is upheld.
b) The Central government will notify further amendments in MV Act / Rules after they are passed in parliament.

For full text of the judgement:
https://api.sci.gov.in/supremecourt/2017/29686/29686_2017_1_1501_57018_Judgement_06-Nov-2024.pdf