Non-registration of vehicle ground for insurance company to deny insurance claim: Supreme Court

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The Bench of Justices UU Lalit, Ravindra Bhat and Bela M Trivedi said that when an incident involves a vehicle that has no valid registration, then the insurance company can deny payment of the insurance claim since it is a breach of the conditions of the agreement.

"Therefore, on the date of theft, the vehicle had been driven/used without valid registration, amounting to a clear violation of Sections 39 and 192 of the Motor Vehicles Act, 1988. This results in a fundamental breach of the terms and conditions of the policy, as held by this Court in Narinder Singh, entitling the insurer to repudiate the policy," the Court held.

The NCDRC should not have overlooked and disregarded a clear binding judgment of this Court – it also should not have disregarded its ruling in 

6 39. Necessity for registration. - No person shall drive any motor vehicle and no owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place unless the vehicle is registered in accordance with this Chapter and the certificate of registration of the vehicle has not been suspended or cancelled and the vehicle carries a registration mark displayed in the prescribed manner: Provided that nothing in this section shall apply to a motor vehicle in possession of a dealer subject to such conditions as may be prescribed by the Central Government. 192. Using vehicle without registration.--(1) Whoever drives a motor vehicle or causes or allows a motor vehicle to be used in contravention of the provisions of section 39 shall be punishable for the first offence with a fine which may extend to five thousand rupees but shall not be less than two thousand rupees for a second or subsequent offence with imprisonment which may extend to one year or with fine which may extend to ten thousand rupees but shall not be less than five thousand rupees or with both: Provided that the court may, for reasons to be recorded, impose a lesser punishment. (2) Nothing in this section shall apply to the use of a motor vehicle in an emergency for the conveyance of persons suffering from sickness or injuries or for the transport of food or materials to relieve distress or of medical supplies for a like purpose: Provided that the persons using the vehicle reports about the same to the Regional Transport Authority within seven days from the date of such use. (3) The court to which an appeal lies from any conviction in respect of an offence of the nature specified in sub-section (1), may set aside or vary any order made by the court below, notwithstanding that no appeal lies against the conviction in connection with which such order was made. Explanation.--Use of a motor vehicle in contravention of the provisions of section 56 shall be deemed to be a contravention of the provisions of section 39 and shall be punishable in the same manner as provided in sub-section (1).