Absence of Hazardous-Goods Endorsement Not a Venial Breach; Insurer Directed to Pay and Recover

A bench of Justices Sudhanshu Dhulia and K. Vinod Chandran heard four civil appeals arising from two motor-accident claim matters in which the owner of an oil tanker challenged orders directing the insurer to satisfy compensation awards and recover the sums from the owner and driver. The principal issue was whether absence of the Rule 9 endorsement (training for drivers of vehicles carrying dangerous or hazardous goods) on the driver’s licence amounted to only a technical breach absolving the insurer, and whether a training certificate produced at the appellate stage could be admitted.

The Court affirmed the High Court and upheld the directions to the insurer to pay the awards and recover from the owner of the tanker. It held that Rule 9 required more than a narrow focus on cargo-handling instructions and expressly emphasised driving skill and efficiency for vehicles carrying hazardous goods; therefore the absence of the statutory endorsement was not a venial or purely technical defect capable of absolving the insurer. The Court found the driver had no such endorsement, the tanker carried oil at the relevant time, the Tribunal’s finding of “rash and negligent driving” was supported by the FIR, charge-sheet and an eye-witness (CW2), and the certificate produced for the first time in appeal did not satisfy Order 41 Rule 27 CPC. The Court, in its reasoning, observed: “Rule 9 requires that ‘any person driving a goods carriage carrying goods of dangerous or hazardous nature to human life shall, in addition to being the holder of a driving licence to drive a transport vehicle, also has the ability to read and write at least one Indian language specified in the VIIIth Schedule of the Constitution of India and English and also possess a certificate of having successfully passed a course consisting of the syllabus detailed thereunder’. The syllabus stipulated cannot be found to be that which is confined to proper care being taken of the dangerous or hazardous goods carried in the vehicle; which is only one part of the three-part syllabus tabulated in the Rules as parts ‘A’, ‘B’ & ‘C’. Parts ‘A’ & ‘B’ specifically emphasise the driving skill and efficiency that is required while carrying dangerous or hazardous goods; ... we cannot find the absence of such endorsement of the training course having been undertaken to be a venial breach, not absolving the Insurance Company of its liability.”

Background The appeals arose from two awards by Motor Accidents Claims Tribunals in favour of families of deceased breadwinners who died when an oil tanker struck a bicyclist and a pedestrian. The Tribunal relied on the FIR, charge-sheet and the deposition of CW2 (an eye-witness) to find rash and negligent driving. The insurer paid the awards and sought recovery from the owner and driver on the ground that the driver lacked the endorsement required under Rule 9 to drive vehicles carrying dangerous/hazardous goods. The owner contended the tanker was not carrying hazardous goods at the time and, in any event, the absence of an endorsement was a venial breach; a three-day training certificate was produced at the stage of first appeal.

The High Court and the Supreme Court rejected the owner’s contentions. Applying Section 11 read with Rule 9 and the syllabus annexed thereto, the Court held the statutory course dealt substantially with advanced and defensive driving skills (Parts A & B) in addition to product safety (Part C), and thus the endorsement was material to the risk insured. The Court also applied the test in Swaran Singh and noted that where lack of a requisite licence or endorsement is a contributory cause of accident the insurer could not avoid liability. The certificate produced in appeal was excluded under Order 41 Rule 27, since it was not produced before the Tribunal and no satisfactory explanation for non-production was offered; the document lacked basic indicia such as a serial number and institutional seal. The appeals were dismissed and the direction that the insurer pay the claim amounts and recover from the owner was affirmed. No interim directions were granted; pending applications stood disposed of.

Case Details: Case No.: C.A. @ SLP (C) No. 25789-25792 of 2019 (2025 INSC 468) Case Title: M/s Chatha Service Station v. Lalmati Devi & Ors. Appearances: For the Petitioner(s): Not indicated in the judgment For the Respondent(s): Not indicated in the judgment