In a significant ruling, the Karnataka High Court has clarified that it is the fundamental duty of an employer to verify the credentials of its drivers. The court held that a failure to ensure a driver holds a valid and effective licence amounts to a breach of insurance policy conditions, which frees the insurance company from any liability in case of an accident.
Court Upholds Compensation Order Against School
The observation was made by Justice K Manmadha Rao while upholding an order passed by the Commissioner for Employees Compensation in Mangaluru. The commissioner had directed the management of a local school to provide compensation to the family of a bus driver who died in a tragic accident in August 2008.
The Fatal Accident and Licence Lapse
The incident occurred when a bus belonging to the Balmy English Medium School in Thenkulipady skidded on a rain-soaked road and plunged into the Phalguni river. The driver, Badruddin, suffered grievous injuries and later succumbed to them.
Following his death, his wife and two children approached the employees' compensation commissioner seeking relief. However, Bajaj Allianz General Insurance Company, which had insured the vehicle, opposed the claim. The insurer pointed out a critical flaw: the driver did not possess a valid driving licence on the date of the accident. Official records revealed that his licence had expired on June 17, 2008 — nearly two months before the fatal crash in August.
School's Appeal Dismissed, Supreme Court Precedent Cited
The commissioner had held the school management, as the vehicle owner, liable to pay Rs 5.4 lakh with 12% annual interest from the date of the accident. Challenging this order, the school management argued before the High Court that it had operated under a bona fide belief that the insurer would bear the liability and thus did not actively contest the proceedings earlier.
After examining the records, Justice Rao noted that the insurer had clearly established a violation of the policy conditions. The judge reinforced this finding by citing the Supreme Court's judgment in the Beli Ram case. The apex court had unequivocally ruled that ensuring a driver holds a valid licence is the employer's responsibility. Any lapse on this front squarely shifts the burden of compensation onto the employer, not the insurer.
With these conclusive findings, the Karnataka High Court dismissed the school management's appeal. The institution remains solely responsible for paying the compensation to the driver's family.
