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Insurance companies cannot be compelled to pay compensation for transport vehicles involved in mishaps if the driver lacks an proper licence, the Supreme Court has held.

For instance, a person might be possessing a licence for driving a light motor vehicle (LMV), but if he drives a transport or heavy motor vehicle (HMV) and meets with an accident, in such a case, the insurer need not pay compensation to the driver or the vehicle owner.

If a person is driving a HMV or transport vehicle, then he must be in possession of a valid licence to drive the same, or have an endorsement upon it from the competent authority, a bench of C K Thakker and Tarun Chatterjee said.

The bench passed the ruling while allowing a batch of appeals filed by the New India Assurance Company challenging the compensations awarded by various consumer forums in the country to transport vehicle owners, despite the fact that the drivers did not have the necessary licence to drive the heavy vehicles.
Citing its earlier rulings on the issue, the apex court said the importance of a driving licence issued for a transport vehicle could be gauged from the fact that it is renewable after every three years, unlike the other licences which are valid for 20 years or till the person attains 50 years.

Hence it said the insurance company cannot be compelled to pay compensation where the driver is not in possession of a valid driving licence for a transport vehicle.

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