In a major judgement to help innocent road accident victims, the Supreme Court has ruled that an insurance company was liable to pay compensation to the victims even if the driver of the vehicle, which met with an accident, had a fake driving licence.

This ruling was given by a Bench comprising Justice S N Variava and Justice B N Agrawal while imposing a cost of Rs 20,000 on United India Insurance Company Ltd for filing 'unnecessary appeals' to deprive the claimants of the compensation.

It was a case where the insurance company had tried to wriggle out of its commitment to pay compensation to the third party accident victims on the ground that the driver of the vehicle involved in the accident had a fake licence.

The Bench, while giving this judgement, cited an example of a vehicle being stolen; while being drive by the thief meets with an accident and it was found that the thief had no licence at all.

"Can the insurance company disown liability? The answer has to be an emphatic 'No'. To hold otherwise would be to negate the very purpose of compulsory insurance," the Bench said.

To help the injured or the relatives of the person killed the legislature had made insurance, at least third party insurance, compulsory, the Bench said, and added: "The aim and purpose being that an insurance company would be available to pay."