NEUTRAL CITATION
C/FA/1701/2015 ORDER DATED: 21/08/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 1701 of 2015
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ORIENTAL INSURANCE COMPANY LTD
Versus
CHAVDA BHIKHABHAI MOTIBHAI & 7 other(s)
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Appearance:
MR VC THOMAS(5476) for the Appellant(s) No. 1
MR AKHTAR N MALEK(3382) for the Defendant(s) No. 8
MR H M SHAH(3997) for the Defendant(s) No. 1,2,3,4,5
MR RATHIN P RAVAL(5013) for the Defendant(s) No. 7
MR SALIM M SAIYED(5172) for the Defendant(s) No. 6
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CORAM:HONOURABLE MR. JUSTICE ILESH J. VORA
Date : 21/08/2023
ORAL ORDER
1. This Appeal is filed under Section 173 of the Motor Vehicle Act, 1988, by the insurance company namely Oriental Insurance Company Limited - original opponent no.4, assailing the judgment and award dated 14.05.2015 in MACP No.392 of 2006 filed under Section 163-A of the M.V. Act, passed by the MACT (Main), Anand, whereby, the appellant held liable for the amount of compensation for and on behalf of owner of the vehicle.
2. Mr.V.C. Thomas, learned counsel confined his submission on the law point and does not press the other grounds mentioned in the appeal memo.
3. Mr. Thomas, learned counsel appearing for and on behalf Page 1 of 4 Downloaded on : Sun Sep 17 01:54:56 IST 2023 NEUTRAL CITATION C/FA/1701/2015 ORDER DATED: 21/08/2023 undefined of the insurance company assails the impugned judgment and award mainly on the ground that, the Tribunal erred in fastening the liability of the insurance company which calls for interference as the owner of the vehicle, failed to honour the amount of premium towards the policy. He submitted that, the receipt of premium was issued subject to realization of the cheque issued by the owner of the vehicle and the same was dishonoured which amounts to non-compliance of Section 64 V B of the Insurance Act, 1938.
4. On the other hand, learned counsel Mr. Hemal Shah, Mr. Rathin Raval, Mr. Akhtar Malek and Mr. Salim Saiyed have opposed the appeal and contended that, the insurance company failed to intimate the owner about the return of cheque and therefore, the mandatory procedure having not been followed in the facts of the present case and therefore, the learned Tribunal has rightly fastened the liability of the appellant company.
5. Having heard the learned counsel for the respective parties and on perusal of the impugned judgment and award, the issue arise for determination is whether the Tribunal is justified in passing the judgment and order by fastening the liability on the appellant-insurance company which calls for interference?
6. The Tribunal has not committed any error either on facts, or on law in fixing the liability of the appellant-insurance Page 2 of 4 Downloaded on : Sun Sep 17 01:54:56 IST 2023 NEUTRAL CITATION C/FA/1701/2015 ORDER DATED: 21/08/2023 undefined company. The vehicle being truck no.GJ-7-Y-3619 was insured with the appellant company. The coverage of the insurance was from 14.11.2006 to 13.11.2007 covering the date of incident i.e. 29.11.2006. It is case of the insurance company before the Tribunal that, the cheque of premium was dishonoured and there was a specific clause that, the acceptance of cheque will be subject to realization. The cheque given was dishonoured on 09.11.2006. The policy had been cancelled on 14.11.2006 before the date of accident. In the case of cheque return, the Apex Court in the case of United India Insurance Company Limited vs. Laxmamma (2012) ACJ 1307 SC, observed that, when the cheque given for payment of premium of policy is dishonoured and on that count insurance company cancel the policy, by intimating the insured of such dishonour of cheque before date of accident, then in such a situation, insurance company cannot be held liable, but, insurance company fails to intimate the insured about such "dishonour" and "cancellation of policy" before the date of accident.
7. In light of the settled legal position and applying the same to the facts of the present case, the insurance company failed to intimate the insured about the dishonour of cheque and decision of cancellation of policy before the accident. Before the Tribunal, nothing brought on record to establish the prior intimation to the insured.
8. In view of the aforestated reasons, the impugned Page 3 of 4 Downloaded on : Sun Sep 17 01:54:56 IST 2023 NEUTRAL CITATION C/FA/1701/2015 ORDER DATED: 21/08/2023 undefined judgment and award fastening the liability on the appellant company does not call for any interference. Accordingly, the appeal fails and is hereby dismissed. The award be drawn accordingly.
(ILESH J. VORA,J) TAUSIF SAIYED Page 4 of 4 Downloaded on : Sun Sep 17 01:54:56 IST 2023