The Divisional Manager, National ... vs Harijana Parameswarudu Paramesh
2021 Latest Caselaw 2571 AP

            HON'BLE SRI JUSTICE NINALA JAYASURYA

                     M.A.C.M.A.No. 1905 of 2005

JUDGMENT:-

       Aggrieved by the order and decree dated 30.07.2004 in

M.V.O.P.No.173 of 2003 passed by the V Additional District Judge(Fast

Track Court)-cum-Motor Accident Claims Tribunal, Kurnool (herein after

referred to as 'Claims Tribunal') , the present appeal has been preferred

by the insurance company.



2.     For the sake of convenience, the parties are hereinafter referred

to as they were arrayed before the Claims Tribunal in the original

petition.



3.     The petitioner/claimant one Mr.Harijana Parameswarudu @

Paramesh seeking compensation of Rs.50,000/- for the injuries

sustained by him in a road accident that occurred on 26.12.2002, filed

the claim petition in M.V.O.P.No.173 of 2003. In the said petition, it is

averred that on 26.12.2002 at about 4-00 a.m., when the petitioner and

others were proceeding in an auto bearing No.AP21-T-7638 towards

A.Gokulapadu village, a lorry bearing No.AP16-TT-767 driven in a rash

and negligent manner came in the opposite direction, dashed against

the auto and as a result of the accident, the petitioner and two others

sustained multiple and grievous injuries.



4.     The 1st respondent-owner of the lorry remained exparte. The 2nd

respondent-insurance company filed its counter inter alia stating that the

lorry bearing No.AP16-TT-767 was not involved in any accident much

less on 26.12.2002, the petitioner/claimant in collusion with the police

officials have falsely implicated the said lorry in the accident and infact

MACMA_1905_2005 NJS, J

as per the First Information Report, the crime vehicle was AP10-T-768.

It was further stated that the 1st respondent by suppressing the fact that

the lorry bearing No.AP16-TT-767 was involved in the accident has

issued a cheque on 26/12/2002 and accordingly, a cover note

No.952861 dated 26/12/2002 was issued at about 7-45 p.m., and further

that the said cheque was dishonoured and after due intimation to the 1st

respondent, cancelled also. Subsequently, the 1st respondent again

insured his vehicle by paying the amount through Demand Draft on

18/01/2003 and as such the 2nd respondent issued a fresh cover note on

19/01/2003 covering the period from 19/01/2003 to 18/01/2004. The 2nd

respondent, accordingly, denied the liability of the insurance company

as the material facts were suppressed and that the policy was not

effective as on the date of accident.

5. On the basis of pleadings, the Claims Tribunal framed the

following issues for consideration:

1) Whether the accident occurred due to rash and negligent driving of the driver of lorry bearing No.AP16-TT-767(10 tyres lorry)?

2) Whether the petitioner is entitled to compensation and if so, to what amount and from which of the respondents?

3) To what result?

6. In support of his case, the petitioner examined himself as P.W.1

and got marked Exs.A1 to A5. On behalf of the insurance company,

R.W.1 was examined and Exs.B1 to B7 have been marked.

7. The Claims Tribunal after considering the oral and documentary

evidence, answered the issues in favour of the petitioner/claimant and

partly allowed the claim by awarding a sum of Rs.16,567/- with

MACMA_1905_2005 NJS, J

proportionate costs and interest @ 9% p.a., from the date of petition till

the date of realization. Against the said award and decree, the instant

appeal is preferred.

8. While reiterating the grounds raised in the appeal, the learned

counsel for the insurance company contends that the 1st respondent-

owner of the vehicle suppressed the material facts with regard to

occurrence of the accident on 26/12/2002 in the early hours,

approached the insurance company on the same day evening and

obtained the policy of insurance by issuing a cheque dated 26/12/2002.

He further submits that even the said cheque was returned on the

ground of 'insufficient funds' and therefore the insurance company

cancelled the policy as the issuance of cover note and the consequential

policy are subject to realization of the cheque. He further submits that

the 1st respondent in view of the dishonor of the cheque, paid the

premium amount by way of Demand Draft on 18/01/2003 and the

insurance company issued a fresh cover note on 19/01/2003 and

subsequently policy covering the period from 19/01/2003 to 18/01/2004.

He contends that thus policy in respect of vehicle bearing No.AP16-TT-

767 was not in force as on the date of accident and therefore the

insurance company is not liable to pay any compensation. He further

submits that even assuming, the policy would come into effect on

26/12/2002 after sunrise i.e., 6-00 a.m., as per the customary practices

prevailing in India and not as per Gregorian calendar. He submits that

as the accident occurred at 4-00 a.m. on 26/12/2002 before sunrise, the

insurance company cannot be fastened with any liability and that the

finding of the Claims Tribunal in this regard is unsustainable. He also

submits that infact, there is collusion between the claimant and owner of

MACMA_1905_2005 NJS, J

the vehicle and though the vehicle in question was not involved in the

accident, for wrongful gain, the said lorry bearing No.AP16 TT 767 was

brought into picture. He submits that as there is suppression of facts

and as the vehicle in question was not having valid insurance policy at

the time of accident, the insurance company cannot be made liable for

payment of compensation and the award and decree of the Claims

Tribunal is liable to be set aside.

9. Perused the material, both oral and documentary available on

record. The contentions of the learned counsel for the appellant are

considered with reference to the said material and the legal aspect that

falls for consideration by this Court is:

"Whether the policy of insurance comes into operation from the sunrise on the date of issuance of policy or from the specific time mentioned in the policy?"

10. In the present case, a cheque(Ex.B3) was issued by the owner of

the vehicle/lorry bearing No.AP 16-TT-767 towards insurance premium

on the basis of which a cover note(Ex.B1) was issued on 26/12/2002

followed by policy bearing No.550400/31/02/6307261 dated

31/12/2002(Ex.B2) covering the period "from 26/12/2002 at 12 a.m., to

midnight of 25/12/2003" which clearly indicates the policy covers the

period during which the accident occurred i.e., at 4-00 a.m. on

26/12/2002. It is not in dispute that the said cheque was returned vide

cheque return memo dated 13/01/2003(Ex.B4), but it is the contention of

the learned counsel for the insurance company that even assuming, the

policy would come into force from the sunrise on the date of issuance of

policy.

MACMA_1905_2005 NJS, J

11. In the case of New India Assurance Co.Ltd., v. Ram Dayal and

others1, the Hon'ble Supreme Court while affirming the view taken by

the Punjab and Haryana High Court held to the effect that the insurance

policy obtained on the date of the accident becomes operative from the

commencement of the date of insurance i.e., from the previous mid night

and since the accident took place on the date of the policy, the insurer

became liable.

12. Further in New India Assurance Co., v. Bhagwati Devi and

Others2, the Hon'ble Supreme Court while referring to the earlier

judgment in National Insurance Co. Ltd., v. Jikubhai Nathuji Dabhi3

held to the effect that a insurance policy becomes operative from the

previous mid night, when bought during the day following, in the

absence of a contract to the contrary and in case there is mention of a

specific time of its purchase, then a special contract to the contrary

comes into being and the policy would be effective from the mentioned

time.

13. In the present case, as is evident from Ex.B2, the policy

commences and covers the period "from 26/12/2002 at about 12-00

a.m. to mid night of 25/12/2003".

14. Applying the expression of the Hon'ble Supreme Court in the

above referred judgment, as the period of insurance coverage is

mentioned in clear terms, the policy of insurance would come into force

from the said period and the contention of the learned counsel for the

1 (1990) 2 SCC 680 2 (1998) 6 SCC 534 3 (1997) 1 SCC 66

MACMA_1905_2005 NJS, J

appellant that the insurance policy would come into force from

26/12/2002 after 6-00 a.m., i.e., after sunrise as per the Indian customs

and practice is not sustainable and accordingly the same is rejected.

15. Be that as it may Ex.B2-insurance policy was issued only after

issuance of cheque which was returned subsequent to the occurrence of

accident and for the default/lapses on the part of the owner of the

vehicle, the claimant cannot be made to suffer. Further, as seen from

the evidence on record, no steps were taken by the insurance company

in view of the dishonor of the cheque and on the other hand a Demand

Draft furnished towards the premium amount was accepted and a

policy(Ex.B7) in respect of offending vehicle was issued on 19/01/2003.

Though the learned counsel for the insurance company argued that the

Ex.B1-cover note and Ex.B2-insurance policy were obtained by

suppression of facts and further that the lorry in question bearing

No.AP16-TT-767 was falsely implicated in the case for wrongful gain,

the same merits no consideration in view of the well considered findings

recorded by the Claims Tribunal on a detailed examination of the

evidence on record. The Claims Tribunal while answering Issue No.1,

had dealt with the matter extensively and recorded its conclusion in

favour of the claimant and the same warrants no interference by this

Court.

16. Insofar as the liability is concerned, though the learned counsel

for the appellant submitted that the policy was not in force in view of the

dishonor of the cheque subsequent to the occurrence of the accident, as

opined supra, the claimant cannot be made to suffer for the lapses of

owner of the vehicle. If the policy of insurance was obtained by

MACMA_1905_2005 NJS, J

suppression of facts or the policy was cancelled due to dishonor of the

cheque issued towards premium like in the present case, the claimant

cannot be made to suffer and as rightly pointed out by the Claims

Tribunal, it is for the insurance company to sue the owner of the vehicle

for the acts/lapses on his part. As observed earlier, no such action has

been taken by the appellant-insurance company and on the other hand,

a policy in respect of the vehicle in question was issued subsequently.

Under the said circumstances, the claimant cannot be deprived of

compensation, much less against the insurance company. Therefore,

the contention of the learned counsel for the appellant that the Claims

Tribunal erred in fastening the liability on the insurance company cannot

be accepted and the same is accordingly rejected.

17. For the foregoing reasons, this Court is of the considered opinion

that the award and decree of the Claims Tribunal is well considered,

based on material on record, contains cogent reasons and warrants no

interference.

18. Accordingly, the appeal is dismissed. No order as to costs.

Miscellaneous Petitions, if any, pending in this appeal shall stand

dismissed.

__________________ NINALA JAYASURYA, J 24.07.2021.

BLV

MACMA_1905_2005 NJS, J

HON'BLE SRI JUSTICE NINALA JAYASURYA

M.A.C.M.A.No.1905 of 2005 Dated 24.07.2021

BLV