National Insurance Co. Ltd. vs Kamlesh Singh & Ors.
2009 Latest Caselaw 4355 Del

42
*       IN THE HIGH COURT OF DELHI AT NEW DELHI

                       +       MAC.APP.No.853/2006

%                                 Date of decision: 27th October, 2009


      NATIONAL INSURANCE CO. LTD.        ..... Appellant
                    Through : Mr. Manoj Ranjan Sinha, Adv.

                      versus

      KAMLESH SINGH & ORS.                ..... Respondents
                   Through : Mr. R.P. Singh, Adv.
                             for R-1 to 5.


CORAM :-
THE HON'BLE MR. JUSTICE J.R. MIDHA

1.      Whether Reporters of Local papers may
        be allowed to see the Judgment?

2.      To be referred to the Reporter or not?

3.      Whether the judgment should be
        reported in the Digest?

                               JUDGMENT (Oral)

1. The appellant has challenged the award of the learned

Tribunal whereby compensation of Rs.4,60,000/- has been

awarded to claimants/respondents No.1 to 5.

2. The only ground urged at the time of hearing of this appeal

is that the cheque issued by the owner of the offending vehicle

towards the premium of the Insurance of the offending vehicle

was dishonoured and, therefore, the appellant is not liable. The

copy of the cheque No.091956 dated 13th February, 2002 for

Rs.23,129/- has been filed along with this appeal. The dishonour

memo of the Bank has also been placed on record. The appellant

issued a notice dated 21st February, 2002 to the owner of the

offending vehicle intimating him about the dishonour of the said

cheque. In the notice dated 21st February, 2002, it was also

notified to the owner that the company is under no risk till the

time the fresh remittance of the premium is made by the owner.

The learned counsel for the appellant submits that the owner did

not make the payment of the premium amount after the notice

dated 21st February, 2002 and, therefore, the appellant is not

liable under the policy which stood cancelled after the notice

dated 21st February, 2002.

3. It is well settled that the liability of the appellant continues

towards the third parties till the notice is issued by the appellant

to the Road Transport Authority. Admittedly, no notice was

issued to the Road Transport Authority and, therefore, the

appellant continued to remain liable towards third parties.

However, after making the payment of the award amount, the

appellant is entitled to recovery rights from the owner of the

offending vehicle.

4. In the facts and circumstances of this case, the appeal is

partially allowed by granting the recovery rights to the appellant

to recover the award amount from the owner of the offending

vehicle after making the payment of the award amount to the

claimants.

5. The learned counsel for the appellant submits that the

entire award amount has been deposited with the learned

Tribunal in terms of the order dated 31 st August, 2006. However,

the operation of the impugned award was stayed by this Court on

31st October, 2006 due to which the claimants could not get the

award amount.

6. The claimants applied for release of the award amount by

CM No.13662/2007 which was allowed vide order dated 26th

March, 2008 and the amount was directed to be released upon

furnishing bank guarantee. The claimants being poor persons

could not furnish the bank guarantee and, therefore, the award

amount was not released to the claimants.

7. Vide order dated 8th May, 2009, the order dated 31st

October, 2006 was modified by this Court and the award amount

was directed to be released to the claimants in pursuance to

which the amount has been released to them on 12th October,

2009.

8. In the facts and circumstances of this case, it is held that

the claimants shall be entitled to interest on the award amount

till 8th May, 2009 when this Court directed the award amount to

be released to the claimants.

9. The learned counsel for claimants/respondents No.1 to 5

submit that there is short deposit in respect of interest payable

on the award amount up to the date of deposit.

10. The Accounts Department of Delhi High Court has done the

calculation of interest and as per the said calculation, the

appellant is liable to pay interest of Rs.79,858/- up to 8th May,

2009.

11. The appellant is directed to make payment of Rs.79,858/- to

the claimants/respondents by means of a cheque drawn in the

name of Kamlesh Singh and the same be handed over to her in

Court on the next date of hearing.

12. Upon the payment of the said interest amount, the Registry

shall refund the statutory amount of Rs.25,000/- to the appellant.

13. The learned Tribunal is directed to release the FDRs with

proper endorsement to the claimants in terms of the award.

14. The offending vehicle was owned by respondent No.7 who

has since expired and is survived by Harbansh Singh and Jasbir

Kaur who have been added as respondents No.7 and 8 vide

amended memo of parties dated 14th September, 2007.

15. The appellant is granted recovery rights against

respondents No.7 and 8 with respect to the amount paid to the

claimants.

16. List the appeal for directions on 8th December, 2009.

17. Copy of this order be given 'Dasti' to learned counsel for

both the parties under signature of Court Master.

J.R. MIDHA, J

OCTOBER 27, 2009 aj/mk