Delhi High Court
Oriental Insurance Co. Ltd. vs Santosh & Ors. on 1 June, 2016
$~R-134
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision: 01.06.2016
+ MAC.APP. 101/2008
ORIENTAL INSURANCE CO. LTD. ..... Appellants
Through: Mr. Saurabh Kr. Tuteja for Mr.
Tarkeshswar Nath, Adv.
versus
SANTOSH & ORS. ..... Respondents
Through: None .
CORAM:
HON'BLE MR. JUSTICE R.K.GAUBA
JUDGMENT
R.K.GAUBA, J (ORAL):
1. On 12.03.1998, Satya Prakash died in a motor vehicular accident
involving use of bus bearing registration No. DL 1P 3670 (the offending
vehicle), statedly insured against third party risk with the appellant insurance
company for the period in question. His dependent family members (first to
sixth respondents/claimants) instituted an accident claim case (Suit No.
961/1998) on 28.08.1998, seeking compensation initially under Sections 166
and 140 of Motor Vehicles Act, 1988 (MV Act) but later converting it into a
case under Section 163 A of MV Act.
2. The tribunal held inquiry, and by judgment dated 20.11.2007 upheld
the case that the death had occurred due to negligent driving of the bus. The
tribunal awarded compensation in favour of the claimants in the sum of `
3,75,000/- with interest @ 7% per annum and directed the insurance
company to pay.
3. The insurer had taken the plea before the tribunal that there was no
valid or effective insurance cover for the date of accident (i.e. 12.03.1998).
The said contention raised was considered but rejected by the tribunal with
following observations:-
"It is argued on behalf of R3, insurance company that there was
no privity of contract between respondent no.2 (owner) and R3
(insurer) as the policy of insurance of offending vehicle for the
period from 6.12.97 to 5.12.98 had been cancelled because of
dishonouring of cheque of consideration amount paid by
respondent No.2. It is furthered argued that thereafter fresh
cover note had been issued for the period from 21.3.98 to
20.03.99, which does not cover the date of accident i.e. 12.3.98,
hence R3 is not liable to pay any compensation to petitioners
even that cheque was also dishonoured. I have carefully
considered the submissions made by counsel for R3 and
scrutinized the evidence on record. R3W1 Anand Kumar, has
no where disposed in his entire testimony that any legal
notice/show cause notice was issued to R2 before cancelling the
cover note/insurance policy No. 25132 dt. 6.12.1997 for the
period from 6.12.97 to 5.12.99. Initially the cover note was
issued. Thereafter insurance policy was also issued. No date
when policy was cancelled has been stated by this witness. No
copy of notice issued to the insured prior to cancellation to
insurance policy has been placed on the file. No bounced
cheque/cheque return memo with regard to the policy w.e.f.
6.12.97 to 5.12.98 has been placed on the file. The documents
placed on the file with regard to bouncing of cheques pertains
to second policy issued w.e.f 21.3.98 to 20.3.99 which does not
cover the date of accident. In the absence of any such evidence,
it cannot be said that the insurance policy of R2 had been
legally cancelled by R3, hence R3 cannot be allowed to take
benefit of its own wrong. In view of above discussion, this
court is of opinion that R3 is liable to pay compensation to the
petitioners on behalf of its insured."
4. The insurer by the appeal at hand reiterates that there was no valid
insurance cover.
5. The reasons set out by the tribunal, as quoted above for rejecting the
above-said plea, are found to be appropriate in the face of evidence on
record. Thus, the Court does not find any merit in the appeal. It is
dismissed.
6. By order dated 21.01.2009, it was noted that the appellant had
deposited the entire awarded amount in the Court. The said deposited
amount was directed to be kept in fixed deposit initially for a period of six
months. By order dated 13.05.2009, the Registrar General was directed to
transfer the said deposit and statutory amount to the tribunal within the
period specified and the tribunal was given liberty to release the same to the
claimants in terms of the award. Thus, no further directions are required.
7. The appeal is disposed of in above terms.
(R.K. GAUBA)
JUDGE
JUNE 01, 2016/nk
