Jammu & Kashmir High Court
Oriental Insurance Co. Ltd vs Asha Rani & Ors on 14 October, 2025
Author: Sanjay Dhar
Bench: Sanjay Dhar
Serial No. 37
HIGH COURT OF JAMMU & KASHMIR AND LADAKH
AT JAMMU
Case:- FAO(WC) No.42/2019
CM No.9091/2019
CM No.2143/2024
Oriental Insurance Co. Ltd.
..... Petitioner(s)
Through: Mr. Rupinder Singh, Advocate
Vs
Asha Rani & Ors.
.....Respondent(s)
Through: Mr. M.K. Raina, Advocate
Mr. Sachin Sharma, Advocate
Coram: HON'BLE MR. JUSTICE SANJAY DHAR, JUDGE
ORDER
(14.10.2025)
1. This is an application filed by respondents No.1 to 4 for
release of deposited award amount in their favour.
2. In the application, it has been submitted that husband of
respondent No.1 and father of respondents No.2 to 4 was
working with respondent No.5 and during his employment
with the said firm, he died on 16.09.2012. It has been
further submitted that the Assistant Labour
Commissioner, Udhampur, has awarded compensation in
the amount of Rs.5,50,395/- along with interest @12% per
annum in favour of the applicants/respondents No.1 to 4,
which stands deposited with the Assistant Labour
Commissioner, Udhampur. It has been further submitted
that the applicants/respondents have no income and, as
such, they are in need of money. On these grounds, the
applicants have sought release of the amount.
3. Learned counsel appearing for the appellant-Oriental
Insurance Company Ltd. has opposed the release of
amount in favour of the respondents/applicants on the
ground that the appellant is sure to succeed in appeal on
merits, inasmuch as the appellant-Insurance Company did
not have any privity of contract with respondent No.5 with
whom the deceased was employed.
4. It has been submitted that contract of insurance was
entered into by the appellant with the father of respondent
No.5, who died on 27.03.2011 therefore, in case the
amount is released in favour of the
applicants/respondents and the appellant-Insurance
Company succeeds in the appeal, it will be difficult to
recover the amount from the applicants.
5. Learned counsel for the applicants/respondents by
placing reliance upon the judgment of the Supreme Court
in case of the 'United India Insurance Co. Ltd Vs Santro
Devi & Ors, (2009) 1 SCC 558', has contended that in
the said judgment, it has been laid down that if insurance
premium continues to be paid by the widow of the
deceased owner, but no steps were taken by the legal heirs
to get the registration of the vehicle transferred in their
name, the Insurance Company is liable to pay the
compensation. In the above-mentioned judgment, the
Supreme Court has, relied upon the provisions contained
in Section 157 of the Motor Vehicles Act, 1988, which
provides for transfer of policy of the insurance with
transfer of vehicle. On that analogy, learned counsel for
the applicants/respondents has submitted that even if the
original insured has died but because his son was
continuing to pay premium for the renewal of the policy,
the Insurance Company is liable to pay the compensation.
6. Without commenting upon the merits of the rival
submissions made by the parties, it appears that the
applicants/respondents, who are widow and minor
children of the deceased, cannot be made to wait for the
compensation till decision of the appeal as the same is
likely to take some time. In order to take care of the day-
to-day needs of the applicants/respondents, it is
necessary to make a provision for release of a part of the
compensation in their favour.
7. Accordingly, the application is allowed and the Assistant
Labour Commissioner, Udhampur, is directed to release
an amount of Rs. 2 lakhs out of the deposited amount in
favour of respondents No.1 to 4 through respondent No.1,
subject to the undertaking that in case appellant-
Insurance Company succeeds in the appeal, the
appellants/respondents shall refund the amount along
with the interest @ 6% per annum. The amount shall be
transferred directly into the bank account of respondent
No.1, particulars whereof shall be provided by the
applicants to the concerned office.
8. The application stands disposed of.
1. Heard learned counsel for the parties and perused the
record.
2. The appeal gives rise to the following substantial questions
of law for determination of this Court :-
"(i) Whether upon the death of the insured, the
contract of insurance between the Insurance
Company and legal heirs of the insured,
subsists, in a case where the policy is renewed
by the legal heirs of the deceased after death
of the insured
(ii) Whether in the facts and circumstances of
the present case, the appellant-insurance
company is not liable to pay compensation to
the legal heirs of the deceased."
3. This appeal is admitted to hearing.
4. List this appeal for final hearing on 18.12.2025.
(SANJAY DHAR)
JUDGE
JAMMU
14.10.2025
Sneha
