Md. Azimuddin vs New India Assurance Company Limited
2025 Latest Caselaw 7256 Jhar

Jharkhand High Court

Md. Azimuddin vs New India Assurance Company Limited on 28 November, 2025

                                                   2025:JHHC:35797




 IN THE HIGH COURT OF JHARKHAND AT RANCHI
                 M.A. No. 435 of 2015
                   ---------
Md. Azimuddin, son of Late Md. Sultan Ahmad, Resident of
Village - Barkagaon, P.O. and P.S. - Barkagaon, District -
Hazaribagh, Jharkhand and At present residing at Fahima
Academy Road, at Pugmil, P.O. and P.S. - Hazaribagh, District
- Hazaribagh, Jharkhand              ... ... Owner/Appellant
                    Versus
New India Assurance Company Limited, having its Branch at
Main Road, Near Lakshmi Cinema, Hazaribagh, P.O. and P.S. -
Hazaribagh, Jharkhand - 825301
                                 ...Opposite party/ Respondent
                          ---------
 For the Appellant        : Mr. A. Allam, Sr. Advocate
                          : Mr. Faisal Allam, Advocate
 For the Respondent       : Mr. Alok Lal, Advocate
                   ---------
                   PRESENT
     HON'BLE MR. JUSTICE ARUN KUMAR RAI
               JUDGMENT

C.A.V. on 04.07.2025 Pronounced on 28.11.2025

1. Heard Mr. A. Allam, learned Senior Counsel appearing on behalf of the appellant/owner and Mr. Alok Lal, learned counsel appearing on behalf of the respondent- New India Insurance Company Limited.

2. The instant miscellaneous appeal is directed against the judgment dated 31.07.2015, passed by learned Presiding Officer, Motor Vehicle Accident Claims Tribunal, Hazaribagh in Miscellaneous Case No. 13 of 2006 whereby and whereunder, the court below has rejected the Miscellaneous Case No. 13 of 2006 which was remanded by the Hon'ble High Court after considering the Miscellaneous Appeal No. 212 of 2002 on 25.04.2006.

3. This case has a chequered history, therefore, facts are being narrated below in a chronological manner:-

(i) On 24.04.1992 at 06:30 A.M. while Imamuddin was riding the bicycle and Wakil Ahmad was sitting on it, then a petrol tanker having Registration No. BPM 3760 dashed the

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bicycle and the above-said Wakil Ahmad fell down from the bicycle and received internal injury and died on the spot. Mrs. Amna Khatoon, wife of deceased Wakil Ahmad and their sons filed a claim petition under Sections 140 and 166 of Motor Vehicle Act, 1988 before the Claim Tribunal, Hazaribagh being Claim Case No. 264 of 1992 and present appellant as well as respondent i.e. New India Insurance Company was made opposite party in the above-said claim petition.

(ii) The record reveals that despite service, the present appellant did not choose to appear before the learned Tribunal in the said proceeding, whereas Insurance Company put its appearance before the learned Tribunal and got deleted its name from array of respondents on the premise that the day on which accident took place, the said petrol tanker was not insured with the Insurance Company, as the insurance of the offending tanker had already expired on 19.12.1991. Appellant herein, is the owner of the said petrol tanker involved in the accident.

(iii) The learned Tribunal vide award dated 10.08.2001 allowed the claim petition and awarded compensation of Rs. 1,60,000/- to the claimants with an interest of 9% per annum from the date of filing of the claim application. The Tribunal directed the owner of the offending tanker (appellant herein, to make payment within stipulated time).

(iv) Records further reveal that for recovery of above- said awarded amount, a certificate case was filed by the dependent of deceased Wakil Ahmad being Certificate Case No. 05 of 2003 before the Certificate Officer, Hazaribagh and show cause was issued to the appellant, then the appellant filed an objection under Section 9 of Public Demand Recovery Act, 1914, but same was rejected and Certificate Officer issued

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direction for payment of the decretal amount asking the appellant to pay the said amount to the dependent of deceased Wakil Ahmad.

(v) It further transpires that the appellant filed miscellaneous appeal being M.A. No. 212 of 2002 before the Hon'ble High court against the award dated 10.08.2001 passed in Claim Case No. 264 of 1992. The appellant also filed one writ petition before the Hon'ble High Court vide W.P.(C) No. 4145 of 2003 against the above said award dated 10.08.2001 in which an interim order was passed by the Hon'ble High Court on 26.08.2003 whereby the appellant was directed to pay the decretal amount of Rs. 1,60,000/- along with interest after adjusting a sum of Rs. 25,000/- in four equal monthly installments. For ready reference relevant portion of the order dated 26.08.2003 passed in W.P.(C) No. 4145 of 2003 is being reproduced herein below for ready reference:-

.............The petitioner, in the meantime, is directed to deposit a sum of Rs. 1,60,000/- with 9% interest before the Certificate Officer, Hazaribagh, as per the order dated 10th August, 2001 passed in Claim Case No.264 of 1992 by the Claim Tribunal, Hazaribagh, after adjustment of Rs.25,000/-, if already paid/deposited in connection with Misc. Appeal No.212 of 2002, in four equal monthly instalments.

Such payment/deposit of amount, shall be subject to the decision of Misc. Appeal No.212 of 2002.

In case, the petitioner succeeds in Misc. Appeal No.212 of 2002, the Insurance Company may be directed to refund the amount to the petitioner with additional 5% interest.

Place the case 'For Admission' on 19th November, 2003. In the meantime, the Certificate Case No.5 of 2002-03 shall remain stayed.

(vi) The record further reveals that when the appellant made the entire payment to the dependents of the deceased Wakil Ahmad thereafter, this Court in M.A. No. 212 of 2002 vide order dated 25.04.2006 remitted back the matter to the Tribunal for giving a finding by providing opportunity to both the sides i.e. the owner of the vehicle and Insurance

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Company on the question whether the offending vehicle was insured with the respondent-New India Insurance Company Limited or not? For ready reference order dated 25.04.2006 passed in M.A. No. 212 of 2002 is reproduced herein below:-

..........The only question that falls for consideration is as to whether the offending vehicle was insured with the respondent- New India Insurance Company Ltd or not?

The contention of the appellant is that the vehicle was insured and premium was paid through bank vide cheque dated 23.12.1991. On the other hand, the Insurance Company disputes the above contention.

After hearing learned counsel for the parties and with their consent the matter is remitted back to the tribunal to give a finding after giving opportunity of hearing to both the owner of the vehicle and Insurance Company on the aforesaid question. If it is found that on the relevant date the vehicle was insured with the New India Insurance Company then appropriate order shall be passed in accordance with law.

Needless to say that both the parties shall lead evidence both oral and documentary. If the amount of compensation awarded by the tribunal has already been paid by the appellant-owner of the vehicle, there is no need of hearing the claimants. It goes without saying that in the event amount is found payable by the Insurance Company the same shall carry interest at the rate of 6% per annum.

In view of the aforesaid order W.P.C No.4145 of 2003 stands disposed of.

It is evident that by above-said order M.A. No. 212 of 2002 as well as W.P.(C) No. 4145 of 2003 stand disposed of by the Hon'ble High Court.

4. The appellant being owner of petrol tanker having Registration No. BPM 3760 has filed an application before the Motor Accident Claim Tribunal, Hazaribagh being Miscellaneous Case No. 13 of 2006, stating inter alia that, on 24.04.1992 i.e. on the date of accident the offending petrol tanker having Registration No. BPM 3760 was insured with the respondent/opposite party vide insurance policy no. 31540600402162 and it is further contended that respondent/opposite party (Insurance Company herein) got his name deleted from the earlier claim petition being Claim Case

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No. 264 of 1992 on 17.02.2000 by making incorrect submission to the Tribunal.

5. It is further contended by the appellant that it was not a case of new/fresh insurance rather a case of renewal of the said insurance policy no. 31540600402162 w.e.f. 20.12.1990 to 19.12.1991 and appellant paid Rs. 5738/- through cheque bearing No. 0298153 dated 23.12.1991 in favour of Insurance Company towards renewal to the said Insurance policy for the year 1991-92 and the said cheque was also deposited by the respondent/opposite party (Insurance Company) with Bank of India on 24.12.1991 and the same was credited to the account of Insurance Company on 03.01.1992 after collection from Barkagaon Branch of Bank of India. A certificate dated 10.04.2002 has also been brought on record to this effect.

6. It has also contented in the application that amount awarded in the Claim Case No. 264 of 1992 has already been paid to the dependent of deceased Wakil Ahmad and there was valid insurance contract between the appellant and the Insurance Company on the day of accident i.e. 24.04.1992 covering the risk of petrol tanker being Registration No. BPM 3760 and the Insurance Company has liability to indemnify the award passed ex-parte against the appellant.

7. Insurance Company filed show cause where precisely plea has been taken on behalf of the Insurance Company that this is an old matter and document related to the Insurance involved in the present case has already been destroyed by the Insurance Company as such the Insurance Company can neither affirm nor deny the assertion made by the appellant.

8. It has been contended by the Insurance Company in the above-said show cause that Company used to destroy the document after lapse of three years.

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9. During inquiry before the tribunal, the appellant has produced three witnesses including the appellant himself (P.W.-1) and two Bank officials namely Namud Alam Khan, s/o Late Abdul Rashid Khan (P.W.-2) and Shailesh Kumar Sinha, S/o Bimal Prasd Kishore Sinha(P.W.-3). The other two witnesses apart from the appellant, Mr. Namud Alam Khan proved the certificate dated 05.10.2002 as Exhibit - 1. Exhibit

-1 is the certificate issued by the Bank of India on 05.10.2002 which certified that appellant had made payment vide cheque No. 029153 dated 23.12.1991 for Rs. 5738/- in favour of the New India Insurance Company limited towards renewal of Policy No. 315406004002162 as per our record.

10. In cross-examination, the witness has stated that he has given the certificate on the basis of the endorsement on the backside of the cheque that payment has been made for renewal of above said policy. P.W. - 3 Shailesh Kumar Sinha, Senior Manager, Hazaribagh Branch, Bank of India, has proved the letter dated 10.04.2002 as Exhibit - 1/a but has categorically stated that the Manager, namely, Dhananjay Kumar has put his signature on this letter, but he has not worked with Dhananjay Kumar at any point of time and this has not been signed before him. However, this certificate also speaks about the credit of amount of Rs. 5738/- to the Insurance Company on 03.01.1992 from the account of the appellant. Photocopy of the above-said cheque is also placed on record and marked as Exhibit- x/c and the motor vehicle insurance pass book have also been marked as Exhibit - x/b.

11. As far as Insurance Company is concerned, one document surveyor report dated 28.04.2006 has been brought on record and same has been marked as Exhibit - Y in the present proceeding.

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12. Learned counsel for the appellant vehemently argued that the appellant has proved payment of premium amount of Rs. 5738/- by bringing on record the copy of the said cheque as well as evidence of Bank officials and even after their cross- examination, there is no dent in their testimony which could even remotely suggest that no payment has been made by the appellant to the Insurance Company for renewal of the insurance policy. In this circumstances, learned counsel for the appellant tried to impress upon the Court that the Court can draw an inference of existence of the insurance policy of petrol tanker bearing Registration No. BPM 3760 which covers the period of accident and then liability would be foisted upon the Insurance Company.

13. Learned counsel further pointed that, it is legitimate expectation of the appellant regarding existence of the insurance policy, and the moment the money parted to the Insurance Company by the appellant, the company being Public Sector Undertaking cannot and should not be allowed to play hide and seek with the appellant to evade the statutory liability foisted on its shoulder.

14. Per contra, learned counsel for the Insurance Company submitted that even if the payment has been made to the Insurance Company intended for renewal of policy, this cannot itself show that a contract of insurance struck between the appellant and the Insurance Company and that too when admittedly, insurance expired on 19.12.1991 and cheque is dated 23.11.1991 and the amount credited in the account of Insurance Company on 03.01.1992 this is beyond the period of existence of insurance policy, therefore, it could not be said that renewal of policy had been done on or before 19.12.1991.

15. After considering the aforesaid factual aspect of the present case, the issue fell for consideration before this Court

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as to whether there was insurance policy existed on 24.04.1992 i.e. the date when accident took place and Wakil Ahmed succumbed to injury.

16. It is the case of the appellant, the owner of petrol tanker bearing Registration No. BPM 3760 that he got insured the said petrol tanker from the period 23.12.1991 to 22.12.1992 as he issued cheque dated 23.12.1991 in favour of Insurance Company and same was credited to the account of Insurance Company on 03.01.1992. Undisputedly earlier policy expired on 19.12.1991 but there is no pleading by the appellant to the effect that after expiry of insurance policy, there is grace period in which policy could be renewed by the insured. It is consistent case of the appellant that it is a case of renewal of insurance policy and not the case of the fresh insurance policy of the offending vehicle.

17. Insurance is actually a contract between the Insurance Company and the insured, where proposal is being advanced by the person who is interested to get insured his vehicle with the Insurance Company and he makes an offer/proposal and Insurance Company may accept the said proposal and for completion of this agreement some consideration is required. A contract is formed when there is an unqualified acceptance of the proposal. Acceptance may be expressed in writing or it may even be implied.

18. It would not be out of place to mention here that a contract of insurance is a species of commercial transactions, well-established for commercial- practice to send cover notes even prior to the completion of a proper proposal or while the proposal is being considered or a policy is in preparation for delivery. A cover note is a temporary and limited agreement. It may be self-contained or it may incorporate by reference the terms and conditions of the future policy. When the cover note

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incorporates the policy in the manner, it does not have to recite the term and conditions, but merely to refer to a particular standard policy. The letters of acceptance clearly mentioned that cover notes were being sent. The contract of insurance is based upon the cover notes for the period covered by the cover notes.

19. The insurance policy between the insurer and the insured represents the contract between the parties wherein the insurer undertakes to compensate the loss suffered by the insured on account of risks covered by the insurance policy and the terms of the agreement have to be strictly construed to determine the extent of liability based on the insurance policy. In absence of such contract or policy between the parties, insurer is not bound to compensate if loss caused or suffered to the insured.

20. From the discussion made in the preceding paragraph, admittedly the amount of Rs. 5738/- has been credited to the account of Insurance Company on 03.01.1992 as testified by the Bank officials and the document brought on record by the appellant as nothing has been extracted from the mouth of any of the witnesses (P.W. 2 and P.W.-3 Bank officials brought by appellant) during cross-examination by the Insurance Company which could make this fact improbable. Now, the question which falls for consideration before this Court is that if the payment has been made by a person to the Insurance Company after elapse of insurance period, then can the insurance policy would automatically be renewed.

21. As stated earlier, nothing has been pleaded on behalf of the appellant that even after the expiry of period of Insurance Policy, it can be renewed. normally, if policy expired, then after payment of premium a new Insurance Policy would be created and in that eventuality, a fresh Proposal form is

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required to be filled by the concerned person and vehicle has also to be inspected for getting insured the vehicle. However, there is no pleading by the appellant that any proposal forms or inspection of the vehicle had been conducted for fresh issuance of Insurance Policy of the offending vehicle tanker bearing Registration No. BPM 3760.

22. It is required to be noted that initially in the claim application as well as the affidavit (examination-in-chief), which has been filed by the appellant before the Tribunal, it has been contended by the appellant that he got the copy of renewed policy of the said petrol tanker but the same has been misplaced, but in cross-examination, the appellant has categorically stated that he has never received the renewed insurance policy.

23. Upon the above said pleading and testimony of the appellant, the question which cropped up in the mind of this Court is that if at no point of time the appellant was having the said renewed policy, then how he had given the number of the said policy in the Claim application before the tribunal and in evidence (in the form of affidavit). Admittedly, there is no cover note, no premium receipt and no policy number as appellant has himself stated that the Insurance Company had not given him the Insurance policy.

24. In absence of cover note, premium receipt and policy number document, no adverse inference could be and should be drawn against the Insurance Company, because there is no cover note at least which is essentially an interim or initial agreement prior to the contract of Insurance between the two parties and it is the assertion of appellant regarding existence of renewal of Insurance policy, so the onus is upon his shoulder to prima facie prove the factum that there was

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Insurance policy for the offending vehicle (tanker) on the date when the accident took place i.e. on 24.04.1992.

25. This Court on the basis of above discussion is of considered view that only by making payment of amount of Rs. 5738/- to the Insurance Company, does not prima facie make a case of existence of insurance policy between the appellant and Insurance Company.

26. In view of the aforesaid discussions this Court does not find any reason to interfere in the order/award dated 31.07.2015 passed by learned Presiding Officer, Motor Vehicle Accident Claims Tribunal, Hazaribagh in Miscellaneous Case No. 13 of 2006. Hence, the instant miscellaneous appeal being M.A. No. 435 of 2015 is, hereby, dismissed.

27. Let the lower court records be sent back to the concerned tribunal.

(Arun Kumar Rai, J.)

High Court of Jharkhand at Ranchi Dated, the 28th day of November, 2025 Umesh/-A.F.R.