Madras High Court
The Branch Manager vs Kalichamy ... 1St on 16 February, 2021
C.M.A(MD)No.35 of 2019
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 16.02.2021
CORAM :
THE HONOURABLE MRS.JUSTICE J.NISHA BANU
C.M.A(MD)No.35 of 2019
and
C.M.P(MD).No.465 of 2019
The Branch Manager,
New India Insurance Co.Ltd.,
Mumbai. ... Appellant/2nd Respondent
vs.
1. Kalichamy ... 1st Respondent/Petitioner
2. Johny ... 2nd Respondent
/1st Respondent
Prayer: Appeal filed under Section 173 of the Motor Vehicles Act,
1988, against the decree and judgment dated 01.10.2018 made in
MCOP.No.1 of 2014 on the file of Motor Accidents Claims
Tribunal/Subordinate Court, Periyakulam and allow the appeal.
For Appellant : Mr.J.S.Murali
For R1 : Mr.R.Rajamohan
For R2 : No appearance
JUDGMENT
Challenging its liability to pay compensation to the claimants, the
appellant insurance company has filed this appeal.
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C.M.A(MD)No.35 of 2019
2. The only contention made by the learned counsel for the
appellant is that the cheque issued by the 2nd respondent herein/owner of
the offending vehicle towards premium, was dishonoured by the bankers
on 04.12.2012 and the same was intimated to the 2 nd respondent and also
the Regional Transport Authority and to that effect, the relevant
evidences and documents viz., RW1 (Company official), Exhibits R1
(policy), R2 (cheque), R3 (Bank return memo), R4 (notice sent to owner
of the vehicle and RTO by RPAD) and R5 (Fresh Policy) have been
submitted before the Tribunal. But the Tribunal failed to consider the
said evidence and documents in the proper perspective. The canceled
policy was issued for the period from 06.12.2012 to 05.12.2013 and on
09.03.2013, the accident had occurred. Thus, he submitted that on the
date of accident, the insurance policy was not in force and therefore, the
appellant is not liable to pay compensation, but the Tribunal ordered pay
and recovery, instead of totally exonerating the appellant. In support of
his contentions, learned counsel relied on the following judgments:-
(i)New India Assurance Co.Ltd., vs. Tara Devi and others reported
in 2016 (2) TN MAC 520 (SC).
(ii)National Insurance Co.Ltd., vs. Subhadraben reported in 2016
(2)TN MAC 761 (Guj)
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C.M.A(MD)No.35 of 2019
(iii)D.Kala vs. Nalameena reported in 2015 (1) TN MAC 415.
3.Learned counsel for the 1st respondent would contend that
though the insurance policy has been cancelled upon dishonour of the
cheque, the claim of third party cannot be defeated for the self-created
predicament of the insurer in issuing the policy without actually
receiving the premium and considering the fact that the third party
claimants cannot be made to suffer, the Tribunal has ordered pay and
recovery, which does not require interference by this Court. In support
of his contention, he relied on a judgment of this Court in The Branch
Manager vs. A.Shanthi & Ors., New India Assurance Co.Ltd.
4.Heard the learned counsel for the parties and perused the
records.
5.The only issue to be decided in this matter is when the insurance
policy was actually not in force due to dishonour of cheque, whether the
Tribunal is correct in ordering pay and recovery. The said issue has been
answered by the Hon'ble Supreme Court in a decision reported in 2016
(2) TN MAC 520 cited by the appellant, wherein in similar
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C.M.A(MD)No.35 of 2019
circumstances, the Apex Court held that insurance policy was cancelled
on account of dishonour of cheque after due intimation to the owner
about the dishonour and cancellation letter sent to the insured/owner and
on the date of the accident, the policy was not in force and therefore, the
insurance company is not liable to pay compensation. Consequently, the
Apex Court directed that the amount deposited by the insurer shall be
refunded.
6.The said decision is squarely applicable to the present case. In
this case also, after due intimation to the owner about the dishonour of
the cheque, the insurance policy of the appellant has been cancelled,
which has also been acknowledged by the 2nd respondent/owner and
thereafter, the accident had occurred and on the date of accident namely,
09.03.2013, no insurance policy was in force.
7.Therefore, in view of the judgment reported in 2016 (2) TN
MAC 520, the finding of the Tribunal ordering pay and recovery is set
aside and the appellant is totally exonerated from its liability to pay
compensation. While fixing the liability on the appellant, the learned
Judge had ordered pay and recovery and therefore, the 2nd
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C.M.A(MD)No.35 of 2019
respondent/owner of the vehicle is liable to pay the compensation.
8. With the above direction, this Civil Miscellaneous Appeal is
allowed. No costs. Consequently, connected miscellaneous petition is
closed.
16.02.2021
Index : Yes / No
Internet : Yes / No
pkn
To
1)The Subordinate Court,
Motor Accidents Claims Tribunal,
Periyakulam.
2)The Section Officer,
V.R Section,
Madurai Bench of Madras High Court,
Madurai.
J.NISHA BANU, J.
pkn
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C.M.A(MD)No.35 of 2019
CMA(MD)No.35 of 2019
16.02.2021
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