The New India Assurance Company ... vs Malya Kondanna Goud And 3 Ors
2023 Latest Caselaw 4034 Tel

Citation : 2023 Latest Caselaw 4034 Tel
Judgement Date : 15 November, 2023

Telangana High Court

The New India Assurance Company ... vs Malya Kondanna Goud And 3 Ors on 15 November, 2023

Bench: K. Sujana

           THE HONOURABLE SMT. JUSTICE K. SUJANA
                      M.A.C.M.A.No.1251 of 2008
JUDGMENT:

Feeling aggrieved and dissatisfied with the judgment and decree dated

23.08.2006 in O.P.No.301 of 2003 passed by the Motor Accident Claims

Tribunal-cum-I Additional District Judge, Mahabubnagar (for short 'The

Tribunal'), the appellant/Insurance Company preferred the present appeal.

2. Vide the aforesaid award, the Tribunal has awarded an amount of

Rs.1,64,000/- (Rupees One Lakh Sixty-Four Thousand only) as

compensation with proportionate costs and interest at 7.00% per annum

thereon from the date of petition till the date of realization. The Tribunal

directed respondents to deposit the amount.

3. The respondents/claimants filed the claim petition before the Tribunal

under Section 166 of the Motor Vehicles Act, 1988 for an amount of

Rs.3,00,000/- (Rupees Three Lakhs only) for the death of the deceased in

the road accident. The appellant/Insurance Company filed the present

appeal disputing the liability.

4. Heard Sri A. Rama Krishna Reddy, learned counsel appearing on

behalf of the appellant.

5. The facts of the case are that one Male Prasadh died in a Motor

accident which occurred on 30.03.2003 involving a lorry bearing

No. AET - 1414. At the time of accident, the deceased was working as a

SKS,J MACMA.No.1251_2008

Motor Cycle Mechanic under one K.Enna Reddy at Shadnagar. On

30.03.2003, at about 04:30 p.m., he has repaired TVS Max 100 bearing No.

AP 22 F 1537 and went on trial of the same at Pargi - Shadnagar road while

he was passing in the left side near Electricity Office, the offending lorry

came from Pargi side in a high speed in rash and negligent manner and

dashed him. As a result, he fell down and sustained injuries and died on

the spot. Respondents/claimants filed O.P. against the appellant/Insurance

Company.

7. The respondents therein filed counters denying the allegations and

further pleaded that owner of the offending lorry is one Nadar Bejani as per

the records. But the petition is filed against respondent No.1-Narasimhulu.

The said Nadar Bejani was not registered owner at the time of issuing policy

and therefore, he had no insurable interest at all. Therefore, there is no

contract between respondent No.1 and respondent No.2. As such, they are

not liable to pay the compensation.

8. The Tribunal on consideration of the entire evidence both oral and

documentary, decreed the O.P. and granted Rs.1,64,000/- to the claimants.

The Tribunal also discussed about the contentions raised by the Insurance

Company that on the date of accident, the policy was not in the name of the

owner of the vehicle and relied on the Judgment of the Hon'ble Supreme

Court in "Rikhi Ram Vs. Sukhrania 1 ", wherein it was held that the

liability of the Insurance Company would not cease as far as the third party

2003 ACJ 534 (SC)

SKS,J MACMA.No.1251_2008

is concerned. When the vehicle was transferred, no intimation was given to

the Insurance Company, however, the Insurance Company could recover the

amount paid from the insured or from the transferee of the vehicle.

9. The Tribunal also relied on the Judgment in "Madhineni Kondaiah

vs. Yaseen Fatima 2 " of High Court of Andhra Pradesh wherein it is

observed that the public liability to notify the transfer and securing No

Objection Certificate under Section 1 read with Section 94 of the Act, 1939

would make the original owner retain the insurable interest, in that case, it

was not proprietary interest but the public liability, not to run the vehicle or

cause or allow any person to run the vehicle without insurance and also to

notify the transfer of such vehicle to the registering authority or such

transfer that so long as such obligations, notwithstanding the cessation of

proprietary interest the insurable interest which is the foundation for the

continuance of the operation of the policy stands.

10. The Tribunal also relied on the Judgment of "G. Govindan vs. New

India Assurance Co.Ltd" held that the view expressed by the High Court of

Andhra Pradesh is preferable to the Delhi High Court view (Delhi High Court

contrary views on that aspect) since view expressed by the A.P. High Court

promotes the object of the legislature in protecting the third party interest.

11. Making his submission, on the same aspect, the claimants placed his

reliance upon the decision of the Hon'ble Apex Court in the case between

1986 ACJ 1 (A.P)

SKS,J MACMA.No.1251_2008

United India Insurance Co.Ltd., Shimla vs. Tilak Singh and others 3

wherein the Court at para 12 of the order held as follows:

"12. In Rikhi Ram vs. Sukhrania a bench of three learned Judges of this Court had occasion to consider Section 103-A of the 1939 Act. This Court reaffirmed the decision in G. Govindan 4 case and added that the liability of an insurer does not cease even if the owner or purchaser fails to give intimation of transfer to the Insurance Company, as the purpose of the legislation was to protect the rights and interests of the third party."

11. In the light of the legal position, it cannot be said that the liability of

Respondent No.2 has extinguished due to detection of discrepancy in

question with reference to insurable interest of respondent No.1. If this

discrepancy is considered as fatal, respondent No.2 is entitled to proceed

against respondent No.1 and recover compensation paid to the petitioners

who are third parties to the policy in question.

12. The only contention of the Insurance Company is that on the date of

accident, there is no contract between the Insurance Company and the

owner of the vehicle. As such, they are not liable to pay the compensation.

Whereas, in view of the observation of the Apex Court, the transfer of policy

is not necessary if there is a policy existing on the date of accident in the

name of crime vehicle. It is sufficient to be liable to the Insurance Company.