M/S The Oriental Insurance Co. Limited vs K.Jaya Lakshmi And 3 Others
2025 Latest Caselaw 5081 Tel

Telangana High Court

M/S The Oriental Insurance Co. Limited vs K.Jaya Lakshmi And 3 Others on 25 April, 2025

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      HONOURABLE SMT. JUSTICE TIRUMALA DEVI EADA

                   M.A.C.M.A.NO.76 OF 2021

JUDGMENT:

This appeal is filed by the Insurance Company aggrieved by

the Order and Decree dated 03.03.2020 in M.V.O.P.No.562 of 2016

passed by the Chairman, Motor Accident Claims Tribunal-cum-I

Additional Chief Judge, City Civil Court, Secunderabad (for short

"the Tribunal").

2. For convenience and clarity, the parties herein are referred to

as they were arrayed before the Tribunal.

3. The case of the claim petitioners before the Tribunal was that

on 24.08.2016 at 11:00 a.m., while the deceased was going on his

motor bike from Cherlapally towards Nacharam and when he

reached near IDA Nacharam Petrol Bunk, and was waiting for his

friend, who went to fill the petrol, suddenly lorry tanker bearing

No.AP-29-V-1444 came in a rash and negligent manner and

dashed the motor bike of the deceased from behind and ran over

him, due to which he died on the spot.

4. The respondent Nos.1 and 2 remained ex-parte.

5. The respondent No.3-Insurance Company has filed counter

denying the averments of the petition with regard to the occurrence

of the accident, age, avocation and income of the deceased. They ETD,J MACMA No.76_2021

further contended that the driver of the lorry tanker was not

holding valid driving license as on the date of the accident and

their company is not liable to pay any compensation.

6. Based on the rival contentions of the parties, the Tribunal

has framed the following issues for trial:

1) Whether the pleaded accident occurred resulting in death to the victim viz., Sri K. Sivaramaprasad @ Prasad, S/o K. Samudralu, due to rash and negligent driving of the driver of lorry tanker bearing No.AP-29V-1444, by its driver?

2) Whether the petitioners are entitled to any compensation and if so, at what quantum?

3) To what relief?

7. To prove their case, the petitioners got examined PW1 to 3

and got marked Exs.A1 to A8. On behalf of the respondents, RW1

and 2 were examined and Ex.B1 to B12 were marked.

8. Based on the evidence on record, the trial Court has awarded

a compensation of Rs.18,64,400/- holding that respondent No.2

and 3 are jointly and severally liable to pay compensation.

Aggrieved by the said award, the present appeal is preferred by the

Insurance Company.

9. Heard the submission of Ms. A. Anasuya, learned counsel for

the appellant. Inspite of service of notice, learned counsel for the

respondents failed to appear in this matter.

10. Learned counsel for appellant has submitted that the order

and decree passed by the learned Tribunal is contrary to law and ETD,J MACMA No.76_2021

that the Tribunal failed to consider the evidence adduced by the

Insurance Company and has not properly appreciated the facts

and circumstances of the case. She further argued that the

Tribunal failed to take notice of the fact that the Insurance

Company has cancelled the policy due to dishonour of cheque and

that without any subsisting policy, the Tribunal has fastened the

liability on the Insurance Company, which is not proper. She

therefore, prayed to set aside the order and decree of the Tribunal

by allowing this appeal.

11. Based on the above rival contentions, this Court frames the

following points for determination:

1. Whether the lorry tanker bearing No.AP-29V-1444 was covered under a valid insurance policy as on the date of the accident? If so, whether the insurance company is liable to pay compensation?

2. Whether the order and decree of the trial Court need any interference?

3. To what relief?

12. POINT NO.1:-

a) The grievance of the appellant is that the crime vehicle was

not covered by the insurance policy as on the date of the accident.

It is their case that the cheque issued by the insured towards

payment of premium was dishonoured and that the said fact was

intimated to the owner of the vehicle. In support of their

contention, they got examined RW1 and 2 and also got marked

Ex.B4 to B12. Ex.B4 is the Proposal Form for obtaining insurance ETD,J MACMA No.76_2021

policy submitted by the owner of the vehicle-Mohd. Jameel to

Oriental Insurance Company i.e., the appellant herein with regard

to the vehicle i.e., lorry bearing No.AP-29-V-1444. Ex.B6 is the

receipt issued to Mohd. Jameel by the Oriental Insurance

Company saying that it has collected premium on 18.09.2015. The

recitals of the document further show that the policy has been

cancelled and the payment mode is through cheque bearing

No.000989 dated 18.09.2015 and that the payment under the

receipt is valid subject to the realization of the cheque. Ex.B7 is the

cheque return memo issued by the Andhra Bank that the cheque is

returned due to the reason "funds insufficient." The insurance

company has cancelled the policy vide Ex.B8. It is clearly

mentioned that the cancellation of policy is due to dishonour of

cheque. The said cancellation of policy was intimated to the

insured vide Ex.B9 on 06.10.2015. The said fact was intimated to

the RTO Office vide Ex.B10 saying that since the cheque issued by

the client was dishonoured, the policy stood cancelled right from

the inception of the policy.

b) They have also examined RW1 and RW2. RW1 is the

Administrative Officer of Oriental Insurance Company Limited. In

his chief examination he has contended that they cancelled the

policy as the cheque towards premium was dishonoured. In his

cross examination it is elicited that the premium amount collected ETD,J MACMA No.76_2021

towards the crime vehicle is Rs.29,195/- and the cheque was given

for the insurance premium of more than one vehicle which

includes the premium for other vehicles also, and that they have

not filed the details of the vehicles for which the premium is

included in the said cheque. He has not filed any proof of service

letters addressed to the insured informing about the cheque

return. He has admitted that there is a contract between the owner

and the Insurance Company subject to the terms and conditions.

c) RW2 is the Chief Manager of Andhra Bank-Nacharam

Branch. It is elicited in his evidence that the insured-Mohd. Jameel

possessed an account bearing No.087331043040023 in their Bank

and that his overdraft limit was Rs.25,00,000/- and also that he

has issued a cheque towards Oriental Insurance Company vide

Cheque bearing No.000989 dated 18.09.2015 for an amount of

Rs.64,201/- and that it was returned on 03.10.2015, and that as

on that date, the account shows a debit balance of Rs.25,27,035/-

and since cheque amount exceeded the over draft facility, it was

dishonoured and on 03.10.2015 an amount of Rs.171/- was

debited towards cheque return charges. The said transaction is

reflected in the statement of accounts filed under Ex.B12. He also

stated that whenever a transaction is effected into the account

either by debit or credit, the said information would be sent to the ETD,J MACMA No.76_2021

customer through an SMS and that the said SMS alerts are sent

from the Department of Information Technology of the Head Office.

d) In his cross examination he has stated that he has not filed

any separate document to show that they have sent an SMS alert

with regard to cheque return intimation to Mohd Jameel. Thus it is

elicited through the evidence of RW1 and 2 that the cheque issued

towards the payment of premium vide cheque No.000989 dated

18.09.2015 was dishonoured. The said dishonour of cheque is

proved through the evidence of RW2 coupled with Ex.B12. After

the cheque was dishonoured the Insurance Company got cancelled

the Policy vide Ex.B8 and it was intimated to the owner of the

vehicle-Mohd. Jameel and also to the RTO. Thus, the Insurance

Company has taken all the steps required to be fulfilled whenever a

policy is cancelled. Therefore, it is elicited that the intimation was

sent to the insured on 06.10.2015, and the accident occurred on

24.08.2016 i.e., after 10 months, after the cancellation of Policy.

Therefore, as on the date of the accident the Policy bearing

No.431391/31/2016/304 was not subsisting. When there is no

policy, the Insurance Company is exonerated from the liability of

paying compensation. The Tribunal has awarded a compensation

of Rs.18,64,400/-. The said quantum is not under challenge in this

appeal. The Insurance Company is exonerated from its liability, ETD,J MACMA No.76_2021

while the owner/respondent No.2 and driver/respondent No.1 are

jointly and severally liable to pay compensation to the claimants.

Point No.1 is answered accordingly.

13. Point No.2:-

In view of the finding arrived at Point No.1, the order and

decree of the Tribunal dated 03.03.2020 is set aside and the

Insurance Company is exonerated from the liability of paying

compensation.

Point No.2 is answered accordingly.

14. Point No.3:-

In the result, the appeal is allowed setting aside the Order

and Decree dated 03.03.2020 in M.V.O.P.No.562 of 2016 passed by

the Chairman, Motor Accident Claims Tribunal-cum-I Additional

Chief Judge, City Civil Court, Secunderabad, exonerating the

Insurance Company from its liability of paying compensation. The

owner/respondent No.2 and driver/respondent No.1 of the vehicle

are jointly and severally liable to pay compensation awarded by the

Tribunal. No costs.

Miscellaneous petitions, pending if any, in this appeal, shall

stand closed.

_________________________________ JUSTICE TIRUMALA DEVI EADA Date: 25.04.2025 ds