New India Assurance Company Limited v. Sahibun Khatoon
2002-10-03
R.M.PRASAD
body2002
DigiLaw.ai
Judgment R.M.Prasad, J. 1. This appeal is directed against the judgment and award passed in Claim Case No. 136 of 1997 by the 4th Additional Motor Accidents Claims Tribunal, Muzaffarpur. 2. Learned counsel for the appellant assailed the validity of the judgment on the sole ground that on the date of accident, i.e., 18.6.1997 there was no valid policy to indemnify the liability of the owner. 3. It is submitted that it is a case of commission of fraud by the owner as the premium deposited by him in cheque had bounced and the policy had been cancelled. Learned counsel submitted that, in fact, the owner was fully aware of bouncing of the cheque as he got another policy for the vehicle by paying premium in cash on the date of the accident. It has further been submitted that the owner though filed written statement, but did not choose to contest by appearing in the case and deposing before the court in support of his case in the written statement. 4. I do not find any substance in the said submission of the learned Counsel for the appellant. From the impugned judgment I find that the appellant insurance company never raised the question regarding the subsequent policy before the Tribunal. Moreover, in view of the fact that the accident took place on 18.6.1997 and the insurance policy was cancelled subsequently on 23.6.1997, I do not find any error in the impugned judgment holding that the appellant insurance company is liable to pay the compensation awarded. 5. The Apex Court in the case of New India Assurance Co. Ltd. V/s. Rula 2000 ACJ 630 (SC), while considering the insurers liability against third party risk where cheque received towards premium bounced and, consequently, the policy was cancelled, held that right accrued in favour of third party prior to the cancellation of the policy would remain unaffected by the cancellation irrespective of any provisions to the contrary contained in Contract Act or Insurance Act. 6. As, in the instant case, right accrued in favour of the claimant prior to the cancellation of the policy, it would remain unaffected by cancellation in view of the above principle decided by the Apex Court. 7. In the facts and circumstances aforementioned, this Court does not find any merit in the appeal and the same is, thus, dismissed.