JUDGMENT 1. 1. This appeal is directed against the judgment and award dated 8.9.1993 passed by Motor Accident Claims Tribunal, Hanumangarh (hereinafter referred to as the Tribunal'), whereby the Tribunal awarded compensation of Rs. 2,46,000/- in favour of respondent-Claimants No.1 to 6 (hereinafter referred to as the claimants') and held the appellant Oriental Insurance Company (hereinafter referred to as 'the insurance company') liable. Aggrieved by judgment and award impugned, the insurance company has preferred this appeal. 2. I have heard learned counsel for the parties. Perused the judgment and award impugned as also the record of the Tribunal. 3. The only point argued by the learned counsel for the insurance company is that the liability is limited to the extent of Rs. 50,000/- and the Tribunal fell in error in holding the insurance company liable for the entire award. 4. Carbon copy of insurance policy Ex.A/1 is on record. The premium under different heads has been charged to the tune of ( Rs. 1200+600+24) in addition to the basic premium charged at the rate of Rs. 1661/-. NAW.1 Rajendra Kumar the insured (owner of the truck) appeared before the Tribunal as witness and deposed on oath that the truck No. RSF-1901 was insured with the appellant insurance company for the period commencing from 4.8.1981 to 3.8.1982. He has produced the insurance policy Ex,A/1. A suggestion was given to this witness by the counsel appearing for the insurance company before the Tribunal that liability of insurance company is limited to the extent of Rs. 50,000/- qua third party. This witness specifically denied this suggestion. Before the Tribunal, the insurance company produced NAW.2 Milakharaj Kukkad, who stated that liability of insurance company is maximum to Rs. 50,000/- qua third party. 5. Policy Ex.A/1 under the caption "Limits of Liability" provides limit of the amount of the company's liability under Section II-I (i) in respect of any one accident : Such amount as is necessary to meet the requirements of the Motor Vehicles Act, 1939. Limit of the amount of the Company's liability under Section II-I (ii) in respect of any one claim or series of claims arising out of one event : Rs. 50,000/-. 6. I have carefully gone through the statement of NAW.1, Rajendra Kumar. Limit of the amount of the Company's liability under Section II-I (ii) in respect of any one claim or series of claims arising out of one event : Rs. 50,000/-. 6. I have carefully gone through the statement of NAW.1, Rajendra Kumar. In this examination in chief, he has not stated that he has paid any additional amount covering higher risk than the one provided under the Motor Vehicles Act, 1939 (hereinafter referred to as 'the Old Act'). Thus, from the evidence, the insurance company has succeeded in establishing the limits of liability of the insurance company to the extent of Rs,50,000/- and interest and cost thereon. 7. Learned counsel for the claimants contended that even if the limit of liability is Rs. 50,000/- the insurance company is liable to pay the whole of award in view of the provisions of section 96(1). (4) and (6) of the Old Act. 8. In New Asiatic Insurance Co. Ltd. v. Pessumal Dhanamal Aswani AIR 1964 SC 1736 , three Judges Bench of the Hon'ble Supreme Court held as under : "The Act contemplates the possibility of the policy of insurance undertaking liability to third parties providing such a contract between the insurer and the insured, that is, the person who effected the policy, as would make the company entitled to recover the whole or part of the amount it has paid to the third party from the insured.. The insurer thus acts as security for the third party with respect to its realising damages for the injuries suffered, but vis-a-vis the insured, the company does not undertake that liability or undertakes it to a limited extent. It is in view of such a possibility that various conditions are laid down in policy. Such conditions, however, are effective only between the insured and the company, and have to be ignored when considering the liability of the company to third parties. This is mentioned prominently in the policy itself and is mentioned under the heading 'Avoidance of certain terms and rights of recovery', as well as in the form of 'an important notice' in the Schedule to policy. The avoidance clause says that nothing in the policy or any endorsement thereon shall affect the right of any person indemnified by the policy or another person to recover an amount under or by virtue of the provisions of the Act. It also. The avoidance clause says that nothing in the policy or any endorsement thereon shall affect the right of any person indemnified by the policy or another person to recover an amount under or by virtue of the provisions of the Act. It also. provides that the insured will repay to the company all sums paid by it which the company would not have been liable to pay but for the said provisions of the Act. The 'Important Notice' mentions that any payment made by the company by reason of wider terms appearing in the certificate in order to comply with the Act is recoverable from the insured, and refers to the avoidance clause." 9. In New India Assurance Co., Shimla v. Kamla AIR 2001 SC 1419 , Hon'ble Supreme Court held as under : "A reading of the proviso to sub-section (4) as well as the language employed in subsection (5) would indicate that they are intended to safeguard the interest of an insurer who otherwise has no.liability to pay any amount to the insured but for the provisions contained in Chapter XI of the Act. This means, the insurer has to pay to the third parties only on account of the fact that a policy of insurance has been issued in respect of the vehicle, but the insurer were not otherwise liable to pay such sum to the insured by virtue of the conditions of the contract of insurance indicated by the policy. When a valid insurance policy has been issued in respect of a vehicle as evidenced by a certificate of insurance the burden is on the insurer to pay to the third parties, whether or not there has been any breach or violation of the policy conditions. But the amount so paid by the insurer to third parties can be allowed to be recovered from the insured if as per the policy conditions the insurer had no liability to pay such sum to the insured." 10. It was further held by their Lordships that : "The insurer and the insured are bound by the conditions enumerated in the policy and the insurer is not liable to the insured if there is violation of any policy condition. It was further held by their Lordships that : "The insurer and the insured are bound by the conditions enumerated in the policy and the insurer is not liable to the insured if there is violation of any policy condition. But the insurer who is made statutorily liable to pay compensation to third parties on account of the certificate of insurance issued shall be entitled to recover from the insured the amount paid to the third parties, if there was any breach of policy conditions on account of the vehicle being driven without a valid driving licence." 11. No other point was pressed. 12. In view of the aforesaid discussion, this appeal succeeds and is allowed to the extent that the limit of liability of the insurance company is Rs. 50,000/- and interest thereon. However, the respondent-claimants are entitled to be paid the entire amount of compensation awarded by the Tribunal and thereafter, the insurance company will have a right to recover the excess amount paid by it beyond its limit of liability of Rs. 50,000/- from the insured, owner respondent No.7. No order as to costs.Order accordingly. *******