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2004 DIGILAW 114 (PAT)

Oriental Insurance Co. Ltd. v. Jhaman Mian

2004-01-23

S.K.KATRIAR

body2004
ORDER Heard Mr. Ashok Priyadarshi for the appellant, and Mr. Bashishtha Narayan Mishra for respondent nos. 1 and 2. This appeal is directed against the judgment and award dated 19.8.2000, passed by the learned 1st Additional Distric Judge-cum Claims Tribunal, East Champaran, Motihari, in Claim case No. 32 of 1994 (Jhamman Mian Vs. Afzal Abdullah & another). 2. The applicant's case, is that on 28.10.1994 at 1.00 A.M. victim Fazallmam alias Lambu Mistri was under the standing truck no. BRD-7421 and doing repair work another truck no. BPI-6102 dashed against the standing truck as a result of which Lambu Mistri was seriously injured and died on way to hospital. The applicant is father of the deceased. The occurrence took place at NH-28 road south of village Shambuapur, P.S. Dumariyaghat, District East Champaran, Dumariyaghat P.S. case No. 28/94 dated 27/28.10.94 was registered marked Ext. 1. The police investigated the case and submitted charge-sheet marked Ext. 2. Dr. Devendra Nath Akela held post-mortem examination on the dead body of deceased Lambu Mistri on 29.10.94. Certified copy of post-mortem report is Ext. 3. 3. Respondent nos. 1 and 2 herein filed the claim application under section 166 of the Motor Vehicles Act. 1988 (hereinafter referred to as the Acf). Respondent no. 1 herein (Jhaman Mian) is the father and respondent no.2 (Sahjida Khatoon) is the mother of the deceased. Respondent no.3 (Afzal Abdullah) is the owner of the truck who has not entered appearance in spite of valid service of notice on him. According to the impugned judgment, the accident had taken place on 28.10.1994, and the victim had died the same day. The deceased was aged about 22 years and was a motor-vehicle mechanic under the emloyment of Shamim Mistri, owner of the motor-garage, Main Road Siwan. The deceased was earning Rs. 3,000/- per month as mechanic. 4. While assailing the validity of the impugned order, learned counsel for the appellant submits that there was no subsisting insurance policy on the date of the accident and, therefore, the appellant is not liable to pay the amount of compensation to the claimants. He relies on the judgment of the Supreme Court reported in 2001 AIR SCW 837 (Shri Ishar Alloys Steels Ltd. Vs. Jayaswals NECO Ltd.) 5. Learned counsel for respondent nos. 1 and 2 has supported the impugned order. He relies on the judgment of the Supreme Court reported in 2001 AIR SCW 837 (Shri Ishar Alloys Steels Ltd. Vs. Jayaswals NECO Ltd.) 5. Learned counsel for respondent nos. 1 and 2 has supported the impugned order. He submits that even in a situation where there was no contract valid the claims of vehicle of the owner ignored but those of the third party cannot be ignored. He relies on the judgment of the Supreme Court reported in AIR 1998 Supreme Court 588 (Oriental Insurance Co. Ltd. Vs. Inderjit Kaur and others) 6. I have perused the materials on record and considered the submissions of learned counsel for the parties. It appears to me that the policy (Ext. B) covers the period 28.6.1994 to 27.6.1995 for- which respondent no. 3 had handed over the cheque dated 28.6.1994 to the appellant. The same was reported dishonoured to the appellant with the intimation dated 2.7.1994 (Ext. F) from the Bank. The dishonoured cheque is marked Ext.-E. This was followed by cancellation of the insurance policy which was duly communicated to respondent no.3. In the meanwhile, the accident had taken place on 28.10.1994. Respondent no.3 submitted a new proposal form (Ext.-A) on 7.11.1994 accompanied with the amount of premium in cash and the appellant had accordingly issued a fresh insurance policy on the same date covering the period 7.11 .1994 to 6.11 .1995 which is marked Ext. D. 7. It is thus manifest that there was no subsisting policy covering the risk with respect to the vehicle in question. Later the insurance policy was on the basis of a fresh proposal and indeed a fresh insurance policy commencing from a date subsequent to that of the accident. In other words, the vehicle in question was not insured on the date of the accident. I am, therefore, of the view that the subsisting insurance policy (Ext.-D) does not cover the accident in question. The issue is concluded by the judgment of the Supreme Court reported in (2001) 3 Supreme Court Cases 151 (National Insurance Co. Ltd. Vs. Seema Malhotra and others), wherein it has been held that in such a situation the insurer is not liable to pay compensation to any body. Paragraphs 18 to 20 of the judgment is relevant and are set Jut here-in-below for the facility of the quick reference : "18. Ltd. Vs. Seema Malhotra and others), wherein it has been held that in such a situation the insurer is not liable to pay compensation to any body. Paragraphs 18 to 20 of the judgment is relevant and are set Jut here-in-below for the facility of the quick reference : "18. Thus, when the insured fails to pay the premium promised, or when the cheque is issued by him towards the premium is returned dishonoured by the bank concerned the insurer need not perform his part of the promise. The corollary is that the insured cannot claim performance from the insurer in such situation.” "19. Under Section 25 of the Contract Act an agreement made without consideration is void. Section 65 of the Contract Act says that when a contract becomes void any person who has received any advantage under such contract is bound to restore it to the person from whom he received it. So even if the insurer has disbursed the amount covered by the policy to the insured before the cheque was returned dishonoured, the insurer is entitled to get the money back." "20. However, if the insured makes up the premium even after the cheque was dishonoured but before the date of accident it would be a different case as payment of consideration can be treated as paid in the order in which the nature of transaction required it. As such an event did not happen in this case, the Insurance Company is legally justified in refusing to pay the amount claimed by the respondents" I, therefore, hold on the authority of the judgment of the Supreme Court in National Insurance Co. Ltd. Vs. Seem a Malhotra and others (supra) that the appellant-company is not liable to pay compensation to the claimants in the present case. 8. Since there is no appeal or cross-appeal by anyone of the respondents, I hereby direct that the amount of compensation determined by the impugned judgment will now be paid by respondent no.3 (Afzal Abdullah). The impugned judgment is accordingly modified. 9. In the result, the appeal succeeds. The impugned judgment and the award are modified in the aforesaid manner. Let the statutory amount deposited by the appellant in this Court be returned to the learned counsel for the appellant by means of appropriate instrument.