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2009 DIGILAW 2191 (PNJ)

Oriental Insurance Company Limited v. Mamu Ram

2009-12-17

A.N.JINDAL

body2009
Judgment A.N.Jindal, J. 1. This appeal filed by The Oriental Insurance Company Limited (herein referred as the appellant) is against the award dated 31.10.2006 passed by the Motor Accident Claims Tribunal, Karnal (herein referred as the Tribunal) awarding compensation to the same of Rs. 50,000/- along with interest @ 6% per annum in favour of the claimant-respondent No. 1 (herein referred as the respondent No. 1) and against the appellant as well as respondent No. 2 and 3 jointly and severally. 2. The main grouse of the appellant-company is that the accident in the case took place on 18.3.2005 at 1.15 p.m. whereas, the vehicle was insured w.e.f. 9.15 P.M. hours on 19.3.2005 to 18.3.2006 vide insurance policy Ex. R-4. The policy (Ex. R-4) stipulates that it would take effect w.e.f. 19.3.2005, therefore, the accident having taken place much prior to 19.3.2005 i.e. on 18.3.2005 at about 1.15 p.m., the company can not be held liable. 3. To the contrary, learned counsel for the respondents has submitted that since the company had received the premium as well as the papers were got signed on 18.3.2005, therefore, the stipulation, if any, with regard to commencement of the policy from 19.3.2005 would hardly effect their rights and will not give speech to the company to sat that the policy was not in force. 4. Perusal of the cover note issued on 18.3.2005 was to commence from 19.3.2005. This cover note was undoubtedly signed by the proposer. The policy Ex.R-4 also contains the same terms that it would be effective from 19.3.20005 to 18.3.2006. 5. The policy of insurance being contract between the insurer and insured, that were bound by the terms and conditions contained therein. In the absence of any time or date as to when the policy was to commence, it would commence from the previous mid night. In the instant case, the cover note was issued on 18.3.2005 but it was mentioned that it will be effective w.e.f. 19.3.2005 till mid night of 18.3.2006. While interpreting the effective date of commencement of the insurance policy for the purpose of act from 0 oclock, the Apex Court in case New India Assurance Company Limited v. Sita Bai, 1999(4) RCR(Civil) 644: (1999) 7 SCC 575, observed as under :- "6. While interpreting the effective date of commencement of the insurance policy for the purpose of act from 0 oclock, the Apex Court in case New India Assurance Company Limited v. Sita Bai, 1999(4) RCR(Civil) 644: (1999) 7 SCC 575, observed as under :- "6. The correctness and applicability of the judgment in Ram Day al case, (1990) 2 SCC 680, came up for consideration before this Court subsequently in a number of cases. In New India Assurance Co. v. Bhagwati Devi, 1999(4) RCR(Civil) 350 : (1999) 6 SCC 534,, a three Judges Bench of this Court relied upon the view taken in National Insurance Co. Ltd. v. Jikubhai Nathuji Dabhi, 1997(3) RCR(Civil) 397 : (1997) 1 SCC 66, wherein it had been held that if there is a special contract, mentioning in the policy the time when it was brought, the insurance policy would be operative from that time and not from the previous midnight as was the case in Ram Dayal case where no time from which the insurance policy becomes effective had been mentioned. It was held that should there be no contract to the contrary, an insurance policy becomes operative from the previous midnight, when bought during the day following, but in cases where there is a mention of the specific time for the purpose of the policy, then a special contract comes into being and the policy note/policy itself. The judgment in Jikubhai case has been sub-sequently followed in Oriental Insurance Co. Ltd v. Sunita Rathi 1998(1) RCR(Civil) 429 : 1998(1) RCR(Civil) 698:1998(1) 118 PLR 195 (S. C.) : (1998) 1 SCC 365, by a three Judges Bench of this Court also." 6. Thus, the ratio as drawn from the aforesaid judgment is that in case the policy or the cover note come into existence bearing certain terms, then the contract would be complete and commence from the date and time when it was sought to be so commenced. Similar, observations were made by the Apex Court in case Oriental Insurance Co. Ltd v. Porselvi and another, 2009(2) RCR(Civil) 926: 2009(3) R.A.J. 431:2009(1) A.I.C.J. 680: (2009) 3 PLR 65. The Tribunal has taken wrong note of the fact while making observations that when the company had received the premium then that policy would be treated as issued and taken effect, but the parties were bound by the stipulations as contained in the policy. The Tribunal has taken wrong note of the fact while making observations that when the company had received the premium then that policy would be treated as issued and taken effect, but the parties were bound by the stipulations as contained in the policy. As such, the findings as recorded by the Tribunal fastening the liability of the Insurance Company do not stand to the reason and need to be reversed. 7. Resultantly, while reversing the findings returned by the Tribunal on issue No. 2, this appeal is accepted and it is ordered that the company stands exonerated from the liability as fastened by the Tribunal. However, the liability to compensate the claimant which has been fastened by the Tribunal upon the respondent No. 2 and 3 would remain intact.