JUDGMENT
S.D. Anand, J.
1. The only grievance of the appellant-Insurance Company is that it ought to have been totally exonerated from payment of liability in view of the fact that the cheque issued by the insured-respondent in lieu of the payment of premium was dis-honoured on account of insufficient funds even before the date of the impugned accident and that the Insurance Policy had already been cancelled by that time.
2. The Tribunal held that the petitioner-insurer would nonetheless be liable to the 3rd party but would be entitled to be indemnified by the insured.
3. The other part of the findings was not challenged before this Court.
4. Mr. V. Ramswaroop, learned Counsel for the appellant, argued that as the Insurance Policy itself had been cancelled on 3.8.2000 long before the impugned accident had taken place on 8.9.2000, there was no policy contract at all in force on the basis whereof the appellant could be held liable to reimburse the claim and thereafter claim indemnification from the insured.
5. The plea advocated on behalf of the appellant is bereft of merit and not in accord with the law of the land. It was held by the Full Bench of the Kerala High Court in Oriental Insurance Co. Ltd. v. A.B. Sivankuty and Ors. 2006 (1) Apex Criminal 371 (Kerala), that the insurer would be liable to indemnify the third party and would thereafter be entitled to recover the amount from the insured. In the course of that judgment, that Court noticed a number of judgments including those rendered by the Apex Court in New India Co. Ltd. v. Rula and Oriental Insurance Co. Ltd. v. Inderjit Kaur . After appraising the entire spectrum of rulings, the Full Bench aforementioned noticed the legal position as under:
The position is that the liability of the Insurance Company in damages for third party risks continues for the entire period covered by the policy inspite of the cheque issued toward payment of premium was dishonored and consequently policy was cancelled by the Insurance Company. The remedy of the Insurance Company lies against the “insured” to have the amount paid by them by way of compensation for third party risks to be got reimbursed.
No law, taking a contrary view of facts, was cited before this Court.
In the light of foregoing discussion, it is apparent that the plea raised by the insurer in the present matter must be negatived and it is so held accordingly.
6. The appeal is held to be devoid of force and is ordered to be dismissed. There will, however, be no order as to costs pf the cause.