IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 2390 DAY OF SEPTEMBER 2O1Q'E'._V'
BEFORE _ %
THE HON'BE_E MR. JUSTICE ARALI NAG,A ARAJ ff _
MISCELLANEOUS FIRST APPE/i§:\:E_»AA'|v\|:,(§.'}j'.3'23S/260$'T..,,,_'_: 3
MISCELLANEOUS FIRST APPE'AE."'»NOS. 1311631', 33162,
13163, 13236, 13237, 13413.,.1»3O414, 134'3.--S.,,,13?416,
13417-3; 13'14_8/2005-.,,,
BETWEEN: '
THE ORIENTAL"I-NSL}F{A.E\iCE.COMPANY'--LTD,"
3 C ROAD,TL%1vIKUR '
THROUGH ITS.,RE§3:ONA:_'OFE1CE
LEO SHOPP1N.G'€OM'P:,E.x
44-45, E:,ESIOE'NCy RO1ADcT<OSS_ --
BANGALOREr~4 S6652-»S 1 '
BY ITS ASST. '--MANAGE._§<T_ "
1 _ APPELLANT
"(COMMON IN ALL THE CASES)
V' "(By SRLO-PTMAEJESH A"D'v)V
IN' MEA N,O.1§2S35/2006
SMT;:.DRAKSHAYANAMMA
.. W/O SHTVALTNGAIAH
_ 'AGED 47 YEARS
* «R/O DODDER1
TUMKUR TALUK
IN MFA NO.13161/2006
1. RASHMI
D/O RAEASHEKARAIAH
AGED 24 YEARS
R/A OPRHARSHA INSTITUTE OF
COMMERCE, KUVEMOPUNAGAR
TUMKUR
IN MFA NO,l3162/2006
1. D N BHARATHI
D/O H NANJUNDAPPA _V
AGED 27 YEARS
R/A DODDERI, BELLAVI HOBIAIAIA:
TUMKUR TALUK
IN MFA NO.13l63/2006
1. SHUBHA
D/O H SID~'DARAM'1§i._$& g
AGED 29.x<.EAs§s ~
R/A SHIVAKUMARASWIA-MY VN1'ILA'~:A'V« '
ASHOi<NVAC¥i»'-\R,,. 6"'"'"' CRCJSES
IN MFA N'b..1'3236z'2:O'CY.5i'~'AA'"--.,:a"' A
1. SMT.G VIMAL.A ._
{W/QD S SIDDARAMAIAH
,_"*A<3E_LD 44 YEARS .....
A R/(3 DODDERI
-.TUMK!J?L.TA--LUK & DIST
NVb;Vi":3:23';¥/$2006
A . I. .""?2.A31;Asé+I'E§ ,D5BOUT"49...YEARS
A 0PPR."HARSHA INSTITUTE OF
~ .Vcc1;$¢':v:E:2_C'E_,.1KUVEMPUNAGAR
' Tt.e.,:s%u--<:¢U's2
IN 'zv;.u§A No..:3'{;.1'%/2006
SHWETHA D s
A. W/O 9 s SIDDARAMAIAH
" V "AGED ABOUT 22 YEARS
R/0 DODDERI
TUMKUR TALUK
IN MFA NO.13418/2006
1. SHRUTHI D S
D/O D S SIDDARAMAIAH
AGED 23 YEARS
R/A DODDERI
TUMKUR TALUK
2. RAJASHEKAR A
S/O ARASAIAH 7
MAJOR
NO,756, II MAIN ROAD
JAYAPURA EXTENSION
TUMKUR %_= <_'== 5
_ _'*vI.._."P,ESPO?\}D_ENTS
1{'"R~?, COIvIMoN _4li\EVA'L1_ THE CASES)
(By SRIvuTHS:M R SHASHID'H.AVR&-Ii} SR_I.N'I~»§kA.§r'_v,ADvs)
THESE :vIFAs_:_AP._E 1=.:;LED L;§;'S~..17~3'_(VJ.) 'OF MV ACT AGAINST
THE JUDGMENT Al\_£B' ,AwARD_ 'DATED 'o6'.'o9'.2oo6 PASSED IN
MVC NOS.112'8}'1._9'9.?;:*_V 11_2.3_/1.997, *aj11_2'5/1997, 1127/1997,
1129/1997, '1113o/11997'; '11'I36,I1'99I7, 1124/1997, 1131/1997,
1I32/1997T,..1:'1'3.4/'199:7,AND.1135;.1.997 RESPECTIVELY ON THE
FILE OFZVTHE PRESIDING OFEICER,.FAST TRACK COL.$R"i"--III AND
MACT, TUMKLJR, AwA..RDIINEIIVAIIIICOMPENSATION OF RS.45,700/-,
22,000/--,'A.22,.oo0/5,'*5_9,_56o/5.411,500/-, 11,000/~, 24,000/~ ,
36,450/~, «.11,~ooo/---, ".A24,2--5o/-- 29,250/-- AND 28,000/-
RESPECTIVELY.W'ITH'--.IN'aTEREST @ 6% PER ANNUM FROM THE
DATE OF P_ETITI(3i\I_T'IVLL DEPOSIT.
T'H'*EjsED%0'Me_FAS ARE COMING ON FOR HEARING THIS
DAY, =TAHE_'CQUART. MADE THE FOLLOWING:
COMMON JUDGMENT
"A.E§ii;hese 12 Misceiéaneous First Appeais have arisen
A w.:0froVI%i"'-the Same Common Judgment and respective Awards
defied 06.09.2006 passed in MVC No.1123/1997 and other
:--~§'x'"""\/-w
5
connected cases on the file of learned Presiding Officer,
Fast Track Court»-m and Addl. MACT, Tumkur (hereinafter
referred to as 'MACT' for short).
2. The respective motor "vehicle com;oer}'sati'ion_VA'
cases were filed before the MACT by
in3'ured~claimants claiming compgensatiojn'__towards<.__th.§Ti'
bodily injuries sustained-byggrthem inhfthe it/ehlgc.i'e V
accident that occurred on atfablout 3:90 pm.
on Huliyur road near:Aladelcagttefi.within the limits of
Chiknayakarzahaili policeVV_statio.n"V»in T;'u,frr1Ai<uf_'.-District which
was caused ;b$/;g.t'i1elidriyeri 'of:"'i\?iata.c'§or Van bearing
registratior-2 driving it in a rash and
negligent 'rngariinger; _A'ilV.:the's»e4 appeals are by the insurer of
the gsiaifd=vehicl'e.w._.V:'Respondent No.1 is the claimant and
.respoi:den.t«.i§l’o,Z is the owner of said vehicle in each of
ffthes-el«aVpperals’.~f§;;”‘The same set of facts and question of law
_ are'”i’nvo’!’\:/ed”in all these appeals. Therefore, these appeals
“.c,.:ai’esd_isposed of by this Common Judgment.
M
3. I have heard the arguments of Sri.O Mahesh,
learned Counsel for the appellant Insurance Companyjand
Sri.M R Shashidhar, learned Counsel for the
claimants in all these appeals. Perused
Judgment and respective Awards.
4. It is not in disputeV__ti’:aVt the’- accidvent,l’7i;n’v~olving
the said vehicle, occurred on and place
and that as a result of claimants in
each of the saidcases It is also
not in dispute due to rash and
negligent_dVr_iAvin::’g by its driver and that
second:Virespon.der.u’t:-vvas»”t§oée”own”er thereof.
5. .”4_£”heV second »–re’s.pondent, the owner of the said
vehi’,c_ier’ras notchoser. to contest these appeals despite
lreceljpt _or5.noti’ce of appeals.
heard the Eearned Counsel for both the
–V sides’, tti-e’.ori”lVy point that arise for my determination is:
u?*
7
“Whether the MACT is justified in
directing the appellant Insurance Company to
pay to the respective injured claimants in all
the said cases the respective amounts QfT_
compensation awarded by it, despite recor«d.injgVV”:”~.3.
its findings that the policy of Zinsuranceiithatiwei
was issued by the appel.i.an_t insu.«ei;ee ”
company was cancelled much :e.a’r_i.ie”r_to.”-th’ef~..V
occurrence of the accident for’~the._ reason tha’: V
the cheque that was issuedede by.”th__e’oVw’ne’rf:o’f”‘
vehicle towards premium__had,_bo_unceo?«
7. The foiiowiragdfactzs are .l’n”otf’di_spute:
a) _The appeillarntv.Insura’n’ce–‘iCompany issued
‘inAw.iV7.’»avo’£ir’ Ofisecondiiirespondent owner Ex.D3
0′ _ce’r*:ificat.efcu’m.f’po|icy in respect of the said
“‘–__rnatador”‘iya’nA’:’_’yaiid for the period from 10.00
hvours”‘1on’V’ 17.08.1996 till mid night of
The owner of the said vehicle
:’Vji’ss”ued Ex.D1 cheque dated 16.08.1996 for
being the premium towards
‘ -insurance of the said vehicie.
b) The said cheque came to be returned to
the Insurance Company dishonoured for want
of funds in the account of owner of the said
4′”-‘-rfir\””\-r
vehicie. Ex.D4 is the intimation given by the
bank to the insurance company in respettsyof
dishonour of the said cheque.
Insurance company cancelfed the.-§V__p’o’l’icyy:’—._of’…._T’.
insurance issued in respect of th.e..s_javi.dVveh.icieV”
and Ex.D6 is the copy”‘oVf”‘canCeiiatio_h«._notice.”.
and Ex.D7 is the posta’?
the effect that said notice” was recei’ved4..by that
owner on 27.O8.1996;..y_V”h’ _
8. Thus, it ‘froin.th¢,,fA.§~bove undisputed
facts that though they.v~-Ensiuraynce “c’erti:fi:ca.te~cum–po|icy
(Ex. D3) was _i rance company
for the period.V.f’roVafnh.» iff7.foa]fi’is9s:yfto ::a.o8.1997, it came to
be cantfgelieydi canceliation came to be
intimated”to4’the’i’nsu:red_4′:anVd’ the intimation of cancellation
was rgecesitx/ed.’ by: the insured on 27.08.1996 i.e., much
Reariiér to”fthe’~occurrence of the accident which occurred on
being so, it is further clear that as on
the ‘d.ate,._fof-occurrence of the said accident, there was no
jtfaiid insurance in force in respect of the said vehicie.
‘______(–rs\,,….
9. On careful reading of the impugned common
judgment, it could be seen that MACT has recorde,dw.its
finding that since the Insurance policy which
the Insurance company was cancelled much ea4r__ijierjV’toxf’the
occurrence of the accident ar:d””tl*.ey_ “..Aint;imla”ti%V..fofn”‘.
cancellation of insurance was aiso gi__ven_ to the-Ao»wner–t.4’o~fy ”
the said vehicle, the insurancefiompalhnygist.n’otnV”iiga’bl’es to
indemnify the owner invrespectvof Vin-3i.uries’ sustained by
the respective claimantsllilnfalllt-the’said-t. who are all
admittedly third pi§rties.;;l
10. r.Ie_’ai’rne§dV Counsel for the
appellant strongly contends that
despite recorudlinggxthe’saidffinding, the MACT ought not to
haVe._§gfi:irectedV””the. _____ insurance company to pay the
res’p.ective«.yam’ounts of compensation to the respective
ciairnantsin~the”said case and then recover the same from
.6 the ownerioffithe said vehicle and therefore, the impugned
if and respective awards insofar as they relate to
Sta-idldirection deserve to be set aside.
___~§”-~r’\’_,,..
11. Placing strong reliance on the subsequent
decision of Hon’b|e Supreme Court in the casoeioof
Daddappa and others Vs Branch Manager,;~~:\iati_o’na:l”
Insurance Co. Ltd., reported in 2008 AC3.V_Si$1,’!:¢’ar’ned*«i
Counsel for the appellant Insurance»::A’coVmpainy.:_’:st[‘oV:ngVlVyyVi’
contends that when the Insurance piolyicy. was :c’an<§el'led*: ijy V
the Insurance company and 'cancellation.V_o"nit-theggground
that cheque issued bY:::the vehvivcileftowards
premium was dishonoured'-a_nd,"_thfe cancellation
of the policy the insurance
company the owner in
respectiof"Iiguvfrives:7'sustai.n.ed claimant in the said
cases, h ' rties.
12.; Per’ c.ontra,: placing his strong reliance on the
decision of Kerala High Court in the case of
i’lI:!_rié-._:f:Mt1a’l’ :’i’_nsui’jarice Co. Ltd., Vs Sivankutty and Others
reporteci”i-n’:””2906 AC} 106, learned Counsel for the
J’resop.ond’ent~claimants strongly contends that insofar as 3″”
parties are concerned, the Insurance Company is liable to
«.-~S~—“”””
11
pay compensation despite the insurance policy being
cancelled by it earlier to the occurrence of accidenVt’e’o’rie.the
ground that the cheque that was issued by M
the vehicle was dishonored.
13. I have carefully
decisions relied upon by the r_és.pectiye.__ie’a.rne:d”‘co’uiisel for”
the parties. Full bench of Ke.ralV:a’v–Hi’g..h Courtvvhasjobserved
at para 20 of its judgncientt
“2Q;” .i\ieit3her” V’-three member
decision ‘._.the. in Irideijit
Kauiis nor from the
.iprOV’tisi:c?:nSA6ff ‘secti,o’ns 1’47′(s’) and 149(1) of the
Motor ‘1988 do we get any
support to vh’old:.4′:th,e’Vyiew that the liability to
._pay “”C0_tnpie.i1sa”tioén” for injuries sustained to
i;r’h’irt§__ par”t’ies—~’ceases to exist after the
of the policy. The situation is not
of an owner of a vehicle not having
any insurance at ail for the vehicle as on
.. the date of the accident, as is observed by the
_ iiiivision Bench of this Court in New India
Assurance Co. Ltd., V Raghu, 2002 AC] 217
(Keraia). We, therefore, hold that the decision
¢_—{.\’-‘”\…-“”_’V
of the Division Bench of this court in New India
Assurance Co. Ltd, V Raghu (supra) does not .
lay down the correct law. The position is that
the iiabiiity of Insurance company in damasg__es:’cl
for third party risks continues for the entiyrei’
period covered by the policyyyin spite”‘of:’_the~»:
cheque issued towards payn:1en:t:,4yoj;f
was dishonoured and consequ’enti.y. poiiicyyywas it E
cancelled by the insuqracncey cohmpaanyt
remedy of the insurance__corn_pany iies.a_g:;ainfst
the ‘insured’ to thléiai7i%i(5b!._fi1T.::rJa’id by
by way of compensat.ion’for risks to
be 901: reiI”,’7′:Vi’>Li.rs€C5}WV”V it it it
Vans-we.:’ed as above.
Tvhetiiiiiergistry”shali”aV.ppro>ti’Vrn’ate|y piace the file
before theffreferriin.q”_.Bench alongwith the
answe_r “on IEhe’4vi’EfEfé}.3Ce for further appropriate
;VaCEi.0n in ‘-the’rnatter.”
»ii’ow’e.ver, the Hon’b|e Supreme Court has
‘para Nos.11, 16, 20, 26 and 27 of its
~ –4%.i.i’.j’;.-4.._’_”-.3udgm’e.r}t~ in Daddappas case (2008 AC3 581) as under:
W
.13
11. “Indisputably, the accident had
occurred on 6.2.1998 that is much after
communication of cancellation of the policy”.
16. “The question came is
consideration before this Court in.”‘Ir7derjif’~:
Kaur’s case, 1998 AC3 123;g(scj,’ :wh_er’e.in_
was opined that a policy of in’sura.n’ce wh-ichrvis V’ K
issued in public interestwyorayld prevail _over’t_:he’
interest of the insurance con1,,pany. In’t«.hat case
a bus met with ariicid_ent.,_V_.,ifhe% policyflyof
insurance was letter
stating thatthe ciliegue-1hadjfbeen diisihononred
was to the
premium was paid
Theuaflccident took place
19′-.4.’1_990.itEiesp’il’te’n,oLicing Section 64-VB of
the 1938p it/’1′.ct’,1_ having regard to the
4innderlying_p’ublic’ policy behind the statutory
A ‘scifi”em’e_in respeéct of insurance as evidenced
147 and -Section 149 of the Act
ganucl’ i’.n–._p’a.rt’icular having regard to the fact that
po.!__’i’Cy-of insurance to cover the bus without
receiving the premium had already been
h”-~.i.ssued, this Court held that the Insurance
it “Company was liable to indemnify the insured”.
W
I4
20. “The ratio of the said decision was,
however, noticed by this Court in New India
Assurance Co. Ltd. v. Rula, 2000 AC] 630
(SC). It was held that ordinarily a liability_H_”c
under the contract of insurance would
only on payment of premium, if such payment.V,: 3
was made a condition prec_ecle_nt 4′
effect of the insurance pol_icy:.,.hliitu*.su.c’h~-
condition which is intended forthe l3en.efit”oi’
the insurer can be waivedv.,,4l”3”y_,it”. ‘
“It was opin’e.c_|:– “«*(“i’11’_i)5:li,if,,”}5n,.the damper
accident, there was ;_a ‘po.l1’icy _of-.V’i_n.surance in
respect of_*th_e vehi’cl-e:”‘in”.q:’uestion:,’7the third
party wo._ulcl}1jh’ayevV:a, claim a,c;lai’l’ist’t*ii’e Insurance
compan~,?j1cand3tyftilsgiawnerlor the vehicle would
hayefto bei*n”cl«emnif:.ed_.in respect of the claim
of th’a.t”p.arty,’uSu”bs_equent cancellation of the
éginsurance policy on the ground of nonpayment
€of»–.”premium would not affect the rights already
in-.favour of the third party”.
v_ dicta laid down therein clarifies
i.=ha’t; if on the date of accident the policy
” ‘fi—._subsists, then only the third party would be
V’ “entitled to avail the benefit thereof”.
r”—-(“Sr-_”‘#.
17
the amount of claim to the appellants herein and recover
the same from the owner of the vehicle namely respoéndent
No.2″. Such direction cannot be issued
claims Tribunal or even by this Court.
17. Following the above1″ob:sAervatio’ns”of:
Supreme Court, I am of thefonsidered’ the
appellant Insurance ‘Compagny ‘natty lial5lQ..,.to”V:pay any
amount of compensatiohfi claimants in
the said cases; .__The:’retore¥, issued by the
Tribunal in and the
respective shall pay
compensation to iiblaimants and then recover
the same from” said vehicle deserves to
beset aside.
i3_.” — lfo.rgiti:1;e’e.reasons aforesaid, all these appeals are
i it here
A it The impugned Common Judgment and the
V “re’spiective Awards in the said MVC cases insofar as
__they relate to the direction that the appellant
€
Insurance company shall pay compensation to each
of the claimants and then recover the same fromthe
owner of the said vehicle are hereby set asic_ie,V_:”3£t_*’.s
made clear that respective claimants are M
recover the compensation amount from’_t’r’.-ei
the said vehicle. No order as vto”‘cc.sts.T_” ht 4’
Whatever amount.sisy_depos.é_te’d by oth’euadppei'[‘ant
Insurance Company in”‘~vs.othese a’-p_peaI_”s “shall be
returned to it. I
The original _ofV:[‘thVis.v”__3uidg*m.en»t.’jshalI be kept in
MFA No.:132’V3:5/20_06€ aha -4.a”‘~.é;opVy’1fjnereor in each of
P,
the o’t!’i’er’ =7;
Sd/-7*
JUDGE
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