JUDGMENT
Y.P. Nargotra, J.
1. This appeal by the insurer involves a short question for decision relating to its liability under the policy of insurance issued subsequent to the accident even though it was issued sometime later on the same day. The Tribunal by deciding Issue No. 3 has held the insurer liable.
2. The Motor Accident occurred on 21.8.1987 at about 10.30 A.M. On the same day at 5 P.M. cover note for insurance of the vehicle involved in the accident was obtained by the insured. The insurer pleaded before the tribunal that because at the time of accident there was no insurance covering the said vehicle therefore it was not liable. The tribunal held that policy was valid for whole of the day i.e. 21.8.1987 as such the insurer cannot escape liability.
3. In New India Insurance Company v. Ram Dayal and Ors., 1990 (2) SCR 570 the Apex Court has held that in the absence of any specific time being mentioned, the logical inference to draw was that the insurance became effective from the previous mid-night and therefore an accident which took place on the date of policy, the insurer became liable. If the present case is held to be covered by Ram Dayal’s judgment the order of the tribunal would be perfectly valid. However Ld. Counsel for the appellant submits that case would now be covered by the following judgments of the Apex Court.
I. 1998(1) Supreme 52.
II. 1999(7) Supreme 637. III.
2002(1) Supreme 543.
4. Before appreciating the contention of the LC for the appellant, it would be apt to take notice of few more admitted facts of the case. It is admitted that accident occurred at 10.30 A.M. in the morning on 21st August 1987. The cover note issued on 21st of August 1987 which is available on the file is also admitted. The cover note mentioned the date of execution as 21st of August 1987 and with it under the signatures of the Issuing Officer the words “5. P.M.” stand incorporated. The columns 3rd and 4th of the cover note reads as follows:
“1. …………….. 2. ………………..
3. Effective date of commencement of
Insurance for the propose of the Act       21.8.87
4. Date of expiry of insurance            20.8.88.”
5. Now with these facts in mind let us take into notice the law laid down by the Hon’ble Supreme Court in the cases relied upon by the LC for the appellant in support of his contention that Insurance policy came into existence after 5 P.M. and therefore at the time of accident the vehicle involved in the accident was not covered by the said policy of Insurance in Oriental Insurance Company v. Sunita Rathi and Ors., 1998(1) Supreme 52, their Lordships in para 2 of the judgment have held as follows: “2. The motor accident occurred on 10th of December, 1991 at 2.20 P.M. It was only thereafter the same day at 2.55 P.M. that the insurance policy and the cover note were obtained by the insured, owner of the motor vehicle involved in the accident. There is express mention in the cover note that the effective date and time of commencement of the insurance for the purpose of the Act was 10th December, 1991 at 2.55 P.M. The applicability of the decision in Ram Dayal’s case (supra) has to be considered on these facts. In our opinion the decision in Ram Dayal’s case (supra) is distinguishable and has no application to the facts of this case. The facts of that decision show that the time of issuance of the policy was not mentioned therein and the question, therefore, was of presumption when the date alone was mentioned and not the time at which the insurance was to become effective on that date. In such a situation, it was held in Ram Dayal’s case (supra) that in the absence of any specific time being mentioned, the logical inference to draw was that the insurance became effective from the previous mid-night and, therefore, for an accident which took place on the date of the policy, the insurer became liable. There is no such difficulty in the present case in view of the clear finding based on undisputed facts that the accident occurred at 2.20 P.M. and the cover note was obtained only thereafter at 2.55 P.M. in which it was expressly mentioned that the effective date and time of commencement of the insurance for the purpose of the Act was 10.12.1991 at 2.55 P.M. The reliance on Ram Dayal’s case (supra) by the Tribunal and the High Court was, therefore, mis-placed. We find that in a similar situation, the same view which we have taken, was also the view in National Insurance Co. Ltd. v. Smt. Jikubhai Nathuji Dabhi and Ors., wherein Ram Dayal’s case (supra) was distinguished on the same basis.”
In New India Assurance Ltd. v. Smt. Sita Bhai and Ors., 1999 (7) Supreme 637 the Supreme Court held:
“5. The correctness and applicability of the judgment in Ram Dayal’s case (supra) came up for consideration before this Court subsequently in a number of cases. In New India Assurance Co. Ltd. v. Bhagwati Devi and Ors. a three Judges Bench of this Court relied upon the view taken in National Insurance Co. Ltd. v. Jikubhai Nathuji Dabhi (Smt.) and Ors., wherein it had been held that if there is a special contract mentioning in the policy the time when it was bought, the insurance policy would be operative from that time and not from the previous midnight as was the case in Ram Dayal’s case, where no time from which the insurance policy was to become effective had been mentioned. It was held, that should there be no contract to the contrary, an insurance policy becomes operative from the previous mid-night, when bought during the day following, but, in cases where there is a mention of the specific time for the purchase of the policy, then a special contract comes into being and the policy becomes effective from the time mentioned in the cover note/the policy itself. The judgment in Jikubhai’s case (supra) has been subsequently followed in Oriental Insurance Co, Ltd, v. Sunita Rathi and Ors., by a three Judges Bench of this Court also.”
In the case titled J. Kalaivani and Ors. v. Sivashankar and Anr., 2002 (1) Supreme 543 their Lordships after taking note of the case law held as follows:
“6. Therefore, the position has become now well neigh settled. The court has to look into the contract of insurance to discern whether any particular time has been specified for commencement or expiry, as the case may be, of the policy of insurance. The copies of the erstwhile policy as well as the present policy have been produced for our perusal, the authenticity of which has not been questioned before us. The erstwhile policy of 7.2.1996 by specific terms incorporated in the policy. The next policy has clearly indicated that it had commenced only at 10.00 A.M. on 8.2.96. The interregnum created the void in respect of the vehicle vis-a-vis the insurance company. The unavoidable consequence of it is that the insurance company cannot now be mulcted with the liability in respect of the award granted by the tribunal.”
6. From the above judgments the law settled thereby appears to be that where there is a special contract between the insurer and the insured and that the policy would commence from a particular time it would be operative only from the time. Where the policy does not mention any such time of commencement it would be taken to be operative from the previous midnight of that day. In the present case as has already been stated that effective date of commencement of Insurance for the purpose of Act is 21.8.1987 without mention of any time and therefore the policy in view of Ram Dayal’s judgment would be operative from the previous mid-night and thus would cover the time when the accident occurred. The giving of the time “5. P.M.” with the date of execution, does not alter the position. Therefore, there is no merit in the appeal of the appellant, the same is as such dismissed, alongwith the CMPs.
