IN THE HIGH COURT OF KERALA AT ERNAKULAM
MACA.No. 2625 of 2008()
1. UNITED INDIA INSURANCE COMPANY LTD.,
... Petitioner
Vs
1. MINI JOSE, AGED ABOUT 30 YEARS,
... Respondent
2. B.MURALEEDHARAN PILLAI, HOUSE NO.534/15
3. KANNAN S., S/O.SIVADASAN CHETTI,
4. SUJATHA, W/O.MOHANAN,VILAYIL VEEDU,
5. THE DIVISIONAL MANAGER, NATIONAL
6. MINI PRABHA, W/O.LALKUMAR,
For Petitioner :SRI.P.R.RAMACHANDRA MENON
For Respondent :DR.K.P.SATHEESAN
The Hon'ble MR. Justice M.N.KRISHNAN
Dated :25/11/2009
O R D E R
M.N.KRISHNAN, J
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MACA Nos.2625, 2781,2782,2783,2854,2855,2856
2857,2858 & 2859 OF 2008 & WP(C)No.34337/2008
=====================
Dated this the 25th day of November 2009
JUDGMENT
All these appeals and the writ petition are preferred by the United
India Insurance Company challenging the finding of the Motor Accidents
Claims Tribunal, Punalur on the question of its liability in O.P.(MV)
Nos.1013/03,957/03,966/03,968/03,956/03,1012/03,1011/0357/04,1028/03,
1010/03 and in O.P.(MV)No.954,955,967,970,1009 & 1027/2003. The brief
facts which requires consideration are as follows: The bus insured by the
appellant belonged to one Muraleedharan Pillai. There was a policy taken
by Muraleedharan Pillai on 10.4.2002 to 9.4.2003. It is the contention that
the said Muraleedharan Pillai had transferred the vehicle to one Mini Prabha
on 22.2.2003. It is submitted that this Muraleedharan Pillai submitted an
application for renewal of the policy on 17.4.2003 and a policy was issued
in the name of said Muraleedharan Pillai from 17.4.2003 to 16.4.2004. The
accident had taken place on 16.7.2003. Learned counsel for the insurance
company would contend that since the sale has been effected on 22.2.2003
and as Mini Prabha had become the owner in possession of the vehicle on
MACA 2625/08 & con.cases -:2:-
that day onwards, the proposal filed by the previous owner, viz., the
Muraleedharan Pillai amounts to fraud and it was at a point of time when
he does not have any right or possession over the vehicle and therefore the
policy issued in his name would not cover the field and therefore the
insurance company has to be exonerated from the liability.
2. On the other hand, the learned counsel for Mini Prabha would
contend before me that though there was a sale the registration was
transferred in the name of Mini Prabha only on 28.5.2003 and therefore at
the time of applying for the issuance of a policy in the form of renewal, the
registered owner continued to be Muraleedharan Pillai and therefore there
was nothing wrong in taking the policy in the name of Muraleedharan
Pillai. Since the fiction under Section 157 of the Motor Vehicles Act deals
with the question of a deemed transfer and as the lady has become the
owner, subsequently by change of registration, it is contended that there is a
valid policy in existence and so the insurance company is bound to pay the
amount.
3. Learned counsel for the insurance company would contend and
argue that the endorsement and the evidence tendered in the case would
indicate that there was transfer of permit as early as on 22.2.2003 and
therefore the policy could not have been taken in the name of
MACA 2625/08 & con.cases -:3:-
Muraleedharan Pillai. Learned counsel for Mini Prabha had produced a
notarized copy of the endorsement along with the counter affidavit filed by
her on 15.10.2009 wherein there is an endorsement to the effect regarding
the transfer of registration which bears the date 28.5.2003. Learned counsel
would contend that in the light of this endorsement, it can be clearly seen
that Sri.Muraleedharan Pillai continued to be the registered owner of the
vehicle on the date of applying for the renewal of the policy on 17.4.2003
and when the vehicle is transferred subsequently by virtue of the fiction
under Section 157(1)and (2) of the Motor Vehicles Act the policy is
changed to the name of the Mini Prabha automatically and therefore there
was a valid policy coverage and therefore the insurance company cannot get
exonerated from the liability. Now unfortunately this Mini Prabha did not
enter appearance and contested the case before the Tribunal. The crucial
question regarding who was the registered owner on the date of submission
for the proposal form has to be considered on the back drop of the materials
available and evidence to be adduced in the matter. If a person continues to
be a registered owner, ordinarily it is the registered owner’s name that finds
a place in the policy issued by the company. I am conscious of the fact that
for sale of movable property under the provisions of the Sales of Goods
Act handing over of possession coupled with the payment of consideration
MACA 2625/08 & con.cases -:4:-
will amount to divestiture of title and the sale is complete on the same. But
the procedural formalities in order to make the records in tact are
contemplated under the provisions of the Motor Vehicles Act, under
Section 50 of the New Act and under Section 31 of the Old Act of 1939. It
has been held in very many cases that transfer of registration is subsequent
to the sale and the delay or something on that will not militate against the
same if it is done. Under the provisions of the old Motor Vehicles Act,
section 103A decisions are to the effect that when a policy is taken, there is
privity of contract between the insurer and the insured and when a transfer
is effected unless the insurance company agrees for the change the policy
will not have validity in the case of a transferee and therefore third parties
were affected under such circumstances. In order to over-come the said
situation, the Legislature in its wisdom brought Section 157 of the Motor
Vehicles Act wherein there is a deemed transfer the moment the sale is
effected. A situation may arise where one has to decide whether there was
a policy for the vehicle on the date of accident or not. Learned counsel for
the insurance company views the matter in another angle and submits that if
really the transfer is complete and the person has no right over the property
at all, can a policy taken in his name suppressing the factum of a sale will
cover the filed. The matter requires consideration in these cases for the
MACA 2625/08 & con.cases -:5:-
reason that the crucial date is regarding the transfer of registration for the
reason that a registered owner by various provisions of the Act is always
saddled with the liability so far as the vehicle stands in his name. I am also
sorry to state in these type of cases that when a policy is renewed or a policy
is issued, the persons issuing policy are also expected to look into at least
the registration certificate so as to convince their conscience regarding the
correctness of the policy which they are issuing. But, in very many cases
we find it absent and I leave it there. Therefore the whole matter requires
reconsideration on the following points.
Therefore the awards under challenge are set aside and the matters are
remitted back to the Tribunal for the following points to be considered:(1)
Smt.Mini Prabha may be permitted to file a written statement and produce
documents in support of her contentions.(2) The Tribunal is directed to
arrive at a finding regarding the date of sale, date of change of registration,
date of change of permit, etc. and then consider the question in the legal
back drop of Section 157 of the Motor Vehicles Act regarding entitlement
of the owner to get indemnified as well as the liability of the insurance
company in such cases. Parties are directed to appear before the Tribunal on
21.12.2009. In all these cases the appellant is directed to take out notice to
Sri.Muraleedharan Pillai and if the Tribunal feels that legal representatives
MACA 2625/08 & con.cases -:6:-
of Kannan has to be impleaded, direction may be given to the claimants to
implead them. Since the rights of the claimants are also jeopardized the
Tribunal shall endeavour its level best to dispose of the matter within 4
months from the date of first appearance of the parties.
MACAs and the writ petition are disposed of accordingly.
M.N.KRISHNAN, JUDGE
Cdp/-