- (1.) AMITAVA Lala, J. This is an appeal of the appellant/owner of the vehicle challenging the modified award dated 18th December, 1985 by which the original award of the self same date, whereunder both the owner and Insurance Company were fastened with joint and several liability, was modified. The contention of the learned Counsel appearing for the appellant/owner of the vehicle is that no notice was given to him before such modification of the award.
(2.) INCIDENTALLY on a query of the Court he contended that the learned Counsel appearing for the Insurance Company was also the Counsel of the owner and no change was obtained from him. Therefore, it cannot be construed by the Court at this belated stage, that the modification of the award was made without hearing the parties. Leaving aside such technical plea, if we go to the merit of the modified award and the original award side by side, we shall be able to find that only dispute is determination of the liability of the owner vis-a- vis the Insurance Company. In earlier both were fastened with the joint or several liability of paying Rs. 1,53,600/- and interest when by modification, the Insurance Company was fastened with the liability of Rs. 50,000/- leaving aside the rest for the payment by the owner. We have gone through the two very important judgments of the Supreme Court on that score but before that one factual background is to be clarified hereunder. The original policy which was available before the Court speaks for unlimited liability of the Insurance Company on payment of extra premium. Such policy is made on 31st August, 1982. On 30th August, 1982, a letter was written by the Insurance Company to the owner fixing the liability of Rs. 50,000/- in spite of receiving extra premium for unlimited liability. Against this background a question arose before the Court whether the Insurance Company will be bound by the Statute or by the contract?
(3.) IN 2002 (1) JCLR 766 (All) : AIR 2002 SC 651, New INdia Assurance Co. Ltd. v. C. M. Jaya and Ors. , a Five Judges Bench held that the liability of the INsurance Company could be statutory or contractual. A statutory liability cannot be more than what is required under the statute itself. However, there is nothing in Section 95 of the Motor Vehicles Act, 1939 prohibiting the parties from contracting to create unlimited or higher liability to cover wider risk. IN such an event, the insurer is bound by the terms of the contract as specified in the policy in regard to unlimited or higher liability as the case may be. If such judgment is read alongwith the ratio of the other judgment of the Supreme Court reported in 2005 (1) JCLR 987 (SC) : 2005 (58) ALR 3 (Consu), Polymat INdia (P) Ltd. and Anr. v. National INsurance Co. Ltd. and Ors. , it will be seen that in case of policy of insurance, terms of contract as contended in the insurance policy be construed strictly without altering the nature of contract. Therefore, under no circumstance unilaterally an INsurance Company cannot bind itself with limited liability after entering into the contract about unlimited liability. Having so, we are of view that the modified award as passed by the learned Judge of the Motor Accidents Claims Tribunal cannot be sustained and accordingly the same is set aside by this Court. As a result whereof the original award which has been passed by the Tribunal on the self same date survived.;