Vineet Kothari - (1.) THIS appeal has been filed by the owner of the vehicle under Section 110-D of the Motor Vehicles Act, 1939 against the award of the MACT, Churu dated 3rd August, i 994 whereby the learned Tribunal decided the issue No.5 holding that the Insurance Company would be liable to the extent of limited liability of Rs. 50,000/- under the provisions of 1939 Act and not to the extent of unlimited liability of compensation as awarded by the learned Tribunal.
(2.) THE learned Counsel for the appellant- owner of the vehicle Mr. R.J. Punia for Mr. Vijay Vishnoi submitted that the Insurance Company was liable to unlimited extent because they had charged Rs. 240/- as a premium for insurance of the vehicle in question namely Bus No. RJI 2365 and. therefore, third party risk was covered to the extent of unlimited liability of the Insurance Company. This was contested by the learned Counsel for the Insurance Company vehemently and during the course of arguments, the learned Counsel for the Insurance Company Mr. U.C.S. Singhvi pointed out that vide insurance policy or certificate of insurance Ext. A/1 on record, it would transpire that the date of accident was 10"1 May, 1984 and the cover note was also obtained effective from 10th May, 1984 to 9th May, 1985 for a period of one year whereas the premium in question of Rs. 532/- to total including Rs. 240/- for "liability to public risk" which would cover only 'own damages to property' and not third party risk, was also deposited by the insured vide receipt No. 237163 dated 21st May, 1984 after 11 days of the date of accident and though the date of cover note showed the commencement period from 10th May, 1984, the Insurance Company would not be liable as insurance contract had not come into existence on 10th May. 1984. Mr. U.C.S. Singhvi, there are, urged that the Insurance Company has taken the stand right from the beginning before the learned Tribunal that the contract of insurance obtained by the appellant owner of the vehicle was a forged and fraudulent one and the insurance in question cannot be said to be effective prior to 21st May, 1984 when the premium in question was received by the respondent-Insurance Company and in view of the clear provisions of Section 64 (VB) of the Insurance Act. 1938, the respondent-Insurance Company is not at all liable to pay the compensation in question and there is no question of making it liable even to the extent of limited liability under the provisions of ! 939 Act as held by the learned Tribunal much less to the unlimited extent as contended by the learned Counsel for the appellant-owner of the vehicle. He urged relying on the decision of the Apex Court in the case of National Insurance Company Ltd. v. Yellamma and another 2008 (4) SCJ 590 = 2008 ACJ 1906 = 2008 (2) TAC 772, and Bombay High Court decision in the case of Oriental Fire and General Insurance Co. Ltd. v. Panvel Industrial Co-operative Estates Ltd., ) 1993 Vol. 73 Comp. Cas. 478 (Bom.) and decision of Hon'ble Supreme Court in case of Life Insurance Corporation of India v. Raja Vasireddy Komalavalli Kamba and others, AIR 1984 SC 1014, that since the premium in question was received on 21st May, 1984, therefore, the Insurance Company is not liable to pay the compensation for the death or bodily injury arising out of such accident which admittedly took place on 10th May, 1984. The learned Counsel for the claimants Mr. Trideep Bhandari urged that in fact the Tribunal has determined lower compensation than what the claimants were entitled to under the law and even though the claimants have not filed any cross appeal in the facts and circumstances of the case, the suitable enhancement for compensation may be granted. He, however, does not dispute the legal position obtaining under the various case laws cited before this Court.
(3.) ON the other hand, Mr. R.J. Punia, learned Counsel appearing for the appellant- owner drew the attention of the Court towards a judgment rendered by coordinate Bench of this Court in S.B. Civil Misc. Appeal No. 455/1997, The Oriental Insurance Company Ltd. v. Smt. Shakuntla Devi and others decided on 16th April, 2009 and the relevant portion of which is quoted below: "Much was sought to be argued on the basis of Ext. D4, that amount of Rs. 288/- only was received in the company, and that too on 2nd February, 1988. It would suffice to say, hat the insured's act comes to an end with making the payment to the agent, and receiving cover note. Payment to the agent is a valid payment to the Insurance Company for the purpose of Section 64(VB) to attract the liability of the insurer. Section 64(VB) does not require the insured to ensure, that the amount paid by him to the agent does actually traveled (sic) to the company, and is credited to the coffers of the company, as a sine qua non, for validating of the insurance cover. That may be a matter between the Company and the agent. Neither the insured is covered with that, nor can the third party be said to be concerned with that, and if the insured had paid the minimum of Rs. 150/- additionally, for covering limited liability to third parties, it cannot be said, that the limit of liability of the insurer is limited to Rs. 1,50,000/-. Thus, this contention also has no force. The net result of the aforesaid discussion is, that I do not find any force in the appeal. The appeal is, therefore, dismissed. Sd/-(N.P. Gupta, J.)" The legal position as it emerges from the three judgments relied upon by the learned Counsel for the Insurance Company, Mr. UCS Singhvi, may summarized as below. In National Insurance Company Ltd. v. Yellamma and another (supra), the Hon'ble Supreme laid down as under: "8. In today's world payment by cheque is ordinarily accepted as valid tender but same would be subject to its enhancement. A distinction, however, exists between the statutory liability of the Insurance Company vis-a-vis the third party in terms of Section 147 and 149 of the Motor Vehicles Act and its liability in other cases but it is clear that if the contract of insurance had been cancelled and all concerned had been intimated thereabout, Insurance Company would not be liable to satisfy the claim. 9. In this case, there cannot be any doubt or dispute whatsoever that no privity of contract came into being between the appellant and the respondent No.2 and as such the question of enforcing the purported contract of insurance while taking recourse to Section 147 of the Motor Vehicles Act did not arise. Respondent No.2 did not contest the case at any stage. It did not adduce any evidence before the Tribunal. It does not appeal from the Judgments of the High Court. No argument in the appeal was advanced in his behalf. Before us also, no appearance has been made on behalf of the respondent No.2 despite service of notice." ;