Partly allowed

The Oriental Insurance Co.Ltd. v. Smt.Chandrawati and Others

Allahabad HC23 Jan 2019FAFO/1259/1999

Case brief

AI extract

What is this about?

In this first appeal, the Court allowed the insurer's appeal partly against a Motor Accident Claims Tribunal award. It held that the insurer is liable but must be granted a right to recover the premium amount and interest from the policyholder, noting the cheque dishonour and lack of proof of cash payment.

What did the court decide?

The appellant-Insurance Company is entitled to recover the awarded amount along with 7% interest from the insured, Smt. Urmila.

The Oriental Insurance Co.Ltd. Vs Smt.Chandrawati and Others — Insurance | Allahabad HC (2019)

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Court No. - 25

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Case :- FIRST APPEAL FROM ORDER No. - 1259 of 1999

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Appellant :- The Oriental Insurance Co.Ltd. Respondent :- Smt.Chandrawati And Others Counsel for Appellant :- Amaresh Sinha Counsel for Respondent :- Pankaj Singh,M.S.Dixit,P.K.Jain

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Hon'ble Ram Krishna Gautam,J.

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Heard learned counsel for appellant and perused the impugned judgment and material placed on record.

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This appeal under Section 173 of Motor Vehicles Act, 1988 has been filed by Oriental Insurance Co. Ltd. against judgment and award dated 20.08.1999, passed by M.A.C.T. / IIIrd Additional District Judge, Muzaffarnagar, in M.A.C.P. No. 250 of 1996, on the ground that Tribunal failed to appreciate the facts and law placed before it.

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The cheque given towards premium by the husband of owner of offending Truck, at the time of issue of the cover note, was dishonoured and even after it and knowledge of dishonour of cheque, no amount was deposited by insured. A story of making cash payment to Development Officer Ashok Kumar was developed, but not proved. Rather a fresh insurance by another Insurance Company i.e. New India Insurance Company was got executed on 08.07.1996, which itself shows that the previous payment was wrong, but the Tribunal has imposed the liability on appellant-Insurance Company. Hence, this appeal.

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In the discussion of Issue No. 3 framed by learned Tribunal i.e. "KYA DURGHATNA KI TITHI ME GADI WIPAKSHI SANKHYA 3 ORIENTAL INSURANCE COMPANY LIMITED DWARA BIMAKRIT NAHI THI?", a finding has been given that Chaman Lal H/o Smt. Urmila, while being examined on oath has categorically said that his wife had issued a cheque of Rs.8343/- towards the premium for issuing of cover note of Insurance Company and the same was dishonoured. He got the information within 2-3 days of dishonour, but he made a cash payment to Development officer Ashok Kumar, who gave no receipt of this payment. Meaning thereby, the cheque given as payment towards premium was dishonoured and this was under knowledge of person issuing the cheque, but no payment towards this was made with a valid receipt or acknowledgement and the payment being said to be made to Ashok Kumar was not proved by Chaman Lal and the Tribunal while interpreting the law propounded in Oriental Insurance Co. Ltd. Vs.

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Indrajeet Kaurav and Ors.; 1998 A.C.J. 123 S.C. has held that the Insurance Company will be liable to make the payment in case of accident and loss suffered by third party out of an agreement in between owner and the Insurance Company even if cheque was dishonoured, but the Insurance Company will have the right to recover the same amount from the owner of offending vehicle and this finding was given in the discussion of issue No. 3, but while making the order this portion was left, whereas admittedly the premium towards insurance cover note was not paid and payment in cash to some agent was not proved by Chaman Lal. Subsequently, another insurance by another Insurance Company was got executed after the accident.

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The liability of making the payment has been imposed upon the Insurance Company-appellant, but no right of recovery has been given. Hence, certainly Tribunal failed to appreciate above correct perspective of law, hence this appeal merits its allowance in part.

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The appeal is partly allowed with amendment in award that the awarded amount along with interest paid by the appellantOriental Insurance Co. Ltd. shall be recoverable by the appellant-Insurance Company in the same proceeding before the Tribunal form Smt. Urmila wife of Chaman Lal, who was the registered owner of the offending Truck bearing registration No.DL-1G-1767 along with 7% interest over amount paid.

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Order Date :- 23.1.2019 NS

The Oriental Insurance Co.Ltd. v. Smt.Chandrawati and Others

Case brief

What is this about?

What did the court decide?

The Oriental Insurance Co.Ltd. v. Smt.Chandrawati and Others

Case brief

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What did the court decide?

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