ELIPE DHARMA RAO, J.

( 1 ) THIS appeal was filed by the New India Assurance co. Ltd. , Kakinada, against the order and decree dated 29. 3. 1994 in O. P. No. 85 of 1990 on the file of the Chairman (III Addl. Dist. Judge), Motor Accidents Claims Tribunal, Kakinada, wherein the Tribunal has awarded compensation of Rs. 1,69,000 for the death of the deceased Kancherla Venkata Suryanarayana Rao, in a motor vehicle accident that has occurred on 24. 9. 89, at about 4. 30 p. m. when the deceased was going on his scooter bearing No. ATP 8309 along with his brother s daughter, 4 years and his daughter, on Samalkota-Kakinada Road, towards Kakinada, a taxi bearing No. AAW 333 coming in the opposite direction being driven by its driver in a rash and negligent manner dashed against the scooter, as a result of which the deceased sustained severe injuries and he was shifted to Government General hospital, Kakinada, and he succumbed to the injuries on 11. 10. 1989 and the scooter was also badly damaged. It is stated that the deceased was earning Rs. 6,000 per month by doing business in iron, general and hardware materials. Therefore, the claimants claimed an amount of Rs. 7,70,000 by way of compensation and the Tribunal awarded Rs. 1,69,000.

( 2 ) THE learned counsel for the appellant submitted that the accident occurred on 24. 9. 1989 and the Motor Vehicles Act, 1988 came into force w. e. f. 1. 7. 1989 and the insurance policy Exh. B-1 covering the vehicle was in operation for a period of one year w. e. f. 10. 5. 1989 to 9. 5. 1990 and as per proviso to sub-section (2) of section 147 of the Motor Vehicles Act, 1988, the liability of the appellant is only Rs. 50,000.

( 3 ) PROVISO to sub-section (2) of section 147 of the Motor Vehicles Act, 1988 reads as under:"147 (2): Subject to the proviso to subsection (1), a policy of insurance referred to in sub-section (1), shall cover any liability incurred in respect of any accident, up to the following limits, namely: (a) (b) provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier. "from the reading of the above said proviso, it is clear that any insurance policy issued by the insurer, covering a motor vehicle with a limited liability, which was in force immediately before commencement of the Motor Vehicles Act, 1988, shall continue to be in force for a period of four months after the commencement or till the date of expiry of such policy whichever is earlier. Therefore, to invoke the above said proviso, the vehicle must be covered by insurance policy with limited liability and that policy must be in operation when the Motor Vehicles Act, 1988 came into effect and that shall continue for a. period of four months after such commencement or till the expiry of such policy whichever is earlier, that is to say, if the policy is in operation before the commencement of the Act, 1988, it shall continue for a period of four months. Even otherwise also, if the policy expires within a period of four months of the commencement of the Act, 1988, it will operate to the date of expiry of the policy only and not up to four months from commencement of the Act. If the policy is effective beyond the period of four months from the date of commencement of this Act, but it shall be operative for a period of four months from the date of commencement of the Act, 1988 only. Therefore, as seen from the submissions made by the learned counsel for the appellant, the insurance policy was issued covering the crime vehicle for a period of one year with effect from 10. 5. 1989 to 9. 5. 1990 and the accident had occurred on 24. 9. 89. Therefore, the policy was issued with a limited liability of Rs. 50,000 covering up to 9. 5. 1990 and the accident had occurred on 24. 9. 89. Therefore, the appellant is liable to i

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