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2023 Supreme(AP) 1566

IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATHI
V. GOPALA KRISHNA RAO, J.
The Oriental Insurance Co. Ltd. – Appellant
Versus
Dasari Venkata Rao S/o Narasimham – Respondent
M.A.C.M.A. No. 1439 of 2015
Decided On : 11-08-2023

Advocates:
Advocate Appeared:
For the Appellant : A. Jayanthi.
For the Respondent: G. Venkata Reddy.

Headnote:(A) Motor Vehicles Act, 1988 - Sections 166, 147, and 149 - Appeal against Insurance Company regarding liability for compensation due to motor vehicle collision - Court upheld Tribunal's award based on negligence of offending vehicle's driver - Insurer's liability persists despite dishonored premium cheque, as cancellation notice was sent after accident - The ruling emphasized the need for insurers to communicate cancellation before the accident to evade liability. (Para 13, 14, 15)

(B) Insurance Liability - Dishonored cheque for premium does not exempt insurer's obligation to indemnify third parties unless policy is cancelled and communicated prior to the accident. (Para 13)

Facts of the case:
The claimant sustained injuries in a motor vehicle accident involving a bus that was negligently driven. The Insurance Company's appeal contests the Tribunal's award of Rs.6,33,500/- for compensation, citing issues with payment of premiums leading to policy cancellation.

Findings of Court:
Tribunal's findings that the accident was due to negligence were upheld, making the insurer liable for compensation.

Issues: Determining the extent of liability and the validity of the insurance policy following dishonored cheque and policy cancellation.

Ratio Decidendi: The court reiterated that unless cancellation is communicated prior to the accident, the insurer remains liable.

Result: Appeal dismissed, Tribunal's award confirmed.

Table of Content
1. injury claim history from motor vehicle accident. (Para 3 , 4)
2. insurance liability based on dishonoured cheque rules. (Para 8 , 14 , 15)
3. court's reasoning following precedent cases. (Para 9 , 10 , 13)
4. arguments surrounding insurance policy liability. (Para 11 , 12)
5. final order confirming tribunal's decision. (Para 16 , 17)

JUDGMENT :

V. GOPALA KRISHNA RAO, J.

1. Aggrieved by the impugned order dated 30.07.2014 on the file of Motor Accident Claims Tribunal-cum-IV Additional District Judge, Visakhapatnam, passed in M.V.O.P. No. 436 of 2007, whereby the Tribunal has partly allowed the claim against the respondents 1 to 3, the instant appeal is preferred by the appellant-Insurance Company.

2. For the sake of convenience, both the parties in the appeal will be referred to as they are arrayed in the claim application.

3. The claimant filed a Claim Petition under sections 166 of MOTOR VEHICLES ACT , 1988 read with 455 of MOTOR VEHICLES RULES , 1989 against the respondents praying the Tribunal to award an amount of Rs.8,00,000/- towards compensation for the injuries sustained by him in a Motor Vehicle Accident occurred on 29.09.2006.

4. The facts germane to dispose of this appeal may be briefly stated as follows:

    On 29.09.2006 at about 10.30 p.m., while the petitioner was going towards Anakapalli from Gajuwaka on his motor cycle bearing No. AP 31 AK 8249 and when he reached near Lankilapalem junction, Parawada Mandal, Visakhapatnam District, one Volvo bus bearing No. AP 05TT 4747, hereinafter referred to as ‘offending vehicle’ driven by its driver in a rash and negligent manner, dashed the petitioner’s vehicle from back side, resulting which the petitioner sustained grievous injuries. Basing on the complaint, the Station House Officer, Parawada police station registered a case in Crime No. 164 of 2006 for the offence punishable under Section 338 of Indian Penal Code, 1860 and after completion of investigation, police filed charge sheet against the driver of the offending vehicle.

5. The first and second respondents remained ex-parte. The third respondent filed counter denying the claim of the claimant and contended that the claimant is not entitled any compensation and the third respondent is not liable to pay any compensation to the claimant.

6. Based on the above pleadings, the Tribunal framed the following issues:

    (i) Whether the petitioner sustained injuries in the Motor accident occurred due to the rash and negligent driving of the vehicle bearing No. AP 05TT 4747 (Volvo Bus) driven by its driver?

    (ii) Whether the petitioner is entitled to compensation? If so, to what amount and from which of the respondents?

    (iii) To what relief?

7. During the course of enquiry in the claim petition, on behalf of the petitioner, PW1 to PW4 were examined and Ex.A1 to Ex.A12 and Ex.X1 were marked. On behalf of respondents RW1 was examined and Ex.B1 to Ex.B5 were marked.

8. At the culmination of the enquiry, after considering the evidence on record and on appreciation of the same, the Tribunal has given a finding that the accident was occurred due to rash and negligent driving of driver of offending vehicle and the Tribunal granted an amount of Rs.6,33,500/- to the claimant towards compensation. Being aggrieved by the impugned award, the third respondent Insurance Company filed the appeal questioning the legal validity of the order of the Tribunal.

9. Heard Smt A. Jayanthi, learned counsel for the appellant-Insurance Company and Sri G. Venkata Reddy, learned counsel for respondent No. 1-claimant.

10. Now, the point for consideration is:

    Whether the Order of Tribunal needs any interference? If so, to what extent?

11. POINT:

The learned counsel for the respondent No. 3/appellant would vehemently contend that the policy was issued on 11.09.2006 and the owner of the vehicle issued a cheque for payment of premium vide cheque bearing No. 580424, dated 11.09.2006 and the Insurance Company presented the cheque in the bank on 16.09.2006 and the sam

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