Insurance companies remain liable for compensation despite policy cancellations due to non-payment, requiring proof of such cancellations when contested.

JUDGMENT :

B.S. BHANUMATHI, J.

1. This appeal is filed under section 173 of the MOTOR VEHICLES ACT , 1988, against the award and the decree, dated 01.02.2005, in O.P.No.89 of 2000 on the file of the Court of the Motor Accidents Claims Tribunal-cum-II Additional District Judge, Madanapalle (for short ‘the Tribunal’). The parties are arrayed as before the Tribunal. The 1^st to 5^th respondents herein are the claimants. The respondent No.6 herein is the 1^st respondent and the 7^th and 8^th respondents herein are the 3^rd and 4^th respondents before the Tribunal. The appellant is the 2^nd respondent before the Tribunal.

2. The case of the claimants, is briefly, as follows:

The claimants are the legal representatives of Nadigam Venkatramana (hereinafter referred to as ‘the deceased’). They sought compensation of Rs.4,00,000/- on the ground that the deceased died in a motor vehicle accident on 29.08.1999 due to the rash and negligent driving of the driver of the jeep bearing No.AP 03 D 5996, insured with the 4^th respondent and owned by the 3^rd respondent, as the jeep dashed against a maxi cab van bearing registration No.KA 01 3265, owned by the 1^st respondent and insured with the 2^nd respondent which was driven by its driver also in a rash and negligent manner. The owners of both vehicles did not contest the case. Both the insurance companies contested the case by filing separate written statements. The 2^nd respondent pleaded that policy issued in favour of the 1^st respondent was cancelled as the cheque issued by him relating to the premium amount was dishonoured and therefore it is not liable to pay compensation. That apart, both the insurance companies denied their liability to pay the compensation etc.

3. On behalf of the claimants, the 1^st claimant was examined as PW1, the 4^th claimant was examined as PW2 and Sk. Mahaboob Basha was examined as PW3. Further Exs.A1 to A12 were marked. On behalf of the 2^nd respondent, RW1, Varakumar, was examined and exhibits B1 to B7 were marked, out of which exhibit B1 is the same as exhibit B5 and exhibit B4 is the same as exhibit B6. The 4^th respondent did not lead oral evidence but filed exhibit B8.

For claimants:

Ex.A1 : Certified copy of F.I.R. in Cr.No.143 of 1999 of Nandagudi P.S.

Ex.A2 : English translation copy of Ex.A1.

Ex.A3 : Certified copy of inquest report.

Ex.A4 : English translated copy of inquest of Ex.A3.

Ex.A5 : Certified copy of post mortem certificate.

Ex.A6 : Certified copy of M.V.I’s report.

Ex.A7 : Date of birth certificate of N.Venkatramana.

Ex.A8 : Date of birth certificate of 2^nd petitioner.

Ex.A9 : Date of birth certificate of 3^rd petitioner.

Ex.A10 : Date of birth certificate of 1^st petitioner.

Ex.A11 : Bank pass book issued by the Vysya Bank, Punganur.

Ex.A12 : Original pass book issued by Sri Lakshmi Priya Township Promoters Private Limited, Hyderabad.

For respondents:

Ex.B1 : Xerox copy of cancellation copy of policy.

Ex.B2 : Xerox copy of cheque.

Ex.B3 : Xerox copy of Bank intimation.

Ex.B4 : Xerox copy of cancellation letter addressed to the insured and R.T.O.

Ex.B5 : Copy of cancellation policy.

Ex.B6 : Copy of cancellation letter addressed to R1 & R.T.O.

Ex.B7 : Xerox copy of letter of cheque by the bank authorities.

Ex.B8 : Xerox copy of policy.

4. After hearing both parties, the Tribunal declined the contention of the 2^nd respondent that it had no liability to pay the compensation in view of the cancellation of the policy