The bounced cheque and subsequent realization of the amount affected the validity of the insurance policy and the liability of the insurer.

M. RAMAKRISHNA, J.

( 1 ) THE appellant-insurer being aggrieved by the judgment and award made in M. V. C. 1171 of 1989, disposed of on the 8th of july, 1993, by the Motor Accidents Claims Tribunal, 8th metropolitan Court, Bangalore City, has come up with this appeal challenging the correctness and legality of the finding recorded against the insurer fixing the liability to make good the amount of compensation awarded, on more than one ground,

( 2 ) WE have heard Sri Shankar, learned counsel for the appellant, who took us through the judgment and award and argued that, at the outset, the Member of the Tribunal was in error in having held in paragraph 16 that having regard to the evidence on record - both oral as well as documentary - the policy issued by the insurer in respect of the motor vehicle in question was valid and therefore the insurer was liable to indemnify the insured and therefore directing to pay the compensation. To substantiate his argument Sri Shankar, learned counsel, took us through the provisions of Section 96 (2) (c) which reads as follows: section 96 (2) (c): "that the policy is void on the ground that it was obtained by the non-disclosure of a material fact or by a representation of fact which was false in some material particular. "

( 3 ) IN view of the specific provisions of law referred to above, the submission of the learned counsel is that on 30-3-1989 a cheque for a sum of Rs. 2,039/- was given by the insured in favour of the insurer and accordingly a cover note Ex. R. 1 and a receipt Ex. R. 2 were issued in respect of lorry bearing Reg. No. MYR 3602, subject to the condition that receipt will be valid subject to realisation of cheque. This condition is at Ex. R. 2 (a ). It was dishonoured for want of money and accordingly the Bank by his intimations Exs. R. 4 and R. 5 informed the insurer. On being informed, the insured requested the insurer to re-present the cheque on 13-4-1989, for collection. Accordingly, the cheque was presented later and was honoured and the amount therein was collected on 13-4-1989. Therefore, according to Shri Shankar, on the date of accident on 11-4-1989, no amount was paid to the insurer in respect of the policy covering the vehicle in question. Therefore, it was not valid and hence the insurer was not liable to indemnify the insured for the accident involving the vehicle in question. In support of his submission he relied upon the decision of this court in the case of Smt. Asma Begum and Others v Nisar ahmed and Others. This Court, having regard to the facts and circumstances of the case, held:" (II) In view of Section 64-VB of the Insurance Act, the risk on the part of the insurer commences only on the payment of the premium by the insured. "therefore, Sri Shankar submitted that this was a fit case in which the finding recorded by the Tribunal against the appellant to make good the compensation awarded had to be set aside. 3. We have carefully gone through the original records made available including the depositions. R. W.-1, Sathyanarayana-the administrative Officer of the appellant-company, has stated in his cross-examination that the cheque issued by the insured - R. 5 having being bounced by the Bank, the insured asked the insurer to re-present the cheque on 13-4-1989 and subsequently the cheque was re-presented and the amount was realised.

( 4 ) IT is pertinent to note that Rangaswamy - (R. W. 2) examined on be half of the insured has nowhere stated in his examination-in-chief that the money under the cheque issued by the insured had been realised by the insurer before the accident on 11-4-1989. On the other hand, he had not disputed that on instruction given by the insured to re-present the cheque on 13-4-1989 the cheque was re-presented accordingly and the amount realised. Though he asserts in the cross-examination that on payment of premium, the cover note and the receipt Ex. R. 1 and R. 2 respectively were issued, in view of his admission that a cheque was issued

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