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1999 Supreme(Mad) 652
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE M. KARPAGAVINAYAGAM
The Oriental Insurance Company Ltd.
Versus
G. Moses & Others
C.M.A. Nos. 212 & 213 of 1992
Decided On :Decided on : 19-07-1999
For the Respondents:Mohan Choudary, A. Saravanan, Advocates.
The commencement of policy coverage is determined by the issuance of the cover note and the receipt of the premium, and in the absence of a specific time mentioned, the policy is considered to commence from the midnight of the day.
Headnote:
Insurance - Cover Note - Commencement of Policy Coverage
Fact of the Case:
The insurance company appealed against an award, arguing that the cover note issued for the vehicle involved in an accident was ante-dated, and therefore, the company was not liable to pay the amount. The accident took place on 5.10.87, and the premium amount was received by the agent on 3.10.87.
Finding of the Court:
The court referred to previous decisions and held that once the cover note was issued on the basis of the receipt of the premium, the policy coverage commences. In the absence of any specific time mentioned, the contract would be operative from the midnight of the day.
Issues: The main issue was the commencement of the policy coverage and the liability of the insurance company to pay the amount due to the accident.
Ratio Decidendi: The court interpreted that the policy coverage commenced from the date the premium was received, and in the absence of a specific time mentioned, it would be considered to start from midnight of the day.
Final Decision: The court dismissed the appeals, stating that there was no merit in the argument presented by the insurance company.
These two appeals, C.M.A. Nos. 212 and 213 of 1992, could be disposed of by a common judgment on a short ground.
2. The Insurance company, the appellant herein questioning the award mainly on the ground that the cover note issued to the vehicle in question which bears the date 3.10.87 was deliberately ante dated by the agent of the company, since the amount had been paid to the company by the agent only on 5.10.87, ie., subsequent to the accident and as such, the Insurance Company is not liable to pay the amount.
3. This ground cannot hold good, in view of the decision rendered by the Apex Court in Oriental Insurance Co Ltd v. Inderjit Karur and others (1998-I-L.W.ll), in which it has been held that once the cover note was issued on the basis of the receipt of cheque towards premium which might be bounced later, the policy coverage commences and in New India Assurance Co v. Ram Dayal (1990) 2 S.C.R. 570), wherein it has been held that in the absence of any specific time mentioned in that behalf, the contract would be operative from the mid-night of the day.
4. In the instant case, admittedly, the accident took place on 5.10.87. According to the Insurance company, the premium amount was received from the insured on 3.10.87 by the agent, who gave the amount to the Insurance company only on 5.10.87, i.e., on the date of the accident.
5. It is to be noticed mat in the policy or cover note, the time is not mentioned. Under these circumstances, especially when the cover note and the proposal form bear the date 3.10.87 as put by the agent on behalf of the Insurance company, it has to be taken that the policy coverage, commences from 3.10.87 itself.
6. Even assuming for the sake of argument that the amount of premium was received by the Insurance company on 5.10.87, in the absence of any time being mentioned in the policy, it can be safely held that the policy coverage commences from 12.00 mid-night on 4/5.10.87.
7. Therefore, there is no merit in these appeals. In the result, the appeals are dismissed. No costs.
