Insurer liable to indemnify third-party claimants despite dishonoured premium cheque and registered post intimation of cancellation prior to accident, as public interest in third-party protection prevails; insurer may recover from insured. Quantum recalculated per guidelines.

JUDGMENT :

C.V.Karthikeyan, J.

The 2^nd respondent in MCOP No.2244 of 2014 aggrieved by the award, dated 12.02.2020 granted by the Motor Accident Claims Tribunal, II Court of Small Causes, Chennai, is the appellant herein.

2. MCOP No.2244 of 2014 had been filed by the first – fourth Respondents herein seeking compensation for the death of one Karthik, who was aged 24 years in a motor accident on 18.02.2014 at about 01.00 p.m., near Tada Satyavedu Main Road in front of Colgate Company, the husband of the first respondent / father of the second respondent and son of the third and fourth respondents. It was stated that he was riding a new unregistered motorcycle from his company to his house and at that time, a Tipper Lorry driven by the driver of the fifth respondent herein bearing Registration No.AP 31 TA 1567 in a rash and negligent manner had dashed against the motor cycle. The deceased sustained head injury and died on spot. The fifth respondent herein is the owner of the Tipper Lorry. The appellant herein is the Insurer of the said Tipper Lorry.

3. Before the Tribunal, the appellant herein had resisted the claim petition on the ground that there was no policy of Insurance nor contract of the Insurance between the fifth respondent and the appellant herein. It had been contended that the Policy was issued on 16.12.2013 and a cheque was issued by the fifth respondent on the same day. On 06.01.2014, the cheque was dishonoured on the ground of insufficient funds. On 06.01.2014 this fact was intimated by the appellant herein to the Insured / 5^th respondent. Further communication was also issued to the Road Transport office.

4. The appellant placed reliance on the postal receipts produced before the Tribunal, indicating forwarding and sending of the said communication through Registered post. However they could not file the acknowledgement cards or any other letter from the post office, indicating that the letters had been delivered to the addressee.

5. Before the Tribunal, the appellant herein had stated that since the cheque issued towards the premium had been dishonoured owning to insufficient funds, contract was never entered into between the appellant and the fifth respondent. It was also pointed out that the deceased was working as a Painter and appropriate compensation alone should be granted by the Tribunal.

6. The Tribunal by its Judgement dated 12.02.2020, while examining the liability of the appellant herein, had stated that the acknowledgement cards for Registered post sent regarding the dishonour of cheque by the bankers had not been filed. It had therefore been stated that the Tribunal cannot presume that the cancellation of the policy has been intimated to the Road Transport Office, Nellore. It was finally held that the appellant as an Insurer, was liable to pay compensation with right to recover the same from the fifth respondent herein.

7. With respect to quantum of compensation to be paid, the Tribunal had granted a total sum of Rs.40,00,000/- in the following manner:

8. This appeal has been filed challenging both the liability and quantum.

9. The learned counsel for the appellant first pointed out that the cheque which had been issued towards payment of premium by the fifth respondent herein, the owner of the Tipper Lorry, had been dishonoured for want of insufficient funds. The learned counsel pointed out that the responsibility in such cases on the part of the Insurance Company was to intimate this particular fact to the insured / fifth respondent and also to the concerned Regional Transport Office.

10. The learned counsel in this connection, produced the postal receipts for forwarding the communication through Registered Post and placed reliance on Section 27 of the General Clauses Act, 18