IMPORTANT POINT
Accident--Compensation--Liability--Accident had taken place after the expiry of one year from the date of issuance of a cover note—Insurance Company not liable—Owners of offending bus are liable.

T.P.S. Mann, J.:-Judgment passed by Motor Accidents Claims Tribunal, Barnala on 23.11.1994, while awarding a sum of Rs.65,000/- with interest to the claimants/respondents No 1 to 6 and payable by Insurance Company­appellant, is under challenge in the present appeal.

2. The claim petition under Section 166 of the Motor Vehicles Act, 1988 was filed by the claimants/respondents No.1 to 6 on the ground that on 9.1.1993 at about 1.00 PM, bus bearing registration No PJG-7510 was driven by Sohan Singh, Driver-respondent No.7 in a rash and negligent manner. The same hit Smt. Tej Kaur, who suffered injuries and died on account thereof. Accordingly, the claim petition was filed seeking the grant of Rs.5,00,000/- as compensation.

3. The Driver, besides Depot Manager and Managing Director/Chairman of Pepsu Road Transport Corporation, Patiala (for short ‘P.R.T.C.’), owners of the bus, denied the allegations levelled by the claimants. However, the Insurance Company filed a separate written statement, wherein the factum of accident was denied and it was specifically pleaded that it was not liable to indemnify the owners of the bus even though on 28.8.1991, it had insured 1050 buses of P.R.T.C. including the offending bus and issued a cover note, which was valid for a period of 30 days, yet during the said period, the Insurance Company served a notice dated 18.9.1991 informing P.R.T.C. that the said cover note and the consequent risk coverage would stand cancelled after seven days, i.e. from midnight of September 25, 1991. Aggrieved of the notice issued by the Insurance Company, P.R.T.C. filed a civil suit, which was still pending at that time. In the said suit, an application under Order XXXIX Rules 1 and 2 C.P.C. was also filed by P.R.T.C. seeking temporary injunction against cancellation of cover note which was granted by learned Civil Judge and the appeal filed by the Insurance Company dismissed by the Appellate Court. Thereafter a revision had been filed in the High Court. It was only on account of the issuance of injunction order which was still operating against the Insurance Company that the insurance risk qua the bus was covered, otherwise the coverage of insurance risk ceased with effect from 25.9.1991 midnight.

4. At the trial of the claim petition, the following issues were framed:­

“1. Whether Tej Kaur died in an accident arising out of the negligent driving of bus No. PJG-7510 by the respondent No.1 on 9.1.1993 in the area of Pakhon Kalan as alleged? OPA.

2. Whether are the claimants the legal representatives of Tej Kaur deceased? OP A.

3 To what amount of compensation, if any are the claimants entitled and from whom?

4 Relief.”

5. After the evidence was led by the parties, learned Motor Accidents Claims Tribunal, Barnala returned findings in favour of the claimants and also held that as the vehicle involved was undoubtedly insured with the Insurance Company, it was liable to pay the amount of compensation of Rs.65,000/- along with interest. Hence, the present appeal.

6. I have heard learned counsel for the parties and considered the records placed before me.

7. On 28.8.1991, the Insurance Company initially accepted the offer made by P.R.T.C. for insuring its fleet of 1050 buses, including the bus bearing registration No. PJG-7510. It issued a cover note dated 28.8.1991 which was to remain valid for a period of 30 days from the said date. As is usual, within the said 30 days, the Insurance Company was to issue the detailed policy to P.R.T.C. Further that the insurance cover was to last for a period of one year from 28.8.1991. However, on 18.9.1991 before the expiry of the validity of cover note, it decided to withdraw its offer for providing insurance cover in respect of P.R.T.C. buses. Accordingly, it issued a notice dated 18.9.1991, which was served upon P.R.T.C. on the same day stating therein that the aforementioned cover note and the consequent risk cover would stand cancelled after seven days, i.e., from the midni