IMPORTANT POINT
The insurance company remains liable under the policy to the registered owner despite ownership transfer not being legally completed, reflecting legislative intent to protect transferees.

JUDGMENT :

SUBHASH VIDYARTHI, J.

1. Heard Sri Asit Srivastava, the learned counsel for the petitioner, Sri Ashok Kumar, the learned Counsel for the caveator/opposite party-Govind Gupta and perused the record.

2. By means of the instant petition filed under Article 227 of the Constitution of India, the petitioner has challenged validity of the judgment and order dated 04.06.2024 passed by the Permanent Lok Adalat, Lakhimpur Kheri in P.L.A. Case No. 09 of 2022.

3. The opposite party Govind Gupta filed the aforesaid P.L.A. case stating that he is the registered owner of Truck bearing registration no. UP 31 T 9835, which was insured by the petitioner-The New India Assurance Co. Ltd. for the period 06.11.2019 to 05.11.2020 for a sum of Rs.13,00,000/-. The truck met with an accident in the night of 01.11.2020. The opposite party gave information of the damage caused to the truck to the petitioner and submitted a claim form. The petitioner’s surveyor had inspected the truck. Rs.4,85,768/- were spent in repair of the truck and the opposite party had submitted the repair bills to the petitioner. The petitioner rejected the insurance claim.

4. The petitioner filed objections stating that after the surveyor had submitted his report, the petitioner had appointed an investigator, who took a written statement of the opposite party, wherein the latter stated that he had transferred the truck to one Sanjeev Kumar son of Siya Ram subject to the condition that Sanjeev Kumar will pay the Bank’s installments. At the time of the accident, the truck was being driven by a driver engaged by Sanjeev Kumar. At the time of the accident the truck was in custody of Sanjeev Kumar and not in custody of the opposite party. The investigator had recorded statement of Sanjeev Kumar also, who stated that he was paying the installments to the bank. The petitioner claims that this indicates that the truck was in custody of Sanjeev Kumar and ownership of the truck could not be transferred only because the truck was hypothecated and it could legally be transferred only after repayment of the loan. The petitioner had disputed correctness of the amount spent in repairs also.

5. The Permanent Lok Adalat had framed the following three issues:

(1) Whether the dispute was beyond jurisdiction of the Court?

(2) What would be the effect of involvement of a third party in the dispute between the parties?

(3) Whether the truck met with an accident in the night of 01/01.11.2020 and whether the claimant was entitled to receive compensation for the damage caused to the vehicle? If yes, then he is entitled to receive what amount as compensation?

6. While dealing with issue no. 2, the Permanent Lok Adalat has recorded in its judgment that the petitioner has admitted in the written statement that the vehicle was insured; that it had met with an accident; that the claimant-opposite party had given information of the accident; that the vehicle got damaged in the accident and that it has rejected the insurance claim. It was contended by the petitioner that the opposite party had transferred the vehicle to Sanjeev Kumar and, therefore, the opposite party did not have any insurable interest. The petitioner admitted that as the vehicle loan amount had not been repaid, the vehicle could not be transferred and it continued to be registered in the name of Sanjeev Kumar. Sanjeev Kumar had filed an application for impleadment which had been rejected on 27.04.2023 as he was not the owner of the vehicle and he could not be impleaded in the proceedings.

7. Keeping in view all the aforesaid facts and circumstances of the case, the Permanent Lok Adalat came to the conclusion that the agreement between the opposite party and Sanjeev Kumar would not affect the adjudication of dispute between the parties to the case.

8. Sri. Asit Srivastava, the learned Counsel for the petitioner has limited his ground of challenge to the finding recorded on Issue no. 2 only.

9. The learned Counsel for the petitioner has drawn att