The main legal point established is that an insurance company is not liable for compensation if the accident occurs after the cancellation of the policy due to non-payment of premium.

DEEPAK VERMA, S. K. PANDE, JJ.

( 1 ) THIS appeal under section 173 of the Motor Vehicles act, 1988 is directed against the award dated 6. 9. 2002, passed by Second Additional Motor Accidents Claims Tribunal, satna in Claim Case No. 5 of 1999.

( 2 ) LATE Ram Karan Singh, aged about 48 years died on 2. 12. 1998 in an accident involving a truck bearing No. MTV 888 belonging to Harvinder Singh Sethi, respondent No. 5 and driven by Karan Singh, respondent No. 4. The case of claimants in short was that late Ram Karan Singh was working as a mason with one Manoj Bi-yani at Bhusawal. While he was working, driver, respondent No. 4, put the truck in reverse gear causing dash against Ram karan Singh, who as a result fell down and the wheel of the truck passed over his waist resulting in death. Respondent Nos. 1, 2 and 3 Khelli Bai, Praveen Singh, Kirti kumar Singh respectively widow, daughter and son filed a claim petition, claiming compensation to the tune of Rs. 8,60,000 alleging rash and negligent driving by the driver of the said truck, respondent No. 4, causing the death of late Ram Karan Singh. Owner Harvinder Singh Sethi, respondent no. 5 and driver Karan Singh, respondent no. 4, did not file their written statements, accordingly were proceeded ex pane. The appellant insurance company denied its liability to pay compensation on the ground that the cheque issued by the owner of the vehicle, respondent No. 5, towards premium of the policy was dishonoured and accordingly the policy was cancelled after giving information to the insured by registered post, prior to the occurrence of the accident. The Tribunal below relying on Oriental Insurance Co. Ltd. v. Inderjit kaur, 1998 ACJ 123 (SC), rejected the plea of the appellant insurance company and proceeded to award compensation to the tune of Rs. 2,50,000. The cheque dated 31. 3. 1998, Exh. DIC, towards payment of premium was issued by the owner, respondent No. 5. On being presented vide memo Exh. D2c, it was sent to the Akola Urban Co-operative Bank limited, Akola for collection. The bank concerned vide memo dated 3. H. 1998, Exh. D3c, returned the cheque Exh. DIC, with a note for non-availability of funds in the account of the owner, respondent No. 5. On that basis, the appellant insurance company cancelled the policy vide memo dated 6. 4. 1998, Exh. D4c and sent the information per registered post to the owner, respondent No. 5, that the company shall not be liable for any risk since inception under the policy. Appellant insurance company assailed the impugned award only on the ground that the incident wherein late Ram Karan singh died occurred on 2. 12. 1998. Prior to the said incident, for non-payment of premium, the policy issued in favour of the insured-owner, respondent No. 5, was cancelled on 6. 4. 1998 itself. Memo cancelling the policy was sent to the owner, respondent No. 5, per registered post vide postal receipt, Exh. D3c. Even after the cancellation of policy vide memo dated 6. 4. 1998, the insured-owner, respondent no. 5, did not act, as such the appellant insurance company ought not to have been held liable for payment of compensation to the claimants-respondents. Reading the judgment of Apex Court in oriental Insurance Co. Ltd. v. Inderjit kaur, 1998 ACJ 123 (SC) and New India assurance Co. Ltd. v. Rula, 2000ACJ 630 (SC), the Division Bench of Kerala High court in New India Assurance Co. Ltd. v. Raghu, 2002 ACJ 217 (Kerala), dealt with the case of the nature herein. It has been held:"so far as the present appeals are concerned, the accident occurred after the cancellation of the policy. The question, therefore, is whether since the policy has been cancelled, can the respondent rely on the decisions referred to supra. Learned counsel for appellant contended that for payment by the insurance company, existence of a policy is a must. If the policy is not in existence, then there is no liability to pay the amount notwithstanding that such a policy was previously issued. Thu

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