An insurance company remains liable for compensation even if a premium cheque is dishonored, unless cancellation of policy was communicated before an accident.

JUDGMENT

The above appeal is filed by the appellant/Insurance company against the judgment and decree dated 09.01.2024 and made in M.C.O.P.No.200 of 2022 on the file of the Motor Accident Claims Tribunal, Special Subordinate Judge, Krishnagiri.

2. Since no adverse order is being passed against the respondents, notice to the respondents is dispensed with.

3. It is the case of the appellant / Insurance company that, on 24.09.2020, when the first respondent / claimant namely Manjunath was driving the two wheeler bearing Regn.No.TN 70 AB 5148, at that time a lorry bearing Regn.No.TN 30 AZ 6604 which was proceeding in front of the claimant, suddenly applied brake without lighting any indicator, due to which, the claimant dashed the rear side of the lorry and sustained grievous injuries all over his body and was hospitalised. Therefore, the first respondent / claimant has filed a claim petition claiming a sum of Rs.25,00,000/- for the injuries sustained by him in the said accident.

4. Before the Tribunal, the claimant / first respondent has examined P.W.1 and marked Exhibits P.1 to Ex.P.9. On the side of the appellant / insurance company, they eamined R.W.1 and marked Exs.R1 to R6 and Court document was marked as Ex.C1. After adjudication, the Tribunal awarded a sum of Rs.3,15,000/- as compensation to the claimant. Challenging the same, the appellant / Insurance company has preferred the present appeal.

5. The learned counsel appearing for the appellant / Insurer of lorry submitted that, though the appellant issued a policy covering from 21.09.2020 to 20.09.2021, to the owner of the lorry upon payment of the premium, however, the said premium was dishonoured on the ground of mismatch of signature on 22.09.2020 which is two days prior to the date of accident. It is the further case of the appellant that the accident had happened on 24.09.2020 during which point of time, there was no subsisting contract of insurance between the appellant and the owner of the vehicle. When there being no policy on the date of accident, the Tribunal ought not to have granted a sum of Rs.3,15,000/- in favour of the claimant which is per se unsustainable.

Accordingly, he prayed to allow this appeal.

6. Heard the learned counsel appearing for the appellant and perused the materials available on record.

7. The factum and manner of the accident is not disputed by the parties.

Therefore, this Court is not entering into the said aspect. Admittedly, the accident happened on 24.09.2020. In order to prove the said incident, the claimant has examined himself as P.W.1. who categorically deposed before the Tribunal that the accident had occurred solely due to the driver of the lorry, due to which the first respondent sustained grievous injuries. However, in order to disprove the same, no independent eye witness has been examined by the appellant / Insurance company. It is the contention of the appellant that though the cheque issued by the owner of the lorry for the payment of premium of insurance policy was dishonoured on 22.09.2020 prior to the date of accident on the ground of mismatch of signature, however, the Tribunal ordered to pay and recover the same from the owner of the lorry when there being no subsisting contract between the owner of the lorry and the appellant / insurance company.

8. The issue arises in the present appeal is whether the cancellation of policy by the appellant / insurer of the lorry was duly intimated to the owner of the lorry and Regional Transport Officer or not ?

9. This Court in C.M.A.Nos.4449 of 2019 & 1928 of 2020 dated

22.12.2023 in the case of Gowramma Vs. The Branch Manager M/s.Reliance General Insurance Co. Ltd. held that where