Oriental Insurance Company Limited v. Gursimran Singh & Ors.

On the basis of the pleadings of the parties, learned Tribunal framed the following issues:-

Whether claimant received injuries in the motor vehicular accident which took place on 1.9.01 at

8.40 p.m. in the area of village Gunia Majri due to rash and negligent driving of bus No. PB-11-G-9527 by respondent No.1?OPP.

If issue No.1 is proved, to what amount of compensation the claimant is entitled for and from whom?OPP.

Whether the offending bus was not insured with respondent No.4 company on the date of alleged accident and the policy was obtained by respondents No.1 to 3 by fraud?OPR-4.

Whether the driver of the offending bus was not having valid driving licence at the time of alleged accident?OPR4. FAO No. 4017 of 2006 -4-

Whether the insurance company is entitled to take the pleas as provided under Section 170 of M.V.Act?OPR4.

Whether the offending bus violated the terms and conditions of route permit, if so its effect?OPR-4.

Relief. After hearing learned counsel for the parties and examining the file, learned Tribunal held that it was the driver of the offending bus, who drove it rashly and negligently and thereby caused accident resulting in injuries to the claimant and damage to the Maruti car. The claimant was held entitled to receive an amount of Rs.15,000/- towards the injuries suffered by him. As he was not a registered owner of the car in question, he was not entitled to receive any compensation on account of damage to the car. It was also held that it was not believable that the Insurance Company would issue the cover note without receiving the premium. Therefore, no reliance was placed upon the statement of RW1 Birbal Verma when he stated that the insurance cover note was cancelled as premium was not paid. Accordingly, the driver, the owners and the insurer of the offending bus were made jointly and severally liable to pay the compensation amount with primary liability being that of the insurer. The present appeal was dismissed qua the claimant- respondent on 1.9.2006 when notice was issued to the remaining respondents regarding limited question of recovery right of the appellant- FAO No. 4017 of 2006 -5- Insurance Company. Respondents No.2 to 4, who are the contesting respondents in the present appeal, could not be served in the normal course. The appellant then filed a miscellaneous application for substituted service of the said respondents through publication. Accordingly, respondents No.2 to 4 were served by way of publication but no one put in appearance on their behalf on 29.10.2007 when the present appeal was admitted. Even at the time of final hearing, none had put in appearance for contesting respondents No.2 to 4. The sole issue before the Court is about the coverage of the offending bus by its insurer. According to the written statement filed on behalf of the insurer, cover note, photocopy of which was Ex.R7, bearing No.819448 was cancelled as no premium was paid by the owner of the bus. As per the testimony of RW1 Birbal Verma, Senior Assistant, Oriental Insurance Company, Khanna, the company had issued cover note bearing No. 819448 for the offending bus on 27.4.2000 for the period 28.4.2000 to

27.4.2001. The premium was not received and the cover note was cancelled by obtaining an affidavit from Tejvir Singh, owner of the bus. RW1 produced the original affidavit and placed on record its photocopy as Ex.R2. It was further stated that the company had also issued letter to its agent/Development Officer Shri Ram Rattan. During his cross- examination, he stated that the cover note could be issued without receiving advance payment. The company used to issue cover note even FAO No. 4017 of 2006 -6- earlier to its client without making payment. However, he failed to tell a single instance where the cover note was issued without receiving payment. He denied that cover note had been issued after receiving the payment or that he was deposing falsely being employee of the Insurance Company. Shri Paramjit Singh, Advocate-cum-Notary Public, Khanna appeared as RW2. He stated that vide serial No. 48178 dated 10.5.2001, he attested the affidavit of Tejbir Singh, which was read over to him and he signed the same. He had made entry Ex.R4 in the register, which was in his hand. During cross-examination, he stated that he had not seen the original of Ex.R3 in the Court (seems to have been wrongly mentioned as such, instead, it should have been Ex.R2). Tejbir Singh was not personally known to him. He denied that no one identified said Tejbir Singh. However, he admitted that there was no mention of father's name and residential address of Jaswant Singh, who had identified Tejbir Singh. He volunteered to say that Jaswant Singh was known to him as he was owner of Pritam Bus Service and had signed the affidavit by way of identification of Tejbir Singh. A perusal of cover note Ex.R1 would reveal that on 27.4.2000 the offending vehicle was comprehensively insured for the period

28.4.2000 to 27.4.2001 and the total premium was Rs.13,979/-. On its basis, the insurance policy Ex.R7 was issued. Lateron, Tejbir Singh, the owner of the offending bus submitted his affidavit Ex.R2 to the effect that FAO No. 4017 of 2006 -7- he could not pay the premium amount of Rs.13,979/- and, therefore, cover note be treated as cancelled. It was also stated that he had lost the original cover note and in case any claim in respect of the bus in question arose for the period 28.4.2000 to 27.4.2001, he would himself be responsible in respect of any claim, etc. Tejbir Singh, the owner of the offending bus, signed the aforementioned affidavit Ex.R2. He signed the register of the Notary Public against entry No. 48178 dated 10.5.2001 Ex.R4. Affidavit Ex.R2 was also signed by Jaswant Singh by way of identification of Tejbir Singh and RW2 Paramjit Singh, who had attested affidavit Ex.R2 deposed that Jaswant Singh was known to him as he was the owner of Pritam Bus Service and had signed the affidavit by way of identification of Tejbir Singh. According to RW1 Birbal Verma, the cover note was issued without receiving the premium. Further, the company used to issue cover notes on the assurance of its clients for making payment later. Mere fact that he could not cite a single instance where cover note was issued without receiving payment, is no ground to hold that such a practice was not adopted while insuring the offending bus owned by Tejbir Singh. Learned Tribunal ruled affidavit Ex.R2 out of consideration on the ground that its original was not seen by RW2 Paramjit Singh. RW1 Birbal Verma was examined on 27.7.2005. During examination-in-chief, he stated that he had brought the original affidavit and placed its photocopy Ex.R2 on the record. Apparently, the original affidavit was taken back. FAO No. 4017 of 2006 -8- RW2 Paramjit Singh, Advocate-cum-Notary Public was examined on

7.12.2005. For that reason he was justified in saying that he had not seen the original of the affidavit on that day. It does not mean that the original of the affidavit was not there and only its photocopy had been placed on record. Similarly, mere fact that there was no address of Jaswant Singh on the affidavit Ex.R2 of Tejbir Singh, is not sufficient to reject affidavit Ex.R2 as RW2 Paramjit Singh had stated in his cross-examination that Jaswant Singh was known to him being the owner of Pritam Bus Service and had signed the affidavit by way of identification of Tejbir Singh. To wriggle out of his affidavit Ex.R2, Tejbir Singh, owner of the offending bus and who stood impleaded as respondent No.2 in the claim petition, was required to step into the witness box but he chose not to do so. In view of the above, the findings arrived at by the learned Tribunal that the insurance cover note was not cancelled on account of non-payment of the premium cannot be sustained.

It is held that the cover note was initially issued on 27.4.2000 followed by issuance of insurance policy yet at no point of time Tejbir Singh, owner of the offending bus, had paid the premium and, accordingly, the Insurance Company was left with no other option but to cancel the cover note and, that too, after obtaining an affidavit from Tejbir Singh regarding deemed cancellation of the cover note because of the non-payment of the premium and absolving the Insurance Company from any liability in respect of any claim for the period 28.4.2000 to 27.4.2001 and on the other hand claiming that he FAO No. 4017 of 2006 -9- himself would be responsible in respect of the claims, etc. Once, it is held that the insurer had cancelled the insurance policy on account of non-payment of the premium, the insurer could not have been made liable to pay the compensation as in such a situation only the driver and owner(s) of the offending vehicle were liable.

Resultantly, the impugned award is modified by holding that respondents No.2 to 4, herein, who were respondents No.1 to 3 in the claim petition, shall be jointly and severally liable to pay the amount of compensation to the claimant. The appellant-Insurance Company, who was respondent No.4 in the claim petition, is absolved of its liability to pay the compensation. In case the amount of compensation alongwith interest as awarded by the learned Tribunal has already been paid by the appellant- Insurance Company, it shall have the remedy of recovering the same from the present respondents No.2 to 4. The appeal is, accordingly, disposed of. July 13, 2010 ajay-1 ( T.P.S. MANN ) JUDGE