Divisional Manager, Oriental Insurance Co. Ltd. vs P.Balachandran

THIS appeal is directed against the order passed by the District Forum, Malappuram, in O.P. No. 70/94. Second opposite party is the appellant.

WE heard the Counsel for the appellant and the respondent/complainant. Shortly stated the allegations in the complaint are as follows : The complainant''s house was insured. Some damages were caused to his house in a lightning accident on 10.10.1992. Though the claim was made it was repudiated by the opposite party on the ground that on the date of accident there was no insurance coverage for the house as the insurance policy covered only the period from 12.10.1992 to 11.10.1993. The first opposite party is the Housing Society from where the complainant had taken a loan for construction of the house. As per terms and conditions of the loan agreement the first opposite party is liable to remit premium to the second opposite party for insurance of the complainant''s house.

The first opposite party in its version stated that they remitted the premium to the second opposite party on 8.10.1992 and hence there is no default on their part. The second opposite party contended that the policy in question is not a renewal policy as contended by the complainant. According to the 2nd opposite party the proposal and premium were received only on 12.10.1992 and the liability if any is with the 1st opposite party if premium was not paid in time.

THE contention taken by the second opposite party is that there is no subsisting policy on the date of accident. THE lightning accident took place on 10.10.1992. Ext. B8 is the policy in which the period of cover is mentioned as from 12.10.1992 to 11.10.1993. Ext. B6 is the proposal form in respect of the policy. What is stated there as the period of insurance is from 8.10.1992 to 7.10.1993. Ext. B 7 is a copy of the receipt in respect of premium and it shows that the date of Demand Draft sent is 8.10.1993 and the date of receipt is 12.10.1992. Ext. B5 is the covering letter under which the Demand Draft representing premium was sent to the second opposite party by the first opposite party. That letter is dated 7.10.1992 and date of receipt by the Insurance Company is shown as 12.10.1993. Ext. B16 is the premium register maintained by the first opposite party. It shows the date of receipt as 8.10.1992. Ext. B2 is the Despatch Register maintained by the first opposite party. That would show that the Demand Draft was sent on 8.10.1992 by post. We also find that the letter Ext. B 10 sent by the second opposite party was received by the first opposite party on 27.10.1992 which reads as follows : "Since the policy is effective from 8.10.1992 and the damage occurred on 10.8.1992 (as you have stated in your letter) we repeat that we are unable to entertain the claim". It is clear from the evidence that the Demand Draft was sent by first opposite party on 8.10.1992 but it was received by the second opposite party only on 12.10.1992. The question that falls for consideration is whether when the policy takes effect. In this context the explanation to Section 64-VB is relevant. It reads as follows : "Where the premium is tendered by postal money order or cheque sent by post, the risk may be assumed on the date on which the money order is booked or the cheque is posted, as the case may be."

In view of this explanation to Section 64-VB it has to be deemed that the policy came into force when the Demand Draft was sent by post. So it has to be held that the view taken by the District Forum is correct. There is no merit in the appeal and it is accordingly dismissed. Appeal dismissed. _____________