New India Assurance Co. Ltd. vs Laxman Singh and Others

S.K. Dubey, J.—Short contention of Mr. Sharma, learned counsel for the appellant, is that on the date of accident, the insured Bijendrasingh, who is insured in the records of insurance company and the policy was issued in his name, covering risk of the vehicle No. CPH 5167, transferred the vehicle to one Ajit Kumar. As this was a suppression of the material fact, the policy lapsed from the date of transfer. The name of Ajit Kumar is also recorded in the records of Regional Transport Authority. Therefore, the Tribunal, without holding an enquiry, committed an illegality in passing order u/s 92-A of the Motor Vehicles Act, 1939 (for short ''the Act'').

Mr. R.D. Jain, learned counsel for respondent No. 4, contended that this is not the appropriate stage where the defence u/s 96 (2) of the Act can be considered while deciding an application u/s 92-A of the Act. All the defences u/s 96 (2) of the Act will have to be tried and then decided after recording the evidence.

Learned counsel for the claimant contended that as the vehicle was insured with the insurance company which fact has also been admitted in the written statement in para 8, therefore, prima facie, the insurance company, the driver and owner are liable to pay the amount of Rs. 15,000/- which has been awarded as an interim award on no fault liability basis. Learned counsel, Mr. Goyal, placed reliance on two decisions of Gauhati and Delhi High Courts reported in The New India Assurance Company Ltd. Vs. Member, Motor Accident Claim Tribunal and Others, and New India Assurance Co. Ltd. Vs. N.P. Tyagi and Others, Learned counsel also placed reliance on the decision of this court in Oriental Fire and General Insurance Co. Ltd. v. Bandhan 1988 (2) MPWN 104, wherein this court had taken the view that the purpose of Section 92-A is to award interim maintenance without delay and the relationship between the insurer and insured cannot be decided before grant of interim award.

Mr. V.K. Sharma, counsel for the appellant, in reply to the submissions made by learned counsel for the respondent contended that when the insurance company cannot be made liable to pay the amount of final award, no order u/s 92-A can also be passed against the insurance company and for that reliance was placed on Apex Court''s decision in Kashiram Yadav and Another Vs. Oriental Fire and General Insurance Co. and Others,

After hearing counsel, I am clearly of the opinion that the defences available u/s 96 (2) of the Act cannot be taken into consideration at the time of consideration of application u/s 92-A of the Act. Following the idea behind Section 92-A of the Act being payment of prompt and immediate compensation, the purpose cannot be allowed to be frustrated by deciding various defences raised by the insurance company which would take time. In case it is ultimately found that the insurer is not liable to indemnify the insured an appropriate order u/s 96 (4) of the Act can be passed.

In case of New Indian Assurance Co. and Another Vs. Phoolwati and Others, , this court while considering the defence raised by the insurance company held that the vehicle at the relevant time of accident was stationary and the other vehicle was the offending vehicle and that the owner was not made a party. This court, while considering the object u/s 92-A of the Act which created ''no fault'' liability and question of liability was to be adjudged, held that section created ''no fault'' liability and the question of liability being attached to a vehicle, which ought to have been offending vehicle, becomes otiose and objection about non-joinder of owner or insurer of the offending vehicle falls to the ground. Provision in Section 92-A of the Act is meant to help all destitutes, who are affected by the motor accident and not only to those who are pedestrians or their legal representatives.

It is not the case of the appellant that the vehicle was not insured, but the appellant contended before this court that though the vehicle was insured, during the period of insurance the vehicle was transferred without notice, which was a suppression of the material fact and thus, the policy of insurance lapsed on transfer and that the insurance company appellant cannot be made liable to pay even the amount of interim award u/s 92-A of the Act in my opinion has no merit.

Suffice to say that this question cannot be decided without enquiry, the Tribunal cannot come to a decision unless an issue is raised on the defence as raised by the insurance company. After recording of evidence and conclusion of the trial, the said issue shall be decided. In case it is found that the policy has lapsed, then certainly the appellant insurance company will be entitled u/s 96 (4) of the Act to recover the said amount from the insured.

The case relied on by Mr. Sharma is Kashiram Yadav and Another Vs. Oriental Fire and General Insurance Co. and Others, , decided by the Apex Court has no application in the present case as it does not deal with the case of Section 92-A of the Act but after final adjudication, when the Tribunal came to a finding that the driver was not holding a licence, the Apex Court held that it was a breach of condition of the policy and as such the insurance company was exempted from liability.

It is stated at the Bar that the appellant company has not till date deposited the amount of interim compensation, though it was passed on 2.11.1988. It is, therefore, directed that the appellant company shall deposit the amount of Rs. 15,000/- with interest at the rate of 12 per cent per annum from 2.11.1988. That shall be done within a period of six weeks from today.

In the result, the appeal is dismissed with costs. Claimants only shall be entitled to costs. Counsel''s fee Rs. 300/-, if already certified.