National Insurance Company Ltd. vs Ram Chandra and Another

Nisha Gupta, J.—Since both the matters are related to the same award, hence they are being decided by this common order. The short facts of the case are that accident took place on 14.01.1994 at about 9 a.m. near blind School Sri Ganganagar. The claimant Ramchander was going on his Scooter. A tractor trailer No. RNC 8624 was going ahead on the same direction. Suddenly the driver took a turn towards left side and collied with the claimant. The claimant got injured. He was immediately taken to the Hospital. The FIR was lodged. The claim petition was preferred by the claimant and the learned Tribunal has awarded a compensation of Rs. 2,55,000/-.

The only contention of the Insurance Company is that admittedly the accident has taken place on 14.01.1994 at 9 a.m. whereas the insurance policy has become effective on 14.01.1994 at 12.10 p.m. and at the time of accident, the tractor was not insured, hence the Insurance Company cannot be held liable for the award.

Per contra the contention of the claimant is that according to rule 142 of the Central Motor vehicles Rules, 1989 the insurance will be effective from the date of issue of cover note and further his contention is that a meagre amount has been awarded. The claimant has suffered permanent disability of 80%. His one leg has been imputed above the knee and hence appropriate compensation should be awarded.

Respondent No. 3 died and his name has been deleted on 15.12.2004.

Heard learned counsel for the parties and perused the impugned award as well as the relevant record.

The contention of the Insurance Company is that according to the cover note Ex. N.A. 1, the insurance policy was effective from 14.01.1994 at 12.10 p.m. whereas the accident has occurred at 9 a.m. and admittedly, the vehicle was not insured with them and at the time of accident, the Insurance Company is not liable. It was amply proved before the learned Tribunal that according to Ex. N.A. 1-cover note, the policy is effective from 14.01.1994 at 12.10 p.m. whereas the accident occurred at 9 a.m. in the morning. To prove Ex. N.A. 1 witness Mahendra Kumar Gupta (NAW 3/2) has been produced who has specifically stated that Ex. N.A. 1 bears his signature and it was issued on 14.01.1994 at 12.10 p.m. in his office and his contention has been further supported by the Branch Manager, Man Mohan Sethi (NAW 3/1). No evidence has been produced to rebut Ex. N.A. 1 cover note. Per contra, Aashish Kumar (NAW 1/1), who is owner of the vehicle has stated that he does not know about the fact whether the insurance policy has been issued at 12.10 p.m.. The original cover note and policy were with the owner but they have not been produced before the learned Tribunal on the pretext that original cover note was taken by the Insurance Company at the time of issuance of the policy and the original policy has been misplaced. Both these important documents have not been produced by the owner which gives rise adverse presumption against the owner of the vehicle. Per contra, the Insurance Company has produced the evidence which was in its control and which clearly suggests that the insurance cover note has been issued at 12.10 p.m. after the accident and at 9 a.m. when the accident has occurred the policy was not in effect. The learned counsel for the claimant has referred Rule 142 of the Central Motor vehicles Rules, 1989 which reads as under:-

Cover notes.-(1) Every cover note issued by an authorised insurer shall be in Forum 52.

(2) A cover note referred to in sub-rule (1) shall be valid for a period of sixty days from the date of its issue and the insurer shall issue a policy of insurance before the date of expiry of the cover note.

A bare perusal of the above goes to show that the insurance will be effective from the date of issuance of cover note. Per contra, the Insurance Company has relied upon M/s. National Insurance Co. Ltd. Vs. Smt. Jijubhai Nathuji Dabhi and others, wherein it has been held as under:-

The Tribunal also had recorded, as a fact, that on October 25, 1993 at 4.00 p.m., the contract of renewal had come into force and it would be operative upto October 24, 1984. The Tribunal also recorded, as a fact, that the accident had occurred on October 25, 1983 at 11.14 a.m., that is, before the renewal of the contract. Under these circumstances, it would be clear that the accident had occurred when the renewal had not taken effect.

This Court in New India Assurance Co. Ltd. Vs. Ram Dayal and Others, had held that in the absence of any specific time mentioned in that behalf, the contract would be operative from the mid-night of the day by operation of provisions of the General Clauses Act. But in view of the special contract mentioned in the insurance policy, namely, it would be operative from 4.00 p.m. on October 25, 1983 and the accident had occurred earlier thereto, the insurance coverage would not enable the claimant to seek recovery of the amount from the appellant-company.

Looking at the above, in the present case, the Insurance Company has proved the fact that the insurance cover note has been issued at 12.10 p.m. whereas the accident has taken place at 9 a.m. and the policy was not effective at the time of the accident, the Insurance Company cannot be held liable to pay the award and hence the Insurance Company is liable to be exonerated from the liability.

The contention of the claimant is that in spite of the fact that the Insurance Company has been exonerated from the liability, still the Insurance Company owes the primary liability to pay the amount to the claimant and then to recover it from the driver and owner of the vehicle as third party rights have been provided by the beneficial legislation of the Motor Vehicles Act and reliance has been placed on New India Assurance Co. Ltd. vs. Kusum & Ors., SLP(C) No. 3372/2007, but the law cited above could not give any help to the claimant as there was a statutory breach of policy as the driver of the insured vehicle was not having a valid driving licence, but here in the present case, the vehicle was not insured and as such no liability could be fastened on the Insurance Company to pay the compensation awarded.

The claimant has also relied upon National Insurance Company Ltd. Vs. Laxmi and Others, where the original insurance policy has not been produced by the Insurance Company and it was found that the contention of the Insurance Company was not proved but here in the present case, the Insurance Company has produced the carbon copy of the original cover note which is also a primary evidence, which amply proved that the insurance has been effective from the date 14.01.1994 at 12.10 p.m. after the occurrence of accident.

In view of the above the Insurance Company is absolved from the liability. The Insurance Company is not obliged to pay anything to the claimant but looking to the fact that Rs. 25,000/- which has already been paid to the claimant need not to be recovered. The Insurance Company is free to recover the said amount from the owner of the vehicle.

The contention of the claimant is that looking to his permanent disability a meagre amount has been awarded. His one leg has been imputed and he has suffered 80% disability. The submission of the petitioner is that he was doing the work of carpenter and due to imputation of his one leg, he is not able to perform his work and looking to the nature of the work, imputation of one leg definitely cause loss of earning and reliance has been placed on Mohan Soni Vs. Ram Avtar Tomar and Others, . Further reliance has been placed on Ram Kiran Goyal (D) thr. L.Rs. Vs. Sub Divisional Engineer and Others, wherein it has been held that when the nature of the injuries suffered by the claimants are such that he never fully got over the same and continued to be under medical treatment till the end of his life and with age the extent of his disability resulting from the accident, also continued to progress, then under the head of future medical expenses, loss of earning, loss of normal life, special damages should be awarded. Here in the present case also, the claimant admittedly, had lost his one leg. He was doing the work of carpenter which he could not do now with full of his capacity. In year 1994 he has spent Rs. 53,100/- on medical expenses which is suggestive of gravity of his injury and mental agony. Admittedly, future medical expenses also have to be incurred by him and with disability he will not get over to his work as prior to the accident and with the growing age, the disability will also increase. No compensation has been awarded for future medical expenses, loss of amenities and loss of normal life. Hence an additional amount of Rs. 50,000/- is awarded for the above losses with interest @ 7% per annum from the date of filing of the appeal.

The Insurance Company is exonerated from the liability and the award is modified to this extent, however, the Insurance Company would not recover the amount already paid to the claimant but the Insurance Company is at liberty to recover it from the owner of the vehicle. Hence both, the appeal as well as the cross-objections are allowed as indicated above.