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Judgment
A.M. Ahmadi and Yogeshwar Dayal, JJ.—Special leave granted. Heard learned Counsel on both sides.
The High Court, we are afraid, imposed an unsustainable condition for permitting production of the copy of the policy which was not produced in the original proceedings in which the insurance company had raised the contention that its liability was limited to Rs. 50,000/- and interest thereon. The High Court imposed a condition that regardless of the question of liability the insurance company will pay the entire amount of the award and thereafter recover the surplus over and above
Rs. 50,000/-, interest and proportionate costs from the owner of the vehicle. Such a condition, in our opinion, is too harsh to be sustained.
Therefore, while issuing notice we limited the scope of the inquiry in this appeal to this part of the direction of the High Court We find difficult to sustain it. We, therefore, set aside that part of the order and direct that the insurance company will be liable to pay Rs. 50,000/- and interest and proportionate costs or Rs. 80,000/-, whichever is higher. The direction that the insurance company will deposit the balance amount also and then recover the same from the owner and driver of the vehicle is set aside. The appeal will stand allowed to the above extent. Needless to say that original claimants will be entitled to execute the balance award against the owner and driver of the vehicle.
There will be no order as to costs.