FAO No.4536 of 2011 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No.4536 of 2011 (O&M) Date of Decision : 16.11.2011 Rajinder Singh and another .......Appellants Versus Surinder Singh Bishi and others .......Respondents CORAM:- HON'BLE MR. JUSTICE JITENDRA CHAUHAN Present: Mr. B.S. Dhillon, Advocate, for Mr. J.S. Cooner, Advocate, for the appellants. Mr. Arvinder Arora, Advocate, for respondent No.1. Mr. Suresh Kumar, Advocate, for Mr. Amit Mehta, Advocate, for respondent No.2. Mr. Ravinder Arora, Advocate, for respondent No.3. **** JITENDRA CHAUHAN, J. (ORAL) The instant appeal has been preferred by the appellants assailing the findings recorded in the impugned Award dated 22.7.2010, by the learned Motor Accident Claims Tribunal, Ambala, whereby the Insurance Company has been exonerated from the liability and the appellants have been held liable to indemnify the claimants. 1 FAO No.4536 of 2011 The learned counsel for the appellant submits that the accident took place on 2.12.2008. The vehicle No.PB-12-G-0057, hereinafter ‘the offending vehicle’ was insured on 12.09.2008 and a cover note, Ex.R3, was issued on 12.09.2008. The cheque, Ex.R6, was dishonoured but no intimation was sent by the Insurance Company to the insurer. The owner-insurer, was under a bona fide belief that his vehicle was insured. It is further submitted that neither the cover note was cancelled nor any intimation regarding dishonour of the cheque was sent. Thus, he argues that the offending vehicle would be deemed to be insured and Insurance Company is liable to indemnify the claimant. Learned counsel cites IV 2009 RCC 137, Reliance General Insurance Company Ltd. Vs. Usha Devi and others. I have heard the learned counsel for the parties and have carefully gone through the record with their able assistance. The only question for consideration before this Court is whether the learned Tribunal was right in holding that the insurance of the offending car had been cancelled and conveyed to the appellants by the Insurance Company prior the date of the accident. In the statement of RW1, Virender Malhotra, Branch Manager, Oriental Insurance Company, it has specifically come that the cover note, Ex.R3, was cancelled on 15.09.2008 on account of the fact that the cheque issued against the payment of premium bearing No.376590 dated 12.09.2008, was dishonoured due to insufficient funds. The Company sent an intimation to the owner of the insured 2 FAO No.4536 of 2011 vehicle in this regard on 22.09.2008. The original receipt of intimation was brought on record as Ex.R4. In the cover note, Ex.R3, it has been specifically mentioned that this cover note is valid subject to realization of cheque. In the event of dishonour of cheque, insurance cover provided with this cover note automatically stands cancelled from inception irrespective of the fact a separate communication is sent or not. However, in this case, a separate communication dated 22.09.2008 was sent which was duly received by the appellants. There was no valid contract between the insurer and the Insurance Company after the cheque was dishonoured, it stood cancelled from the date, on which cover note, Ex.R3, was issued. The natural corollary would be that on the date of the accident, the offending vehicle was without insurance. The case law cited by the learned counsel for the appellant is not applicable in this case. Keeping in view the same, no case for any interference in the impugned Award dated 22.7.2010 is made out. The Insurance Company was rightly absolved of its liability. Dismissed. ( JITENDRA CHAUHAN ) 16.11.2011 JUDGE atulsethi Note: Whether to be referred to reporter ? Yes/No 3