IN THE HIGH COURT OF JUDICATURE AT PATNA Misc. Appeal No.270 of 2002 Branch Manager National Insurance Company Ltd. G.B. Road, Gaya through its Administrative Officer and Duly constituted Attorney Sri Sanjay Kumar, Regional Office, 4th Fllor , Sone Bhawan, B.C. Road,Patna (Opp.Party no.3) .... .... Appellant Versus 1. Bhagia Devi wife of Late Jamuna Mistri ( Claimant no.1) 2. Umesh Mistri ( Claimant no.2) 3. Dinesh Mistri ( Claimant no.3) 4. Sanju Kumari ( Claimant no.4) 5. Bela Kumari ( Claimant no.5) All minor sons and daughters of Late Jamuna Mistri under the guardianship of their mother Bhagia Devi (Respondent no.1), all residents of Village-Kandi Nawadah, P.S. Chandauti, District- Gaya 6. Bimlesh Kumar Sinha, Son of Sri Kailashpati Sinha, resident of Gaurachhni, Biniadganj, P.S. Mofassil, District-Gaya ( Opp.Party no.1) 7. Yabind Hussain Ansari, Son of Kamruddin Ansari , resident of Panchaiti Akhara, P.S. Kotwali, District-Gaya ( Opp.Party no.2) .... .... Respondents ========================================================== Appearance: For the Appellant : Mr. ASHOK PRIYADARSHI, ADVOCATE For the Respondents: Mr. ARUN KUMAR SINHA, ADVOCATE ========================================================== CORAM: HONOURABLE MR. JUSTICE RAKESH KUMAR ORAL JUDGMENT (Per: HONOURABLE MR. JUSTICE RAKESH KUMAR) Rakesh Kumar ,J The present appeal under Section 173 of the Motor Vehicles Act, 1988 has been preferred against the Judgment 18.04.2002 and Award dated 30.4.2002 passed in Motor Accident Claim Case No.2 of 1991/ 3 of 1994 by the 1st Addl. District Judge, Gaya. By the said Judgment and award, the appellant, who was alleged to be insurer of offending bus, namely, Kumar Bus having Registration no.BHB-5709, was directed to pay total compensation amount of Rs. 2, 21,000/- after adjusting the amount of Rs.25, 000/-, which was paid as interim compensation, with Patna High Court MA No.270 of 2002 dt.04-08-2011 2 further direction that on the said amount, interest @ 12 % per annum shall be paid from the date of filing of the claim application. 2. Short fact of the case is that on 12.12.1990, the husband of Respondent no.1, who was father of Respondent nos.2 to 5, was dashed by a bus i.e. Kumar Bus having Registration no. BHB- 5709 due to rash and negligent driving by the driver of the bus. The bus was at a very high speed at the time of occurrence. After accident, a case vide Chandauti P.S. Case No.151 of 1990 was registered on the same day. The postmortem on the dead body of the deceased was also conducted. Subsequently, a claim petition was filed before the court below and the learned court below by the impugned Judgment and award has allowed the same as indicated above. 3. Sri Ashok Pridarshi, learned counsel for the appellant has taken only plea that on the date of accident i.e. 12.12.1990, the insurance policy, which was in respect of the bus, was already cancelled due to the reason that the cheque given by the owner of the bus had already been dishonoured. Sri Priyadarshi, learned counsel for the appellant submits that in the claim case, the insurance company appeared and filed written statement, in which a categorical stand was taken that the insurance policy was already cancelled. Sri Priyadarshi , learned counsel for the appellant submits that accident in the case had taken place on 12.12.1990, however, on 7.12.1990 itself, the insurance company had informed the owner of the vehicle through registered post regarding cancellation of the policy and, as such, it was submitted that the appellant was not insurer on the date of accident and, as such, the learned court below has incorrectly directed the appellant to pay the compensation amount. Patna High Court MA No.270 of 2002 dt.04-08-2011 3 4. Sri Arun Kumar Sinha, who has appeared on behalf of Respondent nos.1 to 5, has opposed the prayer of the appellant. It was submitted that in case of 3rd party insurance and the fact that the vehicle in question was earlier insured by the appellant, the appellant cannot be absolved from the liability of making payment of compensation to the claimant. 5. The present appeal was admitted for hearing on 25.7.2003 and it was directed to be heard along with M.A.No.563 of 2000. Thereafter, on 28.3.2007, the present appeal was dismissed due to non- prosecution. Since at the time of admission, it was directed for hearing the present appeal along with M.A.No.563 of 2000, it was felt necessary to examine the record of M.A.No.563 of 2000, which is already on record. On perusal of the record of M.A.No.563 of 2000, it is evident that the said appeal, which was preferred by the appellant of the present case, of course in another case, was dismissed on 29th March, 2007. The plea, which has been raised by Sri Ashok Priyadarshi , learned counsel for the appellant in the present appeal, is similar as taken in M.A.No.563 of 2000. In that case also, the insurer had taken the plea that on the date of accident, the insurance policy was not in existence. For better appreciation, it would be appropriate to quote paragraph nos.2 ,3 and 4 of the Judgment passed in M.A.No.563 of 2000, which are as follows: “2. During the course of argument, Sri Ajay Kumar, learned Advocate appearing on behalf of the appellant-Insurance Company raised only one point. He contended that the record of the claim case will show that on the alleged date of occurrence i.e. on 7.9.1998 the insurance policy was not in existence as prior to that i.e. on 18.8.98 the Patna High Court MA No.270 of 2002 dt.04-08-2011 4 appellant-Insurance Company had already informed the insured through Exhibit A that the insurance company had cancelled the policy as the cheque issued by him had been returned by the bank as being dishonoured. Learned advocate submitted that after cancellation of policy on 18.8.98 it will be deemed that since that date the vehicle, in question, was not covered under the policy and, as such, the appellant-Insurance Company is not liable to pay compensation but by asking the appellant- Insurance Company to indemnify the award, the Tribunal has committed illegality. In this regard, the learned Advocate of the appellant has placed reliance upon the following decisions: (I) 2002 ACJ page 217 (New India Assurance Co. Ltd. Vs. Raghu & Ors.), (II) 2006 ACJ page 1160 (National Insurance Co. Ltd. Vs. Khelli Bai & Ors.), and (III) (2001) 3 SCC page 151 (National Insurance Co. Ltd. Vs. Seema Malhotra & Ors.). 3. It is true that where on the date of occurrence the policy is not in existence either due to non-payment of premium or due to any other reason, the Insurance Company is not liable to indemnify the award but I am of the view that once the Insurance company issued the policy in respect of any vehicle the company is liable to pay compensation with respect to the third party claim and then to realize the entire amount so paid towards compensation from the owner of the vehicle by way of filing petition in execution proceeding. To support my view, I place reliance upon the decision reported in (2004) 13 SCC page 224 (Oriental Insurance Co. Ltd. Vs. Nanjappan & Ors.). Para 8 of the said decision is relevant which runs as follows: “Therefore, while setting aside the Judgment of the High Court we direct in terms of what has been stated in Baljit Kaur case that the insurer shall pay the quantum of compensation fixed by the Tribunal, about which there was no dispute raised, to the respondent claimants within three months from today. For the purpose of recovering the Patna High Court MA No.270 of 2002 dt.04-08-2011 5 same from the insured, the insurer shall not be required to file a suit. It may initiate a proceeding before the executing court concerned as if the dispute between the insurer and the owner was the subject- matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. Before release of the amount to the claimants, owner of the vehicle shall be issued a notice and he shall be required to furnish security for the entire amount which the insurer will pay to the claimants. The offending vehicle shall be attached, as a part of the security. If necessity arises the executing court shall take assistance of the Regional Transport Authority concerned. The executing court shall pass appropriate orders in accordance with law as to the manner in which the insured, owner of the vehicle shall make payment to the insurer. In case there is any default it shall be open to the executing court to direct realization by disposal of the securities to be furnished or from any other property or properties of the owner of the vehicle, the insured. The appeal is disposed of in the aforesaid terms. With no order as to costs.” 4. The above referred decision fully applies in this case also and, as such, I hold that this appeal by appellant- Insurance Company is not maintainable.” 6. Since the plea, which has been taken in the present case, is similar to the plea taken in M.A.No.563 of 2000, which was negated by a Bench of this Court, the Court is of the opinion that it would not be appropriate to record any contrary finding. Moreover, at the time of admission of the present appeal, it was directed to be heard along with M.A.No.563 of 2000. It is true that the present appeal could not be earlier heard, since it was earlier rejected due to the non-prosecution and subsequently, it was restored by filing a restoration petition. The fact remains that the issue, which has been raised in the present appeal was similar as raised in the earlier appeal and, as such, I am in agreement with the Judgment of this Court passed in M.A.No.563 of 2000. 7. Accordingly, I do not find any merit in the present appeal. Patna High Court MA No.270 of 2002 dt.04-08-2011 6 The present appeal stands dismissed. 8. The statutory amount, which was deposited by the appellant at the time of admission of the present appeal, is directed to be remitted back to the court below for its payment to the claimant. Patna High Court,Patna Dated: the 4th August,2011 Nawal Kishore Singh/ N.A.F.R. ( Rakesh Kumar, J.)