IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN FRIDAY, THE 25 TH JULY 2008 / 3RD SRAVANA 1930 M.A.C.A.No. 110 of 2004(D) ---------------------- OP(MV) NO.873/1998 OF MOTOR ACCIDENTS CLAIMS TRIBUNAL,PERUMBAVOOR .................... APPELLANT/3RD RESPONDENT: -------------------------- THE ORIENTAL INSURANCE COMPANY LIMITED, ALUVA NOW REPRESENTED BY ITS ASSISTANT MANAGER, REGIONAL OFFICE, METRO PALACE, KOCHI-18. BY ADV. SRI.MATHEWS JACOB (SR.) RESPONDENTS/PETITIONER AND RESPONDENTS 1 AND 2 ----------------------------------------------- * 1. M.A.RAPHAEL S/O. ANTHONI, MENACHIRY HOUSE, NEAR PERIKKAPALAM, THOTTAKKATUKARA P.O., ALUVA.(DIED) 2. BASHEER AHAMMED, BANGARA HOUSE, ASHOKAPURAM P.O., ALUVA. 3. NAVAS S/O. AHAMMED, DO. DO. 4. SMT.MARY RAPHAEL, MENACHERY HOUSE,KALLETTINKARA. 5. M.R.DAVIS, MENACHERY HOUSE, NEAR PERIKKAPALAM, THOTTAKKATTUKARA. 6. M.R. ANTONY, NEDUMKALLEL HOUSE, NAGAPUZHA, VAZHAKKULAM. 7. M.R. JOY, MENACHERY HOUSE, KALLETTINKARA. (* L.Rs OF THE DECEASED R1 ARE IMPLEADED AS ADDL. R4 TO R7 VIDE ORDER DATED 16/07/2008 ON I.A. NO.2704 OF 2005.) THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 25/07/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: M.A.C.A.No. 110/ 2004 ORDER ON I.A NO.252 OF 2004 IN M.A.C.A NO.110 OF 2004 DISMISSED SD/ 25/07/2008 M.N. KRISHNAN, JUDGE /TRUE COPY/ P.A. TO JUDGE scm M.N.KRISHNAN, J. -------------------------- M.A.C.A. No. 110 OF 2004 --------------------- Dated this the 25th day of July, 2008 JUDGMENT This appeal is preferred against the award passed by the Motor Accident Claims Tribunal, Perumbavoor, in OP(MV) 873/98. The Insurance Company is the appellant before this court. The short question that arises for determination is regarding the liability of the Insurance Company to pay the amount. 2. It is the contention of the Insurance Company that the policy was issued with effect from 16.4.98 and as the accident had taken place on 15.4.98, there was no valid policy with respect to the vehicle on the date of the accident and therefore the Insurance Company is not bound to pay the amount. There is a contention that the premium has been paid on 15.4.98. The accident had taken place on 15.4.98 at 3.30 pm. The Tribunal on perusal of Ext. B2 register found that 24 persons had paid the premium on that day and the payment in this case is the sixth entry. Taking into consideration the working hours of the Office held that, at any rate the premium could have been paid prior to 3.30 pm, which is the time of the accident. 3. It is true that there cannot be any concrete materials to arrive at a decision regarding the time when the payment was made. But the probabilities, as pointed out by the Tribunal, indicates that there is every MACA No.110/04 2 opportunity of that amount being paid prior to 3.30 pm. When it is so, what is the legal position is the next point to be considered. 4. Learned counsel for the Insurance Company very strongly contends before me that the insurance is a contract between two persons. When two persons agrees that the Insurance has to take effect from a relevant date and therefore the commencement of the policy should be deemed to be on the date mentioned in the policy. It is an appealing argument. But, at the same time, the question that arises for determination is when the liability of the Insurance Company starts. This point has been precisely considered by the Karnataka High Court in the decision reported in T. Dinakar v. P.J. Jagadish and Others [2000 ACJ 228]. It was a case where the owner of the vehicle sent a pay order with covering letter on 7.1.89 by post. Insurance Company denied the receipt of the letter and the owner paid the premium in cash on 12.1.89 and policy was issued on that date. The earlier policy expired on 31.12.88 and the accident took place on 9.1.89. Then the High Court of Karnataka held that since the amount was tendered on 7.1.89, it becomes a concluded contract on the payment of premium and so the liability to indemnify the insured for an accident that had taken place on 9.1.89 is there on the Insurance Company. For the said purpose, the court took note of the provision 64VB of the Insurance Act of 1938. 64VB (2) reads as follows: MACA No.110/04 3 “For the purpose of this section, in the case of risks for which premium can be ascertained in advance, the risk may be assumed not earlier than the date on which the premium has been paid in cash or by cheque to the insurer.” 5. It further explained “where the premium is tendered by postal money order or cheque sent by post, the risk may be assumed on the date on which the money order is booked or the cheque is posted, as the case may be.” 6. So it is very clear that it is the payment of premium that attracts the contract and the liability. So the court held that applying this provision to the policy issued by the Insurance Company, the liability starts on the date of payment of the premium. 7. This point has been considered by the Madras High Court in the decision reported in Oriental Insurance Co. Ltd. v. Vedathal and Another [2001 ACJ 2022]. There also relying on Sec.64VB of the Insurance Act, it was held that it is the date of payment of the premium that creates the liability on the Insurance Company. 8. It has held by the Apex court as well in very many decisions that suppose the premium is paid after the accident had taken place, it is certain that there will not be any contract of insurance between these persons. But, as observed by me earlier and as presumed by the Motor Accident Claims Tribunal, taking note of the materials available in the form of Ext.B2 register and also considering the working hours of the Office, it MACA No.110/04 4 drew an inference that the accident had taken place at 3.30 pm. and out of 24 premiums, 6th premium is paid by this person. One cannot find fault with the Tribunal for assuming that it should have been paid prior to 3.30 pm. It is also to be borne in mind that Motor Accident Claims Tribunal deals with the affected victims in a road accident and the beneficial legislation is intended to confer benefit on the affected victims. I am conscious of the fact that it shall not be used as a weapon to defraud the Insurance Company but when the preponderance of probabilities lies in favour and therefore it has to be presumed. Therefore, I do not find any fault with the Tribunal affixing the liability on the Insurance Company. Therefore the appeal lacks merit and the same is dismissed. M.N.KRISHNAN, JUDGE vps MACA No.110/04 5