FAO No.599 of 1991 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 1. FAO No.599 of 1991 DATE OF DECISION: January 17, 2011 NEW INDIA ASSURANCE CO. LTD. ...APPELLANT VERSUS SAMIA NASIR AND OTHERS ...RESPONDENTS 2. FAO No.600 of 1991 DATE OF DECISION: January 17, 2011 NEW INDIA ASSURANCE CO. LTD. ...APPELLANT VERSUS JIT KAUR AND OTHERS ...RESPONDENTS CORAM: HON'BLE MR. JUSTICE K.KANNAN. 1. Whether reporters of local papers may be allowed to see the judgement. Yes 2. To be referred to the reporters or not? Yes 3. Whether the judgement should be reported in the digest? Yes ---- PRESENT: MR. L.M. SURI, SR.ADVOCATE WITH MR. NEERAJ KHANNA, ADVOCATE FOR THE APPELLANTS. MR. ANSHUMAN CHOPRA, ADVOCATE FOR MR. AMARJIT MARKAN, ADVOCATE FOR RESPONDENTS NO.1 TO 3. MR. ARUN BANSAL, ADVOCATE FOR RESPONDENT NO.4. K.KANNAN, J.(ORAL) 1. Both the appeals are connected, arising under the same accident resulting in death of two persons both of whom were borne on a scooter that was hit by the insured's truck. In the subject matter of appeal, FAO No.599 FAO No.599 of 1991 -2- of 1991, the compensation awarded had been `4,80,000/- and in respect of FAO No.600 of 1991, the compensation awarded was `3,84,000/-. The insurance company for the truck was found liable for the award determined by the Tribunal. 2. Learned senior counsel appearing on behalf of the insurance company pleads for restriction of liabIlity in terms of the policy which was taken on 22.7.1988, when the Motor Vehicle Act of 1939 was still in force. The limit of liability under the terms of the policy was “Such amount as necessary to meet the requirements of the Motor Vehicles Act, 1939”. The liability prescribed under the Act at the relevant time for an injury to third party by the use of transport vehicle was `1,50,000/- and consequently, the liability for each one of the claims ought to have been restricted only to `1,50,000/- and not in the manner determined by the Tribunal. Learned counsel appearing on behalf of the owner would contend that the petition had been filed under the Motor Vehicles Act of 1988 and therefore, the limit of liability must be taken as unlimited. Learned counsel refers me to the fact that the accident had taken place on 23.2.1989 and since the petition had been filed under the Act of 1988, the liability cannot be restricted. This contention, in my view, is not correct in view of the statutory provision brought under the Motor Vehicles Act of 1988 itself that allows for continuance of limited liability for a period of four months after the commencement of the Act or till the date of expiry of said policy, whichever was earlier. The Act commenced on 1.7.1989 and the period of four months will expire on 1.11.1989. The expiry of the policy of insurance was on 21.7.1989 and therefore, being an earlier date, the limit of liability upto `1,50,000/- would enure for any accident upto 21.7.1989. The accident had FAO No.599 of 1991 -3- taken place on 23.2.1989 and consequently it is only the terms of the policy containing restriction as provided under the earlier Act that would be applicable. This is as per the terms of the old Act as protected through the new Act of 1988 through Section 147(2). The amount awarded against the insurance company in each one of the cases shall, therefore, stands restricted to `1,50,000/- with interest as awarded and the amount in excess shall be recovered by the claimant only against the owner-insured. Learned counsel appearing for the insurance company pleads for reduction of interest. I find no reason to do so, for, I make no modification with reference to the award or the quantum. The only modification that the award has suffered is restriction of liability for the insurer. 3. The appeal is allowed to the above extent. January 17, 2011 (K.KANNAN) Gulati JUDGE