DHARAMVIR SINGH Vs. NEW INDIA INSURANCE CO LTD

JUDGEMENT

(1.) THE Appellant Dharamvir Singh impugns a judgment dated 07.10.2009 passed by the Motor Accident Claims Tribunal(the Claims Tribunal) whereby while awarding a compensation of Rs.6,81,000/- in favour of the Respondents No.3 to 6 and making the New India Insurance Co. Ltd. liable to pay the compensation granted recovery rights against the Appellant.

(2.) IT is urged by the learned counsel for the Appellant that in this case the insurance policy was issued by the Respondent New India Insurance Co. Ltd; the Insurance Company failed to prove that a notice of dishonour of the cheque paid towards premium was given to the Appellant; the Appellant never knew of the dishonour of the cheque and thus the Appellant could not have been saddled with the liability to reimburse the amount of compensation paid by the Insurance Company to the Respondents No.3 to 6.

(3.) IN the case of Oriental Insurance Company Limited v. Inderjit Kaur, (1998) 1 SCC 371, the Supreme Court referred to the provision of Section 149 (1) of the Motor Vehicles Act, and held that if an insurer issues policy of Insurance without receiving the premium then the insurer becomes liable to indemnify the third party in respect of the liability which that policy covers and to satisfy the award of compensation in respect thereof; notwithstanding its entitlement to avoid or cancel the policy. Relevant portion of the report is extracted hereunder:-