NEW INDIA ASSURANCE CO LTD Vs. PARAMU

JUDGEMENT

(1.) The Insurance Company, the third respondent in OP(MV) No. 1218/85 before the MACT, Quilon is the appellant. The order of the Tribunal making the Insurance Company liable for the entire compensation awarded against the owner as also the driver of the vehicle involved in the accident is under challenge.

(2.) The learned counsel for the appellant argues that the liability of the Insurance Company is limited to the extent of Rs. 15,000/- and that it is so can be seen from the 'motor policy' issued on 11-5-1983. The counsel in this connection made specific reference to the endorsement in the policy under the head 'limits of liability' namely, limit of the amount of Company's liability under S. II-I (i) in respect of any one accident such amount as is necessary to meet the requirements of M.V. Act 1939 and limit of the amount of the Company's liability under S.II-I(ii) in respect of any one claim or series of claims arising out of one event Rs.50,000/-. The Tribunal below therefore, the counsel submits, has gone wrong in making the appellant insurance company liable for the entire compensation amount of 'Rs.71,000/- with 6% interest from 27-2-1984 till 3 months after the date of award and 18% interest thereafter till realisation'.

(3.) The learned counsel representing the owner of the vehicle, the sixth respondent, on the other hand argues that though under the insurance policy the liability of the insurance company is limited, the insurance company must be deemed to be liable for the entire amount in view of the provisions contained in S.147 of the Motor Vehicles Act, 1988, for short, the 1988 Act. It is all the more so, it is further contended, because the policy of insurance after the coming into force of the 1988 Act, must be treated as one issued under S.147. If that be the position, it should be held that the Tribunal has rightly fastened the entire liability on the appellant insurance company; the counsel submits.