NATIONAL INSURANCE CO LTD Vs. THIRU SHANMUGAM

JUDGEMENT

(1.) THE Insurance Company is on appeal as against the award in a case of injury, where the Tribunal granted a relief of awarding compensation at Rs.68,806/- payable at 7.5% per annum interest by the Insurance Company to be recovered from the owner of the vehicle. THE accident had occurred on 31.7.2005.

(2.) ADMITTEDLY, as on the date of the accident, a policy was there in existence, however, the policy contain a clause that in case of dishonour of premium of cheque, the document, namely, the policy stands automatically cancelled ab initio. The policy contains a cheque No.039617 dated 8.7.2005.

(3.) IN the background of this, learned counsel appearing for the appellant pointed out that on the facts of this case that the cheque was presented on 10.7.2005 and the bank informed on 13.7.2005 that the same was returned on account of want of funds, which led to the cancellation of the policy, the question of a liability, as such, being imposed did not arise. Consequently, the INsurance Company is not bound to make the payment.