LAWS(ORI)-1993-11-5

UNITED INDIA INSURANCE CO LTD Vs. KANDURI NAYAK

Decided On November 04, 1993
UNITED INDIA INSURANCE CO LTD Appellant
V/S
Kanduri Nayak Respondents

JUDGEMENT

(1.) In this appeal under Section 173 of the Motor Vehicles Act, 1988 (in short, 'the Act'), United India Insurance Co. Ltd. (hereinafter referred to as 'the insurer') calls in question legality of award made by the Second Motor Accidents Claims Tribunal, Southern Division, Berhampur (hereinafter referred to as 'the Tribunal') holding that Kanduri Nayak (hereinafter referred to as 'the claimant') is entitled to a compensation of Rs. 20,000/ - in respect of an accident wherein the vehicle bearing registration No. OSG 1155 belonging to Atanu Kumar Behera (hereinafter referred to as 'the owner') was involved. The stipulation of a higher rate of interest in case of default by non -payment is also challenged.

(2.) THE fact situation as presented by the claimant is as follows: On 27.4.1987 one Abhimanyu Nayak (hereinafter referred to as 'the deceased') aged about 12 was going to Bhanjanagar to attend his school. He was proceeding on the left side of Berhampur -Bhanjanagar Road. Suddenly passenger bus bearing registration No. OSG 1155 belonging to the owner came from Berhampur side at a high speed, dashed against the deceased causing his instantaneous death. The vehicle was being driven in rash and negligent manner. The deceased, a brilliant student, was studying in class VI. A compensation of Rs. 50,000/ - was claimed. The owner filed a written statement admitting the accident, but denied the allegation that the vehicle was being driven in a rash and negligent manner. It was also stated that the vehicle was validly insured on the date of accident and in case any liability is fixed the same is to be indemnified by the insurer. The stand of the insurer was that it was not liable to pay any compensation.

(3.) IN support of the appeal Mr. D.M. Misra has strenuously urged that under Section 64 -VB of the Insurance Act, 1938, and Section 95 of the Motor Vehicles Act, 1939 (in short, 'the old Act') the policy is operative from the time it is issued and did not cover risk of anything that happened prior to it, though it relates to the same date. Additionally it is submitted that there is non -disclosure of material facts. It was the bounden duty of the person who submitted proposal for insurance to disclose about the accident, if any. That having not been done, there was suppression of material facts and, therefore, the insurer is not liable to pay. The learned counsel for the claimant, on the other hand, contended that not only the certificate of insurance indicates the date, but also the cover note speaks of the date of commencement of the insurance. Mere mention about the time of issue is not very material. The certificate of insurance is marked as Exh. A while the cover note is marked as Exh. A -1 in this case. In both the documents the date of commencement of insurance is 27.4.1987, but in the cover note the time of issue is indicated to be 8 p.m. Strong reliance is placed on a decision of the Apex Court in New India Assurance Co. Ltd. v. Ram Dayal 1990 ACJ 545 (SC), wherein it was observed that even if the accident took place prior to the time the insurance policy was taken, as the date commenced immediately after the midnight of the previous day ended, the policy covered the risk, notwithstanding the fact that the accident had occurred earlier.