NATIONAL INSURANCE CO LTD Vs. KANTA RAINA

JUDGEMENT

(1.) SOLE question in this appeal for determination before this court is as to what is the effect of cancellation of a policy on account of dishonour of cheque of premium issued by the insured vis -a -vis the claim of a third party, like respondents 1 to 3, hereinafter referred to as the claimants.

(2.) FACTS giving rise to this appeal need to be noticed briefly, Late Shri Roshan Lal Raina was the husband of respondent no. 1 and father of respondents 2 & 3, who are his minor daughter and son. Deceased was a practicising lawyer earlier at Srinagar and Anantnag, who in 1990 had migrated to Jammu. On 31.12.1993 deceased was one of the occupants of the car bearing registration no. JKO 2B -1872 which was being driven by Yash Paul Malhotra, This car was on its way from Chandigarh to Jammu when it met with an accident at a place Chack Janjan failing in -between Tanda to Moga road in Punjab Further case of the claimants was that driver due to his rash and negligent driving lost control of the vehicle which resulted in its dashing against a tree and as a consequence whereof all the five occupants including driver lost their lives.

(3.) VEHICLE being insured with the appellant -Insurance Company is not in dispute, policy of insurance had been issued by it. Only defence put forth to resist the claim of the claimants before the Tribunal in proceedings under Section 166 Motor Vehicles Act 1988 was that the policy in question dated 21.12.1993 was cancelled on 20.1.1994 from its inception as the cheque of premium was dishonoured, therefore, the appellant was not liable to pay the compensation muchless indemnify the owner.