India Assurance Co. Ltd. Vs. Smt. Sita Bai & Ors  INSC 330 (10 September 1999)
M. Srinivasan, R.C. Lohoti.
I to 4 filed a claim petition before the Motor Accident Claims Tribunal, Khandwa
against respondents 5, 6 and the appellant herein - New India Assurance Co.
claim petition arose out of an accident which took place at 10.00 AM on 16.4.1987. Bus No.CPO-9104, owned by respondent
No.5 and driven by respondent No.6 was involved in that accident in which one Smt.
Salta Bai suffered fatal injuries. The Motor Accident Claims Tribunal vide
order dated 22.9.1990 opined that the bus in question was insured with the
appellant-insurance Company for the period 16.4.1987 to 15.4.1988 (both days
owner (respondent No.5) as well as the Insurance Company (appellant herein)
were liable under the provisions of Section 92-A of the Motor Vehicles Act
(hereinafter the Act). An amount of Rs. 15.000- was accordingly directed to be
paid as ad-interim compensation to respondents I to 4 under Section 92- A of
the Act. The order of the Motor Accident Claims Tribunal was put in issue and a
first appeal was filed in the High Court of M.P. at Jabalpur. On 11th March. 1991 .a learned
Single Judge of the High Court relying upon the law laid down by this Court in
New India 680], held that the appeal had no merits and dismissed the same summarily.
Aggrieved, the appellant-insurance Company is before us by special leave.
brief notice of some of the admitted facts would be advantageous at this stage.
proposal for insuring the vehicle in question was made by the owner of the
vehicle on 16.4.1987 at 2100 hours.
cover note was issued by the appellant in respect of that vehicle, being
No.P.'703802 on 16.4.1987 at 2100 hours.
Insurance Policy (Exh.P5) was later on issued in which also the date of
commencement of the insurance policy was recorded as 16.4.1987 (2100 hours).
The accident, in question, in which Smt. Salta Bai received fatal injuries had
admittedly occurred at 10.00
A.M. on 16.4.1987..
i.e.. much before the commencement of the insurance policy.
High Court opined that the insurance policy dated 16.4.1987 covered the period
of the accident also because the policy would be deemed to have commenced at midnight of 15.4.1987 and 16.4.1987. The High Court in taking
this view relied upon the judgment in Ram Dayal's case (supra).
correctness and applicability of the judgment in Ram Dayal's case (supra} came
up for consideration before this Court subsequently in a number of cases. ln.New
Civil.appeal No. 1550 of 1994, decided on 10.2.1998. a three- Judge Bench of
this Court relied upon the view taken (Smt) and Ors., [1997 (1) SCC 66],
wherein it had been held that if there is a special contract, mentioning in the
policy the time when it was bought, the insurance policy would be operative
from that time and not from the previous midnight as was the case in Ram Dayal's
case, where no time from which the insurance policy was to become effective had
been mentioned. It was held that should there be no contract to the contrary,
an insurance policy becomes operative from the previous midnight, when bought
during the day following; but. in cases where there is a mention of the
specific time for the purchase of the policy. then a special contract comes
into being and tile policy becomes effective from the time mentioned in the
cover note/the policy itself. The judgment in Jikubhai's case (supra) has been
subsequently followed in [1998 (1) SCC 365]. by a three-Judge Bench of this
fact situation of this case since the commencement of the policy at 2100 hours
on 16.4.1987 was after the accident which had occurred at 1000 hours on
16.4.1987, the Tribunal as well as the High Court were wrong in burdening the
appellant-insurance Company, with any liability- under Section 92-A of the
Motor Vehicles Act by applying the law- laid down in Ram Dayal's ca.se. which,
on facts, had no application to this case. This case is squarely covered by the
judgment in Jikhubhai's case and the other judgments following it as noticed
above. The impugned order against the appellant cannot thus be sustained. The
same is hereby set aside. The appeal consequently succeeds and is allowed
insofar as the appellant is concerned. No costs.