Andhra HC (Pre-Telangana)
New India Assurance Co., Ltd., Kakinada vs Kancherla Suryavathi And Others on 4 October, 1999
Equivalent citations: II(2000)ACC446, 2001ACJ1902, 2000(1)ALD149, 2000(2)ALT396
Author: Elipe Dharma Rao
Bench: Elipe Dharma Rao
JUDGMENT
1.This appeal was filed by the New India Assurance Company Limited, Kakinada, against the order and decree dated 29-3-1994 in OP No.85 of 1990 on the file of the Chairman (III Additional District Judge), Motor Accident Claims Tribunal, Kakinada, wherein the Tribunal has awarded compensation of Rs. 1,69,0007- for the death of the deceased Kancharla Venkata Suryanarayana Rao, in a motor vehicle accident that was occurred on 24-9-1989, at about 4-30 p.m. when the deceased was going on his scooter bearing No.ATP-8309 alongwith his brother's daughter, 4 years and his daughter, on Samalkota Kakinada Road, towards Kakinada, a taxi bearing No.AAW-333 coming in the opposite direction being driven by its driver in a rash and negligent manner dashed against the scooter, as a result of which the deceased sustained severe injuries and he was shifted to Government General Hospital, Kakinada, and he succumbed to the injuries on 11-10-1989 and the scooter was also badly damaged. It is stated that the deceased was earning Rs.6000/- per month by doing business in iron, general and hardware, materials. Therefore, the claimants claimed an amount of Rs.7,70,000/-by way of compensation and the Tribunal awarded Rs.1,69,000/-
2. The learned Counsel for the appellant submitted that the accident occurred on 24-9-1989 and the Motor Vehicles Act, 1988 came into force with effect from 1-7-1989 and the insurance policy Ex.B1 covering the vehicle was in operation for a period of one year with effect from 10-5-1989 to 9-5-1990 and as per proviso to subsection (2) of Section 147 of the Motor Vehicle Act, 1988, the liability of the appellant is only Rs.50,000/-.
3. Proviso to sub-section (2) of Section 147 of the Motor Vehicle Act, 1988 reads as under:
"147(2): Subject to the proviso to subsection (1) a policy of insurance referred to in sub-section (1), shall cover any liability incurred in respect of any accident, upto the following limits, namely:--
(a) xxxxx
(b) xxxxx Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier...."
From the reading of the above said proviso, it is clear that any insurance policy issued by the insurer, covering a motor vehicle with a limited liability, which was in force immediately before commencement of the Motor Vehicle Act, 1988, shall continue to be in force for a period of four months after commencement of or till the date of expiry of such policy whichever is earlier. Therefore, to invoke the above said proviso, the vehicle must be recovered by insurance policy with limited liability and that policy must be in operation when the Motor Vehicles Act, 1988 came into effect and that shall continue for a period of four months after such commencement or till the expiry of such policy which ever is earlier, that is to say, if the policy is in operation before the commencement of the Act, 1988, it shall continue for a period of four months. Even otherwise also, if the policy expires within a period of four months of the commencement of the Act, 1938, it will operate to the date of expiry of the policy only and not upto four months from commencement of the Act. If the policy is effective beyond the period of four months from the date of commencement of this Act, but it shall be operative for a period of four months from the date of commencement of the Act, 1988 only. Therefore, as seen from the submissions made by the learned Counsel for the appellant, the insurance policy is issued covering the crime vehicle for a period of one year with effect from 10-5-1989 to 9-5-1990 and the accident was occurred on 24-9-1989. Therefore, the policy is issued with a limited liability of Rs.50,000/-covering upto 9-5-1990 and the accident was occurred on 24-9-1990 (sic 24-9-1989). Therefore, the appellant is liable to indemnify the third parties on behalf of the insured to the limited liability of Rs.50,000/- only as the vehicle was used as a taxi. Therefore, in view of the above said provision, the contention of the learned Counsel for the appellant is accepted and the liability of the insurance company/appellant is restricted to the Rs.50,000/-.
4. In the result, the appeal is allowed modifying the award of the Tribunal below to the extent indicated above. No costs.