ORIGINAL JURISDICTION - Orissa High Court

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4.12.1997. The vehicle was insured during the period of accident. On
the basis of such factual submissions it was contended that in view of
Section 157 of the M.V. Act, insurance policy issued in favour of appellant’s
husband has to be deemed to have been transferred in favour of the
appellant. It was further argued that the policy issued to appellant’s
deceased-husband covered the period of accident and the insurance policy
was never cancelled by the Insurance Company. Therefore, third party
benefits contemplated under the M.V. Act cannot be defeated due to delay, if
any, in transfer of the ownership of the offending vehicle in the name of the
appellant as the liability of the Insurance Company towards the third party is
not contractual but is statutory. In support of his contentions learned counsel
for the appellant relied upon decisions of our High Court in Hindustan
General Ins. Society Ltd. –vrs.-Kausalya Rani Das and another, 1972
A.C.J 13 and of the Hon’ble Supreme Court in Oriental Insurance Co. Ltd.
–vrs.- Inderjit Kaur and others, 1998 (1) T.A.C. 615 (SC).
INDIAN LAW REPORTS, CUTTACK SERIES [2010]
4. In reply, learned counsel for the Insurance Company contended that as
the person in whose favour insurance policy was issued died more than
three months before the accident and no step was ever taken by the
appellant to get the insurance policy transferred in her favour, the learned
Tribunal rightly held that Insurance Company is not liable to pay
compensation on account of accident involving the offending vehicle. It was
argued that contract of indemnity between the Insurance Company and
insurer-owner came to an end with his death on 18.3.1997. It was further
contended that as the claim application was initially filed against a dead
person and the case stood abated against the deceased-owner, no award
can be passed against the Insurance Company on the strength of policy
which had been issued to the appellant’s husband. In support of his
contentions learned counsel for the Insurance Company relied upon the
decisions of our High Court in Cuttack Municipality –vrs.- Shyamsundar
Behera, 1976 CLT 1283, of the High Court of Madras in New India
Assurance Co. Ltd. -vrs.- Kaliathal and others, 2002 (3) T.A.C. 663
(Mad.) and of the High Court of Gujarat in United India Insurance Co. Ltd.
–vrs.- Mohanlal Nandiram and others, 1999(3) T.A.C. 831 (Guj.).
5. Learned counsel for the claimants respondent nos.2 to 4 also argued
that in view of provisions under Section 50 (2) (a) and Section 157 of the
M.V. Act the insurance policy which was never cancelled automatically got
transferred in favour of the appellant. There might have been some delay in
getting the vehicle transferred in the name of the appellant. However, delay
is of no consequence so far as liability of the Insurance Company towards
third party is concerned. Learned counsel for the claimants placed reliance