Held,
- Section 64VB of Insurance Act provided that no risk was assumed by insurer unless premium payable was received in advance – Where policy of insurance was issued by an authorized insurer on receipt of cheque towards payment of premium and such cheque was returned dishonoured, then liability of authorized insurer to indemnify third parties in respect of liability which that policy covered subsisted and it had to satisfy award of compensation by reason of provisions of Sections 147(5) and 149(1) of Act unless policy of insurance was cancelled by authorized insurer and intimation of such cancellation had reached insured before accident –
- Where policy of insurance was issued by an authorized insurer to cover a vehicle on receipt of cheque paid towards premium and cheque got dishonored and before accident of vehicle occurred, such insurance company cancelled policy of insurance and sent intimation thereof to owner, insurance company’s liability to indemnify third parties which that policy covered ceased and insurance company was not liable to satisfy awards of compensation in respect thereof –
- In present case, cancellation of policy having been done by Appellant-insurer after accident, Appellant-insurer became liable to satisfy award of compensation passed in favour of Claimants – Impugned judgment of High Court did not call for any interference – Appeal dismissed
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