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Vehicle’s FC, permit not renewed; insurer still has to pay compensation: HC

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The High Court of Karnataka has held that an insurer cannot escape the liability of paying compensation even when the fitness certificate (FC) and permit of a vehicle is not renewed but the insurance policy is in force.

The HC overruled the judgement of a lower court which had ordered the owner of the school bus to pay compensation to the family of an accident victim because the school bus did not have fitness certificate and permit on the day of accident.

The HC has directed the insurance company to indemnify the school bus owner by paying the entire compensation amount.

“In this case though the insurance policy was in force on the date of accident, the permit and the validity of the fitness certificate had expired,” the court noted. The fitness certificate was obtained after the accident.

The HC said that the insurance company “would not have issued the policy unless fitness certificate was in force and it appears that the fitness certificate expired after the issuance of the policy.”

As for the permit, the court pointed out that when the permit is applied for after the existing one has expired, “temporary permit is issued for the interregnum period, and it has nothing to do with renewal.”

The HC said that it should be deemed that on the day when the accident took place, the permit was in force, adding that the insurance company cannot disown its responsibility to indemnify the liability of the appellant.

Syed Wali was riding a motorcycle with another person Mohammed Shali on the pillion on September 28, 2015 when the two-wheeler was involved in the accident with the school bus. Wali died instantly.

Wali’s wife Banu Begum and children Malan Begum and Moula Husen filed claims for compensation.

The insurance company, The New India Assurance Co, claimed that the school bus did not have (a) fitness certificate and its permit was not in force even though the insurance policy was in force.

The II Additional District and Sessions Judge in 2015 accepted the contention of the insurance company. It awarded a compensation of Rs 6,18,000 to the family members of Wali and ordered the owner of the school bus, Dr. Narasimulu Nandini Memorial Education Trust, Raichur, to pay for it.

The Trust approached the High Court with an appeal challenging it. The appeal filed in 2016 was disposed by the division bench of Justice Sreenivas Harish Kumar and Justice S Rachaiah recently.

This amount is now to be indemnified by the insurance company to the Trust as per the HC order.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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