In Brief
M/s Balwant Singh & Sons purchased a vehicle at an auction conducted by ICICI Bank (which had repossessed it following the original owner's default on a hire-purchase agreement). The appellant paid full consideration and obtained a certificate of possession. The bank informed the insurer that its lien had been lifted. The appellant then insured the vehicle with National Insurance Company, paying premium; a policy was issued bearing the appellant's name and address alongside the erstwhile owner's. When the vehicle was stolen, the insurer rejected the claim arguing the appellant had no insurable interest since the vehicle remained registered in the original owner's name. The Supreme Court allowed the appeal, holding that acceptance of premium and issuance of a valid policy document constitute a binding contract of insurance creating insurable interest in the transferee, regardless of non-transfer of the registration certificate.
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