BEFORE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD
F.A.No.895 OF 2012 AGAINST C.C.NO. 04 OF 2010 DISTRICT FORUM SRIKAKULAM
Between:
1. The Oriental Insurance Co.,Ltd.,
rep. by its Divisional Manager,
Visakhapatnam rep. by its Authorized
Signatory, CRM, RO, Vizag
2. The Oriental Insurance Company Ltd.,
rep. by its Branch Manager
Srikakulam by its Authorized Signatory
CRM RO Vizag
Appellants/opposite parties no.1 and 3
A N D
1. Chatla Biragi Naidu S/o Tavudu
Aged 30 years, Dr.No.1-1, Chatla Street
Lopenta Village, Laveru Mandalam, Srikakulam Dist.
Respondent/complainant
2. Ch.Satyanarayana S/o Thavudu
Dr.No.13-2-97, Arivolova, Ambedkar Nagar
Visakhapatnam
Respondent/opposite party no.2
Counsel for the Appellant M/s S.Agasthya Sharma
Counsel for the Respondents M/s Vakkanti Narasimha Rao(R1)
Held sufficient (R2)
QUORUM: SRI R.LAKSHMINARASIMHA RAO, HON’BLE I/C PRESIDENT
SRI THOTA ASHOK KUMAR, HON’BLE MEMBER
AND
SRI S.BHUJANGA RAO, HON’BLE MEMBER
FRIDAY THE TWENTY SEVENTH DAY OF DECEMBER
TWO THOUSAND THIRTEEN
Oral Order (As per Sri R.Lakshminarasimha Rao, Hon’ble I/c President)
***
1. The opposite party-insurance company is the appellant. The appeal is filed challenging the order of the District Forum which allowed the complaint directing the appellant to settle the claim of the respondent no.1.
2. The respondent no.1 purchased vehicle bearing registration number AP31 W 8674 from the respondent no.2 and got transferred the ownership of the vehicle in his favour with RTA. The vehicle was insured with the appellant-insurance company from 6.02.2006 till 5.02.2007. The vehicle met with an accident on 16.11.2006 near zoo park at Vishakapatnam. The accident was stated to have been informed to the appellant-insurance company. The appellant deputed surveyor who assessed the loss caused to the vehicle.
3. The appellant-insurance company resisted the claim on the premise that there was no relationship of insurer and insured between it and the respondent .The original owner of the vehicle, i.e., the second respondent obtained the insurance policy. As per terms of the policy the second respondent is the owner of the vehicle and the respondent no.1 purchased the vehicle from the respondent no.2 and he has transferred the ownership of the vehicle in his name w.e.f., 1.6.2006. As per the provisions of M.V.Act the purchaser of the vehicle should transfer the insurance policy of the vehicle in his name within 14 days from the date of the transfer of the ownership of the vehicle. Tthe policy was not transferred in the name of the respondent no.1 till the expiry of the 14 days i.e., 5.2.2007. As per the terms and conditions of the policy there is no coverage of policy. The respondent no.1 is not entitled to claim any amount from the appellants.
4. The District Forum allowed the complaint on the premise that provisions of Section 157 of the M.V. Act for transfer of the insurance policy is not mandatory.
5. The opposite parties no.1 and 3 have filed appeal contending that the order of the District Forum is erroneous in as much as fixing liability on the appellants to indemnify the respondent no.1 even in absence of any contract owing to non-transfer of insurance policy in his favour.
6. The point for consideration is whether the appellant insurance company is liable to pay any amount even when the insurance policy was not transferred in the name of purchaser?
7. The respondent no.2 is the owner of the vehicle, Swaraj Mazda and he transferred the vehicle in the name of the first respondent. The second respondent obtained the insurance policy in respect of the vehicle from the appellant insurance company for the period from 6.02.2006 to 5.02.2007. On 16.11.2006 the vehicle met with an accident near zoo park at Vishakhapatnam. The appellant has contended that the first respondent has no locus standi to claim the sum assured under the insurance policy in absence of any insurance contract with it.
8. The District Forum observed that transfer of insurance policy within 14 days of purchase of the vehicle is not mandatory. The claim was repudiated on the ground that the insurance policy was not transferred in favour of the respondent.
9. There is no quarrel with the proposition of law that within 14 days of transfer of ownership of a vehicle, the transferee has to apply to the insurer for transfer of the insurance policy which is issued in respect of the vehicle and in force as on the date of transfer of the ownership. It is not disputed that the second respondent transferred his ownership of the vehicle in favour of the first respondent on 1.6.2006 and the insurance policy was not transferred whereas the accident had taken place on 16.11.2006. Thus, on the date of the accident the first respondent who has become the owner of the vehicle did not get the insurance policy transferred in his name in order to claim any privity of contract with the appellant insurer nor he has filed any application before the appellant with a request to transfer the insurance policy from the second respondent in his name and in the circumstances, he has no insurable interest.
10. The action by the insured for an insurance claim on the foot of an insurance policy belongs to the realm of enforcement of an insurance contract. The ground theme of any insurance contract that is agreed between the parties is indemnification in monetary terms for the risk covered therein. Its enforceability and sweep of operation again depend not only on the express terms but also on the law supplying some more flesh and blood to such contract
11. The Supreme Court in “Complete Insulations Pvt. Ltd. Vs. New India Assurance Company Ltd”. reported in I (1996) CPJ 1 (SC) held that Section 157 of the M.V. Act is applicable only in cases of 3rd party risk and in the matter of others, the claim has to be decided only on the basis of actual terms of the contract of insurance policy.
Section 157 of the M.V. Act reads as follows :
157. Transfer of certificate of insurance.
Where a person in whose favour the certificate of insurance has been issued in accordance with the provisions of this Chapter transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.
1[Explanation.-For the removal of doubts, it is hereby declared that such deemed transfer shall include transfer of rights and liabilities of the said certificate of insurance and policy of insurance.]
(2) The transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the fact of transfer in the certificate of insurance and the policy described in the certificate in his favour and the insurer shall make the necessary changes in the certificate and the policy of insurance in regard to the transfer of insurance.
12. As per Rule 144 of the Central Motor Vehicles Rules, the respondent no.1 has to take steps for transfer of the insurance policy in his name and he did not take any steps to the effect as also he had not obtained any endorsement on the insurance policy from his vendor. Rule 144 of the Central Motor Vehicles Rules and Section 157 of the Motor Vehicles Act would fasten responsibility on the purchaser of a motor vehicle to get the insurance policy transferred in his name.
13. The learned counsel for the first respondent has contended that the transfer of the policy goes with the transfer of ownership of the vehicle and even where the policy is not transferred, technicalities cannot be gone into and the appellant has to indemnify the insured. He has placed reliance upon the decision of the Hon’ble National Commission in “Banowarilal Agrawala vs National Insurance Company Ltd and another” IV(2005) CPJ 110.
14. With due respect to the Hon’ble National Commission, we are of the opinion that the ratio laid in the aforementioned decision is not in consonance with the provisions of the Motor Vehicle Act and the judgment of the Hon’ble supreme court in “Complete Insulations “ (supra) which is referred to in the decision subsequently rendered in R.P.No.3502 of 2009 decided on 21.2.2013 of the National Commission. The opposite party no.2 has parted with ownership of the vehicle and he cannot be said to be competent to claim the amount from the insurance company in respect fo the vehicle of which he is no more owner. The complainant who is the owner has no privity of contract with the insurance company. Thus, viewed in any manner the opposite party insurance company cannot be held liable to pay any amount in terms of the insurance policy either to the complainant or to the opposite party no.2. As such the decision of the National Commission has no application to the facts of the case on hand.
15. For the foregoing discussion and in the light of ratio in the aforementioned decision of the Apex Court, the appellant insurance company is not liable to pay any amount in respect of the vehicle whose ownership was transferred in favour of the respondent leaving the insurance policy remain in the name of the vendor of the respondent. The findings returned by the District Forum in regard to the deemed transfer of the insurance policy in favour of the respondent are unsustainable and as such liable to be set aside.
16. In the result, the appeal is allowed setting aside the order of the District Forum. Consequently, the complaint is dismissed. There shall be no order as to costs.
Sd/-
I/c PRESIDENT
Sd/-
MEMBER
Sd/-
MEMBER
DT.27.12.2013
కె.ఎం.కె.*
