BEFORE THE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT  HYDERABAD.

FA  926 of 2012  against CC  57/2011, Dist. Forum, Chittoor

Between:

R.P. Surendra Kumar

S/o.  R. Parthasarathi Naidu

Lorry Owner  AP 06 U 8578

D.No. 1-74,

R.S.L.S. Gandhi Road Extn.

Chittoor-517 001.                                       ***                         Appellant/

Complainant

                                                                   And

1)   The  Oriental Insurance Company Ltd.

Chittoor Branch

Rep. by its Branch Manager

Opp. Court Building

P.H. Road, Chitoor-517 001.

2)  The  Oriental Insurance Company Ltd.

Divisional Office, Tirupathi Division

APSFC Buildings, N.T. Road

Tirupathi-517 507  

Rep. by its Divisional Manager                             ***                         Respondents/

                                                                                                O.Ps.

Counsel for the  Appellant :                         M/s.  D. Kodanda Rami Reddy

Counsel for the  Respondent:                      M/s. N. Mohana Krishna        

CORAM:

                              SMT. M. SHREESHA, PRESIDING MEMBER

&

                              SRI  S. BHUJANGA RAO, MEMBER

FRIDAY, THE ELEVENTH  DAY OF OCTOBER TWO THOUSAND THIRTEEN

ORAL ORDER:  (Per Smt. M. Shreesha, Member)

***

1)                Aggrieved by the  order in C.C. No. 57/2011 on the file of the Dist. Forum, Chittoor, the complainant preferred this appeal.

2)                The brief facts as stated in the complaint are that the complainant got  his lorry bearing No. AP 16 U 8758  insured with the  opposite party insurance company for IDV of Rs. 3 lakhs covering the period from  24.09.2011 to 23.9.2002.     While so, on  18.5.2002  it met with an accident  near Hosakota, Bangalore.    On a report the police registered  it as a case in Crime No. 174/2002.   The complainant approached the opposite parties with relevant documents  to settle the claim  and prepared to surrender the vehicle.     

The   insurance company  without proper verification sent a letter dt. 27.9.2002 settling the claim  much below the estimates.   The surveyor also estimated the loss.    The complainant submits that he presented the quotation  for spare parts and repairs  at Rs. 3,78,710/-.    On account of non-settlement of claim  the complainant incurred loss of earnings  and has been paying rental charges for all this period.  In all  the complainant had incurred an amount of Rs. 6,05,200/-.   The complainant submits that the claim application filed before the MACT, Chittoor in MVOP No. 112/2003 was dismissed as it has no jurisdiction.   The complainant alleges that in spite of several requests the opposite parties did not settle his claim.  Hence this complaint praying for a direction to the opposite parties to  pay a sum of Rs. 6,05,200/-  together with compensation and costs. 

3)                Op1 filed counter  adopted by Op2  denying the allegations made by the complainant.   They contended that the complaint is barred by limitation as the  accident took place on 18.5.2002  whereas the complaint was filed on  17.3.2011 after a lapse of  about 9 years.     On intimation of accident Op1  deputed a surveyor  who estimated the loss and  the same was forwarded to Op2 which in turn sent a letter dt. 27.9.2002 to the complainant giving options for settlement of claim at Rs. 1,22,250/- or Rs. 1,47,050/- as there is violation of terms of the policy.   They denied the allegation of the complainant that they took advantage of dismissal of MVOP before the MACT and did not respond to the complainant.   There is no negligence  or deficiency in service on their behalf  and therefore prayed for dismissal of the complaint with costs. 

4)                The Dist. Forum based on the evidence adduced i.e., Exs. A1 to A6 and Exs. B1 to B5  and the pleadings put forward dismissed the complaint. 

5)                Aggrieved by the said order, the complainant preferred this appeal.

6)                The point that falls for our consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

7)                It is the contention of the appellant/complainant that  apart from damage to the vehicle which was estimated at Rs. 3,78,710/-, on account of non-settlement of his claim  he incurred  additional amounts towards parking charges, and  he also lost  earnings for all this period  in all amounting to Rs. 6,05,200/-.  Non-settlement of claim amounts to deficiency in service and therefore claimed  an amount of Rs. 50,000/- towards compensation. 

8)                It is the contention of the  opposite parties that the complaint is barred by limitation  and that there is violation of terms of the policy as the vehicle was carrying more than  the permissible capacity.  In view of violation of conditions of the policy  they are not liable to pay any amount.   However, based on the surveyor report they made an offer  for settlement of claim on non-standard basis at Rs. 1,22,250/- or  Rs. 1,47,020/- as there is breach of conditions of the policy for which the complainant was not agreeable. 

9)                It is  pertinent to note that the complainant  filed an application u/s 24-A of the Consumer Protection Act  seeking condonation of delay along with the complaint  and taking into consideration the facts and circumstances of the case  and in the light of  proceedings before the MACT, Chittoor, the  Dist. Forum allowed  the application  and registered the complaint.   As no appeal  has been preferred against the said order it has attained finality.   The Dist. Forum  has also made a specific observation with regard to  limitation  with which we agree.

10)              The insurance company did not explain the enormous delay in settling the claim.    The National Commission in  Sushanthkumar Ray  Vs. Oriental Insurance Company Ltd. reported in  2003 (2) CPR 116  wherein it was held that two months  period is reasonable  for insurance company to settle  the claim after receipt of report  of surveyor.    Unexplained delay beyond that period  amounts  to deficiency in service.

11)              In the light of repudiation on the ground that the vehicle was carrying passengers in excess,   the question is whether the insurance company could  repudiate the claim on the said ground.    In fact as long back as in 1996 in    B.V. Nagaraju v. M/s. Oriental Insurance Co. Ltd. Divisional Office, Hassan,  reported in II (1996) CPJ 18 (SC)=I (1997) ACC 123 (SC)=1996 (4) SCC 647   the Hon’ble Supreme Court held that  “Merely by lifting a person or two, or even three, by the driver or the cleaner of the vehicle without the knowledge of the owner, cannot be said to be such a fundamental breach that the owner should, in all events, be denied indemnification. The misuse of the vehicle was somewhat irregular though, but not so fundamental in nature so as to put an end to the contract, unless some factors existed which, by themselves had gone to contribute to the causing of the accident.”

12)                   The Hon’ble Supreme Court in   Amalendu  Sahoo Vs. Oriental Insurance Company Ltd. reported in II (2010) CPJ 9 (SC)  excerpted the guidelines  issued by insurance company  for settling the claim on non-standard basis. 

13)              In view of the above guidelines the insurance company was not justified  in repudiating the claim in its entirety.    It could have settled the claim on non-standard basis  as stated above.    The IDV  of the vehicle is Rs. 3,00,000/-.   Since the Hon’ble Supreme Court  had opined that violation of  such condition  would entail the insurance company to settle the claim  at 75%,  we are of the opinion that the complainant is entitled to 75% of  IDV on non-standard basis, which comes  to an amount of  Rs. 2,25,000/-.

14)              In the result the appeal is allowed in part  setting aside the order of  the Dist. Forum.    Consequently, the complaint is allowed in part directing  the   respondent/insurance company to pay Rs. 2,25,000/-  with  interest @ 9% p.a.,  from the date of complaint till the date of realization  together with costs of  Rs. 5,000/-.   Time for compliance four weeks. 

1)      _______________________________

PRESIDING MEMBER 

2)      ________________________________

*pnr                                                                                MEMBER  

UP LOAD – O.K.