BEFORE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD

F.A.No.1192 OF 2010 AGAINST C.C.NO.81 OF 2009 DISTRICT FORUM KADAPA

Between:

Bajaj Allianz General Insurance Co. Ltd.,
rep. by its Manager, GE Plaza, Airport Road
Yerwada, Pune-411006

                                                                Appellant/opposite party no.2

        A N D

1.   S.Moulali S/o Dastagiri
aged 55 years, Truck Owner
D.No.3/11, Ashoknagar,
Duvvu (V, P & M)

Kadapa District                                    Respondent/complainant

2.   Sreeram Raghavendra Chit Funds (P) Ltd.,
rep. by its Branch Manager, Gandhi Road
Proddatur P.O., Kadapa District

3.   Sreerama Transport Finance Co.Ltd.,
rep. by its Branch Manager, Gandhi Road
Proddatur Post, Kadapa District

Respondents/opposite parties no.1 & 3

Counsel for the Appellant                      M/s N.Mohan Krishna

Counsel for the Respondent                   M/s K.Raja Reddy (R1)
                                                        M/s B.Harinath Rao(R3)

QUORUM:   SRI R.LAKSHMINARASIMHA RAO, HON’BLE MEMBER

                                                AND

SRI THOTA ASHOK KUMAR, HON’BLE MEMBER

THURSDAY THE TWELVEFTH DAY OF JULY

                                TWO THOUSAND TWELVE

Oral Order (As per Sri R.Lakshminarasimha Rao, Hon’ble Member)

                                        ***

1.            The opposite party no.2 is the appellant.

2.             The first respondent  insured his truck bearing registration No. AP 04X 0078 with appellant and paid an amount of `31,170/- towards premium through opposite party no.3.  The validity period of the policy was from 19.1.2008 to 18.1.2009.  On 5.11.2008 at about 14.30 hours on Dhule Surath National High Way No.6 the first respondent’s truck met with an accident as a result of which the truck got damaged.  A case was registered under Cr.No.57 of 2008 by Visarawadi Police Station, Nandurbar District, Maharashtra State.  The first respondent got estimated the damages at `2,64,890/- and sent the same along with photos and bills to appellant insurance company.  The appellant appointed surveyor and he inspected the vehicle.  The appellant despite repeated requests failed to pay `1,99,910/- towards damages of the truck. 

3.            The respondent no.2 resisted the case contending that there was no relationship of producer and customer between the respondent no.2 and the first respondent and the insurance coverage was with the appellant.  The respondent no.2 has nothing to do with the vehicle of the first respondent.  The respondent no.2 is doing chit fund business and had no dealings of business of the motor vehicles.  The vehicle was hypothecated with Sreerama Transport Finance Co.Ltd., but not with the respondent no.2 company. 

4.            The appellant equally resisted the case contending that the first respondent is not a consumer and that the Forum had no jurisdiction to entertain the complaint.  The appellant had no branch office at Kadapa.  The first respondent hypothecated the vehicle with Sreerama Transport Fiance Co.Ltd. but not with respondent no.2.  There was no communication regarding the accident with the appellant.    The vehicle was insured with the appellant under commercial vehicle package policy.  The first respondent was doing transport business and was using the vehicle for commercial activities at the time of accident. The first respondent did not disclose the damages in the notarized crime details form.  The first respondent had to prove that the driver had valid and effective driving license and  valid permit.  The appellant received intimation regarding accident on 19.1.2009 after lapse of 75 days.  By the time the surveyor inspected the vehicle, it was repaired.  As per policy conditions notice should be given in writing to the company immediately after the accident instead the first respondent got the vehicle repaired. 

5.            The respondent no.3 filed counter stating that the first respondent was doing transport business.  The complaint is not maintainable.  There was no deficiency in service and there was no cause of action to the respondent no.1 against the respondent no.3 and prayed for dismissal of the complaint.

6.             The first respondent has filed his affidavit and the documents Exs.A1 to A20.  On behalf of the opposite parties Ex.B1 was markedh

7.            The District Forum allowed the complaint directing the appellant to pay `1,99,910/-.  The complaint against the opposite parties no.1 and 3 was dismissed. 

8.                    Aggrieved by the order of the District Forum, the appellant –insurance company has filed appeal contending that the first respondent is not a consumer as the insurance policy was obtained for the vehicle for commercial purpose and the District Forum has no jurisdiction to try the matter since the appellant has no branch office in Kadapa district and that intimation about the accident was given after 75 days in violation of the terms of the insurance policy as also that the driver of the insured vehicle did not possess valid and effective driving license at the time of the accident.

9.             The points for consideration are:

i)             Whether the District Forum has jurisdiction to entertain the complaint?

ii)           Whether the first respondent violated the terms and conditions of the insurance policy?

iii)          To what relief?

10.           POINT NO.1:    The maintainability of the complaint on the premise of the lack of territorial jurisdiction of the District Forum is one of the objections raised by the appellant-insurance company. It is contended by the learned counsel for the appellant-insurance company that the appellant has no branch office at or in Kadapa district. The plea of the appellant-insurance company is supported by non-denial by the first respondent as also for non-joinder of the branch office if any, of the appellant-insurance company.

11.           The Consumer Protection Act    prescribes territorial jurisdiction  for institution of complaint in District Forum within the local limits of whose jurisdiction the opposite party resides    or the cause of action arises. Section  11(2) of the Act reads as under:

11.       Jurisdiction of the District Forum.—(1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed ''does not exceed rupees twenty lakhs. 

(2)        A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction,—

(a)   the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain, or

(b)   any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office, or personally works for gain, provided that in such case either the permission of the District Forum is given, or the opposite parties who do not reside, or carry on business or have a branch office, or personally work for gain, as the case may be, acquiesce in such institution; or

(c)    the cause of action, wholly or in part, arises. 

12.            The accident occurred when the insured vehicle was proceeding on Dhule –Surat National High Way at Viswaradi village in  Nandarbar district in Maharashtra. As such cause of action has not arisen within the limits of the jurisdiction of the District Forum which has passed the order under appeal.

 13.           The Hon’ble Supreme Court in  “Sonic Surgical Vs. National Insurance Company Ltd”., reported in (2010) 1 SCC 135   held that “simply because  the expression ‘branch office’  in Section 17(2)(b) of the Consumer Protection Act would mean  branch office  where cause of action has arisen but not each and every branch office  of opposite party  wherever it is situated.    That was a somewhat similar case where  insurance policy was taken at Ambala but the claim for compensation was made at Chandigarh contending that the respondent has a branch office at Chandigarh, hence complaint could be filed at Chandigarh”.    On the aspect of cause of action their Lordships’ opined:

“The Supreme Court, further dealing the concept of Article 226(2) and relying on the decision of ONGC (1994 AIR SCW 3287), explained the concept of cause of action in para 17 at page 130 of the report and the relevant extracts wherefrom are excerpted below :

“It is clear from the above judgment that each  and every fact pleaded by the respondents in  their application does not ipso facto lead to the conclusion that those facts give rise to a cause of action within the Court's territorial jurisdiction unless those facts pleaded are such which have a nexus or relevance with the lis that  is involved in the case. Facts which have no bearing with the lis or the dispute involved in the case, do not give rise to a cause of action so as to confer territorial jurisdiction on the Court concerned.”

14.            The appellant-insurance company has no branch office in Kadapa nor any cause of action occurred within the jurisdiction of the District Forum, Kadapa.      The District Forum ought to have considered the objection as to its territorial jurisdiction before proceeding to decide the matter. The order of the District Forum is liable to be set aside. 

15.            In the result, the appeal is allowed. The order of the District Forum is set-aside. The District Forum shall return the original complaint and the documents filed by the first respondent to enable him to present the same in appropriate District forum.  There shall be no order as to costs.

                                                                        MEMBER

                                                                          MEMBER

                                                                    Dt.12.07.2012

KMK*