BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION
AT HYDERABAD.
CC 116 of 2010
Between:
CMR Transport Contractors Company Pvt. Ltd.
Rep. by its Managing Director
Chaluvadi Mallikharjuna Rao
D.No. 54-18-34, Opp. ITI Gate
Bharat Gas Lane, Sivapuram Colony
Vijayawada. *** Complainant
And
1) United India Assurance Company Ltd.
Rep. by its Senior Divisional Manager
Divisional Office, P.B. No. 231
Kubera Towers, 15/1, Arundelpet
Guntur.
2) Adishwar Auto Diagnostics Pvt. Ltd.
Mahavir Motors
Rep. by its Manager
Near Tata Motors
Gudavalli-521 104
Krishna Dist. *** Opposite Parties
Counsel for the complainant : M/s. N.V.S. Talpasayee
Counsel for the Ops: M/s. Nissar Uddin Ahmed Jeddy
M/s A. P. Venugopal (R2)
CORAM:
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
&
SMT. M. SHREESHA, MEMBER
THURSDAY, SECOND DAY OF FEBRUARY TWO THOUSAND TWELVE
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
*****
1) This is a complaint filed claiming Rs. 21,40,000/- towards value of the vehicle with interest @ 24% p.a., from the date of accident together with hire charges of Rs. 1,500/- per day besides compensation of Rs. 1 lakh and costs against the opposite party insurance company.
2) The case of the complainant in brief is that he is the owner of Mercedes Benz car (herein after called ‘the car’) insured with Op1 insurance company for Rs. 21,40,000/- covering the period from 31.3.2010 to 30.3.2011. Op2 is the authorized dealer of said car. While so, on 19.5.2010 it met with an accident, as a result of which the car was completely damaged. On a complaint the police registered it as a case in Crime No. 90/2010. On intimation spot survery was conducted, and photographs were taken, and on the advise of insurance company he got the car taken to Op2. At his request preliminary estimate was given and supplementary estimate to a tune of Rs. 49 lakhs. Later M/s. Simax Surveyors, Chennai conducted the survey and took photos, and represented that the repair charges would cost more than the value of new vehicle. Despite his repeated requests the claim was not settled. Since the amount was not settled he has been paying the hire charges @ Rs. 1,500/- per day from 20.5.2010 onwards. He could not attend to his business and other works due to non-settlement of the claim by the insurance company. In fact he is a senior citizen. After issuance of notice, and reply thereon and as there was no settlement of his claim, imputing deficiency in service, he filed the complaint claiming Rs. 21,40,000/- with interest, compensation and costs.
3) Op1 insurance company resisted the case. While admitting issuance of policy it alleged that the complainant is the owner of an old second hand Benz car of the year 2005. The insured himself declared the value of the vehicle at Rs. 21,40,000/- subject to depreciation value on the age of the vehicle. The schedule of depreciation for fixing IDV of the vehicle would be 50% where the age of the vehicle exceeds four years but not five years. The complainant without waiting for settlement hastily rushed to the State Commission claiming the amount. It has not yet repudiated the claim.
The claim was pre-mature. The complainant did not put forward proper and complete facts. He did not file FIR, charge sheet, final report etc., issued by statutory authorities. The burden of proof lies on him since the damage to the vehicle has been extensive and huge, running into several lakhs of rupees. Documents were created for claiming vexatious amounts. The estimates are not final and has no legal sanction. The estimates at Rs. 48,37,000/- for a second hand car itself shows that it was misleading. There was neither expert evidence nor affidavit evidence of an automobile engineer to show the damages for which the amounts that could be claimed. He has to essentially get it repaired and file documents in order to succeed the claim. The complainant ought to have filed a civil suit. In order to evade scrutiny of documents he filed the complaint claiming several lakhs of public money. The Commission has to relegate the matter to Civil Court. The estimates do not contain the signature of repairer or mechanic. Hire charges at Rs. 1,500/- per day or compensation of Rs. 1 lakh is fanciful and prayed for dismissal of the complaint with costs.
4) Op2 dealer equally filed its counter. It has prepared preliminary estimate of car on 6.5.2010 and supplementary estimate on 5.6.2010 mentioning the amount at Rs. 48,37,160/-. Since there was no clarification of payment of amount, in pursuance of estimate, it could not proceed with the repairs, and therefore the vehicle was lying un-attended. It was waiting for the approval of the complainant, and therefore prayed for dismissal of the complaint with costs.
5) The complainant in proof of his case filed his affidavit evidence and got Exs. A1 to A13 marked while the insurance company filed the affidavit evidence of its Deputy Manager and got Exs. B1 to B3.
6) The points that arise for consideration are :
i) Whether the complainant is entitled to any amount?
ii) If so to what amount? and
iii) To what relief>
7) It is an undisputed fact that a Mercedes Benz car belonging to the complainant was insured by Op1 insurance company for Rs. 21,40,000/- covering the period from 31.3.2010 to 30.3.2011 vide policy Ex. B1. The complainant alleges that the car met with an accident on 19.5.2010. On complaint the police registered a case in Crime No. 90/2010. In the FIR it was alleged that the car was driven by one Sankarapu Kanakaraju. The fact that his car met with an accident was intimated to Op1 insurance company on the very same day vide Ex. B3 filed by the very insurance company wherein the estimated cost of repairs was mentioned at Rs. 49 lakhs. It was categorically mentioned in the coloumn name of the repairer “ M/s. Adiswara Diagnostic Motors, NH5, Gudavalli, Vijayawada an authorized repairer (Op2). He also mentioned the crime No. in regard to the accident. The insurance company appointed M/s. Simax Surveyors. The very Deputy Manager filed his affidavit evidence admitting “upon receipt of information our company has appointed surveyor to survey the accident and give the report.” He alleges that the while investigation and survey was in progress the complainant has hastily got filed the above complaint. For the accident that took place on 19.5.2010 the complainant filed the complaint on 16.11.2010 after six months.
8) It is also not in dispute that the complainant had taken the vehicle to M/s. Adiswara Diagnostic Motors, Vijayawada an authorized repairer which had estimated the damages at Rs. 48 lakhs vide Ex. A4. The insurance company admitted that spot survey was conducted. It did not mention the name of the surveyor who estimated initially and the outcome of his survey. Suppression of this document is not innocent. Later it had appointed another M/s. Simax Surveyors. It has submitted its report on 29.8.2010 vide Ex. B2. Obviously preliminary survey was conducted by another surveyor, second surveyor had estimated the loss while noting:
Insured declared value Rs. 21,40,000/-
Less: Value of wreck in as is
where is condition with R.C. Rs. 3,50,000/-
Less: Initial Excess Rs. 1,000/-
Net liability Rs. 17,89,000/-
However, he added garage rent at Rs. 15,000/- and advertisement expenses at Rs. 20,000/-. The net loss of the insurer on account of total loss would be Rs. 18,24,000/-. The repair cost of the vehicle will work out either nearer to or more than the cost of the new vehicle. Hence it is not economical to repair the vehicle. He also appended Photostat copies of photographs of damaged vehicle.
9) When the insurance company did not file the preliminary report of the surveyor an adverse inference has to be drawn. It must have been total loss as was mentioned by the second surveyor. Even the second surveyor, though appointment is not warranted without recoursing to Section 64 UM of the Insurance Act, assuming without admitting the said report is valid, still it was of the opinion that there was total loss and assessed the net loss at Rs. 18,24,000/-. When it was total wreck it could not have deducted Rs. 3,50,000/-. No doubt in case the complainant is willing to retain the vehicle the claim may be settled on repair loss basis. Having issued the policy for Rs. 21,40,000/- agreeing to the IDV given by the complainant it cannot turn round and contend that it is a second hand car. It does not worth the amount for which policy was issued. It has nothing to do with percentage of depreciation as mentioned in the schedule of the policy.
10) The insurance company has agreed to pay Rs. 1,000/- per day only is reimbursable, however, subject to a maximum of seven days. In the light of stipulation agreed upon, the insurance company is liable to pay Rs. 7,000/- towards hire charges. On that score the complainant cannot recover Rs. 1,500/- per day up till payment.
11) The insurance company contends that the complaint is pre-mature, in view of the fact that it did not repudiate the claim. The fact remains that when the accident took place as long back as on 19.5.2010 it did not choose to settle the claim even up till now even though the complaint was filed, in other words for one and half years it did not settle the claim. The Hon’ble Supreme Court in The United India Insurance Company Ltd. Vs. M/s. MKJ Corporation reported in (1986-1999 Supreme Court & National Commission Cases Vol. III page 4781) held that “two months is a reasonable period for the insurance company to take a decision whether claim requires to be settled or rejected in accordance with the policy, and that the insurance company is liable to pay interest for further delay till date of payment.”
12) In the light of fact that the insurance company did not come forward to settle the claim, obviously left open to the State Commission to assess the damage, when the officers not being inclined to settle the claim, it cannot be said that it was pre-mature. In fact there was deficiency in service on the part of insurance company in not settling the claim within a reasonable period.
13) In the result the complaint is allowed in part directing the insurance company to pay Rs. 18,24,000/- with interest @ 9% p.a., from the date of accident i.e., 19.5.2010 till the date of realization besides hire charges of Rs. 7,000/- together with compensation of Rs. 10,000/- towards mental agony and costs of Rs. 10,000/-. The insurance company is directed to take possession of wreckage in view of the fact that the claim is settled on total loss basis. Time for compliance four weeks. The complaint against Op2 is dismissed however without costs.
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
APPENDIX OF EVIDENCE
WITNESSES EXAMINED FOR
COMPLAINANT: OPPOSITE PARTIES
None None.
Documents marked for complainant:
Ex A-1 Insurance Policy /Certificate for private Package Policy dt : 13.3.2010
Ex A-2 Endorsement Schedule dt : 19.4.2010
Ex A-3 Complainant’s Letter to the Opp.party No.2
Ex A-4 Primary Estimates /Supplementary Estimates from the OP.No.2
Dt : 05-06-2010
Ex A-5 Legal Notice dt : 28.-08-2010
Ex A-6 Reply Legal Notice got issued by the OP No.2 dt 02-09-2010
Ex A-7 Certificate of Incorporation of the complainant dt : 16.5.2005
Ex A-8 FIR No. 90/2010 on the file of Unguturu P.S. dt : 19.5.2010
Ex A-9 Details of Private Car Package Policy
Ex A-10 Registration certificate dt : 26.3.2009
Ex A-11 Hypothecation release letter issued by ICICI Bank dt : 22.4.2009
Ex A-12 Letter Addressed by the 1st OP to the complainant dt: 04-03-2011
Ex A-13 Reply to letter of 1st OP dated : 4.3.2011 got issued by the complainant dt : 10.3.2011
Documents marked for Opposite Parties:
Ex B-1 Certificate of Insurance
Ex B-2 Surveyors / Loss Assessors- Valuers (Engineers)
Ex B-3 Motor Accident report form dt : 19.5.2010
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
02/02/2012
*pnr
UP LOAD – O.K.
