CONSUMER DISPUTES REDRESSAL FORUM – X
GOVERNMENT OF N.C.T. OF DELHI
Udyog Sadan, C – 22 & 23, Institutional Area
(Behind Qutub Hotel)
New Delhi – 110 016
Case No.17/2011
M/S ADDI INDUSTRIES LIMITED,
B-44, MAHARANI BAGH, NEW DELHI
REGD. & CORP. OFFICE:
A-106, SECTOR-IV, NOIDA-201301(U.P.)
THROUGH ITS MANAGER-FINANCE
…………. COMPLAINANT
Vs.
M/S BAJAJ ALLIANZ GENERAL
INSURANCE COMPANY LIMITED,
6TH FLOOR, 93, ASHOKA BHAWAN,
NEHRU PLACE, NEW DELHI-110019
THROUGH ITS BRANCH MANAGER
…………..RESPONDENT
AND
Case No.18/2011
M/S ADDI INDUSTRIES LIMITED,
B-44, MAHARANI BAGH, NEW DELHI
REGD. & CORP. OFFICE:
A-106, SECTOR-IV, NOIDA-201301(U.P.)
THROUGH ITS MANAGER-FINANCE
…………. COMPLAINANT
Vs.
M/S BAJAJ ALLIANZ GENERAL
INSURANCE COMPANY LIMITED,
6TH FLOOR, 93, ASHOKA BHAWAN,
NEHRU PLACE, NEW DELHI-110006
THROUGH ITS BRANCH MANAGER
…………..RESPONDENT
Date of Order: 17.05.2016
O R D E R
A.S. Yadav – President
By this order we shall dispose of the aforesaid complaints as the common question of fact and law is involved. For the sake of reference, facts of case no.17/2011 are detailed.
The complainant company is owner of a Volkswagen Jetta car and the said car was duly insured with OP for an IDV of Rs.11,13,195/- for the period 31.07.2010 to 30.07.2011. On 11.08.2010 at Noida there was heavy water logging. The said car was parked within the factory premises of the company. The driver drove that car and when the car reached the main gate it stopped. Later on the above said car was given a push by two three persons and it got started and reached at the home of the officer of the company at Delhi. Next day in the morning when the car was started by the driver, he observed an abnormal sound from its engine. Immediately the car was sent to workshop and OP was also informed. OP appointed a surveyor. The repairer raised a provisional bill of Rs.1,31,068/- and complainant paid a sum of Rs.65,500/- under protest as the amount was not paid by OP. The service centre raised a final bill for Rs.1,90,603/-. OP sent a cheque for a sum of Rs.12,953/- only as against Rs.1,90,603/-. It is stated that it is a clear cut case of deficiency in service on the part of OP. It is prayed that OP be directed to pay amount of Rs.1,90,603/- towards cost of repairs alongwith interest @ 18% p.a. and also to pay Rs.50,000/- as compensation and Rs.20,000/- as litigation expenses.
OP in the reply took the plea that insured vehicle was used for commercial purposes and accordingly complainant is not a consumer. Moreover, the loss is on account of water entering in the engine compartment. There is no external impact either to the vehicle or to the engine from outside. There can be no impact to the engine merely coming into contact with water. Damage if any can be attributed to either mechanical failure or tying to run the engine when it was still in contract with water. When the vehicle stops on the water logged road effort to start the vehicle is the well known source to cause damage to engine. The obvious course known is not to start the engine without cleaning the water from inside engine and inspection by expert technician. Accordingly damage to the engine is not as per condition No.4 of policy contract. Therefore the liability of respondent is only restricted to flushing of engine and the cleaning of vehicle. The claimant has been so advised vide letter dated 25.08.10. Accordingly the claim has been rightly processed and paid to complainant and is not maintainable under the Consumer Protection Act.
In the rejoinder complainant stated that OP has taken the shelter of condition no.4 of policy contract which is neither a part of the contract of insurance nor disclosed to complainant at any point of time and cannot claim the benefit of the said condition no.4/exclusion clause. More so, OP has not even filed the said alleged condition No.4 i.e. the exclusion clause of the policy terms and conditions before this Forum.
We have gone through written submission of the parties and carefully perused the record.
So far as the use of the vehicle for commercial purposes is concerned, complainant is a consumer. Reference is placed on case of M/s Harsolia Motors Vs M/s National Insurance Co. Ltd. First Appeal No.159 of 2004 dated 03.12.2004 where it was held that if a person takes insurance policy to cover envisaged risk, he does not take the policy for commercial purpose. The policy is only for indemnification of the actual loss. It is not intended to generate profit.
Ld. Counsel for complainant submitted that in fact the clause 4 of the policy was never brought to the notice of complainant nor the same was ever supplied. In fact OP has till date not filed clause 4 of the policy on the record. OP has only filed cover note on record. Ld. Counsel for complainant has referred to the case of M/s Modern Insulators Ltd. Vs Oriental Insurance Co. Ltd. 1(2000) CPJ 1(SC) where Hon’ble Supreme Court held that the insured was only supplied with a cover note and the terms and conditions containing the exclusion clause were never communicated to it. The said exclusion clause runs as follows:-
“In the case of second hand/used property the insurance hereunder shall however, cease immediately on the commencement of the test”
The Hon’ble Supreme Court further held that the as the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant, respondent cannot claim the benefit of the said exclusion clause.
Ld. Counsel for complainant has also referred to the case of Reliance General Ins. Co. Ltd. Vs Dr. Anish Sebastian – 111(2015) CPJ 644(NC) - In that case it was argued that damages are not the direct damages, but only consequential damages, not covered under the purview of the policy. The investigation conducted by the Insurance Company revealed that the vehicle fell in a gutter full of water, due to which the water entered into the engine, the vehicle stopped there. The vehicle was restarted and run resulting in engine damage.
Clause 4 of the terms and conditions of the policy reads that the insured may authorize the repair of the vehicle necessitated by damage for which the company may be liable under this policy provided that:-
- …..
- ……
- …….
Further the general exceptions provided that even after any accidental loss or damage to any property whatsoever or any loss or expenses whatsoever resulting or arising there from or any consequential loss.
It was held that even if ”consequential damage” in this case is taken to be the allegation that the respondent restarted the vehicle and ran it after the initial damage resulting in water entering the engine and damaging the same, the petitioner has not given any evidence to support its case. As per the version of the respondent the car did not restart. Any normal person, stuck in water and with the water entering the car, would make an attempt to restart the car and drive out of the water. This cannot be termed as ‘negligence of the driver’ resulting in ‘consequential damage’.
So there is no question of terming the damage as consequential.
In view of the law discussed above, it is a clear cut case of deficiency in service on the part of OP in both the above said cases as damage was caused in the engine on account of entering of rain water in the engine and the claim in both the cases has been repudiated by resorting to clause 4.
In case No.17/2011, OP is directed to refund the amount of Rs.1,87,650 /- to complainant alongwith 9% interest p.a. from the date of filing of the complaint plus Rs.5,000/- towards compensation and Rs.5,000/- towards litigation expenses.
In case No.18/2011, OP is directed to refund the amount of Rs.2,55,816/- to complainant alongwith 9% interest p.a. from the date of filing of the complaint plus Rs.5,000/- towards compensation and Rs.5,000/- towards litigation expenses.
Let the order be complied with within one month of the receipt thereof. The complaint stands disposed of accordingly.
Copy of order be sent to the parties, free of cost, and thereafter file be consigned to record room.
(D.R.TAMTA) (A.S. YADAV)
MEMBER PRESIDENT
