Jammu and Kashmir

Jammu

CC/354/2017

RASHID BEGHUM - Complainant(s)

Versus

BAJAJ ALLIANZ - Opp.Party(s)

ZA MUGHAL

03 Sep 2018

ORDER

DISTRICT    CONSUMER     DISPUTES   REDRESSAL  FORUM, JAMMU

                (Constituted under J&K Consumer Protection Act,1987)

                                                         

 Case File  No                 482/DFJ         

 Date of  Institution   :    19-03-2014

 Date of Decision      :      07-08-2018

 

Rashid Begum,

Wd/O Late Mohd.Sharief,

R/O Buffliaz,Tehsil Surankote,

District Poonch.

                                                                                                                                                Complainant

               V/S

1.The Bajaj Allianz General Insurance Company Ltd.

Near BSF Camp Paloura,Akhnoor Road,Jammu.

2.The Motor Claims Manager,

Bajaj Allianz General Insurance Company Ltd.

Near BSF Camp Paloura,Akhnoor Road,Jammu.

                                                                                                                                                                Opposite parties

 

  CORAM

                  Khalil Choudhary              (Distt.& Sessions Judge)   President

                  Mrs.Vijay Angral                                                            Member

                  Mr.Ghulam Sarwar Chauhan                                        Member

 

In the matter of: Complaint under section 10 of J&K Consumer

                              Protection Act 1987.

 

Mr.Z.A.Mughal,Advocate for complainant, present.

Mr.Sanjay K.Dhar,Advocate for OPs,present.

 

                                                                      ORDER

                                 Grievance of complainant as dicernible from the complaint is that predecessor-in-interest, of complainant, namely;Mohd.Sharief,(i.e.husband of complainant)being registered owner of vehicle bearing registration No.JK12-1962,got the same insured with OPs under policy No.OG-1 3-1204-1803-00003514.According to complainant since the vehicle was hypothecated with J&K Grameen Bank,Buffliaz,as such all the transactions with regard to the renewal of the insurance policy were carried out by the concerned bank itself as and when required. That unfortunately on,08-12-2009 husband of complainant died in a vehicular accident and the complainant had already informed OP regarding death of her husband and also the concerned bank and the insurance policy of the vehicle was renewed by Ops for the year 2013-14 for which a new policy cover note was issued on,13-03-2013.Complainant further submitted that since her husband had died, as such, she had filed a civil suit before the Ld.Court of Sub-Judge,Surankote on,26-11-2011 seeking declaration to the effect of declaring her as the legal heir of the property/vehicle Tipper Model TATA 5K Sub Model 1613 Engine No.109856 Chassis No.104816 and Registration No.JK12-1962 and the suit was numbered as 235/Civil and came to be decided on,05-04-2012 whereby the complainant was declared as legal heir. Submission of complainant is that on,26-07-2013 the vehicle in question met with an accident under the jurisdiction of Police Station Gursai,Tehsil Mendhar District Poonch and consequently the vehicle was totally damaged and in the accident two persons died and both were driver and conductor of the said  vehicle and FIR bearing No.61/2013 was registered with Police Station Gursai.Allegation of complainant is that as the vehicle was a total loss,as such it was brought to Jammu for loss assessment which was carried out by the surveyor of OP Company and it is important to mention here that for the current years insurance policy, the value of the vehicle was fixed at Rs.6,65,906/- and the assessment has been made  and complainant as per policy and being legal heir of Late Mohd.Sharief is entitled to claim the benefit flowing from the insurance of the vehicle in question, but the loss assessed by the surveyor of OPs was not disclosed to her. Complainant further submitted that she had already informed OPs with regard to the death of husband, but no steps have been taken to bring on record the name of complainants as the beneficiary of insurance policy, moreover as per declaration given by Hon’ble Court that complainant is the legal heir of vehicle in question and the information has also been supplied to OP.Since complainant had already submitted her application dated 26-10-2012 for the insurance claim alongwith  Decree and Judgment of the Hon’ble Court, but OPs delayed the claim of complainant as the insurance  of said vehicle would expire on,12-03-2014.Constrained by the act of Ops,complainant served a legal notice to OPs,but OPs failed to give reply of the legal notice and this act of Ops constitutes deficiency in service on the part of Op,hence the present complaint. In the final analysis, complainant prays for indemnification of loss to the tune of Rs.6,65,906/-alongwith interest @ 18% per annum from the date of entitlement and in addition also prays for compensation of Rs.2.50,000/-including litigation charges.

                  On the other hand,OPs filed written version and resisted the complaint on the ground that the contract of insurance under which complainant is seeking relief has been obtained in the name of a dead person,namely,Mohd.Shrief,as such the contract is void ab initio and not enforcecable.Accordingly,complainant cannot seek any benefit under the said policy of insurance. It is submitted that fundamental principle of insurance law is that of utmost good faith and must be observed by the contracting parties but the complainant has obtained the policy in the name of dead person by mis-representation and suppression of material facts, thus it renders the policy vitiated. The fact of matter is that Mohd,.Shrief being registered owner of vehicle bearing registration No.JK-12-1962 has admittedly died on,08-12-2009 but this material fact was not disclosed by the complainant or any person or the financier bank at any point of time while obtaining the subject policy or previous policies after the death of her husband (owner of the vehicle).The respondent being insurer without knowing about the death of owner of vehicle made the insurance coverage in a bonafide manner and in good faith in the name of deceased.Mohd.Sharief.The Ops further submitted that complaint is not maintainable and deserve out right dismissal in view of the fact that the claim of complainant has been bonafidely repudiated by OP after thorough investigation and proper application of mind in accordance with the provisions of law,terms,conditions,warranties,exclusions,clauses and endorsements contained in the policy schedule and attached thereto especially condition No.10 and law. The condition No.10 is reproduced as under:-

                  in the event of the death of the sole insured, this policy will not immediately lapse but will remain valid for a period of three months from the date of death of insured or until the expiry of this policy(whichever is earlier).During the said period, legal heirs of the insured to whom the custody and use of the motor vehicle passes may apply to have this policy transferred to the name/s of the heirs or obtain a new insurance policy for the motor vehicle.

 Where such legal heir/s desire to apply for a transfer of this policy or obtain a new policy for the vehicle such heirs should make an application to the Company accordingly within the aforesaid period. All such applications should be accompanied by:-

1. Death certificate in respect of the insured.
2. Proof of title to the vehicle
3. Original Policy.

It is apt to mention here that since the owner of subject on 08-12-2009 but the complainant or any other person or the bank with which vehicle is under hypothecation did not disclose this fact at any point of time to OP while obtaining the policies from year to year in the name of dead person and apparently the material facts relating to death of owner of vehicle have been withheld and suppressed.The complainant neither sought the transfer of policy in her name nor applied for obtaining a fresh policy as per mandate of condition No.10 of the policy, thus claim as raised by her is not payable in any manner. That otherwise also the complainant has no “insurable interest “left in the subject matter of Insurance in order to raise the claim under the contract of insurance, in view of the admitted facts that the subject vehicle No.JK-12-1962 was sold by the complainant Rashid Begum to one Shakeel Khan S/O Mohd.Bashir Khan R/O Village Buffliaz Tehsil Surankote under a duly executed & attested Sale Deed dated 26-06-2012 after the possession of the same was handedover/delivered to said Shakeel Khan against the consideration of Rs.;7,60,000/-.The Motor Insurance Claim Form submitted before OP also signed by transferee Shakeel Khan substantiates the fact of sale and purchase of said vehicle.Moreover the Policy of insurance was not got renovated by the transferee as per mandate of Section 157 of the M.V.Act,1988 and Gr.17 of IMT,thus the insurance interest of the complainant/transferor does not existed as on date of loss and also the transferee/purchaser of said vehicle has no privities of contract with the OP Insurance Company to maintain the claim for damages caused to the said vehicle.That the complaint is bad for mis-joinder and non-joinder of necessary party for the reason that the financer of subject vehicle J&K Grameen Bank has not been arrayed as party. Rest of contents are denied.

                 Complainant adduced evidence by way of duly sworn evidence affidavit and affidavits of Amjad Khan, Usman Khan and Shehraz Ahmed.Complainant has placed on record copy of route permit, copy of policy, copy of FIR, copy of death certificate and copy of Driving licence.Complainant has placed on record copy of death certificate, copy of judgment, copy policy schedule, copies of communications and copies of estimates.

               On the other hand,Ops adduced evidence by way of duly sworn evidence affidavits of Rajesh Kumar In-house Surveyor and Loss assessor and Shesho Tickoo,Branch Head Bajaj Allianz General Insurance Co,Ltd.respectively.Ops have placed on record copy of sale deed, copy of death certificate, copy of Motor Insurance Claim Form, copy of claim Discharge cum Satisfaction Voucher, copy of final survey report, copies of communications exchanged between the parties and     policy.           

                We have perused case file and heard L/Cs for the parties at length.

                 Now the point for consideration is that whether the complainant is seeking relief has been obtained in the name of a dead person,namely,Mohd.Sharief,as such, contract is void ab initio and not enforceable or not?

                         It has been revealed from the death certificate that the deceased was died on,08-12-2009 and it was also revealed from the certificate cum policy schedule that the policy was effective from 13-03-2013 to 12-03-2014  and the same policy was effective from 2009 to 2013 and the insurer also received premium for the same. The deceased also obtained loan from the J&K Grameen Bank Buffliaz,Poonch.Complainant stated in her evidence affidavit that her husband was owner of the vehicle in question bearing registration No.JK-12-1962 stood insured with the OP Insurance Company under Policy No. OG-1 3-1204-1803-00003514.Since abovesaid vehicle was hypothecated with J&K Grameen Bank Buffliaz Poonch,as such, all the  transactions with regard to renewal of the policy were carried out by the concerned bank itself as and when required. The husband of complainant died on,08-12-2009 in a vehicular accident which is revealed from the death certificate issued by S.H.O.Police Station Surankote.She further deposed that she had already informed Insurance Company regarding death of her husband and also the concerned bank. The insurance policy of the vehicle was renewed by OP/Insurance Company for the year 2013-14.The insurance policy was renewed on,13-03-2013 for which a new policy cover note was issued on,13-03-2013.The vehicle in question met with an accident on,26-07-2013 under the jurisdiction of Police Station,Gursai and consequently the vehicle was totally damaged. Later on, vehicle was brought to Jammu for the loss assessment which was carried out by the surveyor of the Insurance Company.

        The witnesses of complainant,namely, Amjad Khan, Usman Khan and Shehraz Ahmed,respectively also deposed in their evidence affidavit that the deceased husband of Rashid Begum was the owner of a vehicle bearing registration No.JK12 1962 which stood insured with OP Insurance Company .The complainant is an illiterate lady. That unfortunately in 2009,husband of complainant died in a vehicular accident.

                      It is thus clear that whether intimation is given or not given to the Insurance Company with regard to the death of deceased to OP/Insurance Company. The Insurance Company at the time when it renewed the policy of insurance and accepted the premium should have verified whether Mohd.Sharief was alive or not. It is in the present case premium appears to have been paid by the bank with which the vehicle was hypothecated.

            On the other hand,L/C for OP submitted that complainant is seeking relief has been obtained in the name of a dead person,namely,Mohd.Sharief,as such, the contract is void ab initio and not enforceable.Accordingly,complainant cannot seek any benefit under the said policy of insurance.L/C for complainant submitted that a certificate of insurance having been issued by the Insurance Company, it could not have repudiated the claim having already accepted the amount of premium.

                Motor Vehicles Act,1988 was enacted to consolidate and amend the law relating to motor vehicles. Chapter XI of the Motor Vehicles Act provides for insurance of motor vehicles. Section 145 is the definition section, clause(b)whereof defines ‘certificate of insurance’ to mean a certificate issued by an authorized insurer in pursuance of sub-section (3)of Section 147 and includes a cover note complying with such requirements as may be prescribed, and where more than one certificate has been issued in connection with a policy, or where a copy of a certificate has been issued, all those certificates or that copy, as the case may be. Clause (d) of Section 145 defines ‘policy of insurance ‘which include a certificate of insurance.

        Section 146 mandates that no person, except as a passenger, shall use or cause or allow any other person to use, a motor vehicle in a public place, unless there is enforce in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of the said Chapter. Section 147 provides for the requirements of policies and limits of liability in the following terms:

        “(a) is issued by a person who is any authorized insurer; or

          (b) insurer the person or classes of persons specified in the policy to the extent specified in sub section (2).”

           The insurer could deny its liability on limited grounds as envisaged under sub-section (2) of Section 149 of the Act. One of the grounds which is available to the Insurance Company for denying its statutory liability is that the policy is void having been obtained by reason of non-disclosure of a material fact or by a representation of fact which was false in some material particular.

                Indisputeably,apart from raising a general and vague plea of fraud, no particulars thereof had been disclosed. The contract of insurance was entered into by the bank with the OP Company. The premium was paid by the bank. The contract of insurance might have been drawn in the name of the deceased Mohd.Sharief,but no witness has been examined on behalf of OP alleging that they were not aware thereabout. It has been revealed from the policy that the insurance policy was an old one and it had been renewed from year to year. If Insurance Company had been renewing the insurance policy on year to year basis on receipt of a heavy amount of premium with the knowledge that the owner of the vehicle has expired and the name of his legal heirs and representatives had not been transferred in the registration book maintained by the authorities under the Motor Vehicles Act, in our opinion,OP cannot be heard to say that it was not bound to satisfy the claim of complainant.

                   The provisions of compulsory insurance have been framed to advance a social object. It is in a way part of the social justice doctrine. When a certificate of insurance is issued, in law, the insurance company is bound to reimburse the insured amount.

               Section 146 provides for statutory insurance. An insurance is mandatorily required to be obtained by the person in charge of or in possession of vehicle. There is no provision in the Motor Vehicles Act that unless the name of the heirs of the owner of a vehicle is substituted on the certificate of insurance or in the certificate of registration in place of the original owner(deceased),the motor vehicle cannot be allowed to be used in public place. Thus in the case where the owner of motor vehicle has expired, although there does not exist any statutory interdict for the person in possession of the vehicle to ply the same on the road, but there being a statutory injunction that the same cannot be plied unless a policy of insurance is obtained, we are of the opinion that the contract of insurance would be enforceable. It would be so in a case of this nature as for the purpose of renewal of insurance policy only the premium is to be paid. It is not in dispute that quantum of premium paid for renewal of the policy is in terms of the provisions of Insurance Act,1938.

                The vehicle was hypothecated with J&K Grameen Bank Buffliaz,Poonch.The certificate of registration presumably,therefore,name of bank is also mentioned in the Certificate cum Policy Schedule. The bank admittedly paid the premium.We,therefore,failed to see any reason as to how,OP could avoid its statutory liability.

                   Here we would like to refer to the judgment of Hon’ble Supreme Court of India in case titled United India Insurance Co.Ltd. V/S Santro Devi & Ors.,wherein their lordships has been pleased to hold as:

            “(B) Motor Vehicles Act,1988—Chapter XI—Section 149(2)—Motor Vehicles—Accident Claim—Insurer’s Liability—Statutory grounds for denial of liability—Insurer has very limited grounds for denying its liability—One of them is that, the policy is void, being obtained by reason of non-disclosure of a  material fact or by a representation of fact which was false in some material particular—In this case, a part from raising a general and vague plea of fraud, no particulars thereof had been disclosed—Contract of insurance was entered with by Bank with appellant—Premium was paid by Bank—Contract might have been drawn in the name of deceased/owner of hypothecated vehicle, but, no evidence, that appellant were not aware thereabout—Policy was renewed from time to time, with heavy premium, having knowledge about death of insured/owner and that, names of his legal heirs were not transferred in Registration Book—Appellant’s cannot allowed to deny their liability to satisfy claim of third party.”

       L/C for OP also stated at bar that instant complaint is not maintainable as the complainant Rashid Begum sold the vehicle in question to one Shakeel Khan under duly executed and attested sale deed dated 26-06-2012.Now issue involved in the present case is whether insurance company is liable to pay assessed amount once vehicle was sold, but not transferred in the record of RTO as per Motor Vehicles Act.

             Witnesses of complainant,namely,Amjad Khan,Usman Khan and Shehraz Khan,respectively,stated in one voice that they knew the deceased Mohd.Sharief and he owned a tipper and the deceased was the husband of complainant. The complainant is an illiterate lady, as such she has given power of attorney for dealing with the affairs relating to the vehicle to her nephew,namely,Shakeel Khan D/O Mohd.Bashir.That on ,26-07-2013 vehicle met with an accident under the jurisdiction of Police Station Gursai and consequently, the vehicle was totally damaged.Rashid Begum deposed in her additional evidence affidavit that the complaint is pending before this Forum and she has filed her evidence earlier, but in view of objections filed by OP,additional evidence is required. The OP placed on record copy of sale agreement dated 26-06-2012 between the complainant and one Shakeel Khan and same is denied by her categorically. The complainant also executed Deed of Cancellation dated 26-04-2016 whereby alleged sale agreement dated.26-06-2012 stood registered before Public Notary Surankote.She is owner of vehicle No.JK12-1962.It has been revealed from the Deed of Cancellation between Rashid Begum and Shakeel Khan that the said agreement was executed between the parties, but the complainant was not first part party i.e. complainant was not intimated about the agreement to sell. Both the parties wanted to register the General Power of Attorney, but due to lack of communication between counsel and parties, the agreement to sell registered instead of power of attorney. That the agreement to sell has been registered on,26-06-2012 is void,ab initio.It has been revealed from the aforesaid that the sale of vehicle was not transferred in the name of Shakeel Khan  from the RTO Office. The Op also not produced any proof or evidence in support of their version that the vehicle was transferred in the name of said Shakeel Khan.The OP also not proved that the possession of vehicle was handed over to said person. The submission made by L/C appearing on behalf of OP that on the date of accident vehicle was sold in the name of Shakeel Khan ,therefore, Insurance Company are not liable to indemnify the insured, though insurance policy was well in force is not acceptable and the Insurance Company with whom the said vehicle is also insured is also liable to indemnify and on the date of accident, the vehicle was not transferred and registered in the name of Shakeel Khan as per registration certificate issued by concerned ARTO .

                 

                                   It is needful to recall the judgment of Hon’ble Supreme Court passed Oriental Insurance Company Ltd.V/S M/S Ozma Shipping Co.and Anr.2010 AIR SCW 514;

Before parting with this case we would like to observe that the insurance companies in genuine and bona fide claims of the insured should not adopt the attitude of avoiding payments on one pretext or the other. This attitude puts a serious question mark on their credibility and trustworthiness of the insurance companies. Incidentally by adopting honest approach and attitude the insurance companies would be able to save enormous litigation costs and the interest liability.

                       Admittedly, surveyor was deputed by OP, who assessed the loss. Surveyor report dated 01-10-2013 is on record, whereby total loss assessed by the surveyor to the tune of Rs.3,75,472/-as net assessed amount (Parts Labour) and same has not been disputed by the complainant, hence loss assessed by the surveyor is only available reasonable basis and documentary, evidence for the loss suffered by the complainant.

                     Therefore in view of the aforesaid discussion and after pursuing the record of the case, complaint filed by the complainant is accordingly allowed and we direct the OP.to pay Rs.3,75,472/-alongwith interest @ 7% p.a.,w.e.f.01-12-2013 (i.e.two months after surveyor report), till its realization. The complainant is also entitled to Rs.10,000/-as compensation for causing mental agony and harassment and litigation charges of Rs.10,000/-.This order shall be complied with by OP within one month from date of receipt of this order. Copy of this order be provided to the parties free of charge. Complaint is accordingly disposed of and file be consigned to records after its due compilation.

Order per President                                              Khalil Choudhary

Announced                                                        (Distt.& Sessions Judge)

07-08-2018                                                               President

                                                                            District Consumer Forum

Agreed by                                                                 Jammu.

                                                                                

Ms.Vijay Angral          

Member

                                                                                              

Mr.Ghulam Sarwar Chauhan,

Member