CONSUMER DISPUTES REDRESSAL FORUM

Palakkad, Kerala

Dated this the 30^th day of August 2013

Present: Smt. Seena.H, President

: Smt. Preetha. G. Nair, Member

: Smt. Bhanumathi A.K, Member Date of filing: 12/02/2013

CC / 40 / 2013

Premanand. G,

S/o. V.K. Govindan,

r/a “Sreenandhanam”, Harishankar Road,

Tharekkadu, Palakkad. - Complainant

(By Adv. Ullas Sudhakaran)

Vs

1. The Divisional Manager,

United India Insurance Co. Ltd.,

Divisional Office, Malabar Fort,

G.B. Road, Palakkad. - 1^st Opposite party

(By Adv. Lekshmi Narayanan)

2. The Manager,

Mahindra & Mahindra Financial Services Ltd.,

2^nd Floor, T.M. Complex, Chandranagar,

Palakkad. - 2^nd Opposite party

(By Adv. Viju.K.Raphel)

O R D E R

By Smt. Preetha.G.Nair, Member

Complainant is the registered owner of an Indigo CS ELX Model motor car manufactured by TATA Motors, was insured by the 1^st opposite party and hypothecated to 2^nd opposite party. Policy availed by the complainant for his car from the 1^st opposite party is a Comprehensive Insurance Coverage Policy and the same was issued for the period 28/09/2011 to 27/09/2012. The 1^st opposite party was collected an amount of Rs. 10,744/- from the complainant towards premium. The vehicle met with an accident on 18/04/2012 and it was totally damaged. The complainant intimated to both the opposite parties and he had preferred a claim before the 1^st opposite party. The Surveyor appointed by 1^st opposite party had inspected the vehicle and assessed the damages as total loss. The Surveyor assessed the loss based on the IDV of the vehicle as per the policy as Rs. 4,17,466/- and after deducting the wreck value of Rs. 75,000/-. The amount receivable by the complainant under the comprehensive coverage is Rs. 3,42,466/-. Considering the payments made by the complainant to 2^nd opposite party towards the loan and based on mediation a one time settlement was arrived between them and the above fact was intimated to 1^st opposite party with a direction given to 1^st opposite party to release an amount of Rs. 2,50,000/- to 2^nd opposite party out of the amount of Rs. 3,42,466/- receivable by the complainant. The balance amount of Rs. 92,466/- will be paid to the complainant.

The 1^st opposite party informed the complainant that his claim would processed without any delay and he would be intimated for receiving the cheque for the claim amount. Complainant patiently waited for the intimation from the 1^st opposite party and when the same was getting inordinately delayed he visited the 1^st opposite party's office for ascertaining the status of his claim and he was shocked to find out that the cheque for the entire claim amount stands issued to 2^nd opposite party without intimating him. When questioned about the same the 1^st opposite party had informed the complainant that the cheque for the entire amount was issued to 2^nd opposite party due to oversight and directed him to approach 2^nd opposite party for getting back the amount receivable by the complainant. Then 2^nd opposite party was informed that they would not issue the cheque to the complainant and they would issue the cheque to 1^st opposite party. Thereafter complainant issued a lawyer notice to 1^st opposite party. And the 1^st opposite party had sent a reply stating false contentions one of the contention raised by 1^st opposite party that the entire amount was released to 2^nd opposite party based on an undertaking from them that they would appropriate only an amount of Rs. 2,72,668/- towards loan closing amount and the balance of Rs. 69,798/- will be released by 2^nd opposite party to the complainant on confirmation from 1^st opposite party regarding receipt of R.T.O's proceedings with respect to cancellation of Registration Certificate.

Then complainant approached the concerned R.T.O requesting for initiation of proceedings for cancellation of Registration Certificate and he was informed by the R.T.O that the Registration Certificate would be cancelled only production of NOC from 2^nd opposite party. Complainant had then approached the 2^nd opposite party requesting for issuance of NOC and the 2^nd opposite party demanded signing of blank papers supplied by 2^nd opposite party for issuance of NOC. Complainant was aware that if he sign blank forms as directed by 2^nd opposite party the same would be misused and he would not get the actual amount. Hence complainant refused to sign the blank forms and 2^nd opposite party refused to hand over the NOC to the complainant. The complainant sent lawyer notice to 2^nd opposite party and they had sent reply notice stating false contentions. The act of opposite parties amounts to clear deficiency of service. Hence the complainant prays an order directing

1. the opposite parties to issue the NOC and pay Rs. 92,466/- along with interest at the rate of 12% from 11/10/2012 till the date of payment.

2. Pay Rs. 50,000/- as compensation for mental agony.

3. Cost of the proceedings.

Opposite parties filed version stating the following contentions. It is admitted that the complainant's vehicle met with an accident and the matter was reported to the company. The 1^st opposite party arranged survey of the same and the total loss of the car was assessed as 4,17,466/- and out of which Rs. 75,000/- deducted towards the wreck value. The balance amount of Rs. 3,42,466/- as the damages payable to the complainant. Since the vehicle was hypothicated with 2^nd opposite party, the 1^st opposite party is bound to pay the amount under the contract of insurance to 2^nd opposite party only. Since the claim was treated as total loss the complainant was directed to cancel the RC in respect of the vehicle and the same may be produced before the company. The financier has issued a letter to the company stating that their actual due is Rs. 2,72,668/- and they will return the balance amount to the complainant on getting permission from the insurance company. The 2^nd opposite party has informed the complainant that NOC is ready with them and he has been requested to collect the same and do the needful for cancellation. The company has obtained permission and indemnity letter from the complainant to transfer the amount to the account of the financier. The company has forwarded the amount to the financier as per the terms and conditions in the policy and the financier is holding the balance amount due to the complainant. The amount will be disbursed to the complainant on production of cancellation of the Registration Certificate. So far the complainant has not produced the cancellation proceedings and as per the information received from the 2^nd opposite party not claimed the NOC.

The 2^nd opposite party stated that the complainant has availed a loan from them for purchasing a Tata Indigo car for an amount of Rs. 5,22,000/- including finance charges. The loan amount was agreed to be repaid on 36 monthly instalments of Rs. 14,000/- on the 15^th day of every month and the date of last instalment was on 15/8/2013.

It is true that the complainant informed the accident of the vehicle. The allegation of the complainant about the one time settlement of Rs. 2,50,000/- is not correct and hence denied. As per the account, at the time of payment of amount by 1^st opposite party to them, there was an outstanding balance of Rs. 2,75,676/ due from the complainant. It is true that the 1^st opposite party has released an amount of Rs.3,42,466/- as per the terms of the agreement as well as on the undertaking given to 1^st opposite party that they will release balance amount provided the complainant furnished Registration Certificate cancellation report from the RTO office. The complainant was only directed to comply with certain official formalities for which he was not ready and willing. It is admitted that the complainant had approached the branch office of 2^nd opposite party for collecting the NOC. Since the NOC was kept in the Regional office, they requested the complainant to collect the NOC from the branch office on the next day. The 2^nd opposite party has also requested the complainant to sign bank mandate form which is a pre requisite for fund transfer from the bank account of 2^nd opposite party. The same was done in order to transfer the balance amount of Rs. 66,790/- to the account of complainant after getting RC cancellation report from the R.T.O. Even in the reply notice issued to the counsel of complainant, it was categorically stated that the NOC was ready with the branch office of 2^nd opposite party and the cheque for an amount of Rs. 66,790/- was also ready. There is no deficiency in service on the part of opposite parties. It is the complainant who is deliberately delaying the submission of the Registration Certificate cancellation report thereby delaying the payment of balance amount of Rs. 66,790/-. Hence they prayed that the complaint may be dismissed with cost.

Both parties filed their affidavit. Ext.A1 to Ext.A5 marked on the side of complainant. Ext.B1 to Ext.B7 marked on the side of opposite parties. Complainant and 2^nd opposite party was examined as PW1 and DW1. Argument notes filed.

Issues to be considered are

1. Whether there is any deficiency in service on the part of opposite parties?

2. If so, what is the relief and cost?

Issue I & II

We perused relevant documents on record and heard from both parties. The allegation of the complainant is that an amount of Rs. 2,50,000/- was arrived at between 2^nd opposite party as a result of mediation and one time settlement. No documentary evidence produced by the complainant to show that one time settlement was offered by 2^nd opposite party. In Ext.B3 the complainant stated that "I am agreeable for releasing an amount of Rs. 2,50,000/- in favour of the Financiers as initial payment to enable me to cancel the Registration Certificate". The 1^st opposite party argued that in Ext.B3 the complainant had mentioned that Rs. 2,50,000/- as initial payment for releasing to 2^nd opposite party and not stated the full and final payment. In Ext.B3, the complainant has signed and the opposite parties had not signed. So we cannot considered as execution of Ext.B3 was the result of mediation and one time settlement. As per the B4 agreement the EMI would start from 15/9/2010 and will end at 15/8/2013. In Ext. B6 the account statement shown that the total number of the EMI paid by the complainant is only 18 and the total amount paid to the loan account is only Rs. 2,61,000/-. The complainant stated that he has paid 19 instalments. On verification of Ext.B6 complainant has paid 14,500/- in 17 instalments and Rs. 13,500/- and Rs. 1,000 paid on two instalments. The complainant has not produced documents to show that 19 instalments paid by him to opposite parties. There was no dispute regarding the date of accident on 18/4/2012 and the total claim amount of Rs.3,42,466/- . The complainant has not paid the loan amount after 18/4/2012. The complainant has paid some instalments not on the due date and the 2^nd opposite party is liable to claim the penal interest amount on that period. Opposite parties had admitted that the complainant has intimated the accident and the Surveyor was appointed for the assessment of loss. In Ext.B1 the 1^st opposite party informed the complainant that the claim was settled on total basis for an amount of Rs. 3,42,466/- subject to cancellation of RC on 17/10/2012. The 2^nd opposite party has collected Rs. 8,246/- (2788 + 2259 + 1716 + 1040 + 443) from 15/4/2012 to 15/9/2012 as penal interest. Admittedly the vehicle of the complainant met with an accident on 18/4/2012 and the claim settled on October 2012. In the interest of justice the penal interest of that period shall be excluded. In Ext.B1(a) the 1^st opposite party has sent registered letter to the complainant dated 17/10/2012 and the letter returned with endorsement that "unclaimed". In Ext. B6 the 2^nd opposite party mentioned that the amount received on preclousure dated 12/10/2012 was Rs. 3,42,466/-. In Ext.B1 the letter sent by 1^st opposite party to complainant stated that the policy issuing office has settled the claim for Rs. 3,42,466/- and the amount has been credited to the account of M/s Mahindra Finance on 11/10/2012. The counsel of 1^st opposite party argued that intimation was given to the complainant before the payment of claim amount to the 2^nd opposite party and it was returned with unclaimed. The date of the postal receipt of the letter was on 17/10/2012. But the 1^st opposite party has not produced evidence to show that they had given intimation to the complainant before payment.

According to the complainant at the time of requesting for issuance of NOC the 2^nd opposite party demanded signing of blank papers supplied by them. The 2^nd opposite party stated that the NOC was kept at the Regional Office of them and requested the complainant to collect the same from the branch office which he does not do. In Ext. B7 dated 1/11/2012 shown that the 2^nd opposite party sent a letter to the R.T.O stated that they had no objection of name transfer and cancellation of HP endorsement.

In Ext. B3 the consent letter given by the complainant dated 14/9/2012 to the 1^st opposite party stated that he had not interested in repairing the vehicle and hence requesting for settlement of the claim on total loss basis. According to 1^st opposite party the company has obtained permission and indemnity letter from the complainant to transfer the amount in to the account of the financier. In Ext.B1 letter shown that the 1^st opposite party has credited the claim amount to 2^nd opposite party on 11/10/2012. According to 2^nd opposite party it is the complainant who is duty bound to produce the Registration certificate cancellation report to the 1^st opposite party as stipulated in Section 55 of the Motor Vehicle Act.

In the above discussions we are of the view that there is deficiency in service on the part of opposite parties.

In the result complaint allowed. We order the following:-

1). Directed the 2^nd opposite party to issue the NOC to complainant within 10 days

2). Directed the 2^nd opposite party to pay the complainant an amount of Rs. 75,036/- as the claim amount (Rs.66,790 + 8,246= Rs. 75,036 (Rs. 66,790/- as the balance amount and Rs. 8,246/- as the penal interest )).

3). Also directed both opposite parties jointly and severally liable to pay Rs.10,000/- as compensation for deficiency in service along with pay Rs. 1,000/- as cost of the proceedings. The odered amount shall be paid after receiving the Registration Certificate cancellation of HP endorsement.

Order shall be complied within one month from the date of receipt of order, failing which the complainant is entitled for 9% interest per annum for the whole amount from the date of order till realization.

Pronounced in the open court on this the 30^th day of August, 2013

Sd/-

Smt. Seena.H

President Sd/-

Smt. Preetha. G. Nair

Member

Sd/- Smt.Bhanumathi.A.K

Member

A P P E N D I X

Exhibits marked on the side of complainant

Ext.A1 - Copy of Certificate Cum Policy Schedule issued by the opposite parties to the complainant.

Ext.A2 Series - Copy of Lawyer Notice with Acknowledgement Card and Postal receipt sent by the complainant to the 1^st opposite party dated 25/10/2012.

Ext.A3 - Reply Lawyer Notice sent by the opposite parties to complainant dated 5/11/2012.

Ext.A4 - Copy of Lawyer Notice sent by the complainant to 2^nd opposite party dated 21/11/2012.

Ext.A5- Copy of Reply Notice sent by the 2^nd opposite party with reference to complainant's Lawyer notice.

Exhibits marked on the side of opposite parties

Ext.B1 - Copy of Letter issued by the 1^st opposite party to complainant dated 17/10/12

Ext.B1(a)- Letter with acknowledgement card and postal receipt sent by the 1^st opposite party to the complainant.

Ext.B2 - Letter (original) issued by the 2^nd opposite party to 1^st opposite party dated 5/10/2012.

Ext.B3 - Consent Letter (original) issued by the complainant dated 14/9/2012.

Ext.B4 - Personal Loan Agreement (original) issued by the 2^nd opposite party to the complainant

Ext.B5 - Copy of Power of Attorney issued by the 2^nd opposite party.

Ext.B6 - Copy of Ledger kept by the 2^nd opposite party in the name of complainant.

Ext.B7 - Letter (original) issued by the 2^nd opposite party to the R.T.O, Palakkad dated 1/11/2012.

Witness examined on the side of the complainant

PW1 - Premanand. G

Witness examined on the side of the opposite parties

DW1 - Prateesh. A.C

Cost allowed

Rs. 1,000/- (Rupees One thousand only) allowed as cost of the proceedings.