BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 09^TH DAY OF MAY 2024

ORDER

SMT.M.SHOBHA, PRESIDENT

1. The complaint has been filed under Section 35 of C.P.Act (hereinafter referred as an Act) against the OP for the following reliefs against the OP:-

1. Direct the OP to pay compensation damages caused on according of deficiency in services in a sum of Rs.14,30,552/- together with currend and future rate of interest thereon at 27% p.a., from 28.04.2023 till the date of reimbursement.
2. Direct the OP to pay a sum of Rs.1,00,000/- towards damages for the mental agony, trauma and hardship caused to the complainant.
3. Direct the OP to pay cost of issuance of notice of Rs.25,000/- and the cost of litigation of Rs.50,000/- as also such other costs and consequential reliefs.
4. To pass any such orders as this Hon’ble Commission deems fit.

2. The case set up by the complainant in brief is as under:-

The complainant purchased BMW model 520D lexury line sedan bearing Reg. No.KA 51 MHG 6300 for his personal use in the name of his firm of which he was the partner. He has valid driving licence with an expiry date of 15.07.2028.  The vehicle was under the cover of policy titled under private car package policy and issued to the complainant on 28.10.2022.  The complainant has paid premium of Rs.83,663/- and the policy was inforce from 28.10.2022 to midnight of 27.10.2023.  The OP had issued the policy after inspection of the vehicle and after thorough inspection the policy document was shared with the complainant and the proposal was shared and the premium was paid accordingly.  

3. The insured car damaged due to flooding of water into the car on the afternoon of November 24^th, 2022 and the car was towed to the service station at Navaneeth Motors, near Electronic city, Bangalore for undertaking repairs. The insurance has a special coverage for engine damage as per the policy documents.
4. It is further case of the complainant that he has received proforma invoice on 24.11.2022 from Navaneeth Motors estimating the cost of repairs Rs.14,28,308/- and accordingly he has claimed a claim form with the insurance department of the OP in terms of the policy on 26.11.2022 and the OP have registered the claim. After claim was lodged the OP has called upon the complainant for further information and detailed narration of the incident. Accordingly the complainant has provided a detailed hand written note about the incident on 20.12.2022. In addition to this there was various discussion, chats and conversation with the officers of the OP regarding the technical information.  The OPs have also got entire running conditions and the operation report from the technical expert of the Navaneeth Motors.  The report submitted by the Navaneeth Motors the authorized service team has clearly stated that there was no issues with the vehicle till the incident took place on 24.11.2022. The authorized service team of the BMW have provided the OP company officers a detailed explanation regarding the functioning of the vehicle, service details and the error report and explanation of each error report. The OP company officers and surveyors have collected the explanation and technical report from Navaneeth motors. The complainant has also provided details of CCTV footage of the vehicle being used on the date of incident indicating that the said vehicle was in fit and proper running condition before the incident. The complainant has also provided the report from NHAI regarding the fast track information to show that the vehicle was in running condition.  Inspite of all these information the OPs have repudiated the claim of the complainant and send the repudiation letter on 08.02.2023.   After that the complainant has also contacted the OP and requested them to consider his claim and also got issued a legal notice. Inspite of that the OP neither issued any reply nor complied the request of the complainant. Hence this complaint.
5. In response to the notice, OP appears and files version. Admitted about the policy issued by them and further admitted that the policy was in force as on the date of incident.
6. It is the specific contention taken by the OPs that the complaint is not maintainable. The complainant has filed this complaint by suppressing the material facts.  The complainant has not approached this commission with clean hands. From the beginning there is no negligence or deficiency of service caused by these OPs in dealing with the complainant with consent policy.  This OP based on the proposal form and declarations made in the proposal form has issued the insurance policy and it was valid from 28.10.2022 to 27.10.2023 and the liability if any on this OP shall be limited to the terms and conditions of the policy and also as per the provisions of the motor vehicles act.
7. After receiving the information from the complainant an own damage claim stating that the insured vehicle got damaged due to flooding of water into the car.  They have duly registered the claim and the surveyor was also appointed.  After evaluation and careful consideration of the claim documents it was found that the complainant has misrepresented the facts and trying to hide the material facts regarding the damages. It was also found that the caused for loss and loss date did not justify the existing damages on the vehicle and the damages were too old and were not matching with the description and the date of loss mentioned in the claim form stated by the complainant. Therefore the complainant is and tried to hide the material fact pertaining to the damage of the insurance vehicle and hence this OP has repudiated the claim of the complainant.  This OP has not committed any deficiency of service and also unfair trade practice.  The liability of this OP if any shall be limited to and as per the loss assessed by the independent surveyor. Hence there is no merits in the claim made by the complainant. Hence OP1 to 3 prays for dismissal of the complaint.
8. The complainant has filed his affidavit evidence and relies on 15 documents.  Affidavit evidence of official of OP has been filed and OP relies on 06 documents.
9. Heard the arguments of advocate for the complainant only.  No oral argument is advanced on behalf of OP.  Perused the written arguments filed by the OP.
10. The following points arise for our consideration as are:-

1. Whether the complainant proves deficiency of service on the part of OP?
2. Whether the complainant is entitled to relief mentioned in the complaint?
3. What order?

11. Our answers to the above points are as under:

Point No.1:  Affirmative

Point No.2: Affirmative in part

Point No.3: As per final orders

REASONS

12. Point No.1 AND 2: These two points are inter related and hence they have taken for common discussion.  We have perused the allegations made in the complaint, version, affidavit evidence of both the parties, written arguments filed by OP and documents.
13. It is undisputed fact that the complainant has purchased the BMW car on behalf of the firm in which he was a partner bearing Reg. No.KA 51 MH 6300 for his personal use and it was insured with the OP and the OP has issued the policy after received the premium of Rs.83,663/-.  The policy was issued by the OP after thorough inspection of the vehicle and then only they have shared the policy documents with the complainant and also shared the proposal with the complainant.
14. It is also not in dispute that the insured car suffered damage due to flooding of water into the car in the afternoon of 24^th November 2022 and the car towed to the service station at Navaneeth Motors, which is the authorized service providers of BMW cars.  After thorough inspection the Navaneeth Motors estimated the cost of repairs to be Rs.14,28,308/- and the complainant has filed a claim form with the OP in terms of the policy on 26.11.2022.  The OPs have repudiated the claim of the complainant on 31.01.2023 and sent the letter on 08.02.2023.
15. In support of his contention the complainant has filed his affidavit evidence and relied on 15 documents.  Ex.P1 is the policy documents, Ex.P2 is the details of towing of the car to Navaneeth Motors, Ex.P3 is the claim form submitted to the OP, Ex.P4 is the hand written narration of the incident, Ex.P5 is the typed copy of the hand written narration, Ex.P6 is the whatsapp conversation with photographs, Ex.P7 is the details of the fast tag of HDFC Bank of the period from 01.10.2022 till 24.11.2022, Ex.P8 is the explanation and technical reports from Navaneeth motors,
    Ex.P9 is the report submitted by the NHAI tole, Ex.P10 is the repudiation letter, Ex.P11 is the email, Ex.P12 is the details of payment made by the complainant to BMW authorized dealer Navaneeth Motors, Ex.P13 is the copy of the notice, Ex.P14 is the postal acknowledgement.
16. On the other hand the only objection raised by the OPs is that the complainant has misrepresented the facts and trying to hide the material facts regarding the damages.  
17. It is further case of the OP that it was found that the causes for loss and loss date did not justify the existing damages on the vehicle and the damages were too old and were not matching with the description and the date of loss mentioned in the claim form submitted by the complainant and hence the OP have rejected the claim made by the complainant on the ground that there is misrepresentation of facts and OP suppressed the material facts regarding the damages.
18. In support of their contention the OP company legal manager has filed affidavit and relied on six documents. Ex.R1 is the insurance policy, Ex.R2 is the copy of the claim form, Ex.R3 is the copy of the survey report, Ex.R4 is the copy of repudiation letter, Ex.R5 is the letter of authorization letter.
19. The only ground for rejection of the claim made by the complainant by the OP is based on the survey report i.e., the Ex.R3 produced by them before this Commission.  According to the OP the causes for loss and loss date regarding the damages to the vehicle did not justify the existing damages on the vehicle. The damages were too old and were not matching with the description and the date of loss mentioned in the claim form stated by the complainant.  
20. On this back ground we have gone through the description of the accident given by the complainant as per Ex.P4 and P5. The incident happen on 24.11.2022 when the flooding water entered into the engine the complainant took the car in a small road and there was a flooding of water and also there was a big pot whole which he could not notice because the water level was too high. All of a sudden the car made some noise and smoke came from the engine and after move to 10 to 15 meters the complainant switched off the car and try to start the car and it did not start. After that he has got towed the vehicle to the service station i.e., the authorized BMW service station. They have estimated the damages and they have furnished all the information to the queries raised by the OP company technical officials as per Ex.P7 to P9.  
21. It is undisputed fact that the damages were assessed by the authorized BMW service providers and not by any other service station.  OP has rejected the claim of the complainant only on the basis of the survey report of the surveyor of their company.  
22. It is clear from the decision of the Hon’ble NCDRC in First appeal No.442 and 443/2019 between United India Insurance Company –vs- H.P.Latha and another that

“Consumer Protection Act, 1986 – sec 19 Appeal-services-Insurance-Repudiation of claim-Insurance Act only mandates that while settling a claim, assistance of a surveyor should be taken but it does not go further and say that the insurer would be bound by whatever the surveyor has assessed or quantified; if for any reason, the insurer is of the view that certain material facts ought to have been taken into consideration while framing a report by the surveyor and if it is not done, it can certainly depute another surveyor for the purpose of conducting a fresh survey to estimate the loss suffered by the insured-The option to accept or not to accept the report is with the insurer.  However, if the rejection of the report is arbitrary and based on no acceptable reasons, the courts or other forums can definitely step in and correct the error committed by the insurer while repudiating the claim of the insured-The surveyor, after discussing with the insured along with investigator had taken only stock statement shown items and crossed verified with police FIR and found the value to be Rs.34,83,166/-.  He, on physical verification and assessment, found it to be Rs.8,68,520/-.  It is, however, an admitted position of the surveyor’s itself that this is a case of total loss as the entire stocks and finished products were gutted.  Therefore, clearly, the stand of the surveyor as regards valuation of the stock destroyed is untenable.  It is also an established position that necessary records were brought out to the notice of the surveyor establishing that the value of the stocks at the premises which were burnt down to ashes was Rs.34,83,166/-.  Therefore, there is no reason for the surveyor to limit the loss to only Rs.8,66,520/-.  The opposite party is directed to pay Rs.10,54,500/- to the complainant along with simple interest at 6% per annum.

23. It is clear from the above decision the option to accept or not to accept the report of the surveyor is with the insurer. After going through the survey report Ex.R3 produced by the OP there is no details regarding the alleged misrepresentation of facts made by the complainant regarding causes of loss and the loss date relating to the existing damages on the vehicle was not justified.  There is no details given by the surveyor that the damages claimed are old and pre-existing and not matching with the loss description mentioned in the claim form.  The survey report only discloses the policy details and the vehicle particulars and the drivers particulars. There is no opinion given by the surveyor stating that the existing damages on the vehicle are old and pre-existing and not matching with the loss description mentioned in the claim form. The OPs have rejected the claim of the complainant only on the basis of the surveyor report which is not at all given any opinion in respect of the damages caused to the vehicle are pre-existing and not matching with the description of the damages caused to the vehicle on the date of the incident.
24. On the other hand, the BMW authorized service centre has given detailed report to the OP technical official regarding the damages caused to the vehicle due to the above incident. Under these circumstances, the OPs without properly considering the report submitted by the complainant have simply rejected the incomplete report submitted by the surveyor engaged in their company.  The OPs in order to avoid to pay the damages to the complainant have simply repudiated the claim made by the complainant in order to escape from the liability to pay the amount to the complainant as per the terms and conditions of the policy. It is the duty of the OP to pay the damages claimed by the complainant when the policy was in force and the complainant has paid the premium. Hence the complainant has clearly established the deficiency of service and also negligence and unfair trade practice on the part of the OPs.  Hence we answer point No.1 in affirmative and point No.2 partly in affirmative.

25. Point No.3:- In view the discussion referred above we proceed to pass the following;

O R D E R

1. The complaint is allowed in part.
2. OPs are directed to pay compensational damages of Rs.14,30,552/- with interest at the rate of 8% p.a., from 28.04.2023 to till the date of realization.
3. OPs are further directed to pay damages of Rs.50,000/- and Rs.10,000/- towards litigation cost to the complainant.
4. The OPs shall comply this order within 60 days from this date, failing which the OP shall pay interest at 10% p.a. after expiry of 60 days on Rs.14,30,552/- till final payment.
5. Furnish the copy of this order and return the extra pleadings and documents to the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 09^TH day of MAY 2024)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party – R.W.1;