Haryana

Karnal

44/2013

Sewa Singh S/o Gurdev Singh - Complainant(s)

Versus

Iffco -Tokio General Insurance Company - Opp.Party(s)

Sh. S.S. Moonak

06 Dec 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL  FORUM KARNAL.

 

                                                          Complaint No.44 of 2013

                                                          Date of instt.25.01.2013

                                                          Date of decision: 6.12.2016

 

 

Sewa Singh son of Shri Gurdev Singh resident of village and Post office Prem Nagar, Ugala District Ambala.

                                                                                                                                                                                                ……..Complainant.

                   Vs.

 

1.Iffco Tokio General Insurance Company Limited, through its Branch Manager, Iffco House, 3^rd Floor, 34, Nehru Place, New Delhi.

2.Darshan Singh son of Shri Santokh Singh caste Saini, resident of Dera Janesaron tehsil  Indri district Karnal.

                                                                             …..Opposite Parties.

 

                   Complaint u/s 12 of the Consumer Protection Act.

 

Before                   Sh. K.C.Sharma……..President.

                   Sh Anil Sharma……Member.

 

 

 

Present:-     Sh.S.S.Moonak  Advocate for the complainant.

                   Sh.Virender Sharma Advocate for Opposite Party no.1.

                   Sh.G.S.Arora Advocate for the Opposite Party no.2.

ORDER

 

                   This complaint has been filed by the complainant u/s 12 of the Consumer Protection Act 1986, on the averments that he got insured his  Oil Tanker bearing registration No. HR-37/B-9027 with the Opposite Party no.1 for Rs.seven lacs, vide cover note No. 74200606, which was valid from  7.10.2010 to 6.10.2011. The said Oil Tanker  was stolen on the intervening night  of 2-3/10/2011 from village Nanesaron District Karnal.   The matter was reported to the police and the case bearing First Information Report No.376 of 2011 was registered at Police Station Indri. The matter was also reported to the Opposite Party no.1 and necessary claim form and other relevant documents were submitted. The surveyor appointed by the Opposite Party no.1 conducted the necessary investigations. However, despite repeated requests and visits, the claim was not settled by the officials of Opposite Party no.1 and the matter was prolonged unnecessarily.

                    It has  further been pleaded that Oil Tanker was in the care and custody of Opposite Party no.2, who was looking after  the same on behalf of the complainant as the driver and attorney much prior to the theft. He never sold/transferred the Oil Tanker in question to anyone. This fact was also brought to the knowledge of the investigating officer of the Opposite Party no.1 and statements of the complainant as well as Opposite Party no.2 were recorded during investigation. However, the Opposite Party no.1 repudiated the claim vide letter dated 23.3.2012 on flimsy ground. No opportunity was given to the complainant to explain his position. Therefore, repudiation was totally null, void, illegal and uncalled for. In this way, there was deficiency in services on the part of Opposite Party no.1, which caused him mental pain, agony and harassment apart from financial loss.

 

2.       Notice of the complaint was given to the Opposite Parties. Opposite Party no.1 put into appearance and filed written statement disputing the claim of the complainant. Objections have been raised that the complainant  has no cause of action to file the present complaint; that this Forum has no territorial jurisdiction to  entertain and decide the present complaint as the policy was issued by the Ambala Cantt  Branch Office of the Opposite Party no.1; that the complainant is in connivance with the Opposite Party no.2 and the complaint has been filed just to extort money illegally from Opposite Party no.1.

2.                On merits, it has been submitted that on 2.11.2011 the complainant orally intimated the Opposite Party no.1 that his Oil Tanker was stolen. Thereafter, the Opposite Party no.1 deputed Sh.Vijay Kant Vashisht to investigate, carry out survey and assess the loss of the vehicle. The investigator submitted report dated 30.1.2012 in that the claim of the complainant was not payable since the vehicle in question was already sold by the complainant to Opposite Party no.2. After going through the report of investigator as well as the documents, the claim of the complainant was repudiated, vide letter dated 23.3.2012. The complainant had no insurable interest as the vehicle was already sold by him to Opposite Party no.2 prior to the theft. It has further been averred that the theft of the vehicle took place on 2/3-10-2011. However, intimation of the theft was given to the local police only on 23.10.2010. Intimation was not  given to the Opposite Party no.1  immediately as required under the policy  condition, but after  lapse of thirty days i.e. on 2.11.2011. Thus, the complainant violated the condition no.1 of the terms and conditions of the policy by delaying intimation  to the local police as well as Opposite Party no.1. The First Information Report was lodged by the Opposite Party no.2 stating that  he was owner of the vehicle in question and he had purchased the same from the complainant . In form no.2, the Opposite Party no.2 appended his signatures declaring to the  effect that he was purchaser of the vehicle in question. The complainant as well as Opposite Party no.2 submitted the consent letter to the Opposite Party no.1 which was unfilled. The complainant made false declaration in the claim form, therefore, the right to recover from the Opposite Party no.1, if any, stood forfeited and the complainant is not entitled to any amount on that ground also.  The other allegations made in the complaint have been denied.

3.                The Opposite Party no.2 filed separate written statement admitting the claim of the complainant. It has been averred that the Opposite Party no.2 was  looking after the tanker as care taker on behalf of the complainant,  who continued to be the registered owner thereof. The Opposite Party  no.2 was employed as driver on the said Oil Tanker before the same was under the control, care and custody at the time of theft on 2/3-10-2011.Local police also recorded his statement.

4.                In evidence of the complainant, his affidavit Ex.C1 and documents Ex.C2 to Ex.C7 have been tendered.

5.                On the other hand, in evidence of the Opposite Party no.1, affidavit of Vijay Kant Vashisht Ex.OP1, affidavit of Pallivi Roy Ex.OP2 and documents Ex.OP1/1 to Ex.OP1/11 have been placed on the record.

6.                In evidence of Opposite Party no.2, his affidavit Ex.OP2/A and document Ex.OP2/2B have been tendered.

7.                We have appraised the evidence on record, the material circumstances of the case and the arguments advanced by the learned Counsel for the parties.

8.                The Oil Tanker no.HR-37B/9027 of the complainant was insured with opposite party no.1 for the period of 7.10.2010 to 6.10.2011, but the same was stolen on the intervening night of 2/3.10.2011 from village Janesaron District Karnal. First Information Report no.376 of 2011 was registered regarding the said theft of the vehicle on 23.10.2011. Claim was lodged by the complainant with the opposite party no.1 and necessary investigations were carried out by the investigator appointed by opposite party no.1, but the claim was repudiated vide letter dated 23.3.2012.

9.                 Learned counsel for the opposite party no.1 argued that as per the case of the complainant the theft of the vehicle had taken place on the intervening night of 2/3.10.2011, but the First Information Report was lodged on 23.10.2012 after a delay of 20 days, which has remained unexplained. Not lodging of the First Information Report regarding theft promptly was violation of condition of the policy.

10.               The argument advanced by the learned counsel for the opposite party no.1 cannot be accepted.  Generally, the owner/Driver of the vehicle first tries to search the vehicle at his own level, but when he fails to trace out the same, the matter is reported to the police. It is also a matter of common knowledge that the police does not register the First Information Report immediately after getting information of theft of any vehicle, either the complainant is asked to trace out the vehicle at his own level or efforts are made by the police for searching the vehicle, but when the vehicle is not traced out, then only the First Information Report is registered. Therefore, it cannot be said that there was any unreasonable delay on the part of the complainant in lodging the First Information Report. Even otherwise, no condition of the insurance policy could be pointed out by the learned counsel for the opposite party no.1, according to which immediate lodging of First Information Report was necessary. Thus, there was no violation of any condition of the policy on the ground that the First Information Report was lodged after 20 days of the theft.

11.              The next contention raised by the learned counsel for opposite party no.1 is that the intimation regarding theft of the vehicle was given by the complainant to opposite party no.1 on 2.11.2011 i.e. after delay of one month, whereas according to condition no.1 of the policy the insured was bound to give intimation to opposite party no.1 immediately after the theft. In this way, there was violation of condition of the insurance policy, therefore, opposite party no.1 is not liable to pay any compensation to the complainant.

12.               Insurance Regulatory and Development Authority issued circular dated 20.9.2011, which is reproduced as under:-

“ To: All life insurers and non-life insurers.

  Re: Delay in claim intimation/documents submission with respect to

i.        All life insurance contracts and

ii.       All Non-life individual and group insurance contracts.

          The Authority has been receiving several complaints that claims are being rejected on the ground of delayed submission of intimation and documents.

         The current contractual obligation imposing the condition that the claims shall be intimated to the insurer with prescribed documents within a specified number of days is necessary for insurers for effecting various post claim activities like investigation, loss assessment, provisioning, claim settlement etc. However, this condition should not prevent settlement of genuine claims, particularly when there is delay in intimation or in submission of documents due to unavoidable circumstances.

          The insurers’ decision to reject a claim shall be based on sound logic and valid grounds. It may be noted that such limitation clause does not work in isolation and is not absolute. One needs to see the merits and good ‘spirit of the clause, without compromising on bad claims. Rejection of claims on purely technical grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation.

          Therefore, it is advised that all insurers need to develop a sound mechanism of their own to handle such claims with utmost care and caution. It is also advised that the insurers must not repudiate such claims unless and until the reasons of delay are specifically ascertained, recorded and the insurers should satisfy themselves that the delayed claims would have otherwise been rejected even if reported in time.

          The insurers are advised to incorporate additional wordings in the policy documents, suitably enunciating insurers’ stand to condone delay on merits fort delayed claims where the delay is proved to be for reasons beyond the control of the insured.

          J.Harinarayan

          CHAIRMAN.”

 

13.              It is clear from the above circular that insurance company cannot repudiate the theft claim on technical grounds like delay in intimation and submission of some required documents. The decision of insurer to reject a claim of the claimant should be based on sound logic and valid reasons. The limitation clause does not work in isolation and is not absolute. One needs to see the merits and good spirit of the clause, without compromising on bad claims. Rejection of claims on purely technical grounds in a mechanical fashion will result in policy holder losing confidence in the insurance industry, giving rise to excessive litigation. It has further been advised in the said letter that the insurer must not repudiate such claims unless and until the reasons for delay are specifically ascertained, recorded.

             What is the spirit of insurance policy, should be kept in mind by the officials dealing with the genuine claims of the sufferers and the same should not  be rejected on methodological grounds in a mechanical manner. The tendency of insurance companies in rejecting genuine claims is the reason of increasing litigation between the insurers and the insureds/their legal heirs. In this context reference with advantage may be made to orders of the Hon’ble State commission in  Shriram General insurance Company limited Versus Rajesh Kumar 2014(2) CLT 290 and Shriram General Insurance Company Limited Vs. Manoj 2014(3) CLT 447 as well as order of Hon’ble National Commission in National Insurance Co.Ltd. Versus Kulwant Singh IV (2014) CPJ 62 (NC) .

14.              It is pertinent to note that it is not the case of opposite party no.1 that the vehicle of the complainant was not stolen and the story of theft putforth in the First Information Report was false. Thus, the claim of the complainant regarding theft of the motorcycle was genuine and never disputed by the opposite party no.1. Therefore, the repudiation of the claim of the complainant by the opposite party no.1 was contrary to the spirit of the letter of Insurance Regulatory and Development Authority, because such delay cannot be considered as sufficient to deny the genuine claim of the complainant. A person who lost his vehicle straightway may not go to the insurance company to claim compensation. At the first instance, he himself makes efforts to search the vehicle. Filing of the claim with the insurance company is the last resort.  Under such facts and circumstances, the argument advanced by learned counsel for the complainant for denying the claim on the ground for delay in intimation to opposite party no.1, cannot be accepted.

15.              Learned counsel for opposite party no.1 put great thrust on the contention that the First Information Report was lodged by Darshan Singh, who claimed that the vehicle was purchased by him from the complainant though the registration continued in the name of the complainant. During investigation carried out by the investigator of the opposite party no.1, statements of complainant and Darshan Singh were recorded. Complainant had stated that due to personal reasons he sold his tanker in May, 2011 to Darshan Singh, but the registration was to be transferred in the name of Darshan Singh after clearing outstanding loan. Darshan Singh also stated that the tanker in question was purchased by him from his relative Sewa Singh in May 2011. The said tanker was under HPA with M/s Shri Ram Transport Finance Company, Yamuna Nagar, therefore, he could not get the registration transferred in his name before clearing the outstanding loan. Even the claim form was signed by Darshan Singh alongwith complainant and it was confirmed by Sewa Singh complainant that he had sold the vehicle to Darshan Singh. Thus, from the evidence on record, it is clear that the complainant had already sold the vehicle to Darshan Singh and as such he was not having any insurable interest on the date of theft of the vehicle, therefore, he was not entitled to get any claim from opposite party no.1 and his claim was rightly repudiated. In support of his contention he placed reliance upon Dharambir Versus New India Assurance Co. Ltd. IV (2012) CPJ 639 NC wherein the claim was repudiated on the ground that complainant had no insurable interest on the date of loss as he had already sold the vehicle to Dilprit Singh. The First Information Report was filed before the police by Dilprit Singh as owner of the vehicle and not by the complainant. The complainant had also executed an affidavit regarding sale of the vehicle in favour of Dilpirtt Singh. Under those circumstances, it was held by Hon’ble National Commission that the complainant had no insurable interest on the date of theft of the vehicle and the insurance company rightly repudiated the claim.

16.              To wriggle out the aforesaid contention, learned counsel for the complainant vehemently argued that the vehicle was not sold by the complainant to Darshan Singh, rather the same was given in care and custody of Darshan Singh, who was looking after the same on behalf of complainant as driver and attorney, much prior to theft and this fact was also brought to the knowledge of the Investigating Officer of opposite party no.1. Darshan Singh even lodged the Daily Diary Report on 31.10.2011 clarifying that he had not purchased the vehicle from the complainant, rather he was taking care of the vehicle as Manager and driver and he used to render the accounts to the complainant, who was owner of the vehicle. The affidavit of Darshan Singh Ex.OP2/A is also to the same effect.  He further contended that the copy of power of attorney Ex.OP2/B also clearly indicates that the vehicle was not sold by the complainant to Darshan Singh, rather he was appointed as special attorney to look after the vehicle and do all necessary acts on behalf of the complainant. He lastly argued that the evidence of the complainant on record is sufficient to prove that the vehicle was not sold by the complainant to Darshan Singh and he continued to be owner thereof on the date of theft and as such had insurable interest, therefore, the opposite party no.1 could not repudiate his claim on such ground.

17.              In the instant case, the First Information Report regarding theft of the vehicle was lodged by Darshan Singh. The copy of the First Information Report Ex.OP6 shows that Darshan Singh claimed that he had purchased the said vehicle from Sewa Singh, but the registration record of the vehicle was in the name of Sewa Singh. The opposite party no.1 had appointed investigator, who recorded the statements of Sewa Singh and Darshan Singh during investigation, the copies of which are Ex.OP8 and Ex.OP9, respectively. The investigator Vijay Kant Vashisht filed his affidavit Ex.OP1 in support of the investigation carried out by him and the statements of Darshan Singh recorded during investigation. Sewa Singh and Darshan Singh in their statements before the Investigator categorically stated that the vehicle in question was sold by Sewa Singh to Darshan Singh in May, 2011, but the vehicle was financed by Shri Ram Transport Company Yamuna Nagar, therefore, the registration of the vehicle could not be transferred in the name of Darshan Singh till clearance of the loan. Moreover, the claim form, the copy of which is Ex.OP5, was signed by Sewa Singh and Darshan Singh. At the end of the typed matter, it was specifically mentioned “Further confirm I have sold I.V.to Darshan Singh son of Santokh Singh reside of Dera Janesaron District Karnal.” No doubt Darshan Singh got recorded Daily Diary Report on 31.10.2011 that he was just looking after the vehicle as manager and driver and rendering accounts to Sewa Singh, but such Daily Diary Report was an afterthought and the same is not sufficient to disbelieve his statement before the police and the investigator. The copy of power of attorney dated 21.3.2011 executed by Sewa Singh in favour of Darshan Singh Ex.OP2/B when read as a whole also indicates that the vehicle was sold by Sewa Singh to Darshan Singh. Para no.8 of the power of attorney is most material and for proper appreciation of the matter the same is reproduced as under:-

          “Whereas the possession of the vehicle has been taken by my attorney today and will be responsible for all type of taxes, challans or any other case if any incurred against the abvoesaid vehicle and earlier to this date I will be responsible for all type of taxes, challans, theft case or any other case if any pending against the abvoesaid vehicle.”

Had the vehicle not been sold by the complainant to Darshan Singh, then there was no necessity to mention such condition that after executing power of attorney by Sewa Singh and taking possession of the vehicle by Darshan Singh, only Darshan Singh would be responsible for all types of taxes, challans or any other case against the vehicle and earlier to that Sewa Singh was to remain responsible for all types of taxes, challans and theft case or any other case, if any pending against the vehicle. An attorney appointed by the owner cannot be held responsible to pay taxes, challans or any other case, because he acts on behalf the Principal and not in his independent capacity. The principal/owner is liable for all acts done by attorney on his behalf. Thus, the evidence on record is sufficient to prove that the vehicle was sold by the complainant to Darshan Singh prior to the theft, but the registration continued in his name as the registration could not be transferred till clearance of the loan of the finance company, who had financed the vehicle. Consequently, the complainant had not insurable interest on the date of theft of the vehicle. The proposition of law laid down by the Hon’ble National Commission in Dharambir’s case (supra)  is fully applicable to the facts of the present case. Therefore, repudiation of the claim of the complainant by the opposite party no.1 on the ground that he had no insurable interest on the date of theft of the vehicle cannot be considered as illegal or unjustified in any manner.

18.              As a sequel to the foregoing reasons, we do not find any merit in the present complaint. Therefore, the same is hereby dismissed. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated: 6.12.2016

                                                                                      (K.C.Sharma)

                                                                                         President,

                                                                             District Consumer Disputes

                                                                             Redressal Forum, Karnal.

                             (Anil Sharma)

                               Member