CONSUMER DISPUTES REDRESSAL COMMISSION – X

GOVERNMENT OF N.C.T. OF DELHI

Udyog Sadan, C – 22 & 23, Institutional Area

(Behind Qutub Hotel)

New Delhi – 110016

Case No.92/2016

1. Mrs. SUNITA

W/O SHRI SURENDER

R/O H. NO. 157, VILLAGE TIKRI KHURD,

NARELA, DELHI, …..COMPLAINANT

THROUGH AUTHORISED REPRESENTATIVE/S SON

DEEPAK KHATRI

R/O H. NO. 157, VILLAGE TIKRI KHURD, NARELA, DELHI.

Vs.

2. IFFCO-TOKIO GENERAL INSURANCE COMPANY LTD.

CUSTOMER SERVICE CENTRE- NORTH

IFFCO HOUSE,

NEW DELHI- 1100…..RESPONDENT NO.1/OP

3. IFFCO-TOKIO GENERAL INSURANCE COMPLANY LTD.

IFFCO SADAN,

C-1, DISTRICT CENTRE, SAKET

NEW DELHI- 110017…..RESPONDENT NO.2/OP

Date of Order-22.12.2021

  O R D E R

A.K. KUHAR– President

            Complainant is the  registered owner of vehicle number DL 3C BB1544 Make Tata-Motors Indica Vista TE.The vehicle was purchased in 2009 and it was insured with IFFCO Tokyo General Insurance Company Limited (herein after referred as OP), vide Policy number 879 54 919. This vehicle was stolen on the intervening night of 21/22-02-2015 from the jurisdiction of PS Kharkhoda, District Sonipat, Haryana. The FIR 116 of 2015 was registered regarding the theft at PS Kharkhoda district Sonipat, Haryana.  The police filed an untraced report regarding the said vehicle with the concerned Court. Thereafter, the complainant lodged the claim with the OP (Insurance Company) for claiming the insured amount for the said vehicle.  The OP issued a letter dated 17th April 2015 asking for certain documents for processing the claim which were submitted by the complainant. However, firstly; the claim of complainant was rejected on the ground that the vehicle was being used in contravention of the policy terms and conditions as per the investigation report of M/s Bhola and Company and secondly; the information regarding loss was given after a delay of 11 days. This information was communicated through the letter dated 23rd September 2015 .The complainant then issued a legal notice dated 4th December 2015 through her Counsel asking for the investigation report of M/s Bhola and Company and to process the claim of the complainant in respect of the stolen vehicle or to furnish a valid reason for rejection of the claim. The OP did not respond to the Notice. Hence, this Complaint was filed by the complainant for direction to the OP to pay to the complainant the insured value of the vehicle as assessed under the insurance policy issued by the OP.

Notice was issued to the OP. The OP filed a written statement citing the reasons for rejection of the claim of the complaint. It was stated, inter alia, that repudiation of the claim of the insured cannot be termed as “deficiency of service” or negligence on the part of Insurance company. It was stated that the Insurance company was justified in repudiating the claim on the basis of the report submitted by the surveyor and referred to the Condition No. 3(a) of General Exceptions in policy pertaining to “private cars” which reads;

“ The company shall not be  liable under this policy in respect of any accidental loss, damage and/ or liability  caused sustained or incurred while the vehicle insured herein is being used otherwise then in accordance with the limitation as to its use”.

Complainant and OP have led evidence by filling affidavit. Both the parties have filed written argument as well. We have heard the arguments from Ld. Counsel for the complainant and the OP. The written arguments filed by both the parties have been perused along with the case law referred in support of the arguments.

 Before considering the contentious issues and to cut short the discussion it would be  appropriate  to refer to the admitted facts which are not in dispute which are; (a) the complainant Sunita is the registered owner  of the vehicle  DL3 C BB 1544,( b)the vehicle in question was insured with  the OP, (c) the vehicle in question was stolen, (d) An  FIR was registered regarding the theft at PS Kharkhoda, District Sonipat, Haryana and police filed an untraced report and (e) the claim filed  by the complainant/ insured was rejected by the OP (Insurance Company).

We are now concerned with the reasons for repudiation of the claim of the complainant/ insured. The OP has rejected the claim of the complainant on two grounds which are mentioned in the letter dated 23rd September 2015 (exhibit OP1/4), firstly; that the vehicle was used for Hire and Reward at the time of loss and secondly; the OP was informed about the theft on 11th March 2015 and thus there was a delay of more than 11 days in intimation of theft to the OP. During the course of argument it was also submitted that there was a delay of more than 6 days in lodging a police report. We shall deal with all these issues one by one.

Delay in information to the Insurance Company:  It is an admitted fact that the vehicle in question was stolen on the intervening night of 21/22/02/2015. As per the case of the OP intimation regarding the theft was given to Insurance Company on 11th March 2015. This is not denied by the complainant. The Ld Counsel for the OP has argued that the delay in intimation to the Insurance Company is the violation of the Policy condition as in terms of the Policy the complainant was to inform the Insurance Company about the theft “immediately” after incident. The Ld.Counsel for the OP has referred to the following judgments in support of his argument that delay in information to the Insurance Company justify the repudiation of the claim of the claimant.(a)Iqbal Hussain Karimbhai Patel vs United  India Insurance CompanyLtd. III (2017) CPJ 523 (NC), Sajid Ali vs Sri Ram General Insurance Company Ltd. III (2018) CPJ 168 (NC), Reliance General Insurance Co.ltd. IV (2016) CPJ 150 (NC) and New India Assurance Company Ltd. vs Trilochan Jane IV (2012) CPJ 441 (NC).

On the other hand the Ld Counsel for the Complainant has argued that there was no delay in informing the Insurance Company about the theft. He has argued that such technical and mechanical grounds cannot be used to repudiate the claim of the insured.In support of his argument he has placed reliance on Om Parkash vs Reliance General Insurance and Others (Civil Appeal No.15611 of 2017 decided on 4/10/2017).

 We have considered the rival submission on the issue whether delay in intimation to the Insurance Company would justify the rejection of the claim? The observation of the Hon'ble Supreme Court in the case of Om Parkash (supra) are important to note where the issue of delay in giving intimation of theft to the Insurance Company was involved. The SC observed that the decision of the insurer to reject the claim has to be based on valid grounds.Rejection of the claim on purely technical grounds in a mechanical manner will result in loss of confidence of policy holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay and further that it would not be fair and reasonable to reject the genuine claims which have been verified and found to be correct by the investigator. It was further observed that the condition regarding the delay shall not be a shelter to repudiate the insurance claims which have been otherwise proved to be genuine.

In a recent judgment in Gurshinder Singh vs Shriram General Insurance Co. Ltd and Anr. (2020) 11 SCC 612, Hon'ble SC has dealt with a case where there was a delay of 52 days in intimation to the Insurance Company regarding theft of vehicle, while deciding a reference in view of conflicting decision of the SC on this issue. The view taken in the case of Om Parkash (supra) was upheld. It was held, “we find that this Court in Om Parkash (supra)has rightly held that the Consumer Protection Act aims at protecting the interest of the consumers and it being a beneficial legislation deserves a pragmatic construction. We find that in Om Parkash (supra) this Court has rightly held that mere delay in intimating the insurance company about the theft of the vehicle should not be a shelter to repudiate the insurance claims which has been otherwise proved to be genuine.”

In the present case the authenticity of the claim of the complainant is not disputed. The Surveyor Report Exhibit OP 1/1 has confirmed the theft of the vehicle on the intervening night of 21/22/02/2015 for which an FIR 116/15 was registered under Section 379 IPC at PS Kharkhoda, Sonepat and it was not traced. This Survey Report has established that the claim of the complainant /Insured is genuine. Therefore, in view of the law laid down by the Hon'ble SC in Gurshinder Singh’s case (supra) the OP cannot repudiate the claim of the Insured on the ground that there was delay of 11 days in intimation of theft to the OP.

Another ground taken to assail the case of the complainant is that there was delay in lodging of FIR. The Ld. Counsel for the OP has argued that by causing delay in lodging the FIR, the complainant has violated the policy condition. He stated that the vehicle was stolen on the intervening night of 21/22 February, 2015 while the FIR was got registered on 28/02/2015. He has referred to the judgment in “Jignesh Natwar Singh Solanki V/S ICICI Lombard General Insurance Company II (2016) CPG13 (NC)” where the FIR was lodged after more than one and a half months and rejection of claim was justified.

He refers to the judgment in “New India Assurance Company V/S Trilokchan Jane IV (2012) CPG 441 (NC)” wherein the Hon’ble National Consumer Dispute Redressal Commission has held that police should be informed of theft immediately so that valuable time is not lost in tracing the vehicle.

The Ld. Counsel for the complainant on the other hand has argued that the FIR was registered on 28/02/2015 within six days, moreover, intimation was sent to police at 100 number and the local police post immediately. Therefore, there was no delay in registration of the FIR.

It is, no doubt, necessary for the insured to get the FIR registered immediately after the Commission of theft. The rational and logic behind this propostion of law is that the timely information to the police can help in finding the stolen vehicle.

The Ld. Counsel for the OP had submitted that FIR was to be registered immediately. Now, during the course of argument he has referred to the statement of one Mr. Deepak Rana which was filed by the OP along with the Survey Report (EX. OP-1/1). This Statement would show that Mr. Deepak Rana who had parked the vehicle in front of his house in his village, had found at 7 a.m. that the vehicle was missing he immediately call 100 number and informed about the theft. He has also stated that he went to the nearest police-post at Saidpur, Tehsil Kharkhoda and made a complaint to the police where police recorded his statement and thereafter, the FIR was registered at PS Kharkhoda Distt. Sonepat, Haryana on 28/02/2015. This statement has been relied upon by the OP and is part of the Survey Report submitted by OP. This statement shows that immediately information regarding the theft was given to the police. Once the information has been given to the police it was upon the police to immediately register the FIR if the police had caused some delay in registering the FIR then the complainant cannot be penalised for this omission by the police. Therefore, we are of the view that there was no delay on the part of the complainant in reporting the theft of the vehicle to the police.

Yet another ground taken by the OP is that vehicle was being used for commercial purpose. He has referred to one of the condition of the policy which reads as under:-

“The company shall not be liable under this policy in respect of any accidental loss, damage and / or liability caused sustained for incurred while the vehicle insured herein is being used otherwise, then in accordance with the limitation has used.”

On this aspect reference to the judgment of the Hon’ble Supreme Court in “National Insurance Company V/S Nitin Khandelwal (Civil appeal No. 3409/2008)” decided on 08/05/2008 will be relevant. In the said case the insurance claim was repudiated by the insurance company. The District Forum had dismissed the complaint. The State Commission had allowed the complaint. In Appeal National Consumer District Redressal Commission upheld the order of State Commission and the matter came before the Hon’ble Supreme Court. The District Forum had rejected the claim on the ground that vehicle was insured for personal use and at the time of accident it was being used by the respondent as a taxi therefore there was violation of the terms and conditions of the Insurance Policy. The Hon’ble Supreme Court held that “on consideration of the totality of the facts and circumstances of the case, the law seems to be well settled that in case of theft of vehicle, nature of use of the vehicle cannot be looked into and the Insurance Company cannot repudiate the claim on that basis.

In case of Amalendu Sahu V/S Oriental Insurance Company (Civil appeal No. 2703 of 2010) decided on 25/03/2010 the Insurance claim was rejected on the ground that vehicle was being used for hire purpose at the time of incident still the Hon’ble Supreme Court was of the view that the Insurance Company cannot repudiate the claim in toto. In the present case the complainant had stated that the vehicle was parked outside the house of Mr. Deepak Rana and when he got up in the morning he found that the car has been stolen. Although, in his statement Mr. Deepak Rana has stated that on the previous day he had taken the vehicle for hire. We are of the view that a distinction has to be made between the case when vehicle is damaged or any loss is caused when the vehicle is “being used” contrary to the terms and conditions of the policy and in case of theft when the vehicle in fact was not “being used” for any purpose. Moreover, this condition of using the vehicle for hire purpose would be more relevant when 3^rd party interest is involved and the liability of the Insurance Company is to be decided. In case of theft no such defence can be taken and we are of the considered view that the Insurance Company has to pay the insured value of the vehicle in such cases and the claim of the insured cannot be rejected. We draw strength from the observation made by Hon’ble National Commission in National Insurance Company V/S Kamal Singhal, IV(2010) CPJ 297 (NC), that, “issue is no longer res-integra that in case of theft of vehicle, issue of breach of policy condition was not germane to the issue.”

In view of the above discussion the complaint is allowed with the following directions:-

1. The OP shall pay the claim of the complainant at the insured declared value of the vehicle (which is Rs. 2,50,000/- as per the policy OP EX-1/3) with the interest at the rate of 6 per cent per annum of the amount within 45 days of received of this order.
2. In case payment is not made within 45 days, this amount will carry interest at the rate of 9 per cent per annum till the date of payment.
3. Complainant is also awarded compensation on account of mental agony, harassment which is quantified at Rs. 20,000/-.
4. The complaint is also awarded litigation expenses of Rs. 10,000/-.

Copy of order be sent to the parties, free of cost, and thereafter file be consigned to record room.

(Dr. RAJENDER DHAR)                            (RASHMI BANSAL)                                       (A.K. KUHAR)

        MEMBER                                               MEMBER                                                     PRESIDENT