KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAUD, THIRUVANANTHAPURAM.

APPEAL NO. 106/11

JUDGMENT DATED :23.3.2012

PRESENT:

SHRI. S. CHANDRA MOHAN NAIR                  :  MEMBER

SMT. A. RADHA                                                 :  MEMBER

1.      The Manager,

          Bajaj Allianz General Insurance Co.Ltd.,

          T.C. 28/2222,

Pazhavangadi, Trivandrum.                     

                                                                                :  APPELLANTS

2.      The Branch Head

          Bajaj Allianz General Insurance Co.Ltd.,

          Kozhencherry Road, Pathanamthitta.

(By Adv. Sreevaraham G. Satheesh)

Vs

1.      K. Vargheese John,

          Kuzhikalavayalil House, Mekozhoor,

          Mylapra Village,

          Pathanamthitta.                     

(R1 by Adv. K. Venugopalan Nair)

2.      General Manager

          Mahindra & Mahindra Financial Service Ltd.,

          N.H. Kaloor, Cochin.                                       :  RESPONDENTS         

3.      The Branch Head

          Mahindra & Mahindra Financial Service Ltd.,

          College Road, Pathanamthitta.

(R2 & R3 by Adv. C.S. Rajmohan)

4.      The Managing Partner

          M/s Global Motors, Peroorkada, Trivandrum.

JUDGMENT

SMT. A. RADHA : MEMBER

          The order of CDRF, Pathanamthitta in CC No.6/08 directing the opposite parties to pay to the respondent a sum of Rs.5,18,000/- with interest @ 7% along with 25,000/- as cost is the subject matter of challenge in this appeal.

2.      The complainant/respondent is the owner of car bearing registration No. KL-3-K-1900. The vehicle met with an accident and sustained damages. The insurance claim preferred by the complainant was repudiated by the opposite parties 1 and 5 on the ground that there is no privity of contract between the complainant and the opposite parties. The complaint was filed for getting compensation and damages for the deficiency in service of the opposite parties with respect to the insurance policy. The complainant purchased the vehicle from one Mr. Sayed Maheen Aboobacker who was the prior registered owner and availed a loan from the 2^nd and 3^rd opposite parties and hypothecated the vehicle. It is his case that the 2^nd and 3^rd opposite parties promised to effect the necessary changes in the Certificate of Registration before the RT Office and also for Certificate of Insurance before the opposite party, Insurance Company. The original documents were kept by them for making necessary changes in the RC book. The vehicle was having valid insurance policy during the period from 12.5.06 to 11.05.07. While the vehicle met with an accident on 18.2.07 occurred total loss to the vehicle. The damaged vehicle was brought to the 4^th opposite party, one of the approved workshops. The 1^st and 5^th opposite parties repudiated the insurance claim on untenable reasons.

3.      In the written statement filed by the 1^st and 5^th opposite parties admitted that there is insurance policy covering the period from 12.5.06 to 11.05.07 in the name of Mr. Sayyed Maheen Aboobacker. The claim filed by the complainant/1^st respondent stating the loss caused due to an accident was on 18.2.07. The insurance claim was filed on 20.02.07. The transfer of Certificate of Insurance was made by the complainant on 20.02.07. The alleged accident was on 18.2.07. The claim benefit for the complainant under the policy has no privity of contract with the 1^st opposite party. The transfer of insurance comes under GR 17 of the Indian Motor Tariff. The opposite parties averred that the liability under Motor Vehicle Act shall be deemed to be transferred without the intervention of the party and there is automatic transfer. But in the case of own damage the provision is totally different. The complainant complied GR 17 only on  20.2.07 and on 18.2.07 the complainant has no insurable interest as against the vehicle concerned.

4.      The third opposite party’s contention is to the effect that they were only financiers and returned the documents after making changes before the Motor Vehicle Department with direction to make changes in the Insurance Certificate and averred that it is the 1^st and 5^th opposite parties to make necessary changes in the Insurance Certificate.

5.      The version filed by 4^th opposite party stated that the complainant brought the damaged vehicle in a lorry for total loss accident claim and for repair. When the estimate prepared and sent to the insurance company they rejected the claim on the ground that the policy was not valid at the time of accident. The workshop is one of the approved workshops of the insurance company and they usually assess the damages caused to the vehicle met with accident. It is also the contention of the 4^th opposite party that as the vehicle was lying in the workshop it caused irreparable damages and claimed Rs.42,500/- towards estimating, keeping vehicle in the workshop premises etc.

6.      The evidence consists of proof affidavit. The complainant was examined as PW1 and documents Exts. A1 to A4 marked. D1 to D3 were examined and documents marked as Exts. B1 to B9.

7.      The certificate of Registration was transferred in the name of the complainant on 6.01.07. With the transfer of the ownership of the vehicle, the insurable interest is impliedly transferred to the complainant. The deposition of DW1 shows that the intimation of transfer of ownership came to the knowledge of the Insurance Company. The dispute regarding the transfer of policy certificate is only a technical aspect and it was done on 20.2.07. As per the GR10, the benefit under the policy is in force on the date of transfer shall automatically accrue to the new owner ie. the complainant in this case. The Forum below came to the finding that the insurance claim is to be allowed to the complainant.

8.      The learned counsel for the appellant/opposite party
1 and 5 submitted before us that the interpretation of G17 of IMT is not appreciated by the Forum below in a correct perspective. The automatic transfer of policy on transfer of ownership applies to liability only and present claim pertains to own damage claim where there is no automatic transfer as per GIC circular of 2002 in which GR 17 is incorporated. In package policy the automatic transfer will not take place.  General Regulation 17 of the Indian Motor Tariff Act provides:

“On transfer of ownership, the liability only cover, either under a

Liability only policy or under a package policy, is deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of transfer.

The transferee shall apply within fourteen days from the date of transfer in writing under recorded delivery to the insurer who has insured the vehicle, with the details of the registration of the vehicle, the date of transfer of the vehicle, the previous owner of the vehicle and the number and date of the insurance policy so that the insurer may make the necessary changes in-his record and issue fresh certificate of insurance.”

The learned counsel also relied on the decision in New India Assurance Company Ltd. Vs. Chandrakant Bhujangrao Jogdand II(2010)CPJ 170 (NC) wherein on the date of the accident the vehicle stood in the name of the previous owner and the transferee has to apply within 14 days from the date of transfer to the insurer for making necessary changes. The complainant has no insurable interest in the policy as on the date of the accident the certificate of insurance was not transferred. It is also submitted that any claim of the transferee in respect of person or property cannot be enforced against the insurance company without transfer of policy.

9.      The submission made by the counsel for the 2^nd and 3^rd respondents is that there is no evidence to show that the 1^st respondent/complainant entrusted them to change the certificate of insurance. While purchasing the vehicle the finance alone was arranged by the 2^nd and 3^rd respondent towards the loan account to the 1^st respondent/complainant. The vehicle was hypothecated to the 3^rd respondent. The change in the certificate of insurance is to be done by the 1^st appellant.

10.    We heard the counsel for the appellant and respondents. We are of the view that the Forum below took a wrong interpretation for GR 17 of IMT. Further the complaint is allowed based on the deposition of DW1. It is not supported by any proof. In this context it is to be pointed out that Ext. B9 the receipt of Rs.50/- was remitted by the 1^st respondent/complainant only on 20.2.07 ie after the date of accident. As stated in the GR17 “a fee of Rs.50/- is to be collected for issue of fresh certificate of insurance in the name of the transferee”. It is evident from the documents that the 1^st respondent/complainant has not remitted the prescribed fee for the transfer of certificate of insurance earlier. The complainant /respondent is not entitled to the sum insured since on the date of accident the insurance policy was not transferred in favour of the complainant and it stands in the name of the previous owner and there is no insurable interest to the complainant under the said policy. The Hon’ble Supreme Court held in M/s Complete Insulations (P) Ltd., Vs. New India Assurance Company Ltd. AIR 1996 Supreme Court 586 that

“since insurer had not transferred the policy of

insurance in relation thereto to the transferee,

the insurer was not liable to make good damage to the vehicle”.

Placing reliance on the above decision we allow the appeal setting aside the impugned order passed by the Forum below.

          In the result, the appeal is allowed.

          Parties are directed to bear their respective costs.

Office is directed to send a copy of this order to the Lower Forum with the LCR.

A. RADHA :  MEMBER

S. CHANDRA MOHAN NAIR         :  MEMBER

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