Challenge in this Revision Petition under Section 21(b) of the Consumer Protection Act, 1986 (for short the “Act”) is to the order dated 05.05.2017 in FA No. 697 of 2016 passed by the Haryana State Consumer Disputes Redressal Commission at Panchkula (for short “the State Commission”).  By the impugned order the State Commission has confirmed the finding of the District Consumer Disputes Redressal Forum, Jhajjar (for short “the District Forum”).

2.       The facts in brief are that the Complainant insured his truck with the Opposite Party (hereinafter referred to as “the Insurance Company) vide a cover note bearing No. 739102 for the period from 22.10.2010 to 21.10.2011, mentioning the insured amount as ₹11,20,000/-.  It was averred that in the intervening night of 9^th/10^th.11.2010, the said truck was stolen by some unknown persons and an FIR was lodged at Police Station, Jhajjar on 10.11.2010 and the same was informed to the Insurance Company on the same day.  On 12.11.2010 the Complainant sent the requisite documents to the Insurance Company through UPC and one Mr. Luxmi Rawat was deputed to collect the relevant documents from the Complainant and he had obtained his signatures on blank papers.    The police gave a report dated 29.03.2011 stating that the truck was untraceable and the necessary order was passed by the Judicial Magistrate Ist Class, Jhajjar.  Despite repeated requests and even after service of legal notice dated 15.01.2015,  the Insurance Company did not settle the claim. Hence the Complainant approached the District Forum seeking directions to pay the insured amount of ₹11,20,000/- with interest, compensation and costs. 

3.       The Insurance Company filed their Written Version stating that the Complaint was not maintainable; that the finance company was not made a party; that the theft occurred on 13.11.2010 whereas information was given to them only on 17.12.2010 and, therefore, the claim was repudiated as ‘No Claim’ on 07.01.2011.  It was also averred that they had written letters on 16.03.2011, 30.04.2011 and 12.05.2011 to the Complainant requesting to complete the required formalities to process the claim but the Complainant did not submit the said documents and, therefore, there is no deficiency of service on their behalf. 

4.       The District Forum based on the evidence adduced allowed the Complaint in part directing the Insurance Company to pay the IDV of the vehicle i.e. ₹11,20,000/- along with interest @ 9% p.a. from the date of theft i.e. 10.11.2010 till the date of realization subject to transfer of RC and subrogation letter in the name of the Insurance Company. The Complainant was also awarded costs of ₹5500/-. 

5.       Aggrieved by the said order, the Insurance Company preferred an Appeal before the State Commission, which, while concurring with the findings of the District Forum, observed as follows:-

“10. 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 procedural grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation.  It has been further advised in the above said letter that the insurers must not repudiate such claims unless and until the reasons of 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 case the repudiation of complainant’s claim was contrary to the instructions issued by the IRDA, mentioned above.

11.     During the course of arguments, the Insurance Company stressed time and again that the complaint filed by the complainant is barred by limitation.  Plea has been taken that the Insurance Company sent repudiation letter dated 7^th January, 2011 (Exhibit R-3) mentioning that claim of the complainant was declined due to delay in submitting information to the Insurance Company.  The present complaint was filed by the complainant on 11^th March, 2015.  It is evident from the repudiation letter Exhibit R-3 that claim of the complainant was declined. But from the record on the file it appears that after issuance of the letter Exhibit R-3 also, the Insurance Company continued process regarding claim of the complainant. In this case Prism Insurance Consultants was appointed for investigation. It is evident from the letter dated 16^th March, 2011 (Exhibit R-9) that Prism Insurance Consultants issued a letter to the complainant to produce the documents required for process of the claim.  It is also mentioned in the letter that the complainant was not cooperating with the Prism Insurance Consultants.  For producing documents, again reminder Exhibit R-8 was issued on 30^th April, 2011 and final reminder Exhibit R-7 was issued on 12^th May, 2011.  On 13^th May, 2011, the Investigator submitted his report Exhibit R-10 mentioning that claim can be cleared as per terms and conditions of the policy issued by the Insurance Company.

12.     No document has been placed on the file to prove that what order was passed by the Insurance Company after receiving report Exhibit R-10.  Record on the file does not show that the Insurance Company issued any letter after 13^th May, 2011 mentioning that claim of the complainant finally stands rejected. The Insurance Company cannot say that claim of the complainant was finally rejected on 7^th January, 2011 because after that date also the Insurance Company itself continued process regarding the claim of the complainant. In this way, findings can be safely given that the cause of action in this case is continuous and finally arose when the Insurance Company did not accept the prayer of the complainant despite service of legal notice dated 15^th January, 2015 (Exhibit R-1).  In this way, findings can be safely given that the complaint was filed by the complainant well within the period of limitation i.e. within two years from the date of cause of action.”

6.       Ld. Counsel for the Insurance Company vehemently argued that the Complaint was time-barred as the legal notice was issued in 2015 whereas the claim was repudiated in the year 2011; that there was delay in intimation to the Petitioner which is in violation of the terms and conditions of the policy; that the financier of the vehicle who has the first lien was not made a party; that the policy period was from 12.11.2010 to 11.11.2011 and the theft took place on 10.11.2010 and both the Fora below wrongly relied upon the cover-note which was never admitted by the Insurance Company as the premium was received only on 11.11.2010 and the vehicle was stolen prior to the inception of the policy and, therefore, the repudiation is justified. 

7.       We address ourselves first to the issue of limitation raised by the Counsel for the Insurance Company.  It is seen from the material on record that though admittedly the claim was repudiated on 07.01.2011 as ‘no claim’ on the ground that the claimant’s claim was declined due to delay in submitting the information to the Insurance Company, it is pertinent to note that the Insurance Company in their Written Version have pleaded that they had written letters to the Complainant on 16.03.2011, 30.04.2011 and 12.05.2011 seeking formalities to process the claim.  A brief perusal of the Surveyor Report shows that it is dated 12.05.2011 whereas the repudiation is in the month of January, 2011 and is subsequent to the repudiation.  There are no substantial reasons given by the Insurance Company as to why the repudiation was done four months prior to the receipt of even the Surveyor Report.  Considering the fact that the Insurance Company communicated to the Complainant even after having repudiated the claim, we are of the considered view that both the Fora below were right in coming to the conclusion that the cause of action is a continuing one. 

8.       The second contention of the Ld. Counsel is that there was a delay of 35 days about the intimation of the theft of the vehicle and, therefore, the claim is not admissible. The Hon’ble Supreme Court vide its order dated 04.10.2017 in Civil Appeal No. 15611 of 2017  Om Prakash Vs. Reliance General Insurance & Anr.  has laid down that mere delay in intimation of theft cannot be the ‘sole’ ground for repudiation. Further there is a specific pleading of the Complainant that an FIR was lodged on the very same day of the theft of the vehicle and the intimation was also given to the Insurance Company by UPC.  Keeping in view the Order of the Hon’ble Supreme Court in Om Prakash (supra) and also the averments made in the Complaint, we are of the considered view that mere delay of 35 days alone cannot be the sole ground for repudiation.

9.       Ld. Counsel for the Insurance Company also argued that the cover note No. 739102 was issued on 11.11.2010 and that the period of insurance cover was from 12.11.2010 to midnight of 11.11.2011 and the theft took place on 10.11.2010 and, therefore, the policy does not cover it.  The date of issue of the cover note is 11.11.2010 but the Ld. Counsel for the Respondent/Complainant vehemently argued that the cover note was issued on 21.10.2010 and the policy risk commences from that date.

10.     It is relevant to note that in the Written Version filed before the District Forum there is absolutely no whisper of the cover note having been issued after the date of theft.  In fact in the Written Version both in their preliminary objections and in their reply based on merits, the Insurance Company has only raised the ground of delay in intimation and it was barred by limitation.  It is also pertinent to mention that in the repudiation letter, had the theft not been covered by the policy, that would have been the first and main ground for repudiation.  Secondly it is also strange that the Investigation Report dated 13.05.2011 clearly specifies the policy period to be from 22.10.2010 to 21.10.2011.  If the cover note was issued after the date of theft not only would that be the main ground for repudiation but also the Investigator would not have been appointed and further the same would have also been mentioned in his report.  On the contrary, the Investigator mentions the claim No. as “10000/31/11/C/031424” and the policy period as  “22.10.2010 to 21.10.2011” in his report dated 13.05.2011.  Even in their subsequent letters written by the Insurance Company to the Complainant or in their grounds of Appeal before the State Commission this issue was never raised.  For all the afore-noted reasons, we are of the considered view that the theft happened during the risk period covered by the Insurance Policy, that the Complaint is not barred by limitation and we are also of the considered view that both the Fora below have rightly held that there was deficiency of service on behalf of the Insurance Company in repudiating the claim.  It is observed that only a reasonable rate of interest @ 9% p.a. has been awarded from the date of theft which date is modified to the date of repudiation i.e. 07.01.2011.  In the result this Revision Petition is partly allowed modifying the order of the State Commission only to the extent of period of payment of interest i.e. 9% p.a. interest is to be paid on ₹11,20,000/- from the date of repudiation instead of date of theft.  The rest of the order of the State Commission stands affirmed.