DATE OF FILING-7.6.2011
DATE OF DISPOSAL- 26.3.2014
O R D E R
Miss.S.L.Pattnaik,President
The complainant alleges that he is an unemployed youth and for earning his livelihood, he purchased one Indica Car in financial assistance of Opposite Party No.1, the financial organization. Opposite Party No.2 is the recovery section of the Opposite Party No.1. The car is being registered bearing Regn.No.OR-07T-6219. While sanctioning of loan, the complainant had submitted some post dated cheques towards E.M.I deposits and towards insurance premium. The vehicle of the complainant was insured with ICICI Lambard through the Opposite Party No.1. After being insured of the vehicle, the complainant has received the R.C. Book, insurance certificate, etc. on 27.1.2010. The vehicle was registered under taxi and contract carriage permit. The vehicle was also insured by Opposite Party No.1 under Passenger Carrying Package Policy validated from 29.12.2009 to 28.12.2010. Similarly, the complainant had also paid through cheque for the second year insurance to Opposite Party No.1 to effect and procure second year insurance policy. Second year insurance policy was made with Opposite Party No.3,the Reliance General Insurance. In the second year policy, it was noticed by the complainant that the
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insurance was procured against the vehicle of the complainant under private policy which was valid from 21.12.2010 to 20.12.2011. The complainant informed the matter to the Opp.Party No.1 and requested him to make necessary arrangement to change the policy from private to commercial but he remained in adamant and could not take action to rectify the defect in the policy issued by O.P.No.3. As a result, the complainant could not be able to run the vehicle on the road since the registration was made under taxi and contract carriage permit. By the way the complainant was to loss of earning from the said car at the rate of Rs.15,000/- per month. When the matter stood thus, the said vehicle met with an accident while coming from Bhubaneswar on 20.1.2011 and the vehicle was badly damaged, An F.I.R. was lodged with Khandagiri Police Station on 20.1.2011. When the damage for Rs.45,000/- was claimed with Opposite Party No.3, the insurance company i.e O.P.No.3 refused to settle claim as the policy was made private policy in violation of M.V.Act. According to the complainant, he has sustained loss, damage, mental agony and harassment only due to negligence of the Opposite Party No.1 and 2 and, therefore, he has claimed Rs.,1,30,000/- as compensation and cost of litigation as deemed fit. Hence, this complaint petition. In support of his case the complainant has filed certain documents which are marked as Annexure-1 to 8 respectively.
2- The Opposite Party No.1 is represented through their learned counsel and filed the written version wherein it is admitted, inter-alia, that the complainant was advanced the disputed Indica Car bearing Regn.No.OR-07T-6291 under Hire Purchase Agreement made on 28.12.2009 between the complainant with the Opposite Party No.1. As per agreement the complainant was required to repay the amount of Rs.3,87,888/- in 48 monthly installments. The Opp.Party No.1 was required to procure insurance on behalf of the complainant for 3 years and in this regard, a sum of Rs.47,088/- was included in the hire charges as insurance premium for 3 years. It is stated that the complainant was interested for insuring the vehicle under private vehicle since the premium payable for commercial vehicle was much higher than the private vehicle. It is admitted that a sum of Rs.9419/- was paid by the O.P.No.1 towards second year insurance of the vehicle. It is further stated that the vehicle was insured with the O.P.No.3 under private vehicle policy for the period from 21.12.2010 to 20.12.2011 on the request of the complainant. However, he was default in payment of the installment dues thereafter for which notice was served upon him on dated 29.8.2011 for termination of hire purchase agreement and demanded the payment of dues of
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Rs.2,34,139/-. When the complainant did not pay the amount despite notice, the matter was referred to Arbitrator as per the agreement for realisation of the amount against the vehicle. It is, therefore, contended that the complainant, in order to avoid payment, has come with the instant case which is not maintainable in the eye of law and prayed for dismissal of the case. In support of its case the Opposite Party No.1 has filed certain documents and citations which are placed on record.
The Opposite Party No.2 has preferred not to file written version.
The Opposite Party No.3 in its written version has stated that the vehicle OR-07-T-6219 was insured under private policy for the period from 21.12.2010 to 20.12.2011. Therefore, the claim of the complainant for the damage made on 19.1.2011 was denied due to the fact that the vehicle was not covered the risk of contract carriage/commercial package policy by paying extra premium. It is further stated that at the time of accident the vehicle was plying in violation of M.V.Act as there was no fitness certificate to ply the vehicle on the road. The fitness certificate was obtained after the accident which was valid for the period from 27.1.2011 to 26.1.2012 whereas the accident was occurred on 19.1.2011. It is, therefore, contended that there is no liability to settle the claim of the complainant and since there is no deficiency in service or negligence on its part the case is liable to be dismissed against the insurance company. In support of its case, the Opposite Party No.3 has filed certain documents which are marked from Annexure 1 to 6 respectively.
3- We have carefully perused the documents filed by the respective parties and heard the learned counsel appearing for the respective parties at a length. We have gone through the case in detail and perused the written arguments filed by the parties. It is not in dispute that the complainant purchased the vehicle for earning his livelihood being financed by the Opposite Party No.1 by executing Hire Purchase Agreement as agreed by both the parties. The vehicle viz.Indica car was provided through Opposite Party No.1 on 29.12.2009 to the complainant. It was agreed between the parties that first three years insurance policy in respect of the vehicle should have to be deposited by the complainant at the time of hire purchase agreement and it was the responsibility of the Opposite Party No.1 to insure the vehicle on behalf of the complainant as because till repayment of the hire purchase amount, the vehicle would be the property of the financer. In fact, the first year insurance was made by the Opposite Party No.1 with the ICICI Lambard, the insurance company. Annexure-1
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filed by the complainant is the copy of the first year insurance policy. While perusing the above policy we find that the policy was procured for the period from 29.12.2009 to 28.12.2010 under Passenger Carrying Package Policy. The vehicle was also registered and permit was also obtained in respect of contract carriage for the period from 26.2.2010 to 25.2.2015. Annexure-3 is the permit of the vehicle filed by the complainant. After expiry of the first year policy, it was the obligation of the Opposite Party No.1 to renew the policy for the second year since the vehicle was their property and the repayment was not terminated. But the second year policy was alleged to have insured with the Opposite Party No.3,Reliance General Insurance for the period from 21.12.2010 to 20.12.2011 under private policy. No extra premium was paid to cover the risk as passenger carrying package policy despite the fact known to the Opposite Party No.1 that the complainant plying the vehicle as passenger carrying and permit was also obtained accordingly. It is also admitted by the Opposite Party No.1 that the amount for three years policy premium was deducted from the amount sanctioned/financed for the vehicle. Under these circumstances, we are to believe and accept the contention of the complainant that he could not able to ply the vehicle due to want of valid insurance policy.
4- Regarding non-settlement of the claim by the Opposite Party No.3 as alleged by the complainant, we make it clear that the Opposite Party No.3 is the insurance company who settles the claim taking into consideration the terms and conditions laid down in the policy. The policy was made as private policy and no extra premium was paid by the complainant to cover the extra risk as per its registration. Moreover, the damage was occurred on 19.1.2011. The Opp.Party No.3 has stated that the fitness of the vehicle was for the period from 27.1.2011 to 26.1.2012. But on perusal relevant documents we find that the fitness was availed by the complainant from appropriate authorities for the period from 27.1.2010 to 26.1.2012. This also corroborates the report of the Surveyor of the Opposite Party No.3. Under such situation, the plea of Opp.Party No.3 that the vehicle was having no fitness certificate at the time of accident has not to be accepted. The vehicle was having valid fitness certificate at the time of accident. But at the time of accident the vehicle was having passenger carrying permit and the insurance was made under private policy. So, the insurance company at this stage can not be put liable for settlement of the claim.
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5- It is claimed by the Opposite Party No.1 that the complainant was default in payment of repayment dues and, therefore, the case of the complainant was referred to the Arbitrator who passed his order for recovery of the amount from the complainant. In fact, the vehicle was financed through Hire Purchase Agreement executed between the parties and any deviation thereof by any of the parties are subjected to prosecution under arbitration clause as per the agreement. But before us there is no case for violation of arbitration clause. The Opposite Party No.1 has ample right to take necessary remedies for realization of the amount as per Hire Purchase Agreement. In support of its case, the Opposite Party No.1 has filed a decision of Hon’ble National Commission, New Delhi reported in 2006(3) CPR 339(NC). After perusing the decision, we come to the conclusion that the above decision has no relevance to the present dispute at hand. Therefore, the plea of the Opposite Party No.1 with regard to repayment of the loan dues at this stage is not to be accepted. 6- In view of the above discussion, it is clear that the Opposite Party No.1 has the negligence and deficiency in service while procuring insurance policy for second year in respect of the disputed vehicle on behalf of the complainant having received the amount from the complainant in advance. Therefore, the plea of the Opp. Party No.1 that under the insistence of the complainant, the second year policy was procured as private policy is not to be accepted. Therefore, we are to accept that the claim of the complainant that in absence of the valid insurance policy, the vehicle could not be plied and thereby he has to sustain financial loss of Rs.75,000/- at the rate of Rs.15,000/- per month which includes the monthly installment. However, the claim of the complainant in respect of his expenses made towards repairing of the damage caused during second year policy in force cannot be accepted on the ground that the vehicle had plied by the complainant in absence of valid insurance policy at his own risk in violation of M.V.Act. Since we have already hold that in absence of valid policy the vehicle was remained stand still for a long period and the complainant was entitled for the loss caused to him, in that situation the complainant plied the vehicle in absence of valid license at his own accord for which the Opposite Parties cannot be made liable to compensate the damage caused to him.
7- In view of the above discussion, we hold that there is gross negligence and deficiency in service on the part of Opposite Party No.1 while procuring the second year policy on behalf of the complainant and thereby the complainant was unable to ply the vehicle in absence of valid insurance policy. Opp.Party No.2, being the branch office of
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Opposite Party No.1, so all the transactions were made with O.P.No.1 through Opp.Party No.2. Therefore, the Opp.Party No.2 is equally liable for the acts of Opposite Party No.1. In this regard, the Opposite Party No.1 and 2 are jointly and severally liable to compensate to the complainant of Rs.75,000/- as claimed by the complainant for the entire period of policy in force. Regarding claim for compensation with regard to his sufferings, mental agony and harassment, we award a sum of Rs.3,000/- as compensation in favour of the complainant.
8- In the result, we allow the case of the complainant against Opposite Party No. 1 and 2. We direct the Opposite Party Nos.1 and 2 to pay a sum of Rs.75,000/-(Rupees seventy five thousand) to the complainant towards his loss as discussed in the foregoing paragraphs. We also direct the Opposite Party No.1 and 2 to pay Rs.3,000/-(Rupees three thousand)l towards compensation and Rs.2,000/- as cost of litigation to the complainant. The amount as ordered above, has to be complied by the Opposite Party Nos 1 and 2 jointly and severally within 60 days from the date of receipt of this order failing which the entire amount would carry interest at the rate of 9% per annum thereafter. The case is disposed of accordingly.
Copy of the order be furnished to the parties free of cost.
Dictated and corrected by me on this 26th day of March,2014.
(Dr.N.Tuna Sahu) ( Mrs.M.Pradhan) (Miss S.L.Pattnaik)
I AGREE(MEMBER) I AGREE(MEMBER) PRESIDENT
