BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE URBAN

    17^th DAY OF JANUARY 2019

O R D E R

SRI. S.L PATIL, PRESIDENT

The complainant has filed this complaint U/s.12 of the Consumer Protection Act, 1986 against Opposite Parties (herein after referred as OPs) with a prayer to direct OPs to make the payment of Rs.4,42,622/- to the complainant as claimed under the insurance policy and with interest @ 12% p.a calculated from the date of accident, to settle all the loan dues of Magma fincorp limited which the complainant has raised from December 2014 to till car gets repaired from Prerana Motors, to compensate the complainant for the hardship, mental and emotional trauma caused and financial loss due to the deficient service rendered by the OP by payment of the sum of Rs.5,00,000/- and to award the cost of the proceedings.

2. The brief allegations made in the complaint are as under:

The complainant is an owner of the Tata Indica V2LX (car) temporary registration vehicle No.KA-16-TR-002148/KA, Engine bearing No.4751DI03JVYP35862, chassis bearing No.MAT600175ETJ11940 and the OP-1 is insurance company insured to the said vehicle having its office at Kolkata.  OP-2 is a Divisional Office of the OP-1 having its office at Bangalore.  Complainant by nature is a driver of light motor vehicle and he had opted it as is profession from past one year.  He was driving someone’s car as driver for his livelihood and out of his saving he thought of buying a new car instead of working as driver for some others car for his earnings.  That the complainant had approached Tata Motors in Tumkur for purchasing the Indica V2LX (Car) and he applied loan to purchase the said car in Magma finance and the said finance company sanctioned loan of Rs.3,00,000/- for purchasing the said car.  Finally the complainant purchased said Tata Indica V2LX (Car) at Tumkur for commercial purpose.  The total consideration of the said car is Rs.4,50,000/- out of which the complainant paid Rs.1,50,000/- by way of cash and paid remaining amount through loan, subject to a condition of paying monthly installments of sum of Rs.13,000/- to the Magma finance and till today the said car is hypothecated to Magma Fincorp Limited.  That complainant had obtained all necessary permission such as Temporary Certificate of Registration from the Regional Transport Office, Tumkur to the car bearing No.KA-06/TR002148/KA before he brings his car on road.  That the complainant had insured the said car in the OPs insurance company for a sum of Rs.25,145/- under the Commercial Vehicle Class (PCV) Package Policy with policy No.P0015400002/4103/123357, valid from 31.10.2014 to 30.10.2015.

That on 13.11.2014 at about 4.35 PM the said insured vehicle met with an accident while being driven by the complainant near Kaduru, Karnataka.  Further submitted that an FIR was also registered on complainant, in Kadur Police Station, Chickmagalur District on 13.11.2014 regarding the accident of the said vehicle.  That after the said incident he left the car for repairs on 27.11.2014 to Prerana Motors (P) Ltd.  After inspecting the vehicle, the Prerana Motors (P) Ltd., estimated the total delivery bill for the repair of said car as Rs.4,42,622/-.  That when he had been to claim the insured amount from the OPs under the insurance policy issued by the OPs to the complainant, OP-2 sent a letter on behalf of OP-1 dated 29.01.2015 claiming that there was no permit available for the complainant vehicle at the time of the accident and therefore the claim does not fall under the insurance policy and further it comes under the exclusion clause contained in the policy itself and therefore the claim made by the complainant is rejected.  OP-1 sent another letter dated 24.02.2015 claiming that the said vehicle of the complainant was not holding valid permit at the time of accident.  Further the OP stated “plying a motor vehicle without valid permit is a violation of Motor Vehicles Act and also the terms and conditions of the policy.

That the denial of liability or escaping from the liability by the OPs is against the statutory provisions, illegal and malafide.  Further the OPs have failed to provide the service for the amount they have received from the complainant under insurance policy, which clearly indicates that they are deliberately escaping from the liability and services on frivolous and baseless grounds and this constitutes deficient service for which the complainant deserves to be compensated.  Because of which the complainant is unable to repay loan amount obtained from Magma fincorp limited for which he is getting harassed like anything to repay the loan dues.  It is further submitted by the OPs that even after making several attempts and after running from pillar to post to contact the OPs to recover the money from OPs under the insurance policy the complainant has completely failed in getting the money.  Finally the complainant sent legal notices to both OPs on 05.03.2015 asking for a settlement of his claim in accordance with law.  That both the OPs have completely ignored the legal notices served upon them by the complainant and have neither acknowledged nor replied to the same, causing further delay in the settlement of the claim and ultimately ending with mental and emotional harassment to the complainant.  Hence left with no other remedy, the complainant has filed this complaint.       

3. Despite service of notice to OP-1 failed to appear before the Forum.  Hence OP-1 placed ex-pare.

4. In response to the notice issued, OP-2 appeared through their advocate and filed their version contending in brief as under:

The complaint filed by the complainant is not maintainable either in law or on facts or on merits.  The complainant has not approached this Forum with clean hands and he has violated basic terms and conditions of the policy by plying his vehicle without valid permit at the time of accident, which is also violation of Motor Vehicles Act.  Therefore, the present complaint is liable to be dismissed.

The complaint filed by the complainant against OPs, seeking reimbursement of the amount said to have been spent by him towards carrying repairs to Car No.KA-06-TR-2148 which sustained damages in the accident dated 13.11.2014.  That the complainant obtained commercial vehicle class (PCV) Package insurance policy from the OPs in respect of his Car vide policy No.P00015400002/4103/123357 for the period between 31.10.2014 to 30.10.2015.  Hence it is clear that, the complainant obtained passenger Carrying Commercial vehicle policy for which the permit is very much necessary.  The complainant submitted claim form to the OPs and the second OP having registered the claim of the complainant processed the same and finally repudiated the claim of the complainant on the ground that, after perusal of related documents pertaining to the claim it is observed that, permit for the said car was not available at the material time of accident and plying a motor vehicle without valid permit is a violation of Motor Vehicle Act and also policy terms and conditions.  Hence his claim was repudiated vide letter dated 24.02.2015.  Since the complainant used the insured vehicle by plying on the road without valid permit, he has violated basic terms of the policy and violated the rules formulated in the motor Vehicle Act.  The OPs repudiated the claim of the complainant strictly adhering to the terms and conditions of the policy and merely because the claim of the complainant is not settled, as it is not payable, the same cannot be termed as deficiency of service on the part of the OPs by dealing with the claim of the complainant.  The Own-Damage-Claim and interest are not extended by the insurers to comply with any statutory requirements.  If it is third party risks, the Motor Vehicles Act mandates that all Motor vehicle owners shall obtain a policy to comply with Chapter-XI of the Motor Vehicles Act.  The own-damage-claim is based purely on contract between the insurer and the insured.  The present complaint filed by the complainant alleging deficiency of service against the OPs on the ground that their Own-Damager-claim amount was not paid by the OPs.  That the claim of the complainant is repudiated only after perusal of the documents furnished by him in support of his claim and as the vehicle did not have permit as on the date of accident, his own damage claim is repudiated.

Chapter-V of the Motor Vehicles Act, 1988, deals with control of Transport Vehicles.  In Section 66 of the Act, it is mentioned that necessity for permits – “no owner of a Motor vehicle shall use or Permit the use of the vehicle as a Transport Vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or counter signed by a Regional or State Transport Authority or any prescribed Authority authoring him the use of the vehicle in that place in the manner in which the vehicle is being used”.  Hence, it is clear that, no owner is permitted to ply the transport vehicle on road without permit.  In the present case, as on the date of the accident, the said vehicle did not posses permit to ply on public road.  That the complainant is a driver by profession, he was working as driver in somebody’s car for his livelihood, he thought of buying a new Car instead of working as driver for someone and he obtained driving licence to drive a Cab is not within the knowledge of the OPs.  Complainant purchased Indica V-2 LX Car at Tata Motors Tumkur by obtaining loan of Rs.3,00,000/- from Magma Finance Corporation for a sum of Rs.4,50,000/- is forthcoming as per the sale certificate and tax invoice produced by the complainant.  The complainant obtained necessary permission such as Temporary Certificate of Registration from RTO, Tumkur to his Car No.KA-06/TR002148/KA is true as per Annexure-D i.e., Temporary Registration Certificate and the same is valid from 03.11.2014 to 02.12.2014.  However, he has not obtained valid and effective permit and permanent registration number to the said car as on the date of accident.  That on 13.11.2014 at about 4.35 PM the said vehicle met with an accident when the complainant was driving the same near Kadur and the same was informed to Kadur Police Station is not within the knowledge of the OPs and they came to know the facts when the complainant furnished claim along with the police documents.  That the complainant left the car for repairs on 27.11.2014 to Prerana Motors, after inspecting the vehicle they have furnished total estimation for carrying repair of the car at Rs.4,42,622/- is also not within the knowledge of this OPs.  When he had been to claim the insured amount from the OPs, OP-2 sent a letter on behalf of OP-1 on 29.01.2015 stating that there was no permit for the vehicle at the time of accident and therefore the claim does not fall under the insurance policy and as per exclusion clause the claim is not payable and therefore it is rejected is not in dispute since the fact that, as on 13.11.2014, the vehicle was not having permit to ply on public road.  OP-1 sent another letter dated 24.02.2015 stating that, the complainant’s car was not holding permit at the time of accident and plying on a motor vehicle without permit is violation of Motor Vehicle Act and also as per the terms and conditions of the policy is true.  That the denial of liability or escaping from the liability by the OPs against the statutory provision is illegal and malafide, the OPs have failed to settle the claim of the complainant on frivolous and baseless grounds, the act of the OPs leads to deficiency of service, due to repudiation of the claim, the complainant is unable to repay loan amount and put to great trouble is denied as false.  OPs acted strictly as per terms and conditions of the policy while dealing with the claim of the complainant.  Merely because his claim is not settled, as it was not payable as per terms and conditions of the policy, that cannot be termed as deficiency of service on the part of OPs.  OPs never bothered the complainant as alleged by him.  The fact that, the result of the claim that is repudiating the claim of the complainant was sent to the complainant on 29.01.2015 explaining the reasons for repudiation and another letter was sent on 24.02.2015 to the complainant by the OPs.  The present complaint is filed only with allegations and with the facts which are far from truth.  Since the claim of the complainant is not maintainable before this Forum, much less he is not entitled to claim any sum with OPs.     

OP-2 has also given para wise reply to the contents of the complaint, which appears to be denial in nature.

For the reasons mentioned above, OP-2 prays for dismissal of the complaint with exemplary cost.

5. The complainant in support of his case tendered his affidavit evidence reiterating the allegations made in the complaint.  Both parties produced certain documents.  Written arguments have been filed.  We have also heard oral arguments.

6. The points that arise for our consideration are:

        7. Our answer to the above points are as under:

REASONS

8. Point No.1 & 2:-   We have briefly stated the contents of the complaint as well as the version filed by OP-2.  Point Nos.1 & 2 are interconnected hence we have taken both for discussion just to avoid repetition of facts.  The undisputed facts which reveals from the pleadings of the parties goes to show that, the complainant is the owner of the Tata Indica V2LX (Car) (hereinafter referred as said car).  Having temporary registration vehicle No.KA-06/TR002148/KA.  It is also not in dispute that the said vehicle has been insured with OP-2.  It is also not in dispute that the said car has been purchased for commercial purpose.  It is also not in dispute on 13.11.2014 at about 4.35 PM the said car was met with an accident while being driven by the complainant near Kadur, Karnataka.  Accordingly FIR has been registered against the complainant in the said Police Station and set criminal law into motion.  It is also not in dispute that after the said accident the complainant left the said car for repair on 27.11.2014 in Prerana Motors Pvt. Ltd.  After inspecting the said car, the Prerana Motors Pvt. Ltd., estimated the total delivery bill for repair of the said car as Rs.4,42,622/-.  Thereafter the complainant submitted his claim before the OPs as the said car covered under insurance.  The second OP sent a letter on behalf of 1^st OP dated 29.01.2015 stating that there was no permit available for the complainant vehicle at the time of the accident hence the claim does not fall under the insurance policy.  Further the 1^st OP also sent another letter dated 24.02.2015 claiming that the vehicle of the complainant was not holding valid permit at the time of accident.  Further stated that “plying a motor vehicle without valid permit is in violation of Motor Vehicles Act and also the terms and conditions of policy”, which can be seen on going through the Annexure-K.

9. Now the sole question that crops up for our consideration is, whether plying the said car without valid permit is in violation of Motor Vehicles Act and also the terms and conditions of the policy.  In this context the complainant has taken only one contention that after purchase of the said car a temporary registration certificate has been issued.  But he has no where stated that he has obtained the permit to ply the said car.  Now what are the consequences if vehicle plied without valid permit which is in violation of the Motor Vehicles Act and also the terms and conditions of the policy.  In this context, the learned advocate for OPs placing reliance on a judgment rendered by Hon’ble National Consumer Disputes Redressal Commission, New Delhi, in case a between New India Assurance Company Ltd., Vs. Birbal Singh Jhakhar in Revision Petition No.2476/2012 dated 06^th February 2014, wherein para.8 to 11 held as under:

“In the context of the above noted settled legal position, we now proceed to analyse the facts of the case.  Section 66 (1) of the Motor Vehicles Act, 1988 deals with “Necessity for permits”, which reads thus:

            “Necessity for permits.

1. No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorizing him the use of the vehicle in that place in the manner in which the vehicle is being used”.

9. From the above, it is clear that no transport vehicle can be used on any public place without a valid permit.  In other words, a transport vehicle without a valid permit cannot be plied on the road.  For the violation of the said provision, there is a penal liability provided under section 192 (A) of the Motor Vehicle Act, 1988.

10. It is undisputed that at the time of incident, the vehicle in question was being plied on a pubic road from Bhadhadar to Sikar.  On perusal of the Policy Schedule-cum-Insurance Certificate, we find that at the bottom left corner, the insurance also provides “Limitations as to Use”, which reads thus:

“The Policy covers use only under a permit within the meaning of the Motor Vehicles Act, 1988 or such a carriage falling under sub-section (3) of Section 66 of the Motor Vehicles Act, 1988.  The policy does not cover use for (a) organised racing, (b) Pace making, (c) Reliability trails, (d) Speed Testing, (e) use whilst drawing a trailer except the towing (other than for reward) of any one disabled mechanically propelled vehicle”.

11. On bare reading of the above, it is clear that under the insurance contract between the parties, the insurance cover extended to the insured is subject to the use of the vehicle only under a permit within the meaning of Motor Vehicle Act, 1988.  It is well settled that insurance contract is a species of commercial transaction and it must be construed like any other contract as per its own terms and conditions.  Hon’ble Supreme Court in the matter of Vikram Greentech (I) Ltd. & Anr. Vs. New India Assurance Co. Ltd. being Civil Appeal No.2080 of 2002 decided on 01.04.2009 while dealing with the question about the construction of an insurance contract has held thus:

“An insurance contract, is a species of commercial transactions and must be construed like any other contract to its own terms and by itself.  In a contract of insurance, there is requirement of uberimma fides i.e. good faith on the part of the insured.  Except that, in other respects, there is no difference between a contract of insurance and any other contract.  The four essentials of a contract of insurance are, (i) the definition of the risk, (ii) the duration of the risk, (iii) the premium and (iv) the amount of insurance.  Since upon issuance of insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the insurance policy, its terms have to be strictly construed to determine the extent of liability of the insurer.  The endeavour of the court must always be to interpret the words in which the contract is expressed by the parties.  The court while construing the terms of policy is not expected to venture into extra liberalism that may result in re-writing the contract or substituting the terms which were not intended by the parties.  The insured cannot claim anything more than what is covered by the insurance policy.  (General Assurance Society Ltd. Vs. Chandumull Jain and another, Oriental Insurance Co. Ltd. Vs. Sony Cheriyan and United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal).

Document like proposal form is a commercial document and being an integral part of policy, reference to proposal form may not only be appropriate but rather essential.  However, the surveyors’ report cannot be taken aid of nor can it furnish the basis for construction of a policy.  Such outside aid for construction of insurance policy is impermissible”.

From the above judgment, it is clear that an insurance contract is like any other commercial contract and it must be construed strictly as per its terms and conditions.  Admittedly, in this case, at the time of incident, vehicle was being plied on a public place without a permit.  Therefore, in view of the above noted clause relating to Limitation as to Use, the insurance cover is not available to the insured.  It is contended on behalf of the respondent complainant that the above noted Limitation as to Use clause is immaterial for the reason that the vehicle in question was comprehensively insured and it was hit by a bus coming from the opposite direction without there being any fault on the part of the driver of the vehicle in question.  The aforesaid argument is of no avail to the respondent complainant because the vehicle was being plied in violation of a “Limitation as to use” clause which is fundamental breach of insurance contract.  Thus, it is clear case of violation of material terms and conditions of insurance contract having direct bearing on the extension of insurance cover.  Therefore, the petitioner insurance company was justified in repudiating the claim”.   

10. Learned Counsel for OPs further placed reliance on a judgment in the case of M/s. Suraj Mal Ram Niwas Oil Mills (P) Ltd., V/s. United India Insurance Co., Ltd., and another, reported in 2010 AIR SCW6490, wherein paras.23 and 24 reads thus:

23. Similarly, in Harchand Rai Chandan Lal’s case (supra), this Court held that:

“The terms of the policy have to be construed as it is and we cannot add or subtract something.  Howsoever liberally we may construe the policy but we cannot take liberalism to the extent of substituting the words which are not intended”.

24. Thus, it needs little emphasis that in construing the terms of a contract of insurance, the words used therein must be given paramount importance, and it is not open for the Court to add, delete or substitute any words.  It is also well settled that sine upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer.  Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed by the parties.

11. If the contents of the decisions cited supra are strictly construed one thing is very clear that if commercial vehicle is plying without permit which is in violation of Section.66(1) of Motor Vehicles Act and also the terms and conditions of the policy the insurance company is not liable to honour the claim.  In this context the claim repudiated by the OPs on the ground that the said car was not holding valid permit at the material time of accident is just and proper.  Accordingly we answer point No.1 in negative and point No.2 in the affirmative.

          12. Point No.3: In the result, we passed the following:         

  O R D E R

The complaint filed by the complainant is dismissed.  We direct both the parties to bear their own costs.

Supply free copy of this order to both the parties.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Forum on this 17^th day of January 2019)

MEMBER                                                              PRESIDENT

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Witnesses examined on behalf of the complainant dated 04.01.2016.

Mr.Raju K.G

Documents produced by the complainant:

Document produced by the Opposite party-2.

MEMBER                                                               PRESIDENT

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