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.362/2012
SMT. NEELAM KUMAR
THROUGH MR. KUMAR ANKUR
I-44, JANGPURA ENTN,
NEW DELHI-110014. …..COMPLAINANT
Vs.
MANAGING DIRECTOR
TATA AIG, UNIT NO.1,
P. NO. 2, DDA BUILDING,
Distt. CENTRE, NEHRU PLACE,
NEW DELHI-110019 ..…..OPPOSITE PARTY
Date of Institution-22/08/2012
Date of Order- 04/11/2022
O R D E R
MONIKA SRIVASTAVA-President
The present complaint has been filed against OP, M/s Tata AIG General Insurance Company Ltd with the prayer that OP should issue cover note immediately at this new address mentioned in the memo of parties. A further prayer is made claiming monetary compensation of Rs. 5,00,000/-; litigation expenses of Rs. 25,000/- and loss recovery of Rs. 47,140/- along with interest @ 18% per annum w.e.f. 15.03.2012.
- The complainant was a subscriber of motor insurance policy issued by OP. The policy was taken for the first time on 08.01.2011 which was to remain valid till the midnight of 07.01.2012. The insurance was taken for the vehicle Honda City 1.5 EXI, bearing registration number HR -51- N-6120.
- It is further stated that complainant diligently renewed her policy before the expiry of its term. The complainant made a cash payment of Rs. 9460/- to the agent of OP at 3 PM on 07.01.2012. A cover note bearing WM no. 10945590 was issued to the complainant, an assurance was given by the authorized agent of OP that the policy will be issued within a period of one month.
- It is stated that since the policy documents were not received in the promised time, the complainant, called the toll-free number of OP on 06.03.2012 to enquire about the status of her policy, however she was informed that no cover note has been issued in favour of the complainant. The agent of OP, who had issued cover note, on being enquired, informed the complainant that he has deposited the cover note with the OP in the month of January itself and the policy may already have been issued to her.
- The complainant was unable to use the car after the expiry of sixty days from the issuance of cover note in terms of Motor Vehicles Act. The validity of the cover note expired on 07.03.2012. It is further stated that the insured vehicle met with an accident on 09.03.2012 at midnight outside the residence of complainant.
- OP, when informed about the accident intimated the complainant that the cover note issued to her is not valid and she is not entitled to any benefits of insurance. Consequently, the complainant had to pay a sum of Rs. 47,140/- to get the car repaired. Refusal to grant benefits of insurance, according to complainant is a deficiency in the services. Repeated reminders/requests to resolve the issue did not bear any fruit. The car remained uninsured for a period of 25 days. A legal notice was issued on 04.05.2012.
- OP, in its reply, on one hand states that the policy was renewed for a further period of one year between 08.01.2012 till 07.01.2013 upon receipt of premium of Rs. 8404/-. A cover note was issued bearing no. WM11438430 dated 07.01.2012 was issued. While on the other hand, it is stated that the owing to delay on the part of its agent in depositing the premium cheque, the policy was issued later. It is submitted premium cheque was deposited on 03.02.2012 hence OP could not have issued policy without receiving premium in terms of section 64VB of Insurance Act 1938. The policy was issued after receipt of premium.
- It is further stated that first communication with complainant was received on 01.03.2012 at its call center, which is after two months from the receipt of cover note. It is stated that the complainant is negligent in not bringing the issue of non-receipt of premium to the notice of OP during the validity of cover note. The subsequent information was received on 05.02.2012 when the complainant was informed that the policy has been sent by email. The hard copy of policy was sent on 09.04.2012 which could not be delivered as the complainant had changed its address and the OP was not intimated about it.
- It is stated that complainant was totally satisfied by its service which is indicated by the renewal of policy for the period 2013-2014.
The complainant has filed rejoinder. Both the parties have filed their respective evidence affidavits and written submissions. This Commission has gone through entire material on record.
The OP has not replied to the pertinent averment made by the complainant that she has paid a sum of Rs. 9460/- towards the premium, in cash, to the agent of OP which deemed to be admitted by the OP. The version of OP that it received the cheque in a sum of Rs. 8404/- towards premium is rather doubtful because the receipt issued by the OP records receipt of Rs. 9460/- while the premium was only Rs.8404/- and a credit of Rs. 1056/- is indicated in the receipt. Besides, the OP has not produced the cheque by which it received the alleged payment to controvert the averment of the complainant of making cash payment. This Commission is of the view that averment of the complainant that the premium was paid in cash is truthful.
In any case, since the OP has admitted that delay in depositing the cheque was caused by its agent, it cannot escape its liability as principal and is responsible for the conduct of its agent. The Complainant cannot be denied benefit of insurance merely because the insurance policy could not be issued to the complainant because the agent of OP failed to deposit the premium cheque in time. The OP cannot take benefit of its own wrong in denying the insurance claim. The Constitution bench of Hon’ble Supreme Court in the matter of General Assurance Society Ltd vs Chandumull Jain AIR 1966 SC 1644 has categorically held that after the expiry of temporary cover granted by cover note, the relations between the parties are governed only by the terms and conditions of the policy unless insurance is declined in the meantime. Delay in issuing the policy makes no difference. The relations even then are governed by the future policy. Therefore, the benefits of the policy cannot be denied because the validity of cover note has expired before the issuance of insurance policy.
The policy was eventually issued with retrospective date therefore, the OP shall be liable to refund the cost incurred by complainant in getting the car repaired. The complainant is also entitled to damages for mental harassment as she could not use the car for a period of 25 days, in terms of mandate of Motor Vehicles Act 1988 which bars driving vehicle without insurance policy.
This Commission therefore directs OP to refund the sum of Rs. 47,140/- incurred on the repair of the car by the complainant along with interest @ 6 % per annum w.e.f 15.05.2012 till realization. A sum of Rs. 20,000/- is awarded towards compensation for mental harassment. This entire sum would be payable by the OP within a period of three months from the date of the order failing which the said amount of Rs. 47,140/- would be payable with interest @ 9% p.a.
Parties be given copy of order to the parties as per rules. File be consigned to the record room. Order be uploaded on the website.
