Date: 10-07-2015
Sri Debasis Bhattacharya
This appeal is directed against the Order dated 12-09-2013 in C. C. No. 03/2013, passed by the Ld. District Forum, Jalpaiguri, whereby the complaint case has been allowed on contest. Being aggrieved by and dissatisfied with the same, the OP thereof has preferred this appeal.
Case of the Complainant, in short, is that he lodged an insurance claim in respect of his insured vehicle with the OP vide Claim No. OG-13-2404-1811-00000032, but even after the passage of long time, it has not settled his legitimate claim. Hence, the case.
Case of the OP, on the other hand, is that since the Complainant miserably failed to substantiate his claim by any supporting bill, payment receipt, etc., there was a gross violation of the policy terms and conditions, and the Complainant had lodged a false and fabricated claim and so, the OP had no other alternative but to close the said file due to non-cooperation of the Complainant. As soon as the claim was intimated, the OP appointed an approved independent IRDA licensed Surveyor for the assessment of the alleged claim and the Complainant was requested to supply certain documents that were indispensible for the settlement of the claim. But, since the Complainant failed to co-operate, the OP was helpless to honour any such claim. On receipt of survey report, it was found that the instant claim of the Complainant was a case of partial loss and accordingly, the OP authorized the Complainant a sum of Rs. 2,75,999/- as repairing liability under the policy and further requested the Complainant to co-operate with the Surveyor for further assessment/processing of the claim of the Complainant. As per condition no. 4 of the policy wording, ‘The Company may at its own option repair, reinstate or replace the vehicle insured or part thereof and/or its accessories or may pay in cash the amount of the loss or damage and the liability of the Company shall not exceed … (b) for partial losses, i.e., losses other than total loss/constructive total loss of the vehicle – actual and reasonable costs of repair and/or replacement of parts lost/damaged subject to depreciation as per limits specified’. In accordance with the policy condition stated in policy wording, the OP is only liable to compensate for actual and reasonable cost or repair subject to depreciation as per limits specified. Therefore, it is very clear from the policy wording itself that the company is responsible for payment subject to depreciation and other applicable deductions. The OP, immediately after receipt of the claim of the Complainant, duly processed the same and since there was gross violation of terms and conditions of Policy, the OP had to close the file as non-payable and thus, there is and cannot be any negligence of service on the part of the OP and the present petition is liable to be rejected on this score alone.
The Ld. District Forum allowed the case with a direction to the OP to pay the sum of Rs. 11,88,214.62 towards the loss sustained for the damaged vehicle in question together with litigation cost and compensation for a sum of Rs. 2,000/- and Rs. 20,000/-, respectively. Another sum of Rs. 2,00,000/- was awarded in favour of the Complainant by the Ld. District Forum on account of gross negligence on the part of the OP.
The moot point for consideration in this appeal is whether there is any infirmity with the impugned order, or not.
Decision with reasons
Ld. Advocate for the Appellant has submitted that the Insurance Company is responsible to indemnify the loss of insured vehicle subject to proper fulfillment of certain terms and conditions of the insurance policy. The Respondent has failed to substantiate his claim by means of any supporting bill, payment receipt etc., which amounts to violation of the terms and conditions of the insurance policy in question. Therefore, the Appellant cannot be held responsible for the present dispute under any circumstances. The Ld. District Forum has wrongly ignored the assessment done by an IRDA licensed Surveyor without any contradictory evidence from the side of the Respondent. Mere production of estimate without any corroborative evidence cannot be the basis of any liability under the policy. If done so, it would frustrate the legislative intent of Sec. 64UM of the Insurance Act. Moreover, in terms of condition no. 1 of the policy, Insured is under obligation to furnish such information and assistance as the Insurance Company requires. Therefore, the impugned order be set aside.
Ld. Advocate for the Respondent, on the other hand, has submitted that in compliance of the terms and conditions of the policy, due intimation to all the concerned authorities, including the Appellant was promptly communicated and afterwards, the vehicle was placed to the authorized service dealer of M/s Kirlosker, who estimated the repairing cost of damaged engine at Rs. 2,32,733/-. The Surveyor-cum-Loss Assessor appointed by the Insurer also got the damaged engine inspected and surveyed. The Terex TLB Backhoe loader was also inspected by the Surveyor at the place of the occurrence and M/s Tarex Co. supplied quotation dated 21-11-2012 for a sum of Rs. 9,90,240/-. Thus, the total required amount for repairing stood at Rs. 11,88,214/-. However, the Appellant has withheld the entire amount citing non-receipt of final requisite documents as per its demand. It is further argued by the Ld. Advocate that the Respondent has already incurred an expenditure of Rs. 2,09,250/- in order to get the Kirloskar engine repaired and submitted original bills pertaining to such expenditure. However, the Appellant has still not released that payment. The accident took place on 05-11-2012, but till date the Insurance Company has not assessed the loss sustained by the Respondent, which they ought to have done at the time of survey itself, only to defeat the legal claim of the Respondent. The impugned order is a fair order which be upheld to impart natural justice to him. In support of his defence, the Ld. Advocate has referred to a decision of the Hon’ble National Commission, reported in II (2013) CPJ 243 (NC).
The Appellant has stated in the Memo of Appeal that it is responsible to indemnify the loss of insured vehicle subject to proper fulfillment of certain terms and conditions of the insurance policy. However, neither it has submitted any copy of the terms and conditions of the concerned policy nor specified in black and white the specific wordings of relevant portion of the so called ‘certain terms and conditions’ those were allegedly not fulfilled by the Respondent. It is always desirable that when party to a litigation asserts something, it shows due maturity to back it up with cogent material/documentary proof. If indeed non-submission of bill, payment receipt etc. amount to violation of terms and conditions of the insurance policy in question, relevant portion of the policy schedule should have been put forth by the Appellant to substantiate it. We are, therefore, constrained to hold that Appellant’s claim in this regard remains unproved.
The Appellant in its WV stoutly denied receiving any estimate of Rs. 9,90,240.62 of M/s Terex Company. Curiously, however, it has annexed copy of said quotation dated 21-11-2012 along with its Memo of Appeal.
The Appellant stated in its letter dated 02-01-2013 that:-
‘On receipt of the survey report, we observed that the claim is of partial repair loss. Surveyor has already authorized to proceed with repair of the vehicle and repair liability is Rs. 2,75,999.00 as per policy terms and conditions. Kindly facilitate the surveyor for further assessment of the loss which enable him to submit the final survey report to us for further processing of the claim.’
In this regard, it bears mentioning that neither the Appellant has clarified as to whether it allows an independent Surveyor to accord due consent on behalf of the Insurance Company to proceed with repairing work, nor attached any documentary proof to substantiate it.
At a first glance, aforesaid contents of Appellant’s letter might give the impression that the survey report was merely an ad hoc/preliminary report. However, a glance through the survey report reveals that the Surveyor described it as his “Motor (Final) Survey Report”.
Be that as it may, let us now deal with the survey report in question.
From the copy of Respondent’s letter dated 17-12-2012, it transpires that the Surveyor inspected the damaged vehicle thrice. So, it can reasonably be presumed that the Surveyor acquired enough first-hand knowledge about the extent of damage sustained by the insured vehicle and after giving a thoughtful consideration into the estimates being placed before him by the Respondent/Service Centres, earmarked the spare parts that to his estimation were required to be replaced and quantified the loss in monetary term accordingly. Also, it is clearly mentioned in the survey report that, ‘No supplementary estimate would be entertained hereafter’. In such circumstances, if we look into the matter from practical perspective, there was virtually no scope that any of the spare parts those were disallowed by the Surveyor would be approved by the Insurance Company. Rather, there was every possibility of further curtailment by the Appellant while releasing payment.
On a closer look into the estimates vis-à-vis the Survey Report, we find that the Surveyor allowed 15 items out of the 74 items as mentioned in the estimate of M/s Terex dated 21-11-2012 and 14 items out of the 44 items in respect of the estimate of M/s NSB Technical & Industrial Services Pvt. Ltd. dated 18-12-2012. In order to justify such drastic cut, the Surveyor stated thus,
‘The damages in details were noted during inspection, which were due to falling/overturning impact, thrust & its jerks/jolts. The damages were found in conformity with the nature of accident & may be considered by the insurer per policy terms & conditions.
Details of damaged parts/items are mentioned in the assessment sheet. The damages disallowed were either old/not damaged or if found damaged were having no relevance with nature and cause of accident as claimed by the repairer in the Estimate.”
It is always desirable that a Surveyor would embark on an assignment in a transparent manner, as also maintain highest standard of probity and clarity. A casual remark like the above, however, does not signify the sincerity of purpose on the part of the concerned Surveyor. That he was not quite serious with the task at hand can be ascertained from the fact that he allowed a sum of Rs. 1,190/- towards the cost of 4 nos. wear pads as against the estimated cost of Rs. 431.84.
Even if we look at the survey report through an extremely conservative spectacle, such drastic cut does raise eyebrows. Having said that, we must make it clear that this is not to suggest that Surveyor should be impacted in any manner by the volume of items or value thereof as mentioned in an estimate of the service centre. However, what we intend to emphasize is the fact that proper explanation should be there behind disallowing every single item mentioned in the estimate. It is not possible for a consumer to read the mind of a Surveyor and understand what transpired in the mind of the Surveyor behind disapproving a particular spare part. The survey report itself should mirror the thinking of the Surveyor in uncertain terms. To cite an example, M/s Terex suggested replacement of “Cab Terex” which comes at a price of Rs. 2,13,020.41. The same has not been approved by the Surveyor. Since he did not assign any reason for disapproving this particular part, there is no possibility to fathom whether he considered it as an old damage or to his estimation the same was not damaged or it had no relevance with the nature and cause of accident.
Given the fact that the Surveyor figured out the loss at Rs. 2,75,999.00 against the estimated cost of repairing for a sum of Rs. 11,88,214.62, the rationality of such drastic disapproval ought to have been properly explained by the Surveyor. It appears from the record that the Appellant did not file either any affidavit or deposition from the side of the Surveyor in order to justify such massive exclusion of parts vis-à-vis the estimates of service centres. May be that the report of a Surveyor carries immense significance in the matter of determination of an insurance claim, however, there is no reason to treat this as sacrosanct; it is always subject to scrutiny. Insurance Company is accountable to its customer. If the survey report remains evasive in its content, the onus of justifying every single rupee deduction in respect of an estimate falls on the Insurance Company, which the Appellant in the present case has miserably failed to discharge.
That apart, no explanation is given from the side of the Appellant while there is necessary provision in the concerned insurance policy that the Insurer may at its own option repair, reinstate or replace the vehicle or part thereof, why such option was not explored though the Surveyor clearly stated in his report that damages were found in conformity with the nature of accident; more so, given the fact that the Respondent also apprised it of his financial crisis because of non-repair of the vehicle in question.
It is true that an insurance claim is subject to some deductions as per terms and conditions of the policy. However, taking into consideration the gross negligence on the part of the Appellant in the matter of settlement of Respondent’s claim, we see no good reason to interfere with the impugned order save and except some modifications of the compensatory award given by the Ld. District Forum.
In the result, the appeal succeeds in part.
Hence,
ORDERED
that the appeal be and the same is allowed in part on contest against the Respondent but without any order as to costs. The lump sum amount of Rs. 2,00,000/-, as awarded by the Ld. District Forum is hereby struck off. Rest of the impugned order shall remain unaltered.
