Per Mr.S.R.Khanzode, Hon’ble Presiding Judicial Member
This appeal takes an exception to an order dated 30/07/2010 passed in consumer complaint no.81/2008 Mr.P.J. Arumainarayagam Nadar and another v/s. New India Assurance Co.Ltd. and another, passed by Mumbai Suburban District Consumer Disputes Redressal Forum at Bandra, Mumbai (‘forum’ in short).
Consumer complaint pertains to alleged deficiency in service on the part of appellant/original opponent no.1 (herein after referred as ‘Insurance company’) for repudiating the claim in respect of heavy goods vehicle i.e. dumper bearing registration no.MH-04-BG-6010 which alleged to have been stolen on the night falling in between 5th and 6th July, 2006, when it was parked during the night in front of the house of respondent/ original complainant no.2-Mr.Nisar Ahmed Yusuf Khan at Malad (West), Mumbai. Forum uphold the contention of the complainants and directed insurance company to pay compensation of `5,89,400/- that is the amount of insured of the stolen vehicle along with interest @ 9% p.a. and also further awarded `5000/- as cost. Feeling aggrieved thereby, the insurance company preferred this appeal. It may be pointed out that complaint as against opponent no.2 -Canara Bank (respondent no.3 in this appeal) stood dismissed by the forum.
We heard both the contesting parties, namely, appellant/ Insurance company and respondent nos.1 & 2 i.e. original complainants as well as respondent no.3- Canara Bank through its counsel Mr.S.Hussain.
The short and only issue which is canvassed before us in the appeal is about the insurable interest of the complainants on the date when the vehicle was stolen vis-à-vis subsisting relationship with the insurance company as a service provider. It is alleged that prior to the said event, respondent/complainant no.1-Mr.P.J. Arumainarayagam Nadar had sold his vehicle to complainant no.2 - Mr.Nisar Ahmed Yusuf Khan and consequent to it even the registration certificate of the vehicle recorded in the name of complainant no.2 - Mr.Nisar Ahmed Yusuf Khan on 30/05/2006. However, it is alleged by the insurance company that until they receive communication dated 13/07/2006 (which was received on 17/07/2006) they were unaware of said transfer and as said communication requesting transfer of the insurance policy, which was simple letter without complying with necessary formalities, was received much after 14 days i.e. the time specified under section 157 of Motor Vehicles Act 1988, and, that too, after the theft occurred, the insurance claim stood repudiated since on the date of event insured left with no insurable interest in the vehicle. Such repudiation was communicated to both the complainants, namely, respondent nos.1 & 2 by the insurance company by its letter dated Nil but in any case before 19/07/2007 when complainant no.2- Mr.Nisar Ahmed Yusuf Khan through his lawyer requested the insurance company to reconsider the claim. Said request was also replied by the insurance company by reaffirming their repudiation by its letter dated 12/10/2007.
The documents placed on record in this appeal are not disputed except one document, viz., alleged communication dated 09/04/2006 by complainant no.1- Mr.P.J. Arumainarayagam Nadar to the insurance company whereby he claimed that the insurance company was informed about the transfer of the vehicle in favour of respondent /complainant no.2 Mr.Nisar Ahmed Yusuf Khan. Insurance company categorically denied having received any such communication in their written version as well as in their earlier reply dated 12/10/2007, supra. Under such circumstances, it is for the respondents/original complainant nos.1 & 2 to establish the fact of sending such communication dated 09/04/2006 to the insurance company intimating alleged transfer of the vehicle, but they miserably failed to do so. Even if we refer to latter communication from respondent/complainant no.1- Mr.P.J. Arumainarayagam Nadar to the insurance company dated 13/07/2006, it could be seen that there is no reference in it to alleged earlier communication dated 09/04/2006. Had there been any such earlier communication made, such letter/communication dated 13/07/2006 would not have missed the reference for the same. Besides this, the alleged communication dated 09/04/2006 which, as earlier pointed out, is not tendered in evidence as per provisions of section 13(4) of the Consumer Protection Act, 1986 and equally, it is not an admitted or undisputed document. Even for the sake of argument taking into consideration that it does not refer to any particulars which are sine quo non to effect transfer of the insurance policy in the name of a new purchaser. It is certainly not in the prescribed form as required under section 157(2) of Motor Vehicles Act 1988. After receiving communication dated 13/07/2006 from respondent no.1 which according to insurance company for the first time it was notified to it about transfer of the vehicle, insurance company specifically stated in its reply communication dated 12/10/2007, supra, pointing out that communication dated 13/07/2006, supra, does not fulfill the requirements on the basis of which transfer of the insurance policy in the name of new purchaser could be made. They further categorically stated that no such transfer could be effected after the event of theft which was reported. Thus, appellant /Insurance company rightly, relying upon the decision of the apex court in the matter of Complete Insulations (P) Ltd. v/s. New India Assurance Co.Ltd. 1996 ACJ 65, stated that since it is a case of total loss since the vehicle was stolen and it is not a case in respect of claim against third party, section 157 of Motor Vehicles Act 1988 is not applicable and since the vehicle is not transferred till the date of event in the name of new purchaser, the insured i.e. respondent/ complainant no.1 since left with no insurable interest in the vehicle, the claim could not be considered and it was rightly repudiated accordingly by the insurance company. We find ourselves in agreement with such submission.
Ld.counsel appearing for the respondents /complainant nos.1 & 2 referring to clause IMT 7 in the insurance policy tried to submit before us that since the amount of insurance was payable to the institution so far as hypothecation is recorded (according to him in favour of respondent/opponent no.2-Canara Bank), absence of transfer of insurance policy in the name of new purchaser, namely, respondent /complainant no.2 is of no consequence. We do not agree with such submission. Firstly, because said policy became redundant once on transfer of the vehicle (as per provisions of Sale of Goods Act), the insured under the said policy viz. respondent/ complainant no.1, ceased to have any insurable interest in the vehicle which was admittedly sold by him to respondent/ complainant no.2.
At the second instance, it is reflected from the copy of registration book of the vehicle placed on compilation of this appeal, that the hypothecation endorsement in favour of the financer of respondent/ complainant no.1 got cancelled when the change in the name of new purchaser was recorded. There is no endorsement of recording any hypothecation or charge of respondent/opponent no.3- Canara Bank. In any case from the communication of the Canara Bank dated 06/07/2006, it could be seen that prior to the event of theft even respondent/opponent no.3- Canara Bank never informed to the insurance company about any hypothecation of the vehicle in their favour since they gave finance to respondent/complainant no.2 to purchase the second hand vehicle. No such document is also placed on record. Therefore, it is not a case wherein any hypothecation agreement or charge accordingly stood recorded in the registration book of the stolen vehicle when the event in question occurred.
In the background of Insurance Regulatroy Act 1989 (hereinafter referred as ‘IRDA’) and regulations framed under it by its Insurance Regulatory and Development Authority General Insurance and Reinsurance Regulations 2000 (herein after referred as regulation), we find it is not a case where any favourable view in favour of original complainants could be taken. It is more particularly important to refer to regulation no.10 amongst the regulations referred above, which speak for obligation on the insurance company to give response within 10 days on receipt of a communication from its policy holder in the matters inter-alia including request for transfer of insurance policy in the name of new purchaser. Such communication, dated 13/07/2006 on the facts established in the instant case, was received on 17/07/2006 by the Insurance company. This communication was promptly replied by the Insurance company. Therefore, considering these aspects as well as provisions of 157(2) of Motor Vehicles Act, 1988; we find the forum failed to appreciate the facts which are undisputed and properly established by evidence tendered and, thus, arrived at a wrong conclusions. We hold accordingly and pass the following order:-
ORDER
Appeal is allowed.
Impugned order dated 30/07/2010 is set aside.
In the result, consumer complaint stand dismissed.
In the given circumstances, both the parties to bear their own costs.
Copies of the order be furnished to the parties.
Pronounced on 23rd August, 2011.
