Tamil Nadu

StateCommission

A/164/2018

The United India Insurance Co Ltd, - Complainant(s)

Versus

Mr. L. Senthil kumaran, - Opp.Party(s)

M/s. Nageshwaran & Navichania

28 Jun 2023

ORDER

IN THE TAMILNADU STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI.

 

Present: Hon’ble THIRU  JUSTICE R. SUBBIAH  :     PRESIDENT

                 THIRU R   VENKATESAPERUMAL         :      MEMBER

 

F.A. No. 164 of 2018

[Against the order passed in C.C. No.187 of 2016 dated 01.06.2018 on the file of the D.C.D.R.F., Chennai (North)].

 

Wednesday, the 28^th day of June 2023

 

The United India Insurance Co. Ltd.,

Represented by its Manager

No.19, Andiappa Gramani Street

Royapuram, Chennai- 600 013.                                   .. Appellant/

                                                                                Opposite Party

 

- Vs –

 

Mr. L. Senthil Kumaran

Proprietor

M/s.His Grace Agencies

No.14/8, Krishnan Koil Street

Chennai – 600 001.                                                  ..  Respondent/

                                                                               Complainant

 

 

Counsel for the Appellant /

Opposite Party   : M/s.Nageswaran & Narichania

 

Counsel for the Respondent/

                                 Complainant     :  M/s. Ilangovan

                                               

                                               

        This First Appeal came up for final hearing on 14.03.2023 and after hearing the arguments of the counsel for the appellant/ opposite party and perusing the materials on record and having stood over for consideration till this day, this Commission passes the following:-

 

O R D E R

 

R.Subbiah, J. – President.

 

             The United India Insurance Company have preferred this appeal, challenging the order, dated 01.06.2018, passed by the District Consumer Disputes Redressal Forum, Chennai-North, in C.C. No.187 of 2016, whereby, the complaint filed by the respondent herein came to be allowed, directing the Insurance Company/ Opposite Party to pay to the complainant a sum of Rs.5,06,588/- towards repairing charges with interest @ 9% p.a. from the date of the complaint till the date of the order, besides a sum of Rs.5,000/- as litigation expenses.                  

 

                2. For the sake of convenience, the parties shall be referred to in the course of this Order, as per their respective rankings before the District Forum.

                3.  The facts, as projected in the complaint, may be concisely stated as follows:-

        The complainant is the owner of the lorry bearing Registration No. TN 25 R 5252, which met with an accident on 13.06.2015 at 09.15 pm between Vaniyambadi and Krishnagiri National Highways Road, within the police limit of Natrampalli Police Station.  In the said accident, the lorry was badly damaged.  After going through all the formalities, the lorry was repaired by the authorized dealer M/s.T.V.Sundaram Iyengar & Sons Private Limited, in their workshop.  The complainant had insured the vehicle with the opposite party, under Policy No.0129003114P111043336 covering the period from 12.03.2015 to 11.03.2016. M/s.T.V.Sundaram Iyengar & Sons Private Limited, had repaired the vehicle after taking due approval from the opposite party’s surveyor and raised a credit bill for a sum of Rs.10,99,616/-.   On receipt of the credit bill from the service dealer, the complainant approached the opposite party and made a claim for total loss of the vehicle.  Though the complainant had paid the entire charges of Rs.10,99,616/- to the service dealer M/s.T.V. Sundaram Iyengar & Sons Private Limited, the opposite party had settled only a sum of Rs.5,93,028/- for the reasons best known to them.  The Insured’s Declared Value (IDV) of the said vehicle fixed in the policy is Rs.12,60,000/-.  As per the policy conditions, the IDV is treated as the market value of the vehicle throughout the policy period without any further depreciation, considered for the purpose of total loss or constructive total loss, if the aggregate cost of retrieval or repair of the vehicle exceeds 75% of the IDV of the vehicle.  The repairing cost of the vehicle of the complainant is Rs.10,99,616/-, which is more than 75% of the IDV of the vehicle.  Hence, the complainant requested the opposite party to treat the claim as constructive total loss claim and settle the claim for full IDV of Rs.12,60,000/-.  Inspite of repeated requests of the complainant, the opposite party did not oblige to the legitimate demand and had settled only 50% of the actual repairing cost.  Therefore, the complainant issued a legal notice on 03.08.2016 to the opposite party.  The opposite party had sent a reply notice dated 04.10.2016 with all baseless and vexatious allegations and refused to settle the legitimate claim of the complainant.  Due to the failure on the part of the opposite party in settling the claim, the complainant had to pay the entire invoice amount towards repairing charges and thereby he suffered a monetary loss of Rs.6,66,972/-.  Hence, he filed the complaint before the District Forum, seeking to issue a direction to the opposite party to pay the complainant a sum of Rs.6,66,972/- towards the balance repairing charges with interest, besides compensation and costs, as mentioned therein.

 

         4.  The Opposite Party resisted the complaint by filing a written version, inter alia stating thus:-

        The complainant had lodged a claim for the damage caused to the insured vehicle with the opposite party, due to an accident on 13.06.2015. The opposite party immediately deputed their licensed surveyor namely, M/s.Simax Surveyors to assess the loss suffered by the complainant.  The surveyors conducted a detailed survey and submitted their report dated 08.02.2016, assessing the value of the damaged parts pertaining to the insured vehicle for a sum of Rs.5,96,482/-.  Based on the assessment made by the surveyors, the claim of the complainant was settled at Rs.5,96,482/-.  The Declared Value of the insured vehicle was Rs.12,60,000/-.  The contention of the complainant, that the Insured’s Declared Value shall be treated as the market value of the vehicle throughout the policy period without any depreciation for the purpose of total loss or constructive total loss if the aggregate cost of retrieval or repair of the vehicle exceeds 75% of the IDV of the vehicle, is not correct.  The policy clearly states that the Insured’s Declared Value of the vehicle and the accessories if any fitted to the vehicle, is to be fixed on the basis of the manufacturer’s listed selling price of the brand and model of the insured vehicle, at the commencement of the insurance/ renewal and adjusted for depreciation, as per the schedule, in the policy.  The schedule of age-wise depreciation is shown in the policy.  Any claim under the policy would be considered strictly based on the policy terms and conditions.  A claim would be evaluated based on the assessment made by the surveyor.  As per the policy conditions, it is the right of the insurer to consider the claim either on repair basis or on total loss basis, depending upon various parameters.  The liability of the company shall not exceed   (a) for total loss/constructive total loss of the vehicle – the insured’s declared value (IDV) of the vehicle, including accessories thereon as specified in the schedule, less the value of the wreck;  b) for partial loss – actual and reasonable costs of repair and/or replacement of parts lost/damaged, subject to depreciation as per limits specified.  As per the assessment of the surveyor, it is clear that the complainant’s vehicle, which met with the accident was capable of being repaired and the components in the vehicle could be replaced to bring back the vehicle to working condition.  The service centre had replaced the damaged parts in the insured vehicle and the insured vehicle is in a very good running condition, as per the re-inspection report of the surveyor.  Therefore, the insured vehicle cannot be construed to be a total loss or a constructive total loss since the value lost or damaged or the repair cost of the damaged property had exceeded the total value of the insured vehicle, to bring the loss within the ambit of total loss or constructive total loss.  The insured vehicle was surveyed, assessed and repaired by an authorized service dealer.  At no point of time, the complainant had approached the opposite party for settlement of the claim on total loss basis.  After settlement of claim by the opposite party, the complainant issued a legal notice on 03.08.2016, and for the first time sought settlement on the constructive total loss basis.  The complainant’s contention is purely an afterthought and not on a bonafide intention.  The insurer alone could decide a claim to be considered on a total loss basis based on the surveyor’s report, if the cost of repair is more than the insured value of the vehicle.  In the instant case, the complainant had proceeded to repair the vehicle and after repair, the vehicle is in good running condition.  Therefore, there is no total loss or constructive total loss to the insured vehicle.  Hence, the contention that the vehicle which suffered damage should be considered to be a total loss, is baseless and not correct.  Total loss means the vehicle is not repairable and Constructive total loss means the vehicle can be repaired, but the repair cost will be more than 75% of the Insured’s Declared Value.  The mode of settlement of claim such as repair basis, total loss, constructive total loss and repair, is based on the survey report and on the interest of the insurers.  Since the surveyor recommended for repair basis settlement, the claim will not fall within the ambit of the constructive total loss or total loss.  Therefore, the complaint is devoid of merits and there is no deficiency of service on the part of the opposite party and hence sought for dismissal of the complaint.                                                                                                                    

 

        5.  In order to substantiate the claim, both sides filed their respective proof affidavits and, while the complainant marked           9 documents as Exs.A1 to A9, on the side of the Insurance Company, no document was marked.   

 

 

        6.  The District Forum, on analyzing the entire evidence and records, had observed that the terms and conditions issued by the insurer provide that the IDV shall be treated as market value and depreciation cannot be allowed in case of total loss or constructive loss of cases.  In this case, the repairer/ service provider himself had given an estimate of Rs.10,99,616/- for repair.  The IDV value fixed by the insurer is Rs.12,60,000/-.  The repair of the vehicle exceeds 75% of the IDV value and the complainant had paid a sum of Rs.10,99,616/- to the repairer/ service provider.  Hence the damage to the vehicle has to be held as constructive total loss.  Therefore, the complainant is entitled for the entire claim amount being the amount paid by him towards repair charges and allowed the complaint by issuing the aforesaid direction against the Insurance Company, who is now before us with the present appeal.  

 

 

                7.   There is no representation for the respondent/ complainant.  Heard the submission of the learned counsel for the Appellant/Opposite Party and perused the materials available on record.   

 

        8.  It is the main argument of the counsel for the Appellant/Insurance company that the findings of the District Forum are opposed to a fair interpretation of various documents marked as Exhibits and terms and conditions of the policy.  The Lower Forum had failed to appreciate that any obligation on the part of the appellant/opposite party could be considered only in accordance with the terms and conditions, forming part of the policy issued by them.   The claim of the respondent/complainant was for payment of the Insured Declared Value.  But the Lower Forum had directed the appellant/ opposite party to pay the balance repair charges, without assigning any reason for awarding the same.  In fact the appellant/ opposite party in their version had clearly stated that they have settled the claim based on the assessment of the Surveyor after obtaining a detailed surveyor’s report.  The assessment is for the damaged parts of the insured vehicle and settlement has already been made to the complainant.  The Lower Forum had failed to consider the terms and conditions of the policy, while giving a specific finding regarding the admissibility of the claim under total loss/ constructive total loss, as claimed by the complainant. 

 

        9.  The main grievance of the complainant in the complaint is that the repairing charges of the vehicle amounting to Rs.10,99,616/-, is more than 75% of the IDV of the vehicle.   Therefore, the Insurance Company ought to have treated the damage as constructive total loss and settled the full IDV of Rs.12,60,000/- towards the claim.  But it is the reply of the appellant/opposite party that though the vehicle met with an accident, it was capable of being repaired and after repair it is in a very good running condition.  Therefore, the same cannot be treated as total loss, even if the repairing charges of the vehicle is more than 75% of the IDV of the vehicle.  Further, it is the submission of the counsel for the appellant/ opposite party that though the prayer of the complainant was to treat the claim as total constructive loss, the District Forum without appraising the issue properly, on its own reasoning, had directed the Insurance Company to pay a sum of Rs.5,06,588/- being the balance repair charges, that has been paid by the complainant as per the invoice, marked as Ex.A2.  As per the terms and conditions of the policy, the Insurance company cannot settle the claim as total loss, when the insured vehicle is capable of being repaired and is brought back to working condition.  Further, the surveyor had assessed the loss of damage of the insured vehicle as Rs.5,96,482/- and the said amount had already been paid to the complainant.  In support of his contention, learned counsel for the opposite party relied upon the judgment of the National Consumer Disputes Redressal Commission, New Delhi in the case of Suresh Kumar Sharma Vs. Oriental Insurance Co. Ltd., reported in III (2021) CPJ 79 (NC), wherein it is held as follows :-

   “11.     Main issue relates to the quantum of loss. Surveyor appointed by the Insurance Company assessed the loss to the tune of Rs.2,96,446.99 and the Complainant filed claim for Rs.7,60,000/-, on the basis of estimate given by Pink City Motors Pvt. Ltd. Surveyor was appointed by the Insurance Company, who visited and inspected the place of incident and thereafter gave his report. Report submitted by a Surveyor is an important piece of evidence and it has to be given due weight, though it is not sacrosanct and can be ignored, provided there is cogent evidence otherwise. In the present case, the Complainant did not lead any evidence disproving the report submitted by the Surveyor of the Insurance Company. In the absence of any evidence to the contrary, the report submitted by the Surveyor of the Insurance Company is to be accepted. Whatever relief the Complainant was entitled, has already been given by the State Commission.” 

 

Therefore, when the Surveyor had assessed the value of loss, the Insurance Company cannot be directed to pay more than that of the amount assessed by the Surveyor unless it is disproved by the complainant, by adducing evidence to the effect that the loss assessed by the surveyor is not correct, irrespective of the fact that the invoice issued by M/s.TV Sundaram Iyengar & Sons Private Limited is more than that of the loss assessed by the Surveyor.  Reliance has also been placed on the judgment of the Supreme Court in Khatema Fibres Ltd., Vs. New India Assurance Co. Ltd. & anr., reported in IV (2021) CPJ 1 (SC), wherein it is held as follows:-

           “38. A Consumer Forum which is primarily concerned with an allegation of deficiency in service cannot subject the surveyor’s report to forensic examination of its anatomy, just as a civil court could do. Once it is found that there was no inadequacy in the quality, nature and manner of performance of the duties and responsibilities of the surveyor, in a manner prescribed by the Regulations as to their code of conduct and once it is found that the report is not based on adhocism or vitiated by arbitrariness, then the jurisdiction of the Consumer Forum to go further would stop.”

 

Therefore, when the loss assessed by the surveyor is Rs.5,93,028/- in the Surveyor report, this Commission cannot direct the opposite party to pay the entire amount claimed by the service centre M/s. TV Sundaram Iyengar & Sons Private Limited, unless there is cogent evidence, contrary to the report submitted by the Surveyor.  The complainant had failed to submit any such cogent evidence.  Merely by placing reliance on the invoice submitted by the service centre, it would not be appropriate to accept the repair charges and direct the opposite party/ Insurance Company to pay the balance repairing charges.  Consequently, we hold that the impugned order passed by the District Forum suffers from errors and hence, it is liable to be set aside.

            

                9. In the result, the Appeal is allowed by setting aside the order, dated 01.06.2018, passed by the District Consumer Disputes Redressal Forum, Chennai-North, in C.C. No.187 of  2016.  Consequently, the complaint is dismissed.

 

 

R   VENKATESAPERUMAL                                                                                         R.SUBBIAH

         MEMBER                                                                                                               PRESIDENT

 

 

Index :  Yes/ No

 

AVR/SCDRC/Chennai/Orders/June/2023