BEFORE THE A.P.STATE CONSUMER DIPSUTES REDRESSAL COMMISSION :HYDERABAD
F.A.No.674/2006 against C.D.No.21/2005,Dist. Forum-III, Hyderabad
Between:
L.Madan Mohan Reddy, S/o.K.Shankar Reddy,
Hindu aged 32 years, R/o.H.No. 8-2-234/68,
L.N.Nagar :Yousufguda, Hyderabad
Rep. by his GPA Sri K.Shankar Reddy . …Appellant/
Complainant
And
1.ICICI Bank
Zenieth House, Keshavarao Khadya Marg,
Mahalaxmi Mumbai 400 034.
2. Surender Jain,
C/o.Mohan Motors 7-11-64/B(783)
Dharam Karan road : Ameerpet:Hyderabad.
3.ICICI Lombard General Insurance Co Ltd.,
Zeneith House, Keshavrao Khadya Marg,
Mahalaxmi, Mumbai 400 034. … Respondents/
Opp.parties
Counsel for the appellant : M./s. D.Madhava Rao
Counsel for the respondents : Sri P.Ramachandran-R1
Sri P.Gangarami Reddy –R2
Sri Katta Laxmi Prasad –R3
F.A.No.636/2009 against C.D.No.21/2005,Dist. Forum-III, Hyderabad
Between:
ICICI Lombard General Insurance Co Ltd.,
Zeneith House, Keshavrao Khadya Marg,
Mahalaxmi, Mumbai 400 034. …Appellant/
Opp.party no.3
And
1.K.Madan Mohan Reddy, S/o.Sri.K.Shankar Reddy,
Hindu aged 32 years r/o.H.No. 8-2-244/68,
L.N.Nagar, Yousufguda, Hyderabad
Rep. by his GPA Sri K.Shankar Reddy . …Respondent /
Complainant
2.ICICI Bank
Zenieth House, Keshavarao Khadya Marg,
Mahalaxmi: Mumbai 400 034. ..Respondent/
Opp.party no.1
2. Surender Jain,
C/o.Mohan Motors 7-11-64/b(783),
Dharam Karan road : Ameerpet:Hyderabad. …Respondent/
Opp.party no.2
Counsel for the appellant : Sri Katta Laxmi Prasad
Counsel for the respondents : M/s. D.Madhava Rao
M/s .P.Gangarami Reddy –R3
CORAM:SMT. M.SHREESHA, HON’BLE MEMBER
AND
SRI K.SATYANAND , HON’BLE MEMBER
WEDNESDAY, THE THIRTIETH DAY OF SEPTEMBER
TWO THOUSAND NINE.
Oral Order (Per Smt M.Shreesha, Hon’ble Member)
***
Aggrieved by the order in C.D.No.21/2005 on the file of District Forum-III, Hyderabad, the complainant preferred F.A.No.674/2006 and the opposite party no.3 filed F.A.No.636/2009. Since both these appeals arise out of the same C.D. i.e. C.D.No.21/2005. they are being disposed of by this common order.
The brief facts as set out in the complaint are that the complainant purchased Opel Corsa Car bearing registration no.A.P.13/G 3091 which is a second sale vehicle from Mohan Motors, Hyderabad i.e. opposite party no.2. The complainant submits that he paid the money required to be paid to the second opposite party before taking possession of the vehicle including the insurance premium and called upon the second opposite party to place the true extract of the statement of account in relation to the transaction since he is in possession of books of accounts and the complainant after fulfilling all the formalities took the vehicle and the second opposite party gave the insurance cover note. The vehicle met with an accident on 15.8.2004 and a complaint was registered before SHO , Puttur PS Chittoor Dist. and the vehicle was completely damaged and the cheque given by the second opposite party to cover insurance was returned dishonoured and that the insurance company did not issue any policy to the second opp.party or to complainant. The complainant submits had he known this fact then he would have paid the money directly to the insurance company and the opposite parties are duty bound to get the vehicle insured and are bound to bear the loss sustained by the complainant since the amounts were paid through the second opposite party. It is their bounden duty to ensure that the vehicle is insured and having failed in discharging his obligation under the agreed terms he is bound to bear the loss sustained by the complainant. The complainant got issued a legal notice on 26.10.2004 and claimed an amount of Rs.2,84,896/- and also filed a complaint before police station S.R.Nagar vide Crime no.97 of 2004. The complainant submits that he is entitled to claim the damage caused to the vehicle i.e.2,84,896/- towards cost of the repairs, Rs.1 lakh towards mental agony and other costs and reliefs. Hence the complaint.
Opposite party no.2 filed written version stating that the complainant paid Rs.1,25,000/- as advance for purchase of unregistered vehicle Opel Corsa out of the total consideration of Rs.4,10,000/- and balance consideration of Rs.2,85,000/- payable by ICICI Bank and the contention of the complainant that the vehicle is a registered vehicle and that the sale consideration is Rs.4,25,000/- was false. Opposite Party admits receipt of Rs.1,25,000/- from the complainant and also admit that they issued cheque for Rs.2,89,725/- deducting payment of one instalment from the complainant’s account. Opposite party no.2 prepared a cheque for Rs.15,567/- towards premium charges believing the complainant’s representation that all the money required for premium would be paid by the next day itself. Since the complainant failed to pay the insurance charges of Rs.15,567/- to opposite party no.2, opposite party no.2 had not issued cheque bearing no.179327 to the insurance company and hence the vehicle in question is not covered by the insurance policy. Opposite party no.2 did not issue the cheque though on the same date i.e. 10.4.2004, cheque on Andhra Bank was prepared but not signed and denies that the cheque was returned dishonoured as contended by the complainant. The complainant’s assertion that M/s. ACT India at Chennai charged Rs.2,84,896/- towards repairs of the vehicle is done at the complainant’s risk, and opposite party no.2 submitted that it is not at all liable to pay the claim.
A petition was filed by the complainant to implead ICIC Lombard General Insurance Company which was allowed and no counter was filed by opposite parties 1 to 3 .
The District Forum based on the evidence adduced i.e. Exs.A1 to A9 allowed the complaint directing opposite parties to pay Rs.1 lakh towards compensation for the deficiency in service within two months from the date of order.
Aggrieved by the said order the complainant preferred F.A.No.674/2006 and opposite party no.3 filed F.A.No.636/2009.
The facts not in dispute are that the complainant purchased a secondhand vehicle Opel Corsa Car from opposite party no.2 and an amount of Rs.2,89,725/- (Ex.A2) has been paid by way of cheque to M/s.Mohan Motors. This delivery order establishes receipt of clearance of carriage money, advance E.M.I. and receipt of insurance cover note copy and receipt of address proof. It is also requested to raise invoice in the name of the customer with hypothecation marked as hypothecated to ICICI Bank Ltd. It is the responsibility of opposite party no.2 to ensure receipt of the insurance cover note. Accordingly, Ex.A1 is evidence of having issued the insurance cover note. Opposite party no.2 admitted that he worked as agent of opposite party no.3. It is the case of the complainant that on 15.8.2004 the vehicle met with an accident which was registered at police station at Puttur PS, Chittoor Dist. and subsequently the vehicle was given to a workshop at Chennai for repairs and the complainant was under the impression that the vehicle was duly covered by insurance policy since he is in possession of the insurance cover note issued by opp.party. However the insurance amount was not paid to him on the ground that the policy was not issued. The learned counsel for the appellant/complainant submitted that the District Forum should have seen that the amount payable to M/s. ACT India was Rs.2,84,896/- whereas the District Forum awarded only Rs.1 lakh towards compensation and having held that the opposite party failed in their duty to settle the claim of the complainant, the District Forum ought to have awarded the amount in toto. The learned counsel for opposite party no.3 insurance company submitted in their grounds that there is no principal and agent relationship between opposite party no.3 and opposite party no.2. It is submitted that the alleged cover note was issued by opposite party no.2 on behalf of opposite party no.3 without forwarding the cover note along with the amount payable there on for having any valid coverage or for issuing any policy. He contended that the firm has not taken into consideration the claim of the complainant as opposite party no.2 had failed to pay the premium and therefore there is no policy issued and hence opposite party no.3 cannot be made liable. Even if the cover note is fraudulently issued by opposite party no.2, and as per the admissions of the said party no premium was forwarded along with the cover note in favour of opposite party no.3, for issuing policy, there can be no liability fastened on opposite party no.3. Even otherwise, if cover note was valid for a period of 60 days and would lapse by 9.6.2004 and the accident occurred on 15.8.2004, no premium was received even till that date and no policy was issued. He further contended that the complainant filed criminal case against opposite party no.2 and the transaction is between the complainant and opposite party no.2 only. There is no privity of contract between opposite party no.3 and the complainant. In Ex.A9 which is the letter issued by opposite party no.3 to the complainant, it is stated as follows:
“2.The cheque no. mentioned on the cover note was of Mohan motors, they themselves have not produced the cheque to us. If the cheque was produced to us the payment was not realized , then we would have intimated you.
6. Mohan Motors have not made any payment to us by cash or cheque, so we are unable to provide the details. We have sent a letter to you on 27.10.2004, Ref:CHE/CS/015/04, stating the status of the referred cover note.”
Ex.A1, which is the motor insurance cover note, is signed by an authorized signatory of opposite party no.3. But it clearly states that the validity of the cover note is for a period of 60 days only. Hence we find force in the contention of the appellant/opposite party no.3 that there is no privity of contract between the opposite party no.3 and the complainant, since the time period for payment of the premium along with cover note has lapsed and policy was not issued. Hence there is no concluded contract between the complainant and opposite party no.3. However we observe that opposite party no.2 who has collected on behalf of the opposite party no.3 and got issued Ex.A1 has never informed the complainant that the premium amount was not paid by him to the insurance company. There was no notice issued, by opposite party no.2 to the complainant calling upon him to pay the premium amount. When once the insurance cover note is issued the complainant is under the bonafide impression that the vehicle is covered by insurance. Ex.A2 clearly states that the complainant paid an amount of Rs.2,89,725/-to opposite party no.2 and this includes receipt of insurance cover note copy. When there is no communication from opposite party no.2 to the complainant that premium was not paid by him, the complainant cannot be made to suffer. This act of opposite party no.2 in issuing an insurance cover note and thereafter not informing the complainant that the premium amount was not paid by him to the insurance company amounts to deficiency in service for which he alone has to be made liable. We are of the considered opinion that the bank and insurance company i.e. opposite parties 1 and 3 cannot be made liable. It is pertinent to note that the complainant also on his part did not pursue the matter and was not vigilant enough to check whether the insurance policy was issued to him or not. When the policy itself has not been issued he cannot claim the entire amount. The accident also did not take place within the period of expiry of 60 days. However, at the same time, he cannot be made to suffer for the negligence of opposite party no.2. It is also pertinent to note that the opposite party no.2 did not prefer any appeal with respect to the amount awarded by the District Forum i.e. Rs.1 lakh towards compensation. We are of the considered view that there are no substantial grounds to interfere with this amount for the afore mentioned reasons.
In the result F.A.No.636/2009, appeal filed by opposite party no.3 insurance company is allowed and appeal filed by complainant F.A.No.674/2006 is dismissed.
MEMBER
MEMBER
Dt. 30.9.2009
Pm*
