Date of filing : 07-03-2008 Date of order : 11-03-2010 IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD C.C. 20/08 Dated this, the 11th day of March 2010 PRESENT SRI.K.T.SIDHIQ : PRESIDENT SMT.P.RAMADEVI : MEMBER SMT.P.P.SHYMALADEVI : MEMBER K.M. Moideen Kutty Haji, S/o. Kunhappu, Pattuvathil House, Po. Thekkil, Kasaragod.Dist. } Complainant (Adv. C.N. Ibrahim, Kasaragod) 1. M/s Cholamandalam MS General } Opposite parties Insurance Company Ltd, Registered and Head Office, ‘Dare House’ Iind floor, NSC Bose Road, Chennai 600001. 2. The Manager-Claims Cholamandalam MS General Insurance Company Ltd, Iind floor, Acel Estate, Iyyattil Junction, Chittoor Road, Kochi.682001. (Adv. S. Mammoo, Taliparamba) O R D E R SRI.K.T.SIDHIQ, PRESIDENT Bereft of unnecessaries the case of the complainant is as follows: Sri.K.Moideenkutty Haji, the complainant herein is the RC Owner of Mercedes Benz Car bearing Reg.No.KL-14/D7272. The said car was insured with opposite party No.1. The car was involved in an accident at Bekal in Kasaragod and sustained extensive damages. The vehicle was taken to the repairer Rajasree Motors, Kochi since they were the authorized dealer and repairer of Mercedes Benz passenger vehicles. They carried out the repair and submitted the bill for Rs.16,82,305/-. Opposite party No.2 is the dealing officer regarding the claims of complainant. Opposite party No.2 after processing the claim of the complainant issued the loss voucher to the repairer M/s Rajasree Motors, Pvt. Ltd to settle the claim for Rs.10,60,965/-. In order to get the delivery of the vehicle the complainant has signed the printed loss voucher without knowing its contents and purport. It is the knowledge of the complainant that the opposite parties were sent the printed voucher to Rajasree Motors along with some correspondence that was suppressed by the opposite parties from the complainant. As per the registered notice dated 30-10-2007 the complainant has withdrawn all the statements in the signed loss voucher. The said statement was obtained committing fraud, suppression of facts and without supplying the necessary information regarding the basis of assessing the damages. Moreover, the opposite parties have calculated the premium i.e. Rs.20,25,447/-. The accident was occurred within 2 months from the date of collection of premium. Hence opposite parties are not entitled to make substantial variation in calculating the cost of parts. The opposite parties are also liable to pay the labour and other charges mentioned in the invoice submitted by M/s Rajasree Motors. The settlement of claim unilaterally without informing the insured is a deficiency in service. Therefore the complaint claiming the balance of Rs.6,21,340/- towards the repair charges as per the bill issued by Rajasree Motors Pvt. Ltd and paid by him with interest and Rs.10,000/- towards the mental agony and hardships along with cost of the proceedings. 2. Opposite parties filed version. According to opposite parties, their liability is subject to the terms, conditions and exceptions contained in the policy. Since the complainant having got his claim duly settled in full and final by giving unconditional discharge, he cannot allege deficiency in service. The complainant lodged a claim before the opposite parties for the damage sustained to the car. The opposite parties appointed a surveyor and the surveyor assessed the damages as Rs.10,60,965/- subject to the terms and conditions exclusion and depreciation clause applicable to the vehicle covered under the policy. Hence there is no deficiency in service on the part of opposite parties. 3. The complainant filed affidavit in support of his claim. He faced cross-examination by the counsel for the opposite parties. Exts A1 to A9 marked. On the side of opposite parties Ext.B1 and X-I series marked. Both sides heard. Documents perused. 4. The key points to be determined in this case are: i) Whether a customer can dispute the execution of the discharge voucher after receiving the insurance claim? ii) Whether the surveyors report is an unsurpassable one that it cannot be overlooked by the insurer? iii) Is there is any deficiency in service on the part of opposite parties? iv) Relief as to compensation and cost? 5. Point No.1: The contention of opposite parties is that since the complainant has accepted the claim duly settled in full and final by giving an unconditional discharges he is estopped from advancing a theory of deficiency in service. The counsel for opposite parties is relying on the decision of the Hon’ble National Commission reported in 1996(1) CPJ 140 (NC) that transaction of the above type does not fall for adjudication before the Hon’ble Forum under Consumer Protection Act. Learned counsel for the opposite parties also relied in the decisions of the Hon‘ble National Commission reported in II (2008) CPJ 327(NC) in the case National Insurance Company Ltd V. Krishna Rice Mills and the case reported in 2008 NCJ 724 (NC) in the case of Zainul Abideen & Anr V. National Insurance Co Ltd & Ors. In all these cases the Hon’ble Commission has held that discharge voucher issued by the complainant in full and final settlement of claim and no allegation of duress, coercion, manipulative practice against the insurer is not entitled for any further relief. The Hon’ble National Commission relied on the decision of the Hon’ble Supreme Court in the case of United India Insurance Co. Ltd V. Ajmersingh Cotton & General Mills & Ors reported in AIR 1999 SC 3026, (1999) 6 SCC 400. In that case it was held that since the complainant had not alleged their execution of discharge voucher under fraud undue, influence, misrepresentation or the like the complainant is not entitled for any further relief. 6. On the other hand the learned counsel for the complainant Sri. C.N. Ibrahim submitted that the case of the complainant is that after the repair, the vehicle was in the custody of the repairer M/s Rajasree Motors, Ernakulam and opposite party No.2 had sent printed loss voucher to M/s Rajasree Motor Pvt Ltd instead of sending the same to the complainant directly to settle the claim. So in order to get the delivery of the vehicle complainant signed the printed loss voucher without knowing the contents and purport. According to the counsel for the complainant, the vehicle was in urgent need to the complainant since he is a PWD Contractor. It was also submitted that in the event of non-acceptance of the said amount as per the discharge voucher he feared the retention of the vehicle by the repairer which would saddle the complainant with the payment of demurrage charges also to the repairer if a legal battle is started against the insurer without executing the discharge voucher. The chance of deterioration of the vehicle keeping the same with the repairer until the finality of the adjudication is also pointed out by the learned counsel. So involving the repairer by the opposite parties in the issue of settlement of the claim brought him to a situation which compelled him to sign the discharge voucher sent by the repairer and therefore the execution of discharge voucher cannot be considered as an execution with free will, volition and accord, complainant’s learned counsel submitted. We find some force in this argument. The learned counsel for the complainant cited a decision National Insurance Co. Ltd V. Sethia Shoes reported in 2008 AIR SCW 1905 and submitted that after accepting the payment made by the Insurance Company further claim is not barred subject to the proof that agreement to accept a particular amount was under coercion. While rendering this judgment the Hon’ble Supreme court relied on its decision in the case of Ajmer Singh Cotton & General Mills & Ors case mentioned supra. In both cases it was held that despite the execution of discharge voucher if the consumer in a given case satisfies the authority under the Act that the discharge voucher was obtained by fraud, misrepresentation, undue influence or the like coercive bargaining compelled by circumstances then the authority before whom the complaint is made would be justified in granting appropriate relief. The learned counsel for the complainant Sri. Ibrahim has submitted that there was such compelling circumstances that forced the complainant to execute the discharge voucher. True, on a bare reading of the said decision also it appears that provisions left open to the insured to challenge the execution of discharge voucher not only limited to fraud, misrepresentation undue influence or coercion but it also provides to challenge the same on the ‘LIKE circumstances’. This term ‘the like’ is often left unnoticed. In our view, what are all ‘the like’ circumstances under which the discharge voucher is executed in a given case is subject to the facts and circumstances of each case. One thing that is clear from the above is that the circumstances to challenge the execution voucher is not only limited to fraud, misrepresentation undue influence or coercive bargaining but it would also open to challenge under the like circumstances. 7. We hold that this is a case in which such a like compelling circumstance is involved. Hence the doors to challenge the execution of discharge voucher is open to the complainant despite the execution of the discharge voucher. Therefore this point is decided accordingly. 8. Point No.ii The learned counsel for opposite parties Sri. Mammu has submitted that the payment is made as per the assessment of the surveyor. The surveyor after detailed examinations of the damaged vehicle and after discussing with the repairer has submitted the survey report. After a thorough inspection the surveyor has assessed the loss to the tune of Rs.10,60,965/- towards the reasonable cost of repairs and applying necessary deductions as applicable as per the terms, conditions, exception, exclusion and depreciation clause applicable to the vehicle covered under the policy. The said survey report is binding on the insured and it is an unsurpassable one. But we are unable to hold this contention. 9. The Hon’ble Supreme Court in the case of New India Assurance Company Ltd V. Pradeep Kumar reported in 2009 CTJ 599(SC)(CP) has held that the survey report is not the last and final word for settling an insurance claim and it is not that sacrosanct or conclusive that it cannot be departed from. Therefore this issue is also decided against the opposite party. 10. Point No.iii The learned counsel for the complainant submitted that after receiving the premium of Rs.67710.69 assessing the value of the vehicle as Rs.20,25,447/- in the month of November 2006, it was not fair on the part of opposite parties to assess the loss adopting a different method, since the vehicle was involved in the accident within 2 months from the date of issuance of policy. According to him the Insured Declared Value (I.D.V) of the vehicle will be deemed to be the sum insured for the purpose of policy which is fixed at the commencement of the policy period. The value and rate adopted for collection of premium is to be adopted for assessing the loss also. Therefore opposite parties are also liable to pay the labour and other charges mentioned in the invoice submitted by M/s. Rajasree Motors Pvt. Ltd. But the opposite parties has made only a part payment. The learned counsel relied heavily on the decision of the Hon’ble Supreme Court in the case of Dharmendra Goel V. Oriental Insurance Co.Ltd reported in 2008 AIR SCW 6394 to substantiate his case. In the said case the Hon’ble Supreme Court has held that in the case of claim for compensation in respect of vehicle value put on vehicle at the time of renewal of policy cannot be disowned by the Insurance Company on one pretext or other. The Apex Court further held that the insurance companies are often acting in an unreasonable manner and after having accepted the value of a particular insured good disown that very figure on one pretext or other when they are called to pay compensation. This take it or leave it attitude is clearly unwarranted not only being bad in law but ethically indefensible. It was further held in the said decision that the court must take a realistic view and if a particular claim to compensation is possible on material on record, it should not denied on hyper technical pleas. 11. But the facts of the said case is a different from this case. That was a case of total loss occurred to the vehicle and instead of granting the claim basing on the declared value of Rs.3,54,000/- the insurer offered only Rs.1,80,000/- considering it as the value of vehicle at the time of accident. 12. Further learned counsel for complainant relying on the policy vehemently argued that the opposite parties ought to have been treated the loss as CTL (Constructive Total Loss) since as per bills and vouchers issued by the repairer the aggregate cost of retrieval and repair of the vehicle, subject to terms and conditions of the policy exceeded 75% of the IDV of the vehicle. 13. We are unable to accept this argument. The IDV of the vehicle was Rs.20,25,447/- at the time of accident and the estimate for repair was assessed as Rs.16,40,850/-. True, the estimate cost prepared was for more than 75% of the IDV, but it was not prepared subject to the terms and conditions of policy. As per the surveyors report prepared subject to the terms and conditions of policy the assessed amount is only Rs.10,60,965/- that is approximately 50% of the IDV of the vehicle. Therefore the loss in this case could not be regarded as a Constructive Total Loss. Even if the invoice summary amount shown in Ext.A2 tax invoice issued by the repairer is taken as the criteria the loss it will not be more than 75% of the IDV subject to the terms and conditions of policy. 14. There is no dispute that the vehicle was above 3 years old as on the date of accident. Hence as per the terms and conditions of the policy the OP is entitled for deduction in the assessed cost of repair as per the schedule mentioned in the policy. As per the said schedule the opposite parties is entitled for a reduction of 50% for all rubber/nylon/plastic parts/tyres/tubes, batteries, air bags etc. For fibre glass components the deduction is 30% and for all other parts including wooden parts for a vehicle aged 3 years but not exceeding 4 years is @ 25%. 15. The case of the complainant that he is entitled to get the entire amount spent for the repair is not sustainable. The insurance is a contract and both the insurer and insured are bound by the terms of contract. The object of contract of insurance is to indemnify the loss and that can in no event make gain out of the transaction. In other words, the insurance is to place the insured in the same position in which he would have been if the loss is not occurred. He cannot make gain out of that because when the repairs are made the vehicle is in a better condition that had before the accident. The contract of Insurance does not allow the insured to profit or better from his loss. Hence deductions as per the policy conditions could not be regarded as a deficiency in service. 16. Ext.X-1 is the tax invoice issued by the repairer Rajasree Morots (P) Ltd. The total repair costs including labour charges is Rs.16,73,888/-. The Ext.A1 is the copy of the tax invoice produced by the complainant there the amount shown is Rs.16,82,305/-. 17. Ext.B1 is the copy of the survey report. On going through the survey report it is seen that the surveyor has elaborately surveyed the loss and the rate of the spare parts are fixed subject to the terms and conditions of the policy. But it is seen that the surveyor has reduced a considerable amount from the repair charges as against the tax invoice. In Ext.X-1 the repair charges as per tax invoice is Rs.2,39,835.20+ service tax Rs.28,780.22 = 2,68,615.42. In addition to that a sum of Rs.12,300/- is seen paid by the repairer by way of sub-contract towards the repair of the vehicle. The same is also not seen considered by the Surveyor. The surveyor has assessed Rs.1,50,000+ Service tax Rs.18,540/- = 1,68,540/- only towards the repair charges. There is no reason for the reduction of the said amount nor the policy of confers any provision to reduce the repair charges to such an extent. Hence the deduction of repair charges without assigning any reason amounts to deficiency in service and the complainant is entitled for the entire repair charges that he paid to the repairer including sub contract charges paid by the repairer. 18. Reliefs& Costs The total sum paid by the opposite parties to the repairer was Rs.10,60,965/-. In that the complainant has awarded only Rs.1,68,540/- including service tax towards the repair charges. But the complainant has paid Rs.2,68,615.22 to the repairer including service tax in addition to that he also paid Rs.12300/- towards the charges collected by the repairer towards the charges for sub contract for repairing the vehicle. So the total amount he paid is Rs.2,80,915.22. But the opposite party has paid only Rs.1,68,540/-. The complainant is therefore entitled for the balance amount i.e. Rs.1,12,375.22. In the result, complaint is partly allowed and the opposite parties are directed to pay a sum of Rs.1,12,000/- (rounded to) ( Rupees One lakh twelve thousand only) with interest @ 9% from the date of complaint till payment along with a cost of Rs.3000/-. Time for compliance is limited to 30 days from the date of receipt of copy of order. Sd/- Sd/- Sd/- MEMBER MEMBER PRESIDENT Exts. A1.Policy (Photo copy) A2.8-6-07. photocopy of tax invoice. A3. 13-7-07 copy of letter issued by OP M/s Rajsree Motors Ltd. A4.30-10-07 copy of lawyer notice. A5.& A5 a. Acknowledgement cards A6.17-11-07 Reply notice. A7.19-6-07 letter sent by Rajasree Motors to complainant. A8&A9. 13-7-07 Receipts issued by Rajasree Motors Pvt.Ltd. B1.Claim Satisfaction note cum discharge voucher X-1. Tax invoice. PW1. Moideenkutty Haji Sd/- Sd/- Sd/- MEMBER MEMBER PRESIDENT Pj/ Forwarded by Order SENIOR SUPERINTENDENT
......................K.T.Sidhiq
......................P.P.Shymaladevi
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