KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAUD THIRUVANANTHAPURAM FA.55/08 JUDGMENT DATED 25.2.2010 PRESENT SMT.VALSALA SARANGADHARAN -- MEMBER SRI.M.V.VISWANATHAN -- JUDICIAL MEMBER Sheebi Joseph, Purackal House, Ettichuvadu P.O -- APPELLANT Ranni. (By Adv.V.K.Mohankumar) Vs. M/s.Oriental Insurance Co.Ltd., Branch office, T.K.Road, Thiruvalla, reptd. by its Divisional Manager. 2. The Manager, Oriental Insurance Co.Ltd. Branch office, PulimoottilBuilding, P.B.No. 17, First Floor Post Office Junction Punalur. 3. B.Sreekumar, -- RESPONDENTS Shanthi Bhavan, Manjalloor P.O, Pathanapuram. (R1 & R2 by Ad.G.S.Kalkura) JUDGMENT SRI.M.V.VISWANATHAN,JUDICIAL MEMBER The appellant is the complainant and respondents are the opposite parties in OP.153/04 on the file of CDRF, Pathanamthitta. The complaint therein was filed alleging deficiency in service on the part of the opposite parties 1 and 2 in disallowing the insurance claim with respect to the vehicle bearing No.KL-02F/4800. The opposite parties 1 and 2 entered appearance and denied the deficiency in service. They contended that there was no privity of contract between the complainant and the opposite parties 1 and 2 with respect to the insured vehicle KL 02F/4800 and that they are not liable to indemnify the loss suffered by the complainant and justified their action in repudiating the insurance claim. 2. The third opposite party filed written version admitting the sale of the insured vehicle to the complainant and the existence of the insurance policy issued by the opposite parties 1 and 2. He also expressed his willingness and no objection in honouring the insurance claim put forward by the complainant with respect to the insured vehicle KL-02F/4800. 3. Before the forum below the complainant was examined as PW1 and Exts.A1 to A9 documents were marked on his side. A witness was examined on the side of the opposite parties 1 and 2 as DW1, and B1 copy of the General Regulation No.17 of the Indian Motor Tariff was also marked on the side of the opposite parties 1 and 2. No. evidence was adduced by the additional third opposite party. On an appreciation of the evidence on record, the forum below passed the impugned order dismissing the complaint in OP.153/04. Hence the present appeal by the complainant therein. 4. The points that arise for consideration are:- 1. Whether there was any deficiency in service on the part of the opposite parties 1 and 2 in repudiating the insurance claim with respect to the insured Vehicle bearing no KL-02F/4800? 2. Whether the opposite parties 1 and 2 can be justified in repudiating the insurance claim on the strength of GR 17 of the Indian Motor Tariff? 3. Is there any legally sustainable ground to interfere with the impugned order dated 10th March 2008 passed by CDRF, Pathanamthitta in OP.153/04? 5. POINTS 1 TO 3:- For the sake of convenience we will refer the parties to this appeal according to their rank and status before the forum below. 6. There is no dispute that the complainant purchased the Mahindra Jeep bearing No.KL 02F/4800 from the third opposite party Sri.B.Sreekumar. Ext.A2 sale deed dated 10.10.02 would show that the complainant purchased the said vehicle on a sale consideration of Rs.2,27,000/-. The aforesaid vehicle was purchased by the complainant from the registered owner Mr. B.Sreekumar, the additional third opposite party. There is no dispute regarding the execution of A2 sale deed. The third opposite party, the registered owner of the vehicle filed written version admitting the sale of the vehicle to the complainant. There is also no doubt about the fact that the said vehicle KL-02/4800 was insured with the first opposite party/Oriental Insurance Company Ltd; and the said vehicle was having valid and effective comprehensive policy of insurance from 15.5.02 to 14.5.03. Admittedly, the insured vehicle was stolen on 1.1.2003. The Police has also registered a crime with respect to the theft of the insured vehicle and they filed final report stating that the vehicle could not be recovered. 7. The complainant preferred an insurance claim with respect to the insured vehicle and the said insurance claim was repudiated by the opposite party/Oriental Insurance Company Ltd. The issuance of policy of insurance with respect to the vehicle KL02/4800 is not in dispute. The definite case of the complainant is that he purchased the vehicle from the third opposite party. B.Sreekumar, the registered owner of the vehicle. But he failed or neglected to transfer the insurance policy into his name. It is to be noted that owner ship of the vehicle was also not changed in the registration certificate of the vehicle. It is true that the change of ownership in the registration certificate is only a formality but the sale of the vehicle is completed on 10.10.2002 by the execution of A2 sale deed. But the policy of insurance stood in the name of the registered owner B.Sreekumar. The complainant or the third opposite party did not take any steps to get the policy of insurance transferred into the name of the complainant the transferer. Admittedly, the complainant had no privity of contract with opposite parties 1 and 2. The opposite parties are not bound to indemnify the loss suffered by the complainant who purchased the insured vehicle from the registered owner B.Sreekumar on 10.10.02. The registered owner admitted sale of the vehicle and transfer of possession of the same to the complainant. Thus, the third opposite party the registered owner and insured of the vehicle had lost his interest in the vehicle with effect from 10.10.02. So, the third opposite party had no insurable interest in the vehicle, on the date of theft of the vehicle. Admittedly, the vehicle was stolen on 1.1.03, and on that date third opposite party, the registered owner of the vehicle had no interest or right over the insured vehicle. He is not entitled to get any claim with respect to the insured vehicle. 8. The case of the complainant is that on transfer or by sale of the vehicle, the policy of insurance would also automatically transferred into the name of the transferee. But there is no such provision prevailing at the relevant time. On the other hand, GR17 of the Indian Motor Tariff which was in existence at the relevant time would show other wise. GR 17 of the India Tariff is as follows:- On transfer of ownership, the Liability Only cover, either under a Liability Only policy or under a Package policy, is deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of transfer. The transferee shall apply within fourteen days from the date of transfer in writing under recorded delivery to the insurer who has insured the vehicle, with the details of the registration of the vehicle, the date of transfer of the vehicle, the previous owner of the vehicle and the number and date of the insurance policy so that the insurer may make the necessary changes in his record and issue fresh Certificate of Insurance. In case of Package Policies, transfer of the “Own Damage’ section of the policy in favour of the transferee, shall be made by the insurer only on receipt of a specific request from the transferee along with consent of the transferor. If the transferee is not entitled to the benefit of the No. Claim Bonus (NCB) shown on the policy, or is entitled to a lesser percentage of NCB than that existing in the policy, recovery of the difference between the transferee’s entitlement, if any, and that shown on the policy shall be made before effecting the transfer. A fresh Proposal Form duly completed is to be obtained from the transferee in respect of both Liability Only and Package Policies. Transfer of Package Policy in the name of the transferee can be done only on getting acceptable evidence of sale and a fresh proposal form duly filled and signed. The old Certificate of Insurance for the vehicle, is required to be surrendered and a fee of Rs.50/- is to be collected for issue of fresh Certificate in the name of the transferee. If for any reason, the old Certificate of Insurance cannot be surrendered, a proper declaration to that effect is to be taken from the transferee before a new Certificate of Insurance is issued. 9. The aforesaid provisions of GR 17 would make it abundantly clear that there cannot be any automatic transfer of the policy of insurance on transfer of ownership of the vehicle. In other words, it is the duty of the transferee to take necessary steps to get the policy transferred into his name. It is also stated that the transfer application is to be submitted within 14 days from the date of transfer of ownership. In the present case, the ownership of vehicle was transferred by A2 sale deed dated 10.10.02. But, even on 1.1.03, the policy stood in the name of the previous owner namely, the third opposite party B.Sreekumar. So, the opposite party 1 and 2 are perfectly justified in repudiating the insurance claim put forward by the complainant. GR 17 of the India Motor Tariff would justify the action of opposite parties 1 and 2 in repudiating the insurance claim with respect to the insured vehicle KL-02/4800. 10. A perusal of provisions of GR 17 of the India Motor Tariff would also make it clear that the act only policy (third party insurance) would get automatically transferred on transfer of ownership of the vehicle. But there cannot be any such transfer of the policy with respect to comprehensive policy or package policy. 11. The section 157 of the motor vehicles Act contains a deeming provision regarding the automatic transfer of policy of insurance with effect from the date of transfer of ownership of the vehicle. But the automatic transfer of insurance policy referred to under Section 157 of the M.V. Act is only with respect to the Act only policy or (third party insurance policy). The principle behind that deeming provision is to safeguard the interest of third parties. But the said provisions of Section 157 cannot be made applicable as far as the comprehensive or package policies are concerned. 12. Prior to the introduction of GR 17 of the revised India Motor Tariff the position was entirely different. Prior to the aforesaid amendment or revision of the India Motor Tariff, there was a provision under GR 10 regarding automatic transfer of the policy with effect from the date of transfer of ownership of the insured vehicle. The old GR 10 reads as follows:- On transfer of a vehicle the benefits under the policy in force on the date of transfer shall automatically accrue to the new owner. If the transferee is not entitled to the benefit of the bonus or subjected to malus already shown on the policy, the recovery of the differences between this entitlement (if any) and that shown on the policy shall be waived till the expiry of the policy. However on expiry and/or termination of the existing Policy the transferee will be eligible for Bonus or subjected to Malus as per his own entitlement. If the transferee wants to change the Policy in his name it may be done on getting acceptable evidence of sale and a fresh proposal Form duly filled and signed. If a new Certificate of Insurance in the transferee’s name is required, his old Certificate of Insurance must be surrendered and a fee of Rs.15/- must be collected. If the old Certificate of Insurance is not surrendered, a proper declaration must be taken from the transferee before a new Certificate of Insurance is issued. 13. But the provisions of the old GR 10 was in existence only up to 30th June 2002 and there after the revised India Motor Tariff came into force and GR 17 occupied the place of the old GR 10. Thus, the decisions relied on by the appellant/complainant based on the old GR 10 of the India Motor Tariff and Section 157 of the M.V.Act cannot be made applicable in the present case. Here, we are concerned with GR 17 of the revised India Motor Tariff. Thus, the Forum below is perfectly justified in dismissing the complaint in OP.153/04. 14. Before parting with this case, we have a considered opinion that the opposite party/Insurance Company and other Insurance Companies are benefited by the introduction of GR 17 of the revised India Motor Tariff. It is to be borne in mind that the vehicle was insured with the opposite party/Insurance Company and they also collected premium for the same. On theft of the insured vehicle, the insurance company has to indemnify the loss suffered on account of theft of the insured vehicle. In the present case, third opposite party, the registered owner and the insured of the vehicle sold the vehicle to the complainant with effect from 10.10.02 and so the opposite party/Insurance company can very well deny the insurance claim to third opposite party, the insured on the ground that the insured lost his insurable interest in the vehicle. The complainant who purchased the vehicle from the insured omitted to take necessary steps to get the ownership of the vehicle transferred in the registration certificate and also failed to get the insurance policy with respect to the vehicle transferred into his name. Thereby, the opposite party/Insurance Company can very well deny the claim made by the transferee/new owner of the vehicle. Thus, in all respects, the opposite party/insurance company is benefited. They got the premium for the policy; but they need not indemnify the loss caused on account of theft of the insured vehicle. In effect the old GR 10 ought to have been permitted to continue as such inauguration. The authorities concerned are expected to think over this crucial aspect regarding payment of the insurance claim with respect to the insured vehicle. In the result, the appeal is dismissed. The impugned order dated 10.3.08 passed by CDRF, Pathanamthitta in OP.153/04 is confirmed. The parties are directed to suffer their respective costs. M.V.VISWANATHAN -- JUDICIAL MEMBER S/L VALSALA SARANGADHARAN-- MEMBER | 
