MRS. NEENA SANDHU, MEMBER

1.       This is an appeal filed by the complainant against order dated 31.8.2010 passed by District Consumer Disputes Redressal Forum-II, UT, Chandigarh (for short hereinafter to be referred as District Forum) passed in complaint case No. 1456 of 2009.

2.       Briefly stated, the facts of the case are, that the complainant purchased a vehicle make BMW X Series X5 3.0 D from M/s. Krishna Automobiles, 125 Industrial Area, Phase-I, Chandigarh vide invoice No.VSIP80091/2008-09 dated 29.7.2008 for an amount of  Rs.57,95,000/-. The said car was purchased after availing loan facility from HDFC Bank Limited and as such the above said vehicle was hypothecated with the said bank.  It was submitted that the vehicle was insured with M/s Reliance General Insurance Company vide Private Car Policy No.2004782311006209 w.e.f. 27.7.2008 till midnight 28.7.2009 and a net premium of Rs.1,18,640/- was paid.  The Insured Declared Value (IDV) of the vehicle was Rs.55,05,250/-.  On 18.12.2008, the vehicle met with an accident at Chandigarh and suffered extensive damage and an FIR was lodged with the Police Station, Sector 26, Chandigarh.  The accident was immediately reported to the office of the OPs and on 30.12.2010, the said vehicle was inspected by Sh.Kailash Chandra, Surveyor & Loss Assessor, who assessed the loss and prepare an estimate for repair.  As per the report of the Surveyor, the damage to the vehicle was assessed at Rs.41,95,457/-. It was further submitted that the repairs of the said vehicle had crossed 75%  of the IDV, therefore, the vehicle was to be declared as total loss as per terms of insurance policy.  However, the OPs refused to declare the said vehicle as a total loss case and insisted on getting the repair done. It was next submitted that on 12.2.2009 Er.Vinod Kumar Sharma, Surveyor and Loss Assessor (A-Grade) independently surveyed the vehicle and vide his report dated 12.2.2009 assessed the loss at Rs.41,56,839/- This surveyor remarked that “It would therefore not be much economical to get the vehicle repaired as after major repairs the vehicle would not come to its original position.” The complainant’s company had requested the OPs to treat the insurance claim of the above said car as a total loss claim case, however the OPs company did not accede to the said request and did not make any payment with regard to the claim lodged with the OP company. It was submitted that vide letter dated 13.4.2009, the complainant company requested for the issuance of Road Worthy Certificate that incase repair was done on the vehicle, then the same would be restored to its original position and it would be safe to drive the same as there were 6 air-bags in the above said vehicle which had all burst opened from the impact of the accident.  Vide letter dated 18.4.2009, it was intimated by M/s Krishna Automobiles that the vehicle could be repaired and restored to a safe road worthy condition.  They had also stated that the repair estimate could change once the car was dismantled and actually repaired. It was alleged by the complainant that as per the terms & conditions of the insurance policy placed at Annexure C-9 that, “The insured vehicle shall be treated as a case of total loss if the aggregate cost of retrieval and/or repair of the vehicle, subject to terms and conditions of the policy, exceeds 75% of the IDV of the Vehicle.”  It was further submitted that despite this, the OPs kept delaying the settlement of claim and only paid Rs.22,99,000/- to the complainant as claim amount and an additional sum of Rs.20 lacs was received on sale of salvage to a third party with the help of the OPs.  As such, the total amount thus paid to the complainant was Rs.42,99,000/- i.e. 78.08% of IDV to the complainant company by the OPs company, which is more than 75% of IDV. The above said act of OPs amounts to deficiency in service and hence, the complaint was filed.    

3.       Reply was filed by the OPs and admitted that the policy was extended to the complainant for the vehicle, subject to the terms & conditions as per Annexure R-1.  It was pleaded that Sh.Kailash Chandra, Surveyor was appointed to assess the loss of the vehicle and as per its report, the cash loss/net salvage value was assessed at Rs.22,99,000/-.  As per the report of the surveyor, the vehicle was very much repairable and was not a case of total loss within the meaning of the policy.  Hence, as per the request and consent of the complainant, the cash loss settlement was agreed upon and the value of claim was assessed at Rs.22,99,000/-, which was less than 75% of the IDV.  It was further pleaded that the report of Sh.Vinod Kumar Sharma, Surveyor was not admissible as evidence as he was not an authorized surveyor of the OPs. The said report was procured, manipulated and fabricated by the complainant in order to make out a false case against the OPs. It was further pleaded that the complainant had accepted a sum of Rs.22,99,000/- in full and final satisfaction of the claim and further he had sold of the salvage of the vehicle for a sum of Rs.20 lacs directly to a third party but with the assistance of the OPs.  It was next submitted that after receipt of the above said amount, the complainant now only indulging in false and frivolous litigation in holding the Ops liable for deficiency in service. It was further pleaded that the claim process was settled immediately  on receipt of information of accident and the complainant was never asked to sign on any blank consent form.  As per the report of the surveyor, the liability of the insurance company was only Rs.22,99,000/- and the complainant cleverly crying to make out a new case by adding the salvage value of Rs.20 lacs to the claim amount to show the value of the damages to the tune of Rs.42,99,000/-. It was further submitted that the said vehicle was in repairable stage as has been confirmed by the manufacturer and dealer of the car, as such, no occasion had arisen for declaring the loss to be total loss. All other allegations leveled by the complainant in the complaint were denied and pleaded that there was no deficiency in service and prayed for dismissal of the complaint.

4.       The parties led their evidence in support of their contentions.

5.       The learned District Forum dismissed the complaint as the OPs have already satisfied their part of the commitment in terms of the policy and no deficiency in service or unfair trade practice is made out against the OPs.

6.          Aggrieved by the order passed by the learned District Forum, the complainant filed an appeal.

7.       In appeal, it is submitted that as per the admitted position, the vehicle had been fully comprehensively insured and in case of an accident, the insured vehicle was be treated as constructive total loss (CTL) if the aggregate cost of retrieval and/or repair of the vehicle, policy exceeds 75% of the IDV of the vehicle. The IDV value of the vehicle being Rs.55,05,250/- and the initial estimate given by the insurance surveyor coming to Rs.41,95,457/- and finally making a payment of Rs.42,99,000/- (after deducting Rs.1,000/- under the liability clause), the Act of the OPs company by not making the total claim amount as per the comprehensive insurance policy and not treating the same to be CTL, amounts to unfair trade practice and deficiency in service. It is submitted that as a matter of fact 75% of the IDV of Rs.55,05,250/- comes to Rs.41,28,937.50 and the payment of Rs.42,99,000/- comes to 78.08% of the IDV. The insurance company from the beginning, was dilly dallying the insurance claim of the appellant company on one pretext or the other and wrongly started treating the said claim under the repair clause category whereas as per the policy, the insurance claim of the appellant company was to be treated as a CTL claim. It is further submitted that the payment of Rs.42,99,000/- as the insurance claim clearly is more than the 75% of the IDV. It is submitted that the OPs company had sent a blank consent letter and asked the complainant to sign on the dotted lines and as such the consent letter was got signed under threat and coercion and thus could not be taken as a ground to reject the claim and not to make the payment to the appellant company as per the insurance policy. The consent was subsequently withdrawn accordingly the action of the OPs company declining the request of the appellant company vide their letter dated 20.8.2009 was without any justification and the learned District Forum has wrongly taken into consideration the fact with regard to giving of the consent as a ground of rejecting the claim of the appellant company. Vide letter dated 12.8.2009, the appellant company had clearly mentioned that advance consent letter accepting terms of settling the claim was taken and the same was under duress and coercion besides taking signatures on blank forms and consent letter without which the claim amount could not be processed. This act of the OPs company amounts to a clear cut blackmailing. The appellant has been deprived of use of his vehicle for more than 7 months and during this period, the complainant has been paying the EMI to the bank and the complainant had already completed all the formalities as asked by the surveyor appointed by the insurance company then it was the duty of the insurance company to immediately settle the accident claim of the vehicle within a reasonable period of two weeks of lodging the complaint and not to linger in the matter and the delay on the part of the insurance company to settle the claim has caused undue sufferings and is a clear cut case amounting to deficiency in service. Hence, it is prayed that the appeal may kindly be allowed and the impugned order passed by the learned District Forum may kindly be set aside.

8.       We have heard Sh.Raman Walia, Advocate for the appellant, Sh.Paras Money Goyal, Advocate for the respondents and perused the record.

9.       The learned counsel for the appellant/complainant contended that as per the terms and conditions of the insurance policy (Annexure C-9), “The insured vehicle shall be treated as a case of total loss if the aggregate cost of retrieval or repair of the vehicle, subject to terms and conditions of the policy, exceeds 75% of the IDV of the vehicle.” Although in the present case the cost of repair exceeds 75% of the IDV but the OPs have settled the claim on the cash loss basis only on the pretext that the loss suffered was less than 75% of the insured value of the vehicle and thus as such it did not fall under the total loss category. It is further contended that the complainant has received a sum of Rs.22,99,000/- as a claim amount along with additional sum of Rs.20 lacs as salvage i.e. in total Rs.42,99,000/- instead of a sum of Rs.57,95,000/-, the total IDV of the car. It is pertinent to mention here that the complainant had no other option/alternative then to sign the consent letter regarding the full and final settlement of the claim, otherwise the OPs refused to give any claim amount to the complainant.  It is further contended that later on, after receiving the amount of Rs.42,99,000/- the complainant sent a letter dated 12.8.2009 (Annexure C-16) to the OPs for the withdrawal of the consent letter dated 3.7.2009 with regard to the full and final settlement of the claim but the OPs did not allow the complainant to withdraw the consent letter and denied to pay as per the IDV. Thus due to this act of OPs, the complainant has filed a complaint before the learned District Forum and the learned District Forum has dismissed the complaint. Against the dismissal of the complaint, the complainant has filed an appeal and prayed that a direction may kindly be issued to the Ops to pay an amount of Rs.1,205,250/- more, which is short of IDV value of Rs.57,95,000/-.

10.     The learned counsel for the OPs i.e. M/s Reliance General Insurance Company Limited has argued that the complainant has been compensated fully by the OPs. As per the terms and conditions, an IRDA approved surveyor was deputed to assess the loss. As per the report of the surveyor (Annexure R-2), the cash loss value was assessed at Rs.22,99,000/-. As per this report, the vehicle was very much repairable and was not a case of total loss within the meaning of the policy and for this reason, the OPs requested the complainant to get the vehicle repaired. Since the complainant was no interested to get his vehicle repaired, therefore, the complainant has opted to settle the claim at cash loss basis and the OPs have settled the claim of the complainant after receiving the unconditional and free consent of the complainant for opting the cash loss and not choosing it to get the vehicle repaired. Hence, as per the request and consent of the complainant, the cash loss settlement was agreed upon, and the value of claim was assessed at Rs.22,99,000/-. This was less than 75% of the IDV, which was duly accepted by the complainant in full and final settlement of the claim. Further the complainant has also received a sum of Rs.20 lacs as a salvage value, hence the complainant in total has received  a sum of Rs.42,99,000/-. It is further argued that the report of Vinod kumar Sharma, Surveyor is not admissible as this surveyor is not authorized surveyor of the OPs. It is next argued that the complainant has been fully compensated, hence prayed that the appeal filed by the complainant may kindly be dismissed with the heavy costs.

11.     After going through the facts of the case, even we are of the opinion that the report of the surveyor Sh.Vinod Kumar Sharma, placed on record by the complainant is only an estimate for the repair of the vehicle. Moreover, this report of Sh.Vinod Kumar Sharma, Surveyor is of no value because he was not appointed as a surveyor by the insurance company for settlement of the claim. The report of the authorized surveyor i.e. Sh.Kailash Chandra, who was duly appointed, has been placed on record by the OPs, Annexure R-2 wherein the net claim amount has been shown as Rs.22.99 lacs, which was duly accepted by the complainant as full and final settlement.  It is also clear that the complainant has also received a sum of Rs.20 lacs as salvage and in this respect, a discharge voucher was duly signed by the complainant.  It is an admitted fact that the complainant has issued a consent letter dated 3.7.2009.   No doubt, later on the complainant has also filed an application dated 12.8.2009, for withdrawal of the above said consent letter dated 3.7.2009 with regard to full and final settlement. In our opinion, in the absence of any cogent evidence, the reasons given for withdrawal of the consent letter is meaningless. Moreover, the OPs have immediately released the claim amount to the complainant after receiving the consent letter, which was duly received by the complainant without any protest. As, in the present case, the OPs have already settled the claim of the complainant as per the surveyor report. Therefore, there is no deficiency in service or unfair trade practice on the part of OPs and the learned District Forum has rightly dismissed the complaint.  Therefore, we are of the view that the appeal filed by the complainant against the order passed by the learned District Forum is liable to be dismissed as devoid of merit.

12.     In view of the foregoing discussion, the appeal filed by the complainant is dismissed and the order passed by the learned District Forum is upheld. The parties are left to bear their own costs. 

13.          Copies of this order be sent to the parties, free of charge. 

Pronounced.                                                                        

1^st April, 2011.