Order by:
Sh.Amrinder Singh Sidhu, President
The complainant has filed the instant complaint under section 12 of the Consumer Protection Act, 1986 (as amended upto date) on the allegations that the Complainant insured his vehicle make Alto 800 VXI BSN LMV Car bearing No.PB-29T-2450 from Opposite Parties No.2 and 3 vide policy No.08000031160304902542 Policy type Package Policy (Private vehicle) valid for the period w.e.f. 29.01.2017 to 28.01.2018 against the paid up premium of Rs.7387/-. The Complainant further alleges that on 12.10.2017 the vehicle in question met with an accident at Moga Talwandi Road and it was totally damaged. In this regard, the Complainant immediately informed the Opposite Parties. The surveyor of Opposite Parties visited the spot and made report regarding the total loss of the vehicle. The Complainant sent the accidental vehicle for its repair to Opposite Party No.1 and after checking, Opposite Party No.1 raised the demand of Rs.1,80,000/- for its repair. The Complainant lodged claim with the ops on 14.10.2017 and submitted all the necessary documents as required by the Opposite Parties. Thereafter, the Complainant many a times approached and requested the Opposite Parties to make the payment of repair of the vehicle, but the Opposite Parties put of the matter on one pretext or another. Not only this, the Complainant also sent legal notice through advocate, but to no affect. Due to the aforesaid act and conduct of the Opposite Parties, there is deficiency in service and Unfair Trade Practice on the part of the Opposite Parties and as such, the Complainant is left with no other alternative but to file the present complaint. Vide instant complaint, the complainant has sought the following reliefs.
a) Opposite Parties may be directed to pay a sum of Rs.1,80,000/- alongwith interest @ 18% per annum.
b) The amount of Rs.20,000/- be allowed to be paid by the opposite parties on account of compensation due to mental tension and harassment caused by the complainant besides Rs.15,000/- as litigation expenses.
2. Opposite Parties appeared through counsel and contested the complaint by filing the written version taking preliminary objections therein inter alia that the complaint is not maintainable. In fact, in the month of November, 2017 the vehicle of the Complainant came to the workshop of the Opposite Party No.1 for its repair as the car of the Complainant was damaged in a road accident. As per the statement of the Complainant, her car met with an accident on 15.11.2017 and intimation regarding accident was given to Opposite Party No.2 by the Complainant. Surveyor of Opposite Party No.2 visited the workshop of Opposite Party No.1 and after receiving estimation from the Opposite Party No.1, the surveyor declared the vehicle beyond repair and he also directed the Opposite Party No.1 that they have no need to repair the vehicle as the same is covered under total loss because the insured value of the vehicle is a less than the estimation value and due to this reason, the Opposite Party No.1 did not repair the vehicle of the Complainant and on the same day, the Opposite Party No.1 informed the Complainant and her husband that their vehicle is covered under total loss. The Opposite Party No.1 informed the Complainant to take away the vehicle from their workshop and also informed that otherwise, they will charge parking charges, but the Complainant or her husband did not give any heed to the request of the Opposite Party No.1. On merits, Opposite Party No.1 took almost the same and similar pleas as taken by them in the preliminary objections. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.
3. Opposite Party No.2 appeared their counsel and filed separate written reply taking the preliminary objections therein inter alia that the Complaint is not maintainable and that there is no deficiency in service on the part of the Opposite Party No.2. After receiving the intimation of the alleged accident, the Opposite Party No.2 immediately deputed their surveyor and Loss Assessor Sh.O.P.Garg and Associates who submitted his final survey report dated 17.03.2018 stating that at the time of accident, the insured vehicle was being driven by Manjeet Singh who was not holding a valid and affective driving licence and he has possessed a driving licence bearing No. 5289/Zira/2012. the Opposite Party No.2 verified the above said DL through his surveyor and loss assessor Manoj Goyal from the licensing authority, Zira and as per the report of the licensing authority, Zira, the DL No. 589/Zira/2012 has been issued to Mr.Avinash Chand son of Ramesh Chand resident of village: Makhu, Tehsil: Zira and valid from 10.02.2012 to 09.08.2031. The driving license of Manjit Singh which was produced by the Complainant at the time of lodging the claim is fake one. Thus due to the violation of the terms and conditions of the policy and provisions of the Motor Vehicle Act, the claim of the Complainant was repudiated as per the terms and conditions of the policy vide repudiation letter dated 29.01.2018. On merits, Opposite Party No.1 took almost the same and similar pleas as taken by them in the preliminary objections. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.
4. Opposite Party No.3 also filed their separate written reply taking the preliminary objections therein inter alia that the Complaint is not maintainable and that there is no deficiency in service on the part of the Opposite Party No.3. Opposite Party No.3 has been impleaded by the Complainant without any reason, cause of action and/ or jurisdiction. The Opposite Party No.3 is neither a necessary nor a proper party to the present complaint for the alleged cause of action. The answering Opposite Party is not an insurance company to indemnity the Complainant for the alleged loss or damage to the vehicle under the insurance cover. The role of the Opposite Party being a facilitator is to apprise customer about the features and benefits of motor insurance products offered by various insurance companies. The policy issuance/ cancellation, appointment of surveyors for claim investigation and assessment and acceptance or repudiation of claims is the sole prerogative of he concerned insurance company only. On merits, Opposite Party No.1 took almost the same and similar pleas as taken by them in the preliminary objections. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.
5. In order to prove her case, the complainant has tendered into evidence her affidavit Ex.C1 alongwith copies of documents Ex.C2 to Ex.C8 and closed the evidence.
6. On the other hand, to rebut the evidence of the complainant, Opposite Party No.1 tendered into evidence the affidavit of Sh.Nirmal Singh Ex.OP1/1 alongwith copies of documents Ex.OP1/2 and Ex.OP1/3. Similarly, Opposite Party No.2 tendered into evidence the affidavit of Sh.Ashok Kumar Jindal Ex.OP2/1W alongwith copies of documents Ex.OP2/1 to Ex.OP2/8 and similarly, Opposite Party No.3 tendered into evidence the affidavit of Sh.Surinder Srivastava Ex.OP3/1 alongwith copies of documents Ex.OP3/2 to Ex.OP3/4 and thereafter, the Opposite Parties closed their respective evidence.
7. We have heard the ld.counsel for the parties and also perused the written arguments filed by the Complainant and gone through the documents placed on record.
8. During the course of arguments, both the ld.counsel for the Complainant as well as Opposite Parties have mainly reiterated the facts as narrated in the complaint as well as in written reply respectively.
9. Ld.counsel for the complainant has mainly contended that the written version filed on behalf of Opposite Parties No. 2 and 3 has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. Opposite Parties No. 2 and 3 are limited Company and written version has been filed on the basis of special power of attorney given to ld.counsel for the Opposite Party. Ld.counsel for the Complainant further contended that the Complainant insured his vehicle make Alto 800 VXI BSN LMV Car bearing No.PB-29T-2450 from Opposite Parties No.2 and 3 vide policy No.08000031160304902542 Policy type Package Policy (Private vehicle) valid for the period w.e.f. 29.01.2017 to 28.01.2018 against the paid up premium of Rs.7387/-. The Complainant further alleges that on 12.10.2017 the vehicle in question met with an accident at Moga Talwandi Road and it was totally damaged. In this regard, the Complainant immediately informed the Opposite Parties. The surveyor of Opposite Parties visited the spot and made report regarding the total loss of the vehicle. The Complainant sent the accidental vehicle for its repair to Opposite Party No.1 and after checking, Opposite Party No.1 raised the demand of Rs.1,80,000/- for its repair. The Complainant lodged claim with the ops on 14.10.2017 and submitted all the necessary documents as required by the Opposite Parties. Thereafter, the Complainant many a times approached and requested the Opposite Parties to make the payment of repair of the vehicle, but the Opposite Parties put of the matter on one pretext or another and hence there is deficiency in service on the part of the Opposite Parties. Ld.counsel for the Complainant also contended that it is well settled law that if driver who was driving he vehicle in question at the time of accident has not a valid license, the insurance company can not declined the claim of the policy holder on this ground and the insurance company has to pay the insurance mount to the policy holder, but the insurance company has to pay the insured amount to the policy holder. In this regard, he has cited the judgement in Recent Civil Reports (Civil) 2018 (4) 700 and this fact was also upheld by the various courts in case New India Insurance Company Vs. Rakesh Kumar Ahuja decided on 17th July, 2003 and New India Assurance Company Vs. Ram Narain decided on 16th October, 2009 and National Insurance Company Ltd. Vs. Ram Pher and another decided on 12th February, 2019 and contended that the insurance company can not decline the claim of the policy holder on this ground.
10. On the other hand, ld.counsel for Opposite Party No.2 mainly repelled the aforesaid contention of the ld.counsel for the Complainant on the ground that after receiving the intimation of the alleged accident, the Opposite Party No.2 immediately deputed their surveyor and Loss Assessor M/s.O.P.Garg and Associates who submitted his final survey report dated 17.03.2018 stating that at the time of accident, the insured vehicle was being driven by Manjeet Singh who was not holding a valid and affective driving licence and he has possessed a driving licence bearing No. 5289/Zira/2012. the Opposite Party No.2 verified the above said DL through his surveyor and loss assessor Manoj Goyal from the licensing authority, Zira and as per the report of the licensing authority, Zira, the DL No. 589/Zira/2012 has been issued to Mr.Avinash Chand son of Ramesh Chand resident of village: Makhu, Tehsil: Zira and valid from 10.02.2012 to 09.08.2031. The driving license of Manjit Singh which was produced by the Complainant at the time of lodging the claim is fake one. Thus due to the violation of the terms and conditions of the policy and provisions of the Motor Vehicle Act, the claim of the Complainant was repudiated as per the terms and conditions of the policy vide repudiation letter dated 29.01.2018.
11. Perusal of the contention shows that Opposite Party No.1 and Opposite Party No.3 has nothing to do with the claim in dispute and they are impleaded by the Complainant unnecessarily without any reasonable cause.
12. Perusal of the further contention of the ld.counsel for the shows that the written version filed on behalf of the Opposite Party No.2 has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party is limited Company and written version has been filed on the basis of special power of attorney given to ld.counsel for the Opposite Party. In this regard, Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment, has held that
“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”
Similar proposition came before the Hon’ble Delhi High Court in “Nibro Ltd. Vs. National Insurance Co. Ltd.”, 2 (2005) 5SCC 30 that the
“bear authority is not recognized under law and ultimately, it was held that the plaint was not instituted by an authorized person. Here also appellant has not placed on record any resolution passed by any Board of Director in favour of Mr. Soonwon Kwon and that he was further authorised to delegate his power in favour of any other person. Further there is no memorandum/articles of the Company to show that Mr. Soonwon Kwon is one of the Director of the Company. In the absence of that evidence on record we cannot say that the special power of attorney given by Director Soonwon Kwon is a competent power of attorney issued in favour of Sh. Bhupinder Singh. In the absence of any resolution of the Company or any memorandum/articles of the Company to show that Sh. Soonwon Kwon is Director and that he was further authorised to issue power of attorney in favour of Sh. Bhupinder Singh.”
Recently our own Hon’ble State Commission, Punjab Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by an unauthorized person has no legal effect.
13. For the sake of arguments, for the time being, if the written reply filed by Opposite Party No.2 is presumed to be correct, the next plea raised by Opposite Party No.2 is that at the time of accident, the insured vehicle was being driven by Manjeet Singh who was not holding a valid and affective driving licence and he has possessed a driving licence bearing No. 5289/Zira/2012. the Opposite Party No.2 verified the above said DL through his surveyor and loss assessor Manoj Goyal from the licensing authority, Zira and as per the report of the licensing authority, Zira, the DL No. 589/Zira/2012 has been issued to Mr.Avinash Chand son of Ramesh Chand resident of village: Makhu, Tehsil: Zira and valid from 10.02.2012 to 09.08.2031. The driving license of Manjit Singh which was produced by the Complainant at the time of lodging the claim is fake one. Thus due to the violation of the terms and conditions of the policy and provisions of the Motor Vehicle Act, the claim of the Complainant was repudiated as per the terms and conditions of the policy vide repudiation letter dated 29.01.2018. On the other hand, that if driver who was driving he vehicle in question at the time of accident has not a valid license, the insurance company can not declined the claim of the policy holder on this ground and the insurance company has to pay the insurance mount to the policy holder, but the insurance company has to pay the insured amount to the policy holder. In this regard, he has cited the judgement in Recent Civil Reports (Civil) 2018 (4) 700 and this fact was also upheld by the various courts in case New India Insurance Company Vs. Rakesh Kumar Ahuja decided on 17th July, 2003 and New India Assurance Company Vs. Ram Narain decided on 16th October, 2009 and National Insurance Company Ltd. Vs. Ram Pher and another decided on 12th February, 2019.
13. However, in the case in hand, the only question involved in the matter has been whether the fake driving license of the driver was sufficient for repudiating the insurance claim? The reply to this query is answered in the negative. It is none of the case of Opposite Party No.1 that the owner of the vehicle knew that driving license of the driver Manjeet Singh was fake. It was none of the duty of the owner of the vehicle to visit the office of DTO for determining the veracity of driving license held by the driver. In such a situation, the insurance claim can not be denied to the complainant simply because the driving license was found to be fake subsequently that too during investigation conducted by the insurer while settling insurance claim. Reliance in this connection can be had on United India Insurance Company Vs. Lehru AIR 2003 SC 1292, in this case the effect of a fake license was directly under consideration before the Supreme Court. What was held and is relevant for the present case is extracted here below.
“When an owner is hiring a driver he will therefore have to check whether the driver has driving license. If the driver produces a driving license which on the face of it looks genuine, he owner is not expected to find out whether the license has in act been issued by a competent authority or not. The owner would then take the test of the driver. If he finds that the driver is competent to driver the vehicle, he will hire the driver. We find it rather strange that insurance companies expect owners to make enquiries with RTO’s which are spread all over the country, whether the driving license shown to then is valid or not. Thus where the owner has satisfied himself that the driver has a license and is driving competently there would be no breach of section 14((2)(a)(ii). The insurance company would not then be absolved of liability. If it ultimately turns out that the license was fake the insurance company would continue to remain liable unless they prove that the owner/ insured was aware or had noticed that the license was fake and still permitted that person to drive.
Further reliance in this connection can be had on Oriental Insurance Company Limited Vs. Meena Variyal, IV (2007) ACC 335 (SC), wherein it has been laid down that mere absence of or production of fake or invalid driving license or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third party. The insurance company to avoid liability, must not only establish the available defence raised in the proceeding concerned but must also establish breach on the part of the owner of the vehicle for which the burden of proof would rest with the insurance company. Whether such a burden had been discharged, would depend upon the facts breach on the part of the insured concerning a policy condition, the insurer would not be allowed to avoid its liability towards the insured unless the said beach of condition is so fundamental as to be found to have contributed to the cause of the accident. This view of Hon’ble Supreme Court has been followed in the latest jugement of Hon’ble Apex Court in case Lakhmi Chand Vs. Reliance General Insurance II (2016) CPJ 3 (SC), wherein it has been held that it becomes very clear from a perusal of the above mentioned case law of this Court that the insurance company, in order to avoid liability must not only establish the defence claimed in the proceedings concerned, but also establish breach on the part of the owner/ insured of the vehicle for which the burden of proof would rest with the insurance company. In the instant case, the respondent- company has not produced any evidence on record to prove that the accident occurred on account of the overloading of passengers in the goods carrying vehicle. Further, as has been held in the case of B.V.Nagaju (supra) that for the insurer to avoid his liability, the breach of the policy must be so fundamental in nature that it brings the contract to an end. In the instant case, it is undisputed that the accident was infact caused on account of the rash and negligent driving of the offending vehicle by its driver, against whom a criminal case vide FIR No. 66 of 2010 was registered for the offences referred to supra under the provisions of the IPC. These facts have not been taken into consideration by either the State Commission or National Commission while exercising their jurisdiction and setting aside the order of the District Forum. Therefore, the judgement and order of the National Commission dated 26.4.2013 passed in the Revision Petition No. 2032 of 2012 is liable to be set aside, as the said findings recorded in the judgement are erroneous in law.
15. From the aforesaid discussion, it transpires that the claim of the complainant has been wrongly repudiated by Opposite Party No.2. Opposite Party No.2 is held to be deficient in service.
16. Now come to the quantum of compensation. Opposite Party No.2 themselves produced the detailed report (9 pages) of their own appointed surveyor M/s.O.P.Garg & Associates Ex.OP2/1 on record vide which Opposite Party No.2 as assessed the consented Net off salvage basis report without RC Rs.1,50,000/- and this report has nowhere denied or rebutted by the Complainant by filing any cogent and convincing evidence. It has been settled by the Hon’ble Supreme Court of India that the report of the Surveyor cannot be brushed aside without valid reasons. In this context, reference may be made to the judgment of the Hon’ble Supreme Court reported as “Sri Venkateshwara Syndicate v. Oriental Insurance Company Limited, II (2010) CPJ 1 (SC)” in which it was held by the Hon’ble Supreme Court that the report of the Surveyor is to be given due importance and weight. Hon’ble National Commission in case cited as PRADEEP KUMAR SHARMA versus NATIONAL INSURANCE COMPANY, III(2008) CPJ 158 (NC), has been held that “Surveyor Report is an important document and cannot be brushed aside without any compelling evidence to the contrary”. Further in case New Horizon Sugar Mills Ltd. v. United India Insurance Co. Ltd. & Ors, 2003(3) CPR 136 (NC), the Hon’ble National Commission, New Delhi has observed that “report of Surveyor appointed under the provisions of Insurance Act has to be given greater importance.” In M/s Natain Cold Storage & Allied Industries Ltd. v . Oriental Insurance Co Ltd. 2003(3) CPR 114 (NC) it has been observed “surveyor’s report in the insurance claim is an important document which cannot be brushed aside easily.” Same view has been taken by the Hon’ble National Commission in case of Bhawana Kumar versus General Manager Varun Webres Ltd. & Anr, 2008(4) CPR 82 (NC). Not only this, recently Hon’ble National Consumer Disputes Redressal Commission, New Delhi in case National Insurance Company Limited Vs. M/s.Kiran Collector & Boutique 2019 (1) CLT 384 (NC), decided on 24th July, 2018 has held that “General rule is that the surveyors are appointed under the Insurance Act, 1938 and their reports are to be considered for settlement of insurance claims- The reports can not be brushed aside without any cogent reasons.”
17. Keeping in view the aforesaid facts and circumstances and replying upon the judgements of Hon’ble Supreme Court of India as well as Hon’ble National Commission, New Delhi (supra) we are of the view that the instant complaint is to be decided on the basis of unrebutted surveyor report.
18. In such a situation the repudiation made by Opposite Party No.2 regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation. This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible. It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-
“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy. The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.
19. In view of the aforesaid facts and circumstances of the case, the instant complaint is allowed against Opposite Party No.2-Insurance Company and Opposite Party No.2-Insurance Company is directed to make the payment of Rs.1,50,000/- (Rupees One lakh fifty thousands only) to the complainant as compensation against her claim of insured vehicle in question, on the basis of report of surveyor alongwith interest @ 8% per annum from the date of filing the complaint i.e. 03.05.2018 till its realization. However, complaint against Opposite Party No.1 and Opposite Party No.3 stands dismissed. Opposite Party No.2-Insurance Company also directed to pay the lump sum compensation to the complainant to the tune of Rs.10,000/- (ten thousands only) on account of harassment, mental tension and litigation expenses. The compliance of this order be made by Opposite Party No.2-Insurance Company within 45 days from the date of receipt of this order, failing which the complainant shall be at liberty to get the order enforced through the indulgence of this District Commission. Copies of the order be furnished to the parties free of cost. File be consigned to record room after compliance.
20. Reason for delay in deciding the complaint.
This complaint could not be decided within the prescribed period because the government has not appointed any of the Whole Time Members in this Commission for about 3 years i.e. w.e.f. 15.09.2018 till 27.08.2021 as well as due to pandemic of COVID-19.
Announced in Open Commission.
Dated: 26.10.2021.
