DISTRICT CONSUMER DISPUTES REDRESSAL FORUM (CENTRAL)
ISBT KASHMERE GATE DELHI
CC/ 240/2017
No. DF/ Central/
Mr. Ajay Kumar
S/o Sh. Om Prakash Singh
R/o 18/15 Azad Nagar,
Kishan Ganj, Delhi – 110007 ……..COMPLAINANT
VERSUS
M/s. National Insurance Company Limited
through its Managing Director
General Claim HUB, 2E/25, 3rd Floor,
Above HDFC Bank, Jhandewalan,
New Delhi – 110055 …..OPPOSITE PARTY
Quorum : Ms. Rekha Rani, President
Ms. Manju Bala Sharma, Member
Mr. R.S. Nagar, Member
ORDER
Rekha Rani, President
1. Mr. Ajay Kumar (in short the complainant) filed the instant complaint U/s 12 of the Consumer Protection Act 1986 as amended up to date (in short the Act) pleading therein that he got his vehicle no. DL1LS1019 insured from National Insurance Company Limited (in short the OP) vide Policy No. 360800311610002147 covered for the period from 13/11/2016 to 12/11/2017. On 26/11/2016 said vehicle was stolen and an FIR No. 034726/2016 dated 26/11/2016 u/s 379 IPC was registered and the police had given untraced report of the said vehicle. Complainant filed claim with the OP but OP vide its letter dated 04/08/2017 ref. no. ODH-56426/800 repudiated the claim without any justification. Complainant has sought direction to OP to pay him a sum of Rs. 5,50,000/- (Rs. Five Lakhs and Fifty Thousand only) with interest at the rate of 18% P.A. and Rs. 5,00,000/- (Rs. Five Lakhs only) as compensation for mental agony and litigation expenses.
2. Notice of the instant complaint was issued to the OP who contested the claim vide its reply. Both sides adduced their evidence by way of affidavits. They have also filed written argument. We have perused the case file and heard the complainant and Ms. Gurpreet Kaur Counsel for OP.
3. OP has not disputed that complainant obtained the Insurance Policy in respect of Vehicle No. DL1LS1019. It is stated that on investigation of the claim of the complainant it was revealed that the complainant while obtaining the insurance in respect of the vehicle in question from the opposite party submitted a previous insurance policy for the period from 13.11.2015 to 12.11.2016 issued by SFS General Insurance Co. Ltd. vide Policy No. 001121288621 and obtained a No Claim Bonus discount from the OP to the extent of 45%. It is further stated that OP checked the details of the previous policy and came to know that there was no such insurance company in the name of SFS General Insurance Company. It is stated that previous year policy was fake and forged and complainant obtained NCB discount fraudulently from the OP. It is further stated that concealment of this important and vital fact is in violation of the doctrine of utmost good faith and motor Tariff GR – 27 (f).
4. Complainant in his rejoinder has remained completely silent on the above allegations of fraud made against him by the OP. He has not denied that he availed NCB of 45% on the basis of previous insurance policy issued by SFS General Insurance Company. He has also not disputed the OP’s case that on verification OP found that such insurance Company does not exist.
5. OP in its reply to legal notice of the complainant dated 01/09/2017 proved as Exhibit OP R -1/4 stated in para 2 that complainant had declared that 45% no claim bonus claimed by him is correct and if the declaration is found to be incorrect all benefits in respect of section 1 of the policy will stand forfeited. The said declaration is reproduced by OP in para 2 page 4 of its written statement which complainant has not disputed in corresponding para of his rejoinder.
6. Learned counsel for complainant argued that OP cannot be permitted to challenge the validity of the policy on the ground of rebate of premium and such action would amount to deficiency of service on the part of the insurer. He further argued that any verification of NCB claim should have been made immediately after the issue of policy and not several months later.
7. Same contention was raised on behalf of the complainant on similar facts in Brij Bhushan vs. National Insurance Company Limited & Ors. Revision Petition No.33 of 2012 before the National Commission. In the said case the truck owned by the complainant was insured which met with an accident. The claim was repudiated on the ground that complainant had deliberately and fraudulently misrepresented and misled the insurer, while getting benefit of 55% NCB, transferred on his new truck no.Pb-13-I-5375, he had breached the principle of utmost good faith and that as per the Indian Motor Tariff 2002, framed by the Tariff Advisory Committee, a statutory body under the Insurance Act, 1938, he was not entitled to any own damage claim, since in the light of General Regulation no.27, all the benefits under Section-I of the policy of insurance, stood forfeited in the given circumstances of the case. The State Commission held that although the insurer granting no claim bonus has right to write to the previous insurer within 21 days after grating the cover note, yet complainant cannot take any benefit of the same having fraudulently mis-represented the facts and obtained the cover note which was in the name of Balwinder Singh. It was further observed that principle of equity is that who seeks equity must do the equity but complainant had not done so. It was held that complainant tried to cheat insurance company and claimed no claim bonus although he was not entitled for the same. As such no benefit of this lapse of the insurance company was extended to the complainant. National Commission upheld the order of the State Commission.
8. Similar question arose before the National Commission in Tata AIG General Insurance vs. Gulzari Singh R. P. No. 1255 of 2009. Facts of the case were that during the validity of the insurance, vehicle met with an accident which got repaired. A claim for reimbursement of the repair charges was lodged with the insurer which was repudiated on the ground that complainant had suppressed material fact with regard to having received claim from the previous insurance company. When the matter was cross checked from the previous insurer it came to light that the complainant had filed claims and availed reimbursement under their policy. District Forum dismissed the complaint however the State Commission taking note that the surveyor had assessed the loss at Rs. 97,960/- passed the following order:
“However, so far as the no claim bonus is concerned, the appellant was given discount of Rs.1120/- and, therefore, the respondent could not have denied that claim against the instant policy as the insurance company was bound to pay the claim for the insured period. However, in view of the assessment of the loss as assessed by the surveyor, we allow the appeal by directing the respondent to pay an amount of Rs.97,960/- less the discount of Rs.1,120/- to the appellant besides Rs.25,000/- as compensation which shall include cost of litigation.”
National Commission did not agree with the State Commission and observed that:
“State Commission while allowing the appeal could direct the petitioner to pay an amount of Rs.97,960/- less the discount of Rs.1,120/- given on account of No Claim Bonus as the State Commission, thereby altered the terms of the policy which it had no authority to do. Clearly it had no such jurisdiction. In case of LIC of India Vs. Smt. G.M. Channabasamma (1991) 1 SCC 357, the Hon’ble Supreme Court has held that a contract of insurance is a contract of uberrima fides and there must be complete good faith on the part of the assured. The assured thus is under a solemn obligation to make full disclosure of material fact which may be relevant for insurer to take into an account. Further in the case of General Assurance Society Ltd. Vs. Chandumull Jain & Anr. (1966) 3 SCR 500, the Hon’ble Apex Court has observed that the duty of the Court is to interpret the words in which the contract is expressed by the parties, because it is not for the Court to make a new contract, however, reasonable, if the parties have not made it themselves. The direction to adjust the No Claim Bonus against the amount of damage assessed passed by the State Commission, clearly violates this settled principle of law and, therefore, cannot be sustained.”
9. In the instant complaint, complainant has not proved that the previous insurance policy was valid. OP has proved that the complainant had made false declaration to avail NCB fraudulently and illegally. Therefore repudiation of his claim is justified for want of good faith in terms of the judgment in Smt. G.M. Channabasamma (Supra) as discussed above, the complaint is therefore dismissed. Copy of this order be sent to the parties as statutorily required. File be consigned to record room.
Announced on Day of 2019.
