BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, FEROZEPUR.
C.C. No.161 of 2014 Date of Institution: 15.4.2014 Date of Decision: 18.12.2014
Ishan Singh, aged 24 years, son of Vijay Kumar, resident of Inder Nagri, Jalalabad, Tehsil Jalalabad and District Fazilka.
....... Complainant
Versus
National Insurance Company Limited, Branch Office : Malwal Road, Ferozepur City, through its Branch Manager.
........ Opposite party
Complaint under Section 12 of the Consumer Protection Act, 1986.
* * * * *
PRESENT :
For the complainant : Sh. Hardeep Bajaj, Advocate
For the opposite party : Sh. M.L. Chugh, Advocate
QUORUM
S. Gurpartap Singh Brar, President
S. Gyan Singh, Member
ORDER
GURPARTAP SINGH BRAR, PRESIDENT:-
Brief facts of the complaint are that complainant Ishan Singh was the owner of the car make SKODA OCTAVIA 1.9 bearing Registration No.DL6CJ-4722, which was insured with the opposite party
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from 5.9.2011 to 4.9.2012 for the value of Rs.4,25,250/-, for which the complainant paid premium amount of Rs.15,740/-. On 29.6.2012, the said car met with an accident at Sultanpur Lodhi due to stray animal. The complainant and his relatives sustained multiple injuries and they were admitted in the Civil Hospital, Sultanpur Lodhi for treatment immediately and thereafter they were admitted to Apex Hospital, Jalandhar for treatment. There was total loss of the car in question in the accident, as it was totally damaged. After accident, the car in question was brought to Krishna Auto Sales, Jalandhar-Phagwara G.T.Road, V.P.O. Khajuria, District Kapurthala by M/S B.S. Break Down, Bagha Purana for which the complainant spent Rs.2400/- to the said carrier firm. Krishna Auto Sales prepared the estimate of repair of the car in question, which was for Rs.15,46,818.61 paise. The complainant had to pay the estimate fee of Rs.16,850/- to Krishna Auto Sales and took the delivery of the damaged car. The opposite party appointed M.L. Mehta, Surveyor & Loss Assessor, who verified and inspected the vehicle and took the copy of the estimate and the total loss of the vehicle in question was confirmed by the Surveyor and the opposite party and it was told that the opposite party will pay the amount of insurance for which the vehicle was insured by making deduction of value of the salvage/scrap of the car in question and directed to sell the salvage of the damaged vehicle and rest of the amount will be
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paid by the opposite party. As advised, the complainant took the Surveyor of the opposite party with him and sold the car in question for Rs.80,000/- without Registration Certificate. After sale of the salvage/scrap of the car in question, the complainant requested many a times to the opposite party for payment of the rest of the insurance amount i.e. Rs.3,45,250/- (after deduction of Rs.80,000/-, for which the salvage was sold, out of total amount of insurance of Rs.4,25,250/-). The complainant completed all the formalities for claim of the insurance amount, but the opposite party had been lingering on the matter on one pretext or the other and after elapse of about one year from the date of accident, the opposite party told the complainant that before the payment of insurance claim, there was requirement of cancelled copy of the registration certificate. It was further told that the opposite party had sent a letter to the Registration Authority, Sarai Kale Khan, Delhi, with whom the vehicle in question was registered, for cancellation of the registration certificate. On the advice of the opposite party, the complainant approached the Registration Authority at Delhi to get the R.C. cancelled, but the Registering Authority refused to cancel without physical cutting of the Chassis Number of the car in question. Thereafter, the opposite party told the complainant to submit an affidavit to the effect that he has sold the vehicle to the junkman/scrap dealer and he has not used the RC wrongly nor he will in future. The complainant
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submitted the said affidavit on 17.2.2014 with the opposite party, but the opposite party has not released the claim amount. Non-settlement of the claim of the complainant within the stipulated period amounts to deficiency in service and unfair trade practice on the part of the opposite party. Non-settlement of the claim even after elapse of about one year and ten months amounts to repudiation of the claim. Hence this complaint for a direction to the opposite party to pay Rs.3,45,250/- (after deduction of Rs.80,000/-, for which the salvage/scrap was sold, out of total amount of insurance claim of Rs.4,25,250/-, for which the car in question was insured) alongwith interest at the rate of 18% per annum from the date of accident i.e. 29.6.2012 till realization. Further a sum of Rs.2,00,000/- has been claimed as compensation for harassment and Rs.10,000/- as litigation expenses.
2. Upon notice, the opposite party appeared and filed its written reply to the complaint, wherein it has been pleaded that the present complaint is pre-mature. The claim of the complainant is still under consideration with the opposite party. The claim of the complainant has been approved for Rs.2,69,000/- without R.C. and subject to receipt of cancelled R.C. from the registering authority and affidavit from the insured. The opposite party told the complainant many a times to comply with the requirements including a letter dated 29.1.2014, but the complainant failed to do so. The opposite party also wrote a letter to the
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complainant as well as registering authority of the vehicle, but the insured has failed to submit the same, which resulted into delay in settling the claim. In the absence of the completion of the formalities, claim cannot be paid. The opposite party is still ready to pay the claim provided the complainant completes the formalities. Other allegations of the complaint have been denied and dismissal of the complaint has been prayed for.
3. Learned counsel for the complainant tendered into evidence Ex.C-1 to Ex.C-18 and closed evidence on behalf of the complainant. On the other hand, learned counsel for the opposite party tendered into evidence Ex.OP-1/1 to Ex.OP-1/8 and closed evidence on behalf of the opposite party.
4. We have heard the learned counsel for the parties and have also gone through the file.
5. Insurance of the car of the complainant make SCODA OCTAVIA 1.9 bearing Registration No.DL-6C-J-4722 vide policy Ex.C-3 for IDV of Rs.4,25,250/- for the period from 5.9.2011 to 4.9.2012 and accident of the said car during the subsistence of the policy have been admitted. The grievance of the complainant is that there was total loss of the car in question in the accident, as it was totally damaged, but the opposite party has not made the payment of remaining insurance amount of Rs.3,45,250/- to the complainant after deduction of Rs.80,000/-, for which
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the salvage was sold, out of the total IDV of Rs.4,25,250/-. The opposite party has pleaded that the claim of the complainant has been approved for Rs.2,69,000/- without R.C. and subject to receipt of cancelled R.C. from the registering authority and affidavit from the insured. As per Motor Survey Report Final dated 24.8.2012 Ex.OP-1/6 of M.L. Mehta & Company, Surveyor & Loss Assessor, the said Surveyor had recommended the loss on Net of Salvage Basis without R.C. and the salvage value of the vehicle has been assessed as Rs.80,000/-. After deducting the salvage value of the vehicle in question without R.C. and Rs.1000/- as excess clause, he has assessed the net loss of Rs.2,69,000/- without R.C. In para No.4 of the email letter dated 16.1.2013 written/sent by the said Surveyor M.L. Mehta & Company to the Senior Divisional Manager of the opposite party, it has been mentioned that he has recommended the loss without R.C. and the insured has also given a consent to get the R.C. cancelled. But a perusal of the copy of Consent Letter dated 23.8.2012 produced by the opposite party reveals that the complainant has never undertook to get the R.C. of the vehicle in question cancelled. The complainant also wrote letter dated 26.10.2013 Ex.OP-1/2 to the opposite party, which was duly received by the opposite party, to the effect that he had sold the salvage for Rs.80,000/- and the R.C. was with him; he had visited the Registering Authority Kaale Khan, New Delhi twice for cancellation of R.C., but they have refused to
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cancel the R.C. without physical cutting of Chassis Number of the damaged car and since he had already sold the salvage in July, 2012, it is not feasible for him to present the Chassis cutting with the Registering Authority, New Delhi. In Motor Survey Report Final dated 24.8.2012 Ex.OP-1/6, the Surveyor appointed by the opposite party has duly mentioned that the photographs of the vehicle were put on the website SalvageAuction.Com for taking wreck value and they have received bid for Rs.80,000/-. Therefore, from the report of the Surveyor, it is clear that before issuance of the said report by the Surveyor on 24.8.2012, the complainant was permitted to sell the salvage of the vehicle in question, which was accordingly sold by the complainant and the opposite party also recommended and forwarded the claim of the complainant for approval to the Motor Technical Department, Divisional Office of the opposite party at Moga vide letter dated 20.9.2012 Ex.OP-1/4 on Net of Salvage Basis for Rs.2,69,000/- by deducting the salvage value of Rs.80,000/- without R.C. In letter dated 5.7.2013 written by the opposite party to the Registering Authority, Sarai Kale Khan, Delhi for cancellation of the Registration Certificate, copy of which has been placed on the file by the complainant as Ex.C-6, the opposite party has also admitted that the wreck of the vehicle has been sold. But no evidence has been produced by the opposite party that prior to sale of the salvage of the vehicle in question by the
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complainant, the opposite party ever asked the complainant to get the R.C. of the said vehicle cancelled from the concerned Registering Authority for settlement of the claim. Letter written by the opposite party to the Registering Authority, Kale Khan, Delhi for cancellation of the R.C. of the said vehicle, copy of which has been placed on the file as Ex.OP-1/3, is of dated 7.5.2013 i.e. much after sale of the salvage by the complainant. As per letter No.401701/Claim/MT-OD/190, copy of which has been produced on the file by the opposite party, the opposite party for the first time asked the complainant to submit cancelled copy of Registration Certificate only on 29.1.2014. Even no terms and conditions of the policy has been placed on file by the opposite party that submission of cancelled copy of Registration Certificate of the vehicle in question was mandatory for settlement of the claim. Moreover, the complainant has submitted his duly sworn affidavit dated 17.2.2014, copy of which is Ex.C-8, to the opposite party to the effect that he has sold the vehicle in question to the junkman/scrap dealer and he has not misused the R.C. nor he will misuse the same in future. Therefore, non-settlement/payment of the claim of the complainant by the opposite party for want of cancelled copy of Registration Certificate of the vehicle in question is not justified, which amounts to deficiency in service on the part of the opposite party. Even the assessment of loss by the Surveyor is also not justified. However, report of
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the Surveyor is recommendatory and not mandatory. Admittedly, the vehicle in question was total loss and its salvage was sold for Rs.80,000/- by the complainant. In case of old vehicles, IDV of the insured vehicle is determined on the basis of an understanding between the insurer and the insured and the IDV is to be treated as the market value throughout the policy period without any further depreciation for the purpose of total loss claims. As per copy of Registration Certificate Ex.C-2, manufacturing date of the vehicle in question is 08/2005 and the IDV of this vehicle was Rs.4,25,250/-, as is evident from copy of Certificate of Insurance Cum Policy Schedule Ex.C-3. Therefore, the opposite party is liable to pay the Rs.4,25,250/- minus Rs.80,000/- as salvage value and Rs.1000/- as excess clause, which comes to be Rs.3,44,250/-. So far as consent of the complainant for settlement of the claim for Rs.2,69,000/- on Net of Salvage basis is concerned, the complainant in para No.9 of his affidavit Ex.C-18 has deposed that the said consent letter was obtained under pressure and coercion and even the opposite party remained failed to pay the amount as per the consent letter so far. In our view, the consent letter is not a bar in filing complaint before this Forum. The Consumer Forum constituted under the Consumer Protection Act, 1986 has the power to fasten liability against the insurance company notwithstanding the execution of the consent letter/
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discharge voucher. Similar view has been expressed by the Hon’ble National Commission, New Delhi in “Oriental Insurance Company Limited & Others Versus Western Nutrients Limited”, II (2007) CPJ 295 (NC).
6. In view of what has been discussed above, this complaint is accepted and the opposite party is directed to pay to the complainant a sum of Rs.3,44,250/- as insurance claim on account of loss of the vehicle in question alongwith interest at the rate of 9% per annum from the date of filing the present complaint i.e. 15.4.2014 till realization. Further the opposite party is directed to pay a sum of Rs.5000/- as compensation for harassment and Rs.3000/- as litigation expenses to the complainant. This order is directed to be complied with within a period of thirty days from the date of receipt of a copy of this order. File be consigned to the record room.
Announced 18.12.2014
(Gurpartap Singh Brar)
President
(Gyan Singh )
Member
