DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BATHINDA.

CC.No.41 of 04-02-2013

Decided on 29-05-2013

Krishan Kumar aged about 45 years S/o Ram Sarup R/o Cinema Road, Ward No.11, near Chatur Singh Doctor, Budhlada.

........Complainant

Versus

National Insurance Co. Ltd. Branch Office, 25, Factory Area, Patiala, through its Sr.Branch Manager/Branch Manager.

.......Opposite party

Complaint under Section 12 of the Consumer Protection Act, 1986.

QUORUM

Smt. Vikramjit Kaur Soni, President.

Sh.Amarjeet Paul, Member.

Smt.Sukhwinder Kaur, Member.

Present:-

For the Complainant: Sh.Naresh Garg, counsel for complainant.

For Opposite party: Sh.J.D Nayyar, counsel for the opposite party.

ORDER

VIKRAMJIT KAUR SONI, PRESIDENT:-

1. The complainant has filed the present complaint under section 12 of the Consumer Protection Act, 1986 as amended upto date (Here-in-after referred to as an 'Act'). The brief facts of the complaint are that the complainant has purchased the new car Indigo LS bearing registration No.PB-50-7057 Model November 2011 from M/s Dada Motors Pvt. Ltd., Ludhiana on 15.11.2011 and M/s Dada Motors Pvt. Ltd. issued comprehensive insurance cover note under the tie up arrangement with National Insurance Co. Ltd. and issued the certificate bearing No.25331031116120047496 w.e.f. 15.11.2011 to 14.11.2012. The opposite party issued the abovesaid certificate of the insurance only on 15.11.2011 through M/s Dada Motors Pvt. Ltd. under its tie up arrangement for the cashless insurance scheme and charged Rs.13,117/- from the complainant for the full insurance i.e. comprehensive insurance as package insurance and declared the IDV of the said car to the tune of Rs.4,78,445/- under GR-8 of the India Motor Tariff. The GR-8 and its clauses are mandatory for the opposite party in which it is clearly mentioned that if the loss exceeds 75% of the IDV then it is a case of total loss and for the purpose of total loss the IDV will not be changed during the currency period in question. The opposite party and its agent M/s Dada Motors Pvt. Ltd. never issued the complete policy to the complainant. The said car met with an accident on 24.7.2012 at 9:30 pm in the revenue limits of PS Fatta Distt. Bathinda due to the rash and negligent driving of the truck bearing No.PB-03Q-9271. The complainant's driver lodged FIR No.48 dated 25.7.2012. The intimation of the accident was given by the complainant to the office of the opposite party and it appointed surveyor Mr.Chander Shekhar from Patiala and the complainant shifted the said car to M/s Hemant Goyal Motors Sangrur, authorized dealer-cum-service centre of the manufacturer M/s Tata Motors as the same is comprehensively insured under the tie up arrangement with the opposite party. The complainant spent Rs.3000/- for shifting the damaged car from PS Kot Fatta to Sangrur after taking the Sapurdari from SDJM, Talwandi Sabo. The surveyor Mr.Chander Shekhar visited Sangrur in the abovesaid workshop for the assessment of the loss of the said car and in his presence M/s Hemant Goyal Motors issued the estimate to the tune of Rs.7,65,214/- and the original estimate handed over to the surveyor. The estimate of the repair of Rs.7,65,214/- was issued by the authorized service centre of the manufacturer of the said car against the IDV of Rs.4,78,445/- which is much more than the IDV and the surveyor told the complainant at the workshop that the repair is much more than the IDV as such the said car is total loss. The surveyor visited the said workshop on 2.8.2012 and obtained all the necessary papers from the complainant i.e. duly signed motor accident claim form, original crain receipt of Rs.3000/-, photocopies of RC of the said car, driving licence, insurance certificate and FIR etc. The surveyor of the opposite party also obtained the signature of the complainant on blank consent form with the understanding that this is a total loss case and the total amount as per IDV will be paid to the complainant at the earliest and in good faith the complainant signed the blank consent form and the said vehicle shifted from the abovesaid workshop as it was demanding Rs.250/- per day as parking charges. M/s Hemant Goyal Motors, Sangrur charged Rs.7000/- from the complainant on account of the preparation of the estimate charges and parking charges, which is also payable by the opposite party as the insurance is under tie up arrangement with M/s Tata Motors. The complainant received one registered letter dated 19.9.2012 from the Sangrur office of the opposite party in which they told that the said car was used on hire and reward with HDFC bank as such they have considered the same as no claim against the rules and regulations of the opposite party. The complainant conveyed the officials of the opposite party that the accident took place due to the negligence of the truck driver and not due to the occupants i.e. the official of the HDFC bank and requested them to pay 75% IDV as non standard claim under the rules and regulations issued by the higher authorities i.e. GIC now IRDA but the opposite party refused to pay the same and issued the final No Claim letter dated 1.1.2013. The accident did not take place due to hire and reward. Hence the complainant has filed the present complaint to seek the directions to the opposite party to pay the claim as per IDV to the tune of Rs.4,78,445/-; shifting charges Rs.3000/- and Rs.7000/- as estimate and parking charges alongwith cost and compensation.

2. Notice was sent to the opposite party. The opposite party after appearing before this Forum has filed its written statement and pleaded that the actual facts of the complaint are that on receiving the intimation regarding the claim of the complainant, it was processed and found that at the time of the accident the said car was attached with HDFC bank, Budlada for use of hire and reward whereas the insured car has been registered for the private use only. The claim was not found admissible as the said car was being used for the purpose other than designed for as per the registration of the said car i.e. being used at the time of the accident on hire and reward whereas the said car as per registration certificate is registered for private use. The repudiation of the claim was done due to the breach of the terms and conditions of the policy under the 'limitation as to use clause':- The policy covers use of the vehicle for any purpose other than:

A) Hire or reward

B) Carriage of goods (other than samples or personal luggage)

C) Organized racing

D) Pace making

E) Speed testing and reliability trails

F) Use in connection with motor trade

Out of the above clauses, the clause of repudiation comes under the head (A). The insured had been provided the insurance policy alongwith the terms of the conditions. However the claim, if any, was payable subject to the rules and regulations and terms and conditions of the policy. The surveyor as well as the investigator are an independent agency and not under the pressure/obligations of the insurance company, they provided their independent reports.

3. The parties have led their evidence in support of their respective pleadings.

4. Arguments heard. The record alongwith written submissions submitted by the parties perused.

5. Admitted facts of the parties are that the complainant is owner of one new car Indigo LS, bearing registration No.PB-50-7057 model November 2011, purchased from M/s Dada Motors Pvt. Ltd., Ludhiana on 15.11.2011 and M/s Dada Motors Pvt. Ltd. Issued comprehensively insurance under the tie up arrangement with National Insurance Co. Ltd., the certificate No.25331031116120047496 w.e.f. 15.11.2011 to 14.11.2012. M/s Dada Motors Pvt. Ltd. charged Rs.13,117/- from the complainant for the full insurance i.e. comprehensively insurance as package insurance and declared the IDV of the said car as Rs.4,78,445/- under GR-8 of the India Motor Tariff. The said car met with an accident on 24.7.2012 at 9:30 pm in the revenue limits of PS Fatta Distt. Bathinda.

6. The disputed facts between the parties are that the opposite party has repudiated the claim of the complainant on the account that at the time of the accident the said car was attached with HDFC bank, Budlada for use of hire and reward whereas the insured car has been registered for the private use only. The repudiation of the claim was done due to the breach of the terms and conditions of the policy under the 'limitation as to use clause':- The policy covers use of the vehicle for any purpose other than (A) Hire or reward; (B) Carriage of goods (other than samples or personal luggage); (C) Organized racing; (D) Pace making; (E) Speed testing and reliability trails; (F)Use in connection with motor trade.

7. The complainant has relied upon the various authorities that his claim cannot be repudiated in toto. The accident took place due to the rash and negligence driving of the truck driver bearing registration No.Pb-03Q-9271 and there was no negligence on the part of the complainant, his driver and occupants of the said car. The complainant's driver lodged the FIR No.48 dated 25.7.2012 in this regard. The intimation of the accident was immediately given by the complainant to the office of the opposite party and it appointed surveyor Mr.Chander Shekhar from Patiala and the complainant shifted the said car to M/s Hemant Goyal Motors Sangrur, authorized dealer-cum-service centre of the manufacturer M/s Tata Motors as the same is comprehensively insured under the tie up arrangement with the opposite party. The complainant spent Rs.3000/- for shifting the damaged car from PS Kot Fatta to Sangrur after taking the Sapurdari from SDJM, Talwandi Sabo. The surveyor Mr.Chander Shekhar visited Sangrur in the abovesaid workshop for the assessment of the loss of the said car and in his presence M/s Hemant Goyal Motors issued the estimate to the tune of Rs.7,65,214/-, the original estimate was handed over to the surveyor. The estimate of the repair of Rs.7,65,214/- was issued by the authorized service centre of the manufacturer of the said car against the IDV of Rs.4,78,445/- which is much more than the IDV and the surveyor told the complainant at the workshop that the repair is much more than the IDV as such the said car is a total loss. M/s Hemant Goyal Motors, Sangrur charged Rs.7000/- from the complainant for preparing the estimate, the parking charges, are also payable by the opposite party as the insurance is under tie up arrangement with M/s Data Motors. The complainant received one registered letter dated 19.9.2012 from the Sangrur office of the opposite party in which they told that the said car was used on hire and reward with HDFC bank as such they have considered the same as no claim against the rules and regulations of the opposite party. The complainant conveyed the officials of the opposite party that the accident took place due to the negligence of the truck driver and not due to the occupants i.e. the official of the HDFC bank and requested them to pay 75% IDV as non-standard basis under the rules and regulations issued by the higher authorities but the opposite party refused to pay the same and issued the final 'No Claim' letter dated 1.1.2013 in which they repudiated the claim of the complainant on the ground that the said car was used for hire and reward whereas the accident did not take place due to hire and reward. The surveyor of the opposite party in his report Ex.OP-9 mentioned that the said car is total loss and its salvage value is about Rs.1,75,000/- and he himself admitted that this is a total loss case.

8. The claim of the complainant has been repudiated by the opposite party on the ground that the said car was being used for hire and reward, as the said car was being used for other than the private use and the opposite party has mentioned in its reply that 'limitation as to use clause', thus on account of the breach of the terms and conditions, the claim of the complainant was repudiated by the opposite party. In this regard the Hon'ble State Commission, Punjab, Chandigarh has laid down the precedent in case titled The National Insurance Co.Ltd. Vs. Sh.Vijay Kumar, First Appeal No.773 of 2006, in it the Hon'ble State Commission in para Nos.15 and 16 relying upon the law settled by the Hon'ble Supreme Court in the judgment reported at IV(2008), CPJ 1 (SC) titled 'National Insurance Company Ltd., Vs.Nitin Khandelwal, the relevant portion is reproduced hereunder:-

“15).........if the violation of the terms and conditions of the policy was not germane to the cause of action then the insurance claim cannot be repudiated as a whole. It was held by the Hon'ble Supreme Court as under:-

'(13) In the instant case, the State Commission allowed the claim only on non-standard basis, which has been upheld by the National Commission. On consideration of the totality of the facts and circumstances in the case, the law seems to be well settled that in case of theft of vehicle, nature of use of the vehicle cannot be looked into and the Insurance Company cannot repudiate the claim on that basis.

(14) In the facts and circumstances of the case, the real question is whether, according to the contract between the respondent and the appellant, the respondent is required to be indemnified by the appellant. On the basis of the settled legal position, the view taken by the State Commission cannot be faulted and the National Commission has correctly upheld the said order of the State Commission.'

16) This judgment was followed in the subsequent judgment of the Hon'ble Supreme Court reported as 'Amelendu Sahoo Vs. Oriental Insurance Co. Ltd., II (2010) CPJ 9 (SC)' in which the law laid down by the Hon'ble Supreme Court in Nitin Khandelwal's case (supra) was reiterated. It was held by the Hon'ble Supreme as under:-

'(14) In this connection reference may be made to a decision of National Commission in the case of New India Assurance Company Limited Vs. Narayan Prasad Apparasad Pathak, reported in II (2006) CPJ 144 (NC). In that case also the question was whether the insurance company can repudiate the claims in a case where the vehicle carrying passengers and the driver did not have a proper driving licence and met with an accident. While granting claim on non-standard basis the National Commission set out in its judgment the guidelines issued by the insurance company about settling all such non-standard claims. The said guidelines are set out below:-

The reliance can also be put on the precedent laid down by the Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case titled New India Assurance Company Ltd. Vs. Kotlu Brahamana, Ex-Servicemen's Transport Co-operative Society Ltd., I (2012) CPJ 262 (NC) and further the reliance can also be put on the precedent laid down by the Hon'ble Punjab State Consumer Disputes Redressal Commission, Chandigarh in case titled Jaswant Singh Vs. National Insurance Company Ltd. III (2008) CPJ 472. The opposite party repudiated the claim of the complainant on the ground that there is breach of conditions of the policy. The breach of the conditions of the policy is not fundamental to the accident. The opposite party is liable to pay the amount of 75% of the claimed amount. Hence on no account the claim of the complainant can be repudiated in toto. In the case in hand the IDV of the said car is Rs.4,78,445/- whereas its estimate of repair is Rs.7,65,214/- which is much higher than the IDV of the said car. Moreover the surveyor Mr. Chander Shekhar has also admitted in his report that there is total loss to the vehicle. In the survey report Ex.OP-9 at page No.7 it has been mentioned that Assessment of loss on 'Total loss basis' as per Annexure 'A' (Not viable due to Police FIR on record, yet given for record sake and comparative study:-IDV after policy clause Rs.4,77,945/- less expected Tender value Rs.1,75,000/-=Rs.3,02,945/- only. Assessment of loss on 'Cash loss under Net of salvage basis' as per Annexure 'A':-IDV after policy clause Rs.4,77,945/- Less maximum retainable salvage value Rs.2,25,000/-=Rs.2,52,945/- only. Thus it would meet the ends of justice if this complaint be allowed with some cost and compensation on non-standard basis as there is breach of condition.

9. Therefore in view of what has been discussed above it is admitted fact by the parties that the said car is total loss, thus there is deficiency in service on the part of the opposite party in not paying the genuine claim to the complainant. Hence this complaint is accepted with Rs.5000/- as cost and compensation. As the said car is total loss, the opposite party is directed to pay 75% of the IDV i.e. Rs.3,58,458.75 +Rs.3000/- as towing charges and Rs.7000/-(spent by the complainant for the preparation of the estimate charges)=Rs.3,68,458.75p.

10. The compliance of this order be done within 45 days from the date of receipt of the copy of this order.

11. In case of non-compliance the amount of Rs.3,68,458.75p will yield interest @ 9% per annum till realization.

12. A copy of this order be sent to the parties concerned free of cost and the file be consigned to the record room.

Pronounced

29-05-2013

(Vikramjit Kaur Soni)

President

(Amarjeet Paul)

Member

(Sukhwinder Kaur) Member