Order by:
Sh.Amrinder Singh Sidhu, President
1. Sh.Mohinder Pal, complainant has filed the instant complaint under section 12 of the Consumer Protection Act, 1986 (as amended upto date) on the allegations that he insured his vehicle TATA 4018 40.2 LPS TC, Year of Manufacturing 2014 having Engine No.B591803241H63392217, Chassis No.MAT447220E3H18816, Registration No.PB-05Y-5458 with Opposite Parties vide policy No.401700/31/16/6300001015 valid for the period w.e.f. 15.09.2016 to 14.09.2017, with IDV Rs.22 lakhs, against the paid up premium of Rs.49,240/- and said vehicle was being used by the Complainant to earn his livelihood by means of self employment by hiring a driver and hence, the Complainant is consumer of the Opposite Parties as defined under the Act. The Complainant alleges that it is continuous policy as the said vehicle of the Complainant was also insured with the New India Assurance Company from the period 15.09.2015 to 14.09.2016. The Complainant further alleges that alongwith the cover note, the Opposite Parties never issued any terms and conditions of the policy documents. Further alleges that on 08.10.2016 Sagar Kumar son of Tarsem Lal (Having driving licence No.PBPB0820120327712, valid from 12.09.2012 to 19.08.2018 (transport and till 19.08.2035 (non transport) was driving the loaded vehicle in question with Imported Coal and was proceeding to Harachwal, District Gurdaspur from Mudra Port (West) vide GR No. 6132 dated 08.10.2016 issued by M/s.Shree Guru Nank Roadlines and on the way, when the insured vehicle reached near Mudra Port, it struck with another vehicle coming from Opposite Party with force causing extensive damages. In this regard, the Opposite Parties was immediately informed who deputed spot surveyor Mr.Parveen Kumar Goyal, Surveyor & Loss Assessor who assessed the loss to the vehicle to the extent of Rs.12,43,258/- giving the detailed damages to each and every parts of the insured vehicle. Lateron the damaged vehicle was brought to Gobind Motors, Rampura Phul and the assessed the loss to the vehicle to the tune of Rs.12,43,258/- against the IDV of Rs.22 lakhs. Thereafter, the claim of the damaged vehicle was lodged with the Opposite Parties and after investigation through their different surveyors and loss assessors, the Opposite Parties recommended the claim of Rs.7,22,350/-, then Rs.6,25,000/- and lateron for Rs.5,34,350/-. In this regard, the Opposite Parties obtained the consent from the Complainant dated 1.06.2017 for making the payment of Rs.7,22,350/- as recommended by the officer of the Opposite Parties namely Mr.Mukesh Kalia, Manager vide report dated 27.08.2018, but lateron vide letter dated 24.09.2018, the Opposite Parties have repudiated the claim of the Complainant on the false and frivolous ground without application of mind mentioning that the Complainant has violated the terms and conditions of the policy, whereas no such terms and conditions were ever supplied to the Complainant at the time of issuance of the policy in question. In this way, said conduct of the Opposite Parties clearly amounts to deficiency in service 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.12,43,258/- on account of loss to the insured vehicle.
b) The amount of Rs.2,00,000/- be allowed to be paid by the opposite parties on account of compensation due to mental tension and harassment caused by the complainant.
c) The costs of the complaint amounting to Rs.20,000/- may please be allowed.
d) And any other relief to which this Hon’ble Consumer Commission, Moga may deem fit be granted in the interest of justice and equity.
2. Opposite Parties appeared through counsel and contested the complaint by filing the written version on the ground that the Complainant has got issued GC No.6132 dated 08.10.2016 from Sh.Guru Nanak Roadlines and thereafter another GCNo.6145 dated 08.10.2016 of same consignment of different amount and weight. Both the GCs were investigated by Investigator Sh.Jiten V.Thacker, Surveyor and Loss Assessor who visited the spot and as per the record, the GC No. 6132 dated 08.10.2016 and followed by detail of 2 numbers before and 2 numbers after the serial numbers of consignment note were ascertain their GC Note Book issued by them to various persons. The detail of which is given in para No. 3 of the written reply. So, based upon the detail produced by the transporter to the surveyor after verifying the record it was found that the vehicle in question was loaded 29610 KG weight against the detail of the goods consignment dated 08.10.2016 having GC No. 6145 and the photo copy of GC No.6132 dated 08.10.2016 has been shown by transporter issued by them for the vehicle in question, which does not tally with the tallied loaded point and hence, the Complainant has violated the terms and conditions of the insurance policy and so the claim is not fit for approval and is repudiated vide repudiated letter dated 24.09.2018. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.
3. In order to prove his case, the complainant has tendered into evidence his affidavit Ex.C1 alongwith copies of documents Ex.C2 to Ex.C11 and closed his evidence.
4. On the other hand, to rebut the evidence of the complainant, Opposite Parties tendered into evidence affidavit of Sh.Kamaljit Singh, Divisional Manager Ex.OP1 alongwith copies of documents Ex.OP2 to Ex.OP11 and closed the evidence on behalf of the Opposite Parties.
5. We have heard the ld.counsel for the parties and also perused the written arguments filed by both the parties and gone through the documents placed on record.
6. 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.
7. Ld.counsel for the complainant has mainly contended that the written version filed on behalf of Opposite Parties has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. 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. He has relied upon the 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, it was 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 recognised under law and ultimately, it was held that the plaint was not instituted by an authorised 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.
8. For the sake of arguments, if it is admitted that the written version filed by the Opposite Party is legal. Now come to the merit of the case. It is not the denial of the case of the parties that vehicle of the Complainant TATA 4018 40.2 LPS TC, Year of Manufacturing 2014 having Engine No.B591803241H63392217, Chassis No.MAT447220E3H18816, Registration No.PB-05Y-5458 was insured with Opposite Parties vide policy No.401700/31/16/6300001015 valid for the period w.e.f. 15.09.2016 to 14.09.2017, with IDV Rs.22 lakhs, against the paid up premium of Rs.49,240/-, copy of the cover note is placed on record as Ex.C7. It is also not the denial of the parties that on 08.10.2016 the insured vehicle in question struck with another vehicle coming from Opposite Party with force causing extensive damages and in this regard, the Opposite Parties was immediately informed who deputed spot surveyor Mr.Parveen Kumar Goyal, Surveyor & Loss Assessor who assessed the loss to the vehicle to the extent of Rs.12,43,258/- giving the detailed damages to each and every parts of the insured vehicle and the Complainant immediately reported the matter with the Opposite Parties and completed all the formalities, but the Opposite Parties have repudiated the claim of the Complainant vide letter dated 24.09.2018 on the ground that the Complainant has breached the terms and conditions of the policy in question, whereas the contention of the Complainant is that no such terms and conditions of the policy in question were ever supplied to the Complainant and hence, the repudiation of claim of the Complainant is not legal.
9. On the other hand, the only ground of repudiation of the claim of the Complainant by the Opposite Parties is that the Complainant has breached the terms and conditions of the policy in question and hence, the claim of the Complainant was rightly repudiated after application of mind and hence therefore, there is no deficiency in service on the part of the Opposite Parties. But we do not agree with the aforesaid contention of the Opposite Parties because the Opposite Parties could not produce any evidence to prove that terms and conditions of the policy were ever supplied to the complainant insured, when and through which mode? It has been held by Hon’ble National Commission, New Delhi in case titled as The Oriental Insurance Company Limited Vs. Satpal Singh & Others 2014(2) CLT page 305 that the insured is not bound by the terms and conditions of the insurance policy unless it is proved that policy was supplied to the insured by the insurance company. Onus to prove that terms and conditions of the policy were supplied to the insured lies upon the insurance company. From the perusal of the entire evidence produced on record by the Opposite Party, it is clear that Opposite Party has failed to prove on record that they did supply the terms and conditions of the policy to the complainant insured. As such, these terms and conditions, particularly the exclusion clause of the policy is not binding upon the insured. Reliance in this connection can be had on Modern Insulators Ltd.Vs. Oriental Insurance Company Limited (2000) 2 SCC 734, wherein it is held that “In view of the above settled position of law, we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant, the respondent can not claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law.” Our own Hon’ble State Commission, Punjab, Chandigarh in First Appeal No.871 of 2014 decided on 03.02.2017 in case titled as Veena Mahajan (Widow) and others Vs. Aegon Religare Life Insurance Company Limited in para No.5 has held that
“Counsel for the appellant argued that copy of insurance policy was not supplied to the appellant and hence, the exclusion clause in the contract of the insurance policy is not binding upon him. He further argued that no proof of sending of insurance policy was ever produced by the respondent despite specific contention raised by the complainant that the insurance policy was never received by him. He argued that though there is an averment of the OP that the policy in question was delivered through Blue Dart Courier to the complainant. In order to prove their contention, no affidavit of any employee of Blue Dart was produced who would have made a statement to have the effect that the policy was delivered to the complainant nor any acknowledgement slip for having received the article by the complainant through courier company was produced by the insurance company. He argued that since no policy document was received by the insured and argued that the terms and conditions as alleged to be part of the insurance policy were not binding upon the insured. He argued that policy was issued in the name of deceased Sh.Vijinder Pal Mahajan with his wife Mrs.Veena Mahajan as beneficiary and the same was never refused by the OP and the proper premium for insurance was paid by late complainant. He argued that as per the specific allegations made in the complaint in para No.4, no rebuttal to that contention was specifically there in their written reply in para No.2 and para No.4 in the reply filed by OP in the District Forum. He argued that Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case of "Ashok Sharma Vs. National Insurance Co. Limited", in Revision Petition No. 2708 of 2013 held in para No.8 to the point of non-delivery of terms and conditions of the policy. He also cited Hon'ble Supreme Court's decision given in the matter of "United India Insurance Co. Limited Vs. M.K.J.Corporation" in Appeal (civil) 6075-6076 of 1995 (1996) 6 SCC 428 wherein the Apex court held that a fundamental principle of Insurance Law makes it that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured has a duty to disclose, "similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge, since obligation of good faith applies to them equally with the assured and further argued that since the terms and conditions were not supplied even on repeated requests the same cannot be relied upon by the opposite party in order to report to repudiate the genuine claim of the wife of the deceased policy holder.”
10. However, learned counsel argued that even if for arguments sake it is admitted that the complainant has breached the terms and conditions of the policy in question, even then the Insurance Company ought to have settled the claim of the complainant on “non standard basis” even if some of the conditions of the insurance policy are not adhered by the insured. Learned counsel in support of his above contention has relied upon the case titled National Insurance Company Limited versus Kamal Singhal IV (2010)CPJ297 (NC) wherein the Hon'ble National Consumer Disputes Redressal Commission, New Delhi relying upon various decisions of the National Consumer Disputes Redressal Commission in the matter of (1) National Insurance Company Ltd. v. J. P. Leasing & Finance Pvt. Ltd. (RP No. 643/2005), (2) Punjab Chemical Agency v. National Insurance Company Ltd. (RP No. 2097/2009), (3) New India Assurance Co. Ltd. v. Bahrati Rajiv Bankar, (RP) No. 3294/2009) and (4) National Insurance Company Ltd. v. Jeetmal, (RP No.3366/2009) and also judgment of the Hon'ble Apex Court in the matter of Insurance Company Versus Nitin Khandewal IV (2008) CPJ 1(SC), wherein Hon'ble Apex Court held in the matter of theft of a vehicle, breach of condition of the policy was not germane and also held further that : “ the appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy to the loss caused to the insurer”. The Hon'ble Supreme Court has further held that; “even assuming that there was a breach of policy, the appellant Insurance Company ought to have settled the claim on “non-standard basis.” Hon'ble Apex Court in back drop of these features, in these cases, allowed 70% of the claim of the claimant on the “non-standard basis”. This view was again reiterated by the Hon'ble Apex Court in the matter of Amalendu Sahoo versus Oriental Insurance Company Limited. II(2010) CPJ 9(SC)=II (2010)SLT 672. Hon'ble National Commission in the case National Insurance Company Limited versus Kamal Singhal referred to above relying upon the law laid down by the Hon'ble Supreme Court has held that;
“there being a long line of decisions on this score, we have no option but to uphold the finding of Fora below with modification that the claim be settled on 'non-standard' basis”, in terms of the guidelines issued by the Insurance Company. In case petitioner company fails to carry out the direction contained therein, the amount payable on 'non-standard' basis, shall carry interest @ 6% p.a from the date of expiry of six weeks till the date of actual payment”.
11. In such a situation the repudiation made by Opposite Parties 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 seams 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.
12. Now come to the quantum of compensation. In his complaint as well as in his duly sworn affidavit Ex.C1, the Complainant has specifically pleaded that the Opposite Parties obtained the consent from the Complainant dated 1.06.2017 for making the payment of Rs.7,22,350/- as recommended by the Administrative Officer of the Opposite Parties under the signatures from Anurag Shishidoa and Mukesh Kalia, Manager vide report dated 27.08.2018, but lateron vide letter dated 24.09.2018, the Opposite Parties have repudiated the claim of the Complainant. Copy of the consent letter duly signed by the Complainant and submitted to Divisional Manager, National Insurance Company Limited, Moga is placed on record as Ex.C6. Not only this, vide letter dated March 19, 2018 Ex.C3, under the signatures of Administrative officer Mr.Parvinder Singh, as well as Manager Mr. Mukesh Kalia and Regional Manager Mr.Dhananjay Singh, the Opposite Parties has recommended the claim for approval on repair (Non –Standard Basis) for Rs.5,30,867/-. Having regard to the position of the law, as has been laid down, by the Hon'ble Apex Court in the various decisions referred to here-in-above and also the view expressed by the Hon'ble National Commission, we are of the considered view that in the present case the complainant, if not entitled for the entire assessed amount, the Insurance Company definitely ought to have settled the complainant's claim on 'non-standard basis”, which in the facts and circumstances taking the assistance of the view expressed by the Hon'ble Apex Court and also by the Hon'ble National Commission, we allow 70% of the claim of the complainant on 'non-standard' basis” of the consented amount.
13. In view of the aforesaid facts and circumstances of the case, we allow the complaint of the Complainant partly and direct the Opposite Parties to make the payment of Rs.5,05,645/- (Rupees five lakh five thousands six hundred and forty five only) i.e. 70% of the consented amount of Rs.7,22,350/- to the Complainant alongwith interest @ 9% per annum from the date of repudiation of the claim i.e. 24.09.2018 till its actual realization. Opposite Parties are 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 the Opposite Parties 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.
14. 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. Moreover, the President of this Commission is doing additional duties at District Consumer Commission, Faridkot and furthermore due to non-sitting of this District Commission virtually for a long period due to pandemic of COVID-19.
Announced in Open Commission.
Dated: 09.09.2021.
(Mohinder Singh Brar) (Amrinder Singh Sidhu)
Member President
