Delhi

West Delhi

CC/15/52

Mubinuddin - Complainant(s)

Versus

NIC - Opp.Party(s)

17 Oct 2022

ORDER

BEFORE THE CONSUMER DISPUTE REDRESSAL COMMISSION,

WEST DISTRICT, JANAKPURI,

NEW DELHI

 

CC No.   52/2015

In the matter of :

 

MUBINUDDIN

S/O LATE MASHIUDDIN

R/O F-6, GALI NO. 33,

MAHENDRA PARK, DELHI    ........COMPLAINANT

Versus

M/s. NATIONAL INSURANCE CO. LTD.

HAVING ITS-DIVISIONAL OFFICE AT-VIII,

POOJA HOUSE, FIRST FLOOR,

KARAMPURA,NEW DELHI.    ........OPPOSITE  PARTY

 

DATE OF INSTITUTION:     JUDGMENT RESERVED ON:            DATE OF DECISION      :

21.01.2015 14.09.2022 17.10.2022

 

Ms. Sonica Mehrotra, President

Ms.Richa Jindal, Member (Female)

Mr. Anil Kumar Koushal, Member (General)

Order passed byMs.Richa Jindal, Member

 

ORDER

1. The complainant has filed the present complaint under section 12 alongwith the application for condonation of delay in filing complaint under section 24 A of the CPA Act, 1986. Brief facts of the complaint are as follows :-
   1. The complainant is the owner of vehicle bearing registration No: UP-17C-6828 (Tavera) and the said vehicle was stolen on 01.05.2011 from Sec-16, Rohini, Delhi and in this regard, one FIR bearing Not 239/11, U/s-379 I.P.C. P.S.-K.N. Katju Marg, Delhi was gotregistered.
   2. The vehicle of complainant was insured with the opposite party/ respondent vide Passenger carrying Commercial vehicle Package Insurance policy vide policy No: 360300/31/10/63/00001070 valid for a period commence from 10-05-2010 to 09-05-2011 for a sum insured of Rs 5,46,000/- at the time of stolen of vehicle in question.
   3. The complainant has filed claim against the said theft of the said vehicle bearing No: UP-17C 6828 (Tavera) with the opposite party and was investigated by the investigator of the opposite party but unfortunately the claim against said theft is not released to the complainant even tilldate despite of several the requests made by complainant before the respondent.
   4. The complainant sent a notice to the opposite party on 24.05.11, but the respondent had not given its reply to the complainant or settled the dispute with the complainant. Therefore, the complainant sent a notice on 09.11.2012 upon which the officials of opposite party called to complainant severally but despite of that, the opposite party/ respondent has aforesaid failed to settle the dispute.
   5. The complainant again sent a notice through his counsel on 02.12.2014 respondent has given which the false and fabricated reply, then it came to the knowledge of the complainant that the claim of the complainant was closed by the respondent as no claim due to non-supply of fitness certificate and the same was communicates to the complainant on 02.01.2015 by the Opposite party through its reply.
   6. The respondent/opposite party is bound to pay the claim amount to the complainant as per the consumer protection Act but even after many requests made by the complainant, the respondent has not paid the claimed amount which amounts to deficiency of services from the part of the respondent for which, it is liable to be prosecuted.
   7. Acts and conduct on the part of the respondent are highly illegal and negligent which amounts to deficiency of services by the respondent towards the complainant.
   8. In light of the above deficiency of services on the part of the respondent, the opposite party is prima facie guilty for the same and liable to pay the claim amount as claimed by the complainant alongwith compensation. Hence this complaint filed before this commission to sought claim amount to the tune of Rs 5,46,000/- alongwith RS 1,30,000/- as compensation and cost of litigation.

 

2. After hearing the arguments on admission, court notice was issued to the complainant returnable on 7/04/2015 and subsequently on 8/6/2015. Accordingly on 8/6/2015, OP appeared and filed reply taking the following preliminary objections:-
   1. The instant Complaint is false, malicious, incorrect and malafide and is nothing but an abuse of the process of the law and it is an attempt to waste the precious time of this Hon'ble Forum, as the same has been filed by the Complainant just to avail undue advantage. The Complaint is thus liable to be dismissed under Section 26 of the Consumer Protection Act, 1986 (hereinafter referred to as the "Act").
   2. That the complaint is liable to be dismissed primarily on the ground of delay in filing of the complaint. The Court has laid down that:"It would be seen from the aforesaid provision that it is peremptory in nature and requires Consumer Forum to see before it admits the complaint that it has been filed within two years from the date of accrual of cause of action. The Consumer Forum, however, for the reasons to be recorded in writing may condone the delay in filing the complaint if sufficient cause is shown. The expression, 'shall not admit a complaint' occurring in section 24-A is sort of legislative command to the Consumer Forum to examine on its own whether the complaint has been filed with the limitation period prescribed hereunder. As a matter of law, the consumer forum must deal with the complaint on merits only if the complaint has been filed within two years from the date of accrual of cause of action and if beyond the said period, the sufficient cause has been shown and delay condoned for the reasons recorded in writing. In other words, it is the duty of the Consumer Forum to take notice of section 24-A and give effect to it. If the complaint is barred by time and yet, the Consumer Forum decides the complaint on merits, the Forum would be committing an illegality and, therefore, the aggrieved party would be entitled to have such order set aside."It is submitted that cause of action for filing of the present case arises on 15.11.2011 when the letter of closure of claim was handed over to the Complainant. It is further submitted that the Complaint has filed two forged and fabricated notice purportedly sent to the Opposite Party, however, the same was never received by the Opposite Party.
   3. Upon receipt of intimation of alleged theft of vehicle bearing no. UP-17C-6828 (Tavera) on 01.05.2011, the Opposite Party appointed investigator Lakshman Dass Arora & Associate to investigate the claim. The investigator contacted the insured and required the Complainant to submit certain documents. On the basis of his investigation the investigator submitted his report. Relevant facts of the report are as follows:
      1. The engine of the vehicle was giving problem thus the insured used to keep parked his vehicleidle at his home for a long time.
      2. There is contradiction between statements made by the Complainant and the driver of the vehicle. It is submitted that as per version of the Complainant and advocate Rabinder Kumar Verma, the driver was the driver of Mr. Rabinder Kumar Verma, Advocate, however, as per driver he was relative of Complainant.That apart from these three witnesses i.e. the Complainant, advocate Rabinder Kumar Verma and the driver Mohammad Yusuf, there is no other eye witness ofthe incident.
      3. The Complainant did not provide the copy of fitness certificate. However, upon verification of fitness from the authority it was found that the fitness of the vehicle was expired on 24.04.2010. It is pertinent to note that vehicle was allegedly stolen on 01.05.2011.
      4. The vehicle was financed from ICICI Bank Ltd. The insured has paid the instalments to the financer up to August, 2009. Insured did not submit any letter regarding the action taken by the financer for non-payment of instalments by him.'
      5. The financial position of the Insured not sound as per the investigation report.

 

4. On the basis of above report submitted by the investigator, the Complainant was called upon to submit fitness certificate valid as on the date of incident. However, despite letters/reminders the Complainant did not submit the document. Thus, the claim was closed as "no claim" on account of non-supply of required document and fitness being expired as on the date of incident. It is submitted that the fact of closure of claim for the grounds above said was informed to the Complainant vide letter dated 15.11.2011 and said letter was handed over to the Complainant on 15.11.2011.
5. The policy which covered the insured vehicle was issued subject to the terms and conditions of the policy. It has been clearly mentioned in the policy that "the policy covers use only under a permit within the meaning of Section 66 of the Motor Vehicle Act, 1988." Thus liability of insurance company arises only when the vehicle being used under a permit issued by the competent authority and as per the conditions of issuances of the permit. Further Section 84 of the Motor Vehicle Act, 1988 provides for "General conditions attached to all permits." The very first condition provided under the Section 84 (a) provides that the vehicle to which the permit relates carriers valid certificate of fitness issued under Section 56 and is at all times so mentioned as to comply with the requirements of this Act and the rules made thereunder." It is submitted that as per report of the investigator the fitness certificate was already to expired and not valid as on the alleged date of incident.
6. The insurance policy was about to expire just after 8 days of incident and on the basis of investigation report the possibility of some foul play cannot be overruled.
7. The Opposite Party states that there has been no negligence or deficiency in service whatsoever, on part of the Opposite Party in dealing with the concerned Policy, thus, the present Complaint is liable to be dismissed by this Forum.
8. The instant Complaint lacks cause of action. The Complaint is based on mere surmises and conjectures. It is an established principle of law that the machinery of law cannot be invoked on the basis of mere conjectures. Therefore, this Complaint is liable to be dismissed on want of the cause of action.
9. The claim of the Complainant was closed as per the terms and conditions of the Policy. It is settled principles of law that contract of insurance has to be construed strictly without changing the terms and conditions therein. In the case of Deokar Exports Pvt. Ltd. vs. New India Assurance Co. Ltd. 2009 (1) CPJ 6 (SC), it was held that "Rights and obligations of parties to the contract are strictly governed by the policy of insurance. No exception, or relaxation can be made on this ground of equity. Further in LIC of India &Ors. Vs. Mahender Singh 2011 (3) CPJ 1 it has been held by the Apex Court that "the terms of policy are in the nature of contract and their interpretation has to be made in accordance with strict construction of contract. The words in an insurance contract must be given paramount importance and interpreted as expressed without any addition deletion or substitution"
10. The Opposite party has acted as per terms and conditions of the policy and settled principles of law. Thus, there is no negligence or deficiency in services on part of the Complainant and the Complaint is liable to be dismissed.
11. The Complainant was required to submit the fitness certificate valid on the alleged date of incident, however, despite several reminders the Complainant failed to submit the documents and therefore the claim was closed due to non-receipt of the said document.
12. The Opposite Party has not received any of the two notices mentioned in the para. It is submitted that the Complainant has filed forged and fabricated document to illegally create cause of action and cover lapse period of limitation.
13. The notice of the Complainant dated 02.12.2014 was also an illegal attempt to create fresh cause of action and limitation period which was already expired. However, the said notice dated 02.12.2014 was properly replied.
14. It is denied that the opposite party is liable to pay the claim amount. It is also denied that there is any deficiency in services on part of the opposite party. It is submitted that the present complaint is barred by limitation and also liable to be dismissed on merits.
15. It is denied that there is any negligence or deficiency in services on part of the opposite party. For the reasons stated above the present complaint is liable to be dismissed.
16. It is, therefore, most respectfully prayed that the complaint made bythe Complainant being devoid of any merits, be dismissed with cost, in the interest of equity and justice.It is prayed accordingly.

 

3. Rejoinder was filed in rebuttal of defence taken by the OP through their written statement on 2/09/2015. Brief averments made by complainant in rebuttal are as follows :

In fact, the complainant has preferred the present complaint with his genuine grievances and the said complaint is perfectly maintainable in the eyes of law. It is further specifically denied that on 15.11.2011, complainant was informed about closure of claim filed by the complainant under the relevant insurance policy or the last date of filing of complaint was 15.11.2013 as per consumer protection Act, the complainant has filed present case on 12.01.2015 i.e. almost one year after expiry of the date of filing of the case under the Consumer Protection Act. In fact, the complainant has already explained the delay of filing of the present complaint and for which, the complainant preferred an application U/s 24A of Consumer Protection Act with this complaint.It is matter of record that upon receipt of intimation of alleged theft of vehicle bearing NO. UP-17C-6828 (Tavera) on 01.05.2011, the Opposite party appointed investigator Lakshman Dass Arora & Associate to investigate the claim or the Investigator contacted the insured and required the complainant to submit the certain documents. In fact, the Investigator Laxman Dass Arora and associate wrongly and falsely submitted the reports as mentioned in Para (1) to (vi) which are not stand in the eyes of law in any manner. It is specifically denied that on the basis of above report submitted by the investigator, the complainant was called upon to submit fitness certificate valid as on the date of incident or despite deter/ reminders the complainant did not submit the document or the claim was closed as "no claim" on account of non-supply of required document and fitness being expired as on the date of incident or the fact of closure of claim for the grounds above said was informed to the complainant vide letter dated 15.11.2011 and said letter was handed over to the complainant on 15.11.2011. In fact, the complainant has submitted all the relevant documents as required to the investigator but the Investigator not taken heed and attention towards the complainant and even despite of notice.In fact, the opposite party is liable to pay the claim as claimed by the complainant.In fact, the claim of the complainant was within period, therefore the opposite party is liable to pay the claim to the complainant.

 

4. The complainant has filed his evidence by way of an affidavit affirming the facts alleged in the complaint on 26/11/2015. The complainant has filed his evidence as CW1/PW1 by way of his affidavit and he has relied on the following documents.:

 

1. The copy of Fir is Exhibit CW1/1.

 

2. The copy of the registration Certificate is Exhibit CW1/2.
3. copy of retail income is Exhibit CW1/3.
4. The copy of the untrace report is exhibit CW1/4.
5. The Copy of insurance policyis Exhibit CW1/5.
6. The copy of notice dated 23/05/2011 is Exhibit CW1/6.
7. The copy of notice dated 9/11/2012 alongwith postal receipt are Exhibit CW-1/7 and Exhibit CW1/8 respectively.
8. The copy of notice dated 2/12/2014 is Exhibit CW1/9.
9. Copy of reply of notice dated 2/10/2015 is Exhibit CW1/10.

 

5. Thereafter when the matter was adjourned for respondent evidence, on 15/03/2016, Sh. Gulshan Ahuja, Sr. Div. Manager of National Insurance Co. Ltd. has filed his affidavit in evidence on behalf of the respondents affirming the facts alleged in the reply. The OP has filed his evidence as RW1 by way of his affidavit and he has proved the following documents relied upon.

 

1. A copy of investigation report is annexed herewith as Exhibit OP-1,
2. copy of information submitted by the Complainant to investigator is annexed herewith as Exhibit OP-2,
3. copy of statement submitted by Ravinder Kumar Verma, Advocate is annexed herewith as Exhibit OP-3,
4. copy of statement submitted by driver Mohammad Yusuf is annexed herewith as Exhibit OP-4.
5. copy of report issued by the authority regarding fitness certificate of the vehicle is Exhibit OP-5.
6. A copy of repudiation letter dated 15.11.2011 is Exhibit OP-6.

 

6. Both Parties filed Written submissions. Finally, oral arguments on behalf of the complainant were heard on 14/09/2022 and the order was reserved.

 

7. Perusal of record shows that although the complainant had moved an application for condonation of delay in filing complaint before this commission under section 24 A ofCPA Act, 1986, hence as per settled law, it is viable to decided said application before going into the merit of the case.

 

8. Submission of learned Advocate appearing on behalf of complainant that Insurance Company did not mention in the response that after the insurance claim was repudiated by the Insurance Company repudiation letter issued by Insurance Company and communication of repudiation letter has not been given to complainant till date and on this ground application for condonation of delay filed by complainant be allowed and is decided accordingly. It is well settled law that limitation for filing consumer complaint starts from the date of communication of repudiation letter to complainant issued by insurance company and does not start from the date of incident. There is no evidence on record in the order to prove that Insurance Company has communicated repudiation letter to complainant and there is also no evidence on record in order to prove that repudiation letter was issued by Insurance Company. Even Insurance Company did not file reply/response to the application filed for condonation of delay. No proof of supplying of repudiation letter to complainant placed on record by the Insurance Company in order to prove that consumer complaint was not filed within two years after the communication of repudiation letter to insured. In view of 2000 (3) CPJ 400 UPSCDRC titled Tek Chand Versus New India Assurance Co. Ltd. As well as 1996 (1) CPJ 139 NC titled R. Jaya Kumar Versus National Insurance Company Ltd. &Anr.It is held that in the absence of communication of repudiation letter to insured on record it is held that cause of action to complainant is continuity in nature.

 

9. It is well settled law that limitation will not operate when cause of action is continuity in nature. Further in 1993 (3) CPJ 305 NC titled Bank of India Versu1998 (2) CPC 577 NC Time properties and Promotors Ltd. Versus Rakesh Jain. 1999 (2) CPJ 13 titled State Bank of India Versus Anand Mohan Saha. 2002 (2) CPC 426 NC M/s. Syndicate Bank Versus Bangalore Development Authority HCL Ltd. &Anr.

 

10. Whereas Submission of learned advocate appearing on behalf of Insurance Company that complainant did not prove any sufficient cause for condonation of delay in filing the consumer complaint and on this ground,complaint filed by complainant be dismissed. Complainant filed affidavit Ex. CW-1 in evidence. Advocate appearing on behalf of Insurance Company has given written statement before District Forum that Insurance Company does not want to adduce any rebuttal evidence specifically with reference to the limitation point.

 

11. OP did not adduce any rebuttal evidence by way of affidavits qua controversial facts as per modes mentioned under Section 13(4) of Consumer Protection Act 1986. Even insurance company did not file any interrogatories to complainant qua affidavit filed in examination in chief. Even insurance company did not place on record any repudiation letter communicated to insured. Hence adverse inference is drawn against the Insurance Company.

 

12. Through various judgements, Hon'ble National Consumer Commission held that limitation to file the consumer complaint would not start from the date of incident but would start from the date of communication of reputation letter to insured. It is well settled law that evidence qua controversial facts under Section 13(4) of Consumer Protection Act 1986 and response filed by Insurance Company are entirely two different concepts under Consumer Protection Act 1986. Response filed by Insurance Company is only pleadings of Insurance Company. Response filed by Insurance Company could not be treated as evidence relating to controversial facts under Consumer Protection Act 1986. It is well settled law that pleadings are not substitute for evidence of controversial facts in view of latest judgement reported in HLJ 2017 HP 1011 titled Oriental Insurance Company Limited Versus Champa Devi.

 

13. In view of the law point discussed above, we are of opinion that the application for condonation is allowed. Now the next point for consideration before this commission is that whether the claim of the complainant is maintainable or not. Howeverinspite of various opportunity, counsel for OP did not appear before commission to argue the matter.   

 

14. However, we have carefully gone through the record of the case and have heard submissions of the complainant and perused the pleadings filed by OP, which shall be taken into consideration as per settled law by Hon’ble National Commission in N V Deoras V/s Bank of India 1997 (3) CPR 63 (NC), wherein Hon’ble National Commission held that
15. Opposite party if not represented on the subsequent day on which the case was taken up for hearing it is obligatory to consider a written version of the opposite party on the file and examine tenability or otherwise of the contention raised therein before proceeding to decide the case on the merits.”

 

15. We have perused the material available on record as well as the impugned repudiation order. The short question for adjudication in this complaint is whether there is any infirmity in the repudiation order passed by the OP/Insurance Company or not.

 

16. During the pleadings, the main contention/defense raised by the OP is that the vehicle in question does not have valid Fitness Certificate, when the same was stolen by unknown persons.

 

17. Facts giving rise to this complaint, in brief, are that according to consumer complaint, the complainant had purchased Tavera vehicle bearing registration No. UP17-C-6828, after taking loan from ICICI Bank Ltd. The vehicle was insured with the appellant - insurance company through policy No. 360300/31/10/63/00001070 for a sum of Rs. 5,46,000/- for the period from 10.05.2010 to 09.05.2011. The complainant had gone to his friend’s office and the vehicle was parked by its driver near the office situated at Rohini. When the complainant returned back from his friend’s office, the vehicle was not found at the spot, where it was parked. It was searched, but in vain. F.I.R. at case crime No. 239/11 under Section 379 I.P.C. was got registered in P.S. K N Katju Marg, Delhi on 02.06.2011. Simultaneously, the insurance company and the bank were informed through telephone regarding theft of the vehicle. Case was investigated and ultimately, Final Report was submitted by the concerned police station on 28.06.2011. The complainant visited the office of the insurance company time and again enquired regarding his insurance claim, but no payment was made and ultimately, it was informed by the insurance company on 15.11.2011 that the claim is not supported by valid documents and information and claim was repudiated. The insurance company has committed deficiency in service. Hence, the consumer complaint.

 

18. It is submitted on behalf of opposite parties through their reply that according to complainant the theft occurred on 1.05.2011. The vehicle was parked in front of the office of his friend and it has been stolen away. He took search and then lodged report on the same day. According to complainant FIR was lodged. However, police have submitted untrace report. He has submitted the claim to opponent. According to opponent the opponent issued several letters to the complainant and ultimately the claim was closed on 15.11.2011. since, there was no fitness certificate and relevant documents. It was averred that the vehicle in question did not possess valid fitness certificate on the date of occurrence, hence the insurance claim was not payable and the complainant was informed accordingly. The insurance company has not committed any deficiency in service.Hence claim is rejected by opponent on ground of non furnishing of valid fitness certificate. The complaint filed by the complainant is beyond the limitation and there is breach of policy conditions. Hence, the complaint itself is not tenable.

 

19. Admittedly, the complainant possessed the said documents which were valid when the Insurance of the vehicle was done on 10.05.2010. It was incumbent on the insured to have obtained a valid permit and fitness certificate after the expiry of the said documents in order to fix the responsibility on the Insurance Company.

 

20. In Narinder Singh vs. New India Assurance Company Ltd. and Others, 2014 ACJ 2421, Hon'ble Supreme Court has observed thus :-

"14.         Indisputably, a temporary registration was granted in respect of vehicle in question, which had expired on 11.1.2006 and the alleged accident took place on 2.2.2006 when the vehicle was without registration.  Nothing has been brought on record by the appellant to show that before or after  11.1.2006, when the period of temporary registration  expired, the appellant owner of the vehicle either applied for  permanent registration as contemplated under Section 39 of the Act or made any application for extension of period as temporary registration on the ground of some special reasons.    In our view, therefore, using a vehicle on the  public road without any registration  is not only an offence punishable under Section 192 of the Motor Vehicles Act but also a fundamental breach of the terms and conditions of the  policy contract."

21. After going through the record, it must be recalled that the Insurance Claim arose from the theft of the vehicle and not from any accident or third party risk. The question therefore arises whether the breach of a policy condition such as the holding of a valid permit or fitness certificate has any relevance to or nexus with the claim, so as to enable the Insurance Co. to repudiate it. In our view, the answer is clearly in the negative. The breach of any policy condition cannot absolve an Insurer from avoiding his liability towards the insured unless the said breach is as fundamental as is found to have contributed to the incident giving rise to the insurance claim. In this case the vehicle theft was solely a result of some other unforeseen or intervening cause having no nexus with the Complainant not possessing a fitness certificate for his vehicle and, therefore, the insurer will not be allowed to avoid its liability merely for technical breach of the condition concerning the necessity of a valid permit. A hyper technical plea cannot succeed in supporting repudiation when there is no real connection between the exclusion clause in an Insurance Policy that is relied upon and the actual cause of loss. There must be a logical nexus, a cause and effect, between them. The Hon'ble Supreme Court has already made it clear in M/s India Photographic Co. Ltd vs H.D. Shourie (AIR 1999 SC 2453) para 4 that       "... provision has been made herein (C.P.Act,1986) with the object of interpreting the relevant law in a rational manner and for achieving the objective set forth in the Act. Rational approach and not a technical approach is the mandate of law.

 

22. The Insurance Co., therefore, cannot insist on strict construction of the exclusion clause for the simple reason that non-holding of a vehicle fitness certificate could not have contributed, in any manner, to the theft of the vehicle. In a case of vehicle theft of this type, the question as to whether the owner was holding a valid fitness for his vehicle or not is completely redundant.

 

23. In any event, it is well also settled that, in appropriate circumstances, an exclusion clause of an insurance policy is required to be read down so as to serve the main purpose of the policy which, in the present case, is to indemnify the theft of the vehicle. Carter's "Breach of Contract" which was quoted with approval by the Hon'ble Supreme Court in AIR 1987 SC 1184 (Skandia Insurance Co. Ltd vs Kokilaben Chandra vadan & Ors) makes it crystal clear that:

"The instant case relates to the theft of the car. It is not a case of third party risk. In the instant case, the vehicle has not been recovered. It is also incorporated in the counter affidavit that it is not disputed that the vehicle was comprehensively insured. Since the vehicle in question had been stolen, therefore, in the case of theft of vehicle, the breach of condition is not germane."

24. Only dispute to repudiate the claim of the complainant is that the vehicle was not having fitness certificate. The Opposite Party being insurance company cannot co-relate the fitness certificate to the theft because it was not a ground for theft vehicle. For example if the accident is occurred due to non road worthiness of the vehicle, then the insurance company may be right in rejecting the claim of the plaintiff for own damage that too where the disputed road accident was occurred due to the non road worthiness of the vehicle in question and not for the fault of the third party. For example some other vehicle is hit the parked vehicle which is not having fitness certificate.The Opposite party insurance company can directly co- relate the fitness certificate if the accident is occurred only due to non road worthiness of the offending vehicle. Here in this case the insurance company fail to co-relate the fitness certificate, where the insured vehicle is stolen from the parking place.

 

25. Admittedly the vehicle in question which is stolen was a commercial vehicle, which requires fitness certificate for every two years under section 56 of MV Act. The defendant company which is in the insurance field must be aware the said condition or requirement, must have insisted the plaintiff to produce the fitness certificate but no document is forthcoming from the defendant side that it has insisted or demanded the fitness certificate from the plaintiff prior to accepting the premium. In these circumstances the defendant now cannot repudiate the claim on the guise of having no fitness certificate to the stolen vehicle, and defendant is estopped from contending so, under Section 115 of the Indian Evidence Act.

 

26. In terms of the insurance policy which is a contingent contract, the liability of payment of amount arises as soon as the theft occurs and the defense/ reasoning given for rejection of the claim that the fitness certificate was not available on the date of the incident/ theft is neither mentioned in the insurance policy nor was ever a part of the contract. He further argues that once the amount had been sanctioned, there is no occasion for the Insurance Company to have deny the claim that too on the ground that the fitness certificate was not available. He lastly argues that the issue with regard to non-availability of fitness certificate even in the cases of accident were not valid in the light of the judgement in the case of Oriental Insurance Company Limited vs Sushil Kumar Pandey and others; 2013 (2) TAC 361 (All.).

 

27. A perusal of registration certificate of the vehicle does not reveal that it was a private vehicle or a commercial vehicle. The surveyor report does not also reveal the vehicle in question is a commercial vehicle. As per the above mentioned cited case law of Hon'ble National Commission that the insurance company cannot raise the question regarding the validity of fitness certificate, after issuance of the insurance policy, it is the job of Transport Department to see that the fitness certificate is required or not.Wherein the Hon'ble National Commission as well as Apex Court through various judgements held that in case of theft the claim cannot be rejected in toto for want of fitness certificate.

 

28. Hon’ble National Commission in Case “Reliance General Insurance Co Ltd vs Pratap Singh” decided on 17/11/2020 reported in I (2018) CPJ 190 (NC) held that

 

29. Om Prakash vs. Reliance General Insurance &Anr.; IV (2017) CPJ 10 (SC). In this case, the Hon'ble Apex Court held that rejection of the claims on purely technical ground in a mechanical manner will result in loss of confidence of policy- holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay.

 

30. Hon’ble National Commission in Case “Ravi Kumar Chadha vs United India Insurance Company” decided on 17/11/2020 in Revision Petition 1908-1909 of 2015 held that

“Ground taken in the repudiation letter is relating to fitness certificate of the vehicle. It is not clear from the record whether the vehicle in question was registered as a private vehicle or as a commercial vehicle. In fact, fitness certificate is only required for commercial vehicle and not in the case of a private vehicle. The learned counsel for the insurance company states that from the repudiation letter, it seems that it was a commercial vehicle and did not have the valid fitness certificate on the day of theft. If it was a private vehicle, there is no question of a fitness certificate, however, if the vehicle was a commercial vehicle, then fitness certificate was required and the same was not valid at the time of theft. In a case of theft, breach of a policy condition is not germane as held by the Hon’ble Supreme Court in the case of National Insurance Company Ltd., vs Nitin Khandelwal – (2008) 11 SCC, 259 and therefore it is immaterial whether the fitness certificate was there or not.”

 

31. In the case of "United India Insurance Co. Ltd. vs. N.M. Mohd. Jakeer Hussain" (2007 I CPR 236), wherein it is held 'From a reading of the definitions, it is clear that in order to be a 'Transport Vehicle', it should be a public service vehicle or a goods carriage or an educational institution bus or a private service vehicle. The vehicle in question as per the R.C. Book is registered as a "Rig" with effect from 26.11.1996. Rig is not a Transport Vehicle since it is neither a public service vehicle nor goods carriage nor an educational institution bus nor a private service vehicle as defined under the provisions of the Act referred to above. Under Section 56 of the Act, Fitness Certificate is required only in respect of a Transport Vehicle and not in respect of any other type of vehicles.

 

32. There was no justification for the OP to repudiate the claim as held by Hon’ble SCDRC, Uttrakhand recently in “United India Insurance Co. Ltd. vs Vikram Singh Rawat” on 11 January, 2022 Complainant on the ground that the vehicle in question did not have a Fitness Certificate on the date of accident.

 

33. Further Hon’ble Supreme Court in case title “Gurmel Singh v. National Insurance Co. Ltd.” , decided on 20.05.2022 held that the Hon’ble Court believed that in many cases, it is found that the insurance companies are refusing the claim on flimsy grounds and/or technical grounds. It observed,

“The insurance company has become too technical while settling the claim and has acted arbitrarily. The appellant has been asked to furnish the documents which were beyond the control of the appellant to procure and furnish. Once, there was valid insurance on payment of a huge sum by way of premium and the Truck was stolen, the insurance company ought not to have become too technical and ought not to have refused to settle the claim on non-submission of the duplicate certified copy of the certificate of registration, which the appellant could not produce due to the circumstances beyond his control.”

 

34. The defendant denied liability raising several grounds particularly on the ground of violation of important condition. In the version it was contended for the first time that vehicle had no fitness certificate as on the date of theft namely 01-05-2011 as the same had been expired prior to stolen of vehicle and the claim was not payable. It is submitted that, the defendant insurer was aware of expiry of fitness certificate when insurance policy was insured on 14-10-2011. Having issued a policy with full knowledge that the vehicle had no fitness certificate on the date of issuance of the policy.

 

35. It is not open to the Opposite Party to contend that the claim is not admissible as the vehicle had no fitness certificate as on the date of theft, further the loss of the vehicle was not when it was playing on the road but loss on account of theft taken place on 1/05/2011, when it was parked near the office of his friend. It is submitted that in the case of theft vehicle production of fitness certificate was not relevant. In the above circumstances non-consideration of the claim on the ground that vehicle had no fitness certificate on the date of loss is not tenable. As regards the other contention that there was violation of policy condition, it is submitted that the insurance policy issued to the plaintiff does not contain any such clause and there is no clause. There is nothing in the policy that claim for the loss of the theft of the vehicle was not admissible on this ground these facts were brought to the notice of the Complainant only after filing of claim. The complainant had furnished to the defendant all the necessary documents for settlement of the claim. That violation of condition of the policy if any and vehicle not having fitness certificate are not necessarily to settle a claim for loss of vehicle by theft.

 

36. That non-settlement of genuine and just claim Complainant is put to great hardship and repairable loss and injury as admittedly as per the investigation report filed on record by the Opposite party that the financial condition of the complainant was not sound. Due to non-settlement of the claim, he has been put to untold misery.

 

37. We are of the considered opinion, that the District Forum had not properly appreciated the scope and ambit of the policy. The violation of the condition should be such a fundamental breach that the claimant cannot claim any amount whatsoever. As far as the violation in carrying passengers is concerned, this has consistently been held not to be a fundamental breach and, on this behalf, we may refer to the judgments of this Court in the case of National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297, National Insurance Co. Ltd. v. Nitin Khandelwal, (2008) 11 SCC 259, and B.V. Nagaraju v. Oriental Insurance Co. Ltd., (1996) 4 SCC 647.

 

38. In Lakhmi Chand v. Reliance General Insurance, (2016) 3 SCC 100, the Hon’ble Supreme Court held that to avoid its liability, the insurance company must not only establish the defence that the policy has been breached but must also show that the breach of the policy is so fundamental in nature that it brings the contract to an end.

 

39. In Manjeet Singh vs National Insurance Company Ltd., Hon’ble Supreme Court on 8 December 2017 in CIVIL APPEAL NO (S) 21552  OF 2017 held that

“In the present case, the appellant who is the owner was not at fault. His driver gave a lift to some passengers. Carrying such passengers may be a breach of the policy, but it cannot be said to be such a fundamental breach as to bring the insurance policy to an end and terminate the insurance policy. The driver, on a cold wintery night, gave a lift to some persons standing on the road. It was a humanitarian gesture. It cannot be said to be such a breach that it nullifies the policy. In the cases cited above, such claims where there is a breach of policy, have been treated to be non-standard claims and have been directed to be settled at 75%.”

 

40. Thus, in the light of the above discussion, in the present case. we allow the complaint, and set aside the repudiation order since the rejection of the claim was highly unjustified, unwarranted and unfounded, therefore, it amounted to a deficiency in service on the part of O.P. We direct the OP insurance company to pay such claims where there is a breach of policy, have been treated to be non-standard claims on the line of the ratio laid down by Hon’ble SC in Amelendu Sahoo Vs Oriental Insurance Co. Ltd. Passed on 25.03.2010 in CA no. 2703/2010 and have been directed to be settled at 75%.

 

41. Hence the claim petition of the claimant is very much maintainable in the eyes of law and the same is liable to be allowed since the policy in question had been issued after verification and the complainant is entitled to the claim amount. it is a very well-settled issue law that once the company has issued a policy to any person then the company is liable to compensate the insuredin view of various Apex Court judgement
42. Thus, in the light of the above discussion, in the present case. we allow the complaint, and set aside the repudiation order since the rejection of the claim was highly unjustified, unwarranted and unfounded, therefore, it amounted to a deficiency in service on the part of O.P. We direct the OP no.1-insurance company to pay such claims where there is a breach of policy, have been treated to be non-standard claims and have been directed to be settled at 75%.
43. We hold that the OP shall pay 75% of the insured amount of Rs. Rs.6,00,000/- (Rupees four lacs sixty thousand only). We, therefore, direct the OP to pay 75% of the settled IDV of Rs.6,00,000/- (Rupees Six lakh only) i.e., Rs. 4,75,000/- (Rs Four Lakh Seventy Five Thousand Only).
44. Therefore, we allow the complaint of the complainant and it is directed that:-

(i)    The OPs will pay a sum/IDV of Rs.4,75,000/- (Rs. Four Lakh Seventy Five Thousand only) to the complainant.

(ii)    The OPs will also pay a sum of Rs.10,000/- (Rupees Ten Thousand) towards the cost of litigation to the complainant.

(iii)   The OPs will also pay a sum of Rs.15,000/- towards harassment mental agony loss of time to the complainant.

45. Let the order be complied with by OPs within 30 days from the date of receipt of the copy of this order.
46. In the facts and circumstance of this case the said amount of Rs. 4,75000/- is to be paid by the OP to the complainant within a period of 30 days from the date of decision, however, if the OP/ Insurance Company delays the aforesaid payment beyond 30 days then this amount will carry an interest was 9% from the date of the expiry of the period of 30 days till the date of actual payment.
47. A certify copy of the order may be given to all parties after receiving the application for obtaining certify copy as per the direction received from Hon’ble State Commission. Order be sent to www.confonet.nic.in.
48. File be consigned to record room. Announced on 17/10/2022. 

 

 

(Richa Jindal) Member

(Anil Kumar Koushal) Member

(Sonica Mehrotra)           President