Punjab

Ludhiana

CC/23/553

Kuldeep Singh - Complainant(s)

Versus

Oriental Insurance Co.Ltd - Opp.Party(s)

Nitin Kapila Adv.

22 Mar 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No: 553 dated 30.11.2023.                                                        Date of decision: 22.03.2024.

 

Kuldeep Singh, 62 years S/o. Kartar Singh, R/o.143, TPT Nagar, Ludhiana.                                                                                               ..…Complainant

                                                Versus

1. The Oriental Insurance Company Limited, Regd. & Head Office – A25/27, Asaf – Ali Road, New Delhi-110002 through its authorized signatory.
2. The Oriental Insurance Company Limited, Sona Complex, Near Fire Brigade, G.T. Road, Miler Ganj, Ludhiana through authorized signatory.                                                                           …..Opposite parties 

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

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. Nitin Kapila, Advocate.

For OPs                          :         Sh. Rajeev Abhi, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

 

1.                Shorn of unnecessary details, the facts of the complaint are that on 16.01.2014, the complainant purchased new LPT2518/48 TC Ex Truck chassis fitted with cowls and other accessories from Dada Motors, Ludhiana for Rs.18,41,172/- vide invoice No.DadoMo-1314-03462 for self employment and earning livelihood under name and style of M/s. Delhi Panipat Carrier Goods. According to the complainant, after fixing some accessories, the cost of vehicle came to more than Rs.19 Lakhs. Through Dada Motors, Ludhiana, the vehicle was insured from the OPs against IDV value of Rs.19 Lakhs for premium of Rs.45,196/- vide cover note No.460795 having validity from 16.01.2014 to 15.01.2015.  The truck was registered with Licensing Authority, Ludhiana vide registration No.PB-10-EH-5381.The complainant stated that on the night of 14/15.04.2014, the said vehicle was stolen when it was parked and locked in front of office. At that time original documents i.e. RC, permit, insurance etc. were lying in the vehicle. Intimation of theft was given to the OPs and an FIR No.56 dated 21.05.2014, U/s.370/411 IPC was registered at Police Station Division No.6, Ludhiana. On 25.06.2014 police arrested two persons namely Avtar Singh and Ajay Ganotra and recovered the truck body along with Rs.20,000/- cash from them. Intimation was also given to the OPs. Challan was presented by the police in the courts vide No.CH/6/2915 under State Vs Avtar Singh & Ajay Ganotra.

                   The complainant further stated that after investigation, surveyor appointed by the OPs assessed the loss to be Rs.19 Lakhs but the OPs transferred Rs.12 Lakhs on 03.11.2015 in the bank account of the complainant while denied to pay balance amount of Rs.7 Lakhs for want of decision of police case against the accused, for which the complainant has preferred complaint claiming interest for delayed period as well as for claiming remaining amount of Rs.7 Lakhs. Even the OPs for denying the claim of the complainant, compelled him to complete the formalities such as to produce NCRB report. The complainant claimed to have suffered mental tension, harassment and deprived from the insurance claim amount due to deficiency in service and unfair trade practice on the part of the OPs for which he is entitled for compensation. Even for getting the balance claim amount of Rs.7 Lakhs from the OPs as well as to get Rs.80,000/- recovered from the accused after selling body parts of the vehicle, the complainant as well as accused moved joint application before the court of JMIC, Ludhiana for compounding of the offence as he does not want to pursue with the case and has no objection if the accused are acquitted or discharged in the said case. The Court vide its order dated 11.04.2016 held that said offences are compoundable without permissions of the court and offences U/s.379/411 IPC are hereby compounded. The court also ordered for release of Rs.80,000/- in favour of the complainant. Thereafter, the complainant supplied copy of order dated 11.04.2016 with the OPs along with affidavit dated 10.05.2016 with request to release the balance claim amount but the complainant was compelled to give fresh consent letter on affidavit, which was submitted with the OPs on 11.08.2016 for Rs.5,54,750/- by giving cause of claim being accident. OP2 vide its letter dated 02.12.2016 raised objection that the complainant has not mentioned anything about insurance claim in the court and compromise has been affected without informing them which is result of collusion between accused and the complainant. The complainant submitted letter dated 22.12.2016 to the OPs with request to release the payable amount. The OPs further issued letter dated 23.01.2016 seeking clarification from the complainant, which was duly replied by the complainant vide reply dated 03.01.2017. Further vide his letter dated 27.01.2017, the complainant clarified that compromise entered in the court with the accused as they were not thieves and they only dealt for the stolen item. However, the OPs did not settle and pay the balance claim amount. In the end, the complainant has prayed for issuing direction to the OPs to pay balance claim amount of Rs.7,00,000/- after adjusting Rs.80,000/- and also to pay compensation of Rs.50,000/- besides litigation expenses of Rs.11,000/-.

2.                The OPs appeared and filed joint written statement and assailed the complaint by taking preliminary objections on the ground of maintainability of the complaint; the complaint being barred under Section 26 of the Consumer Protection Act; lack of cause of action; concealment of material facts; the complaint being estopped by his own act and conduct from filing the present complaint etc. The OPs averred that on receipt of the claim, it was processed and M/s. Bee Vee Investigating Agency, Patiala was appointed to investigate the theft claim of truck submitted by the complainant. After investigation, the investigator submitted report dated 06.06.2014 with the OPs and after scrutinized the documents as well as during processing of the claim a portion of truck body/tyres were traced by the police for which an amount of Rs.80,000/- was recovered and deposited in the Court in the criminal case. On request of the complainant, the OPs recommended the claim to higher authorities for approval who approved the payment of Rs.12 Lakh subject to completion of usual formalities including transfer of RC in the name of the OPs. After completion of formalities, the OPs released an amount of Rs.12 Lakhs in account of the payment on 03.11.2015.  

                   The OPs further stated that the complainant approached the OPs for release of balance payment of claim after decision of criminal case and also submitted police untraced report along with the court order. Then the OPs appointed Sh. Jagmohan Singh, Investigator to verify the untraced report, recovered salvage value, who after investigation submitted his report dated 20.05.2016 to the OPs. Further M/s. Suresh Vashisht & Co. was appointed for assessment of stolen vehicle No/.PB-10-EH-5381, who also submitted report dated 01.09.2016 to the OPs along with consent form by assessing the net payable amount of Rs.5,54,750/-. After receipt of report dated 20.05.2016 of Sh. Jagmohan Singh as well as report dated 01.09.2016 of M/.s Suresh Vashisht & Co.  and scrutinizing the documents, the OPs called upon the complainant vide letter dated 02.12.2016 to comment on the fact that from the copy of compromise it is observed that he has not mentioned anything about the insurance claim in the court and the compromise reached with the accused is without informing the company and it seems that there is a collusion between the accused and the complainant. According to the OPs, the complainant sent an unsatisfactory reply dated 03.01.2017 and as such, he was again called upon by the OPs vide letter dated 23.01.2017, to which the complainant sent reply dated 27.01.2017. Upon receipt of reply to query raised by the OPs vide letter dated 02.12.2016, they vide letter dated 30.01.2017 approved the balance amount of Rs.5,53,500/-, which is reproduced as under:-   

IDV	Rs.19,00,000/-
Less already paid	Rs.12,00,000/-
Less given by the court	Rs.80,000/-
Less scrap value	Rs.65,000/-
Less excess	Rs.1500/-
	Rs.5,53,500/-

 

Thereafter, the claim was referred to Regional Office Chandigarh for approval, who further referred the claim to Head Office at New Delhi and competent authority of Head Office, New Delhi vide their letter dated 16.10.2017 decided not to pay any additional amount under the claim in question on the ground that the complainant has reached a compromise without informing the company and without consent of the company. Therefore, the recovery rights of the OPs have been prejudiced. The OPs vide letter dated 25.10.2017 repudiated the claim of the complainant qua additional amount/balance amount. The Ops further stated that the claim of the complainant has been rightly repudiated as no claim for the balance payment on legal, valid and enforceable grounds as per terms and conditions of the policy.

                   On merits, the opposite parties reiterated the crux of averments made in the preliminary objections. The opposite parties have denied that there is any deficiency of service and has also prayed for dismissal of the complaint.

3.                The consumer complaint No.RBT/CC/17/753 of 2017, filed by the complainant was dismissed by the Camp Court at Ludhiana vide its decision dated 28.04.2022. The complainant preferred First appeal No.520 of 2022 before the Hon’ble State Consumer Disputes Redressal Commission, Punjab, Chandigarh which was allowed vide order dated 31.10.2023 vide which the order dated 28.04.2022  passed by the District Consumer Disputes Redressal Commission Moga, Camp Court at Ludhiana was set aside. The Hon’ble State Commission further directed this Commission to decide a fresh by considering the contents of the complaints, reply filed by the OPs and the evidence available on record after affording adequate opportunity of raising the arguments to both the parties and further directed to decide the complaint without any further delay preferably within a period not more than four months from the date of receipt of the copy of the order.

                   Accordingly, on 30.11.2023, Sh. Nitin Kapila, Advocate appeared and filed power of attorney on behalf of the complainant. Sh. Rajeev Abhi, Advocate appeared and filed memo of appearance on behalf of the opposite parties and filed regular power of attorney on 18.01.2024. Thereafter, the case was adjourned for arguments.

4.                In support of his claim, the complainant tendered his affidavit Ex. CA1 in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 to Ex. C15 and closed the evidence.

5.                On the other hand, the counsel for the opposite parties tendered affidavit Ex. RA as well as affidavit Ex. RF of Sh. Vinod Thakral, Deputy Manager of the OPs at Ludhiana office, affidavit Ex. RB of Sh. H.S. Bedi of M/s. Bee Vee Investigating Agency, Patiala, affidavit Ex. RC of Sh. Jagmohan Singh, Investigator, Ludhiana, affidavit Ex. RD of Sh. Suresh Vashisht of M/s. Suresh Vashisht & Co., Ludhiana, affidavit Ex. RE of Sh. Vijay Negi, Surveyor and Loss Assessor, Ludhiana  and submitted documents Ex. R1 to Ex. R68 and closed the evidence.

6.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and affidavit produced on record by both the parties.

7.                Admittedly, in the intervening night of 14/15.04.2014 in the area of Transport Nagar, Ludhiana, the truck bearing registration No.PB-10-EH-5381 owned by the complainant having an IDV of Rs.19 Lakhs was stolen within 3 months after its purchase during the subsistence of insurance cover provided by the OPs. An FIR No.56 dated 21.05.2014 under Section 379/411 IPC was registered at Police Station Division No.6, Ludhiana. During the investigation, the accused Avtar Singh and Ajay Ganotra were arrested and mangled remains of truck body were recovered from them. Challan was presented before the court on 22.12.2014.

8.                On receipt of the intimation, claim of the complainant was processed and a loss of Rs.19,00,000/- was assessed. The complainant who was pursuing his claim, preferred a letter dated 18.02.2015 Ex. R22 whereby he requested the OPs to release the payment of amount of 75% of full claim. The operative part of letter Ex. R22 reads as under:-

“Received on 18.02.2015 regarding the submission of documents in original Police Untraceable Report duly accepted by the court. I would like to request you that the said document will take time to be delivered to us by court meanwhile I request you to kindly release the payment on On-Account of 75% of the full claim amount and remaining 25% after the submission of the 173 report of court.”

In view of the consent of the complainant, the OPs made a payment of Rs.12,00,000/- on 03.11.2015 directly to the bank account of the complainant but the remaining amount was withheld on the ground of pendency of criminal proceedings.

9.                Since the balance amount was to be paid to the complainant on the culmination of criminal proceedings, therefore, the complainant entered into a compromise Ex. R6 with the accused and moved a joint application for compounding the offence. The Learned Magistrate after recording the statements of the complainant as well as accused, permitted the compounding of offence in view of the compromise and further ordered to release an amount of Rs.80,000/- deposited by the accused to the complainant vide order dated 11.04.2016 Ex. R7.

10.              During the settlement process, the claim was being investigated by Sh. Jagmohan Singh, Investigator as well as Sh. Suresh Vashisht, Loss Assessor appointed by the OPs. Sh. Jagmohan Singh submitted his report dated 20.05.2016 and Sh. Suresh Vashisht submitted his report on 01.09.2016 assessing a sum of Rs.5,53,500/-. On 18.05.2016, the complainant gave another consent letter Ex. R20 to the OPs and consented to receive the balance amount of the total Rs.17,75,000/-. Operative part of letter Ex. R20 is reproduced as under:-

“With reference to theft of my truck No.PB-10-EH-5381 Model 2013  on 14/15.04.2014 night I hereby give my consent to receive Rs.17,75,000/- less excess as per policy conclusion. I further inform that an amount of Rs.12,00,000 Lac has already been received by me on own account payment. My claim may be given at the highest.”

11.     Although initially, the claim was scrutinized by the OPs by raising queries with regard to the apparent collusion of accused with the complainant which has caused prejudice to the recovery rights of the OPs. However, the payment of balance claim of Rs.5,53,500/- was recommended and case was referred to the Regional Office of the OPs. Thereafter, vide letter dated 25.10.2017 Ex. R1 the OPs declined to make the payment of balance amount. Operative part of letter Ex. R1 reads as under:-

“The Competent Authority had decided not to pay your balance amount under this claim on the ground that you had reached a compromise without informing to us and without our consent. Therefore, the recovery rights of our Company have been prejudiced.”

12.              Now the point of consideration arises before this Commission whether the OPs were justified in declining the payment of balance amount to the complainant.

13.              It is evident from the sequel of events mentioned hereinbefore that although the OPs had settled the claim of Rs.19,00,000/- but they dithered of making full payment to the complainant. Perusal of repudiation letter Ex. R1 shows that the balance payment was declined without referring to any clause in the policy. No such clause was referred in the written statement or affidavit of the OPs. However, the OPs have relied upon Insurance Certificate cum Policy Schedule Ex. R65 and Commercial Vehicle Package Policy Ex. R65A. Condition No.2 of the said Commercial Vehicle Package Policy Ex. R65A is reproduced as under:-

“2. No admission offer promise payment or indemnity shall be made or given by or on behalf of the insured without the written consent of the Company which shall be entitled if it so desires to take over and conduct in the name of the insured the defence or settlement of any claim and the insured shall give all such information and assistance as the Company may require.”

This policy clause mandates that for making any offer, promise of payment or indemnity by the insured, written consent and concurrence of the OPs is a condition precedent. Admittedly, at the time of entering into compromise and compounding of offence, the complainant has received a sum of Rs.80,000/-. The compounding has taken place before the criminal court in a criminal trial where the OPs were not a party or privy to the proceedings nor could it be. The decision of the complainant for entering into a compromise and thereafter, reaping its benefits in violation of the policy terms have impacted the payment of balance amount only. Compounding of offence by the complainant after receipt of amount being a subsequent act, appears to have weighed against in the minds of officials of the OPs from repudiating the entire claim. The belated contentions of the counsel for the complainant that he was not supplied with terms and conditions is of no avail in view of the contents of letter Ex. R20 wherein he has referred to ‘Excess’ clause. So the repudiation letter when read in conjunction with condition No.2 of the policy, justifies the declining of payment of balance claim by the OPs. There is no adoption of unfair trade practice and deficiency in service on the part of the OPs. As such, in view of aforesaid facts and circumstances, this Commission has no hesitation in dismissing the case of the complainant and the same is hereby dismissed.

14.              As a result of above discussion, the complaint fails and the same is hereby dismissed. However, there shall be no order as to costs. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.   

15.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)                                 (Sanjeev Batra)        

                    Member                                              President 

 

Announced in Open Commission.

Dated:22.03.2024.

Gobind Ram.