PER MR SUBHASH CHANDRA

1.     This appeal under section 19 of the Consumer Protection Act, 1986 (in short, ‘the Act’) challenges the order dated 15.09.2016 of the Chhattisgarh State Consumer Disputes Redressal Commission, Raipur (in short, ‘the State Commission’) in CC no. 33 of 2015 dismissing the complaint and prays for setting aside the impugned order and allowing the complaint in CC no.2015/33 and awarding cost of the present appeal and any other order/ directions as deemed fit.

2.     The brief facts of the case are that the appellant had purchased a TATA LPS 4081 truck on 30.04.2014 (Chassis number MAT447224E3D07839 and Engine Number B59180324ID63369780). A temporary registration number CG 10 TR 638/ 14 was issued on 01.05.2014 and was valid upto 30.05.2014. The truck was insured with the respondent insurance company vide Policy no. 193300/31/2015/1173 issued from 30.04.2014 to 29.04.2015 in respect of which Rs.39,269/- was paid as insurance premium. On 12.05.2014, while the truck was parked near the rice godown of Krishi Upaj Mandi, Pathal Gaon, the truck caught fire due to a high tension electric wire falling on the truck at about 03.00 p m. A police complaint vide dy no.562 dated 12.05.2014 was lodged and police authorities, after investigation, concluded that the vehicle had got burnt due to falling of the high tension electric wire on it. A fire tender was also sent by the village Panchayat Office, District Jashpur, Chhattisgarh on 12.05.2014 and a certificate to this effect dated 05.03.2015 was issued. A claim for the insurance amount of Rs.25,65,000/- was submitted by the appellant which was not settled by the respondent despite furnishing the information sought from time to time and hence, the appellant approached the State Commission’s Circuit Bench at Bilaspur, Chhattisgarh. On contest the State Commission held that:

“26.   Investigator Anoop Mehta has clearly mentioned in his investigation report that the accidental truck had been brought loaded with earth and Hydraulic jack had been lifted up for unloading and the driver had drove ahead in the same condition, due to which it had come in contact of the High tension wire and fire took place. As such on the date of accident, the vehicle was being used for transportation of goods and therefore, permit and fitness is required, whereas the complainant has not submitted the permit and fitness certificate, which is violation of Section 58 and Section 66 of the Motor Vehicle Act, 1988 and also the insurance terms. It was the duty of the complainant that he would have obtained the permit and fitness certificate in respect of the vehicle but he has not obtained both which is certainly violation of law and basis of contract and also is the violation of the terms and conditions of policy. Thus, it becomes clear that the complainant has used the vehicle in question without permit and fitness on public road and in such situation, the insurance company has not committed any kind of deficiency in service in rejecting the claim of the complainant and therefore the complainant is not entitled to get any kind of relief and the complaint of the complainant is liable to be dismissed. The judgments which have been cited by the complainant, the facts of these are totally different from the facts of the case.

27.     Therefore, complaint of the complainant is dismissed. Keeping in view the circumstances of the case, the parties will bear their own respective cost”.

3.     This order is impugned before us on the grounds that (i) the State Commission has erroneously held that the truck was being driven at the time of the incident of fire contrary to the statement of witness including the independent witness before the police authorities who had stated that the vehicle was parked at the time of the incident; (ii) the impugned order has wrongly relied upon the report of the respondents surveyor Mr Anup Mehta on 05.11.2014; (iii) State Commission has failed to appreciate that the report of the surveyor Mr Anup Mehta has only referred to the statement of one Mr Om Prakash Behra, time keeper of the State PWD and who did not refer to the statement of the complainant or the driver Mr Sankh Ram; (iv) impugned order fails to appreciate that the truck was purchased on 30.04.2014 and got burnt on 12.05.2014 within a period of 13 days and therefore, it should have relied upon the closure report of the police which included the statement of witness and panchanama; (v) respondents have not produced Om Prakash Behra as witness on whose statement the report of the surveyor Mr Anup Mehta was based and therefore, the State Commission conclusion was incorrect; (vi) State Commission has wrongly held that the driver Sankh Ram did not held a valid driving licence since his licence was valid for a period of 20.11.2007 to uptil 19.11.2007 for motor vehicle and light motor vehicle which was valid to drive TR/Trans category with effect from 08.09.2011 and the respondents informed the surveyor viz., RBS Surveyors and Loss Assessors Company Pvt. Ltd., had found that the driver was holding a valid driving licence upto 07.09.2014 for HGV; (vi) the issue had no relevance as the vehicle was parked at the time of the incident; (vii) the State Commission has failed to consider the surveyor’s report dated 16.05.2014 by P K Aggarwal, Surveyor appointed by the respondent insurance company who has stated that the cause of accident was due to sudden breakage of high tension electrical wire which fell on the vehicle; (viii) impugned order has erroneously not appreciated that the surveyor of the respondent RBS Surveyors and Loss Assessors had assessed the claim on net of salvage basis for Rs.20,38,500/-.

4.      We have heard the learned counsel for both the parties and considered the material on record including the written submissions filed by both the parties carefully.  

5.     The contention of the appellant is that the impugned order had completely ignored the investigation by the police and the statement of the witness and relied upon the statement of one Om Prakash Behra who was not made a witness in the proceedings and therefore, his testimony may not be relied upon. Reliance has been placed on the judgment of the Hon’ble Supreme Court in Lakhmi Chand vs Reliance General Insurance, Civil Appeal nos.49-50 of 2016 and National Insurance Company Ltd., vs Swaran Singh and Ors 4 (2004) 3 SCC 297 which held that:

49.     Such a breach on the part of the insured must be established by the insurer to show that not only the insured used or caused or permitted to be used the vehicle in breach of the Act but also that the damage he suffered flowed from the breach.”

Which was subsequently held in the case of Oriental Insurance Company Ltd. vs Meena Variyal 5 (2007) 5 SCC 428. It has also relied upon the judgment of this Commission in Harsolia Motors vs National Insurance Company Ltd., I (2005) CPJ 27 (NC) which held that “a person who takes insurance policy to cover envisaged risk does not take policy for commercial purpose with intention to generate profit but indemnification of actual loss and therefore, he should be indemnified for the loss under the policy in question”.

6.     During the course of arguments learned counsel for appellant also relied upon the judgment of the High Court of Rajasthan at Jaipur in Man Kanwar (Smt) vs State of Rajasthan and Ors., in S B Civil Writ Petition no. 2841 of 2005 decided on 17.05.2007 wherein it was held that investigation which is based only on ipse dixit reasons cannot be relied upon. It was argued that there was no evidence that the vehicle was being plied for commercial purpose at the time of the incident and therefore, as held by the surveyor of the respondent himself, the appellant was entitled to be compensated for the loss on account of fire to the insured vehicle.

7.     Per contra, it was argued by the counsel for the respondent that as per the complaint to the police, the vehicle was parked along with other vehicles at the paddy godown where other vehicles of the insured were engaged and it was evident from this that the insured vehicle had also been used for commercial purpose while being registered under temporary registration and without obtaining the necessary permit, fitness certificate etc. It was contended that the appellant failed to take due and reasonable care of the vehicle by parking it under a high electric tension wire and not parking at a proper and safe place without seeing the consequences as a man of ordinary prudence. The respondent contended that the driver did not have a valid licence to drive the transport vehicle which was a breach of the terms and conditions of the policy and therefore, the respondent was absolved of its liability towards the insured. The respondent also relied upon the report of its investigator Mr Anup Mehta, who had concluded that the vehicle had been deployed for unloading of building material for the construction of a platform for storing paddy at the paddy collection centre at Kera Kachhat and thereafter the vehicle was driven by the driver without lowering the raised portion of the Hydraulically operated rear of the truck and therefore, the vehicle came in contact with the high tension wire. It was argued that after the incident, the respondent appointed a spot surveyor Mr P K Agarwal, Surveyor/ Loss Assessor who submitted his report on 16.05.2014 and subsequently, the investigator Mr Anup Mehta also submitted his report on 05.11.2014. The final report of Anup Mehta also found that the driver did not possess a driving licence for transport vehicle on the date of incident and that there was no permit or fitness certificate available on the date of the incident. As the carrying of load of building material was not permissible the vehicle of the respondent was being used for commercial purpose on the day of the incident, without a valid permit and the vehicle was driven by a driver who lacked a valid driving licence, claim under the policy was not valid in view of the breach of the terms and conditions of the policy.

8.     Respondent also relied upon the judgment of this Commission United India Insurance Co. Ltd., vs Gian Singh 2006 CTJ 221 (CP) (NCDRC) wherein it was held that in case of violation of condition of the policy as to the nature of use of the vehicle, the claim ought to be settled on non-standard basis. Reliance was also placed on the judgment of the Hon’ble Supreme Court in National Insurance Company Ltd., vs Nitin Khandelwal in Civil Appeal no. 3409 of 2008 decided on 08.05.2008 wherein it was held that section 149 (2) (1) (ii) and 49 and 22 of the Motor Vehicles Act, 1998 empowers the insurance company to repudiate the claim for damage which occurred due to the acts of the driver for not holding a valid driving licence.

9.     The rival submissions of the parties have been considered. It is evident from the record that the insurance company had appointed Mr P K Agarwal, Surveyor/ Loss Assessor for a spot/ preliminary report on 16.05.2014 and as per his report, the driver was found to have a valid driving licence from 20.11.2007 to 07.09.2014 authorising him to drive MCWG/LMV/HGV. Thereafter M/s RBS Surveyor and Loss Assessors Co. Pvt. Ltd., was appointed who in their report dated 23.08.2014 submitted that the driver possessed a valid driving licence. The basis of a third surveyor/ investigator (Anup Mehta) to conclude that the driver did not have a valid driving licence is not forthcoming from the report, although it states that licence no.CG 14 29970000503 dated 20.11.2007 for the vehicle category, Gear Motorcycle, light vehicle/ transport vehicle. However, the respondent has not provided any evidence other than the statement of the person who was neither called upon as witness nor has filed any affidavit to state that the vehicle was being driven at the time of the incident. No other documents indicate that the vehicle had been used for commercial purpose and therefore, the contention of the respondent that the vehicle was being used for commercial purpose at the time of the incident and that since such use is prohibited under the Motor Vehicles Act, 1988 without a valid permit and fitness certificate (which was admittedly not available) and lack of valid driving licence the claim is untenable and cannot be accepted. The argument that since the vehicle was parked with other vehicles engaged with the rice godown indicates that this vehicle was also being used for commercial purpose is only an assumption and conjuncture and cannot be accepted since no documents/ evidence to this effect have been produced.

10.   The report of the spot surveyor, Mr P K Agarwal, and that of subsequent surveyor M/s RBS Surveyor and Loss Assessors Co. Pvt. Ltd.,  makes it clear the vehicle suffered a loss on account of falling of high tension electric wire on it. The loss assessed by M/s RBS Surveyor and Loss Assessors Co. Pvt. Ltd., is clear that the loss exceeded the IDV value since its assessment was that repair costs would be more than 75% of the insured value for the vehicle. It had therefore, deducted the salvage value of Rs.,5,25,000/- from the IDV of Rs.25,65,000/- and worked out the total claim of Rs.20,38,500/- after deducting the policy excess as per norms of Rs.1500/-. No reasons have been provided by the respondent for appointing an Investigator.

11.   In Sri Venkateswara Syndicate Vs. Oriental Insurance Company Limited & Anr, in Civil Appeal No. 4487 of 2004 decided on 24.08.2009, (2009) 8 SCC 507  the Hon’ble Supreme Court has held that:

“35.   In our considered view, the Insurance Act only mandates that while settling a claim, assistance of surveyor should be taken but it does not go further and say that the insurer would be bound whatever the surveyor has assessed or quantified, if for any reason, the insurer is of the view that certain material facts ought to have been taken into consideration while framing a report by the surveyor and if it is not done, it can certainly depute another surveyor for the purpose of conducting a fresh survey to  estimate the loss suffered by the insured.

36.     xxxxxxxxxxxxxxxxx

37.     The option to accept or not to accept the report is with the insurer. However, if the rejection of the report is arbitrary and based on no acceptable reasons, the courts or other forums can definitely step in and correct the error committed by the insurer while repudiating the claim of the insured. We hasten to add, if the reports are prepared in good faith, due application of mind and in the absence of any error or ill motive, the insurance company is not expected to reject the report of the Surveyors.“

[ Emphasis supplied ]

12.   From the foregoing and in the facts and circumstances of this case, the respondents action in appointing a third surveyor has not been justified when a second surveyor M/s RBS Surveyor and Loss Assessors Co. Pvt. Ltd., had already assessed the loss on the basis of the available report of the police after determining that the loss of the vehicle as accidental on account of falling of the high tension electric wire. It does not stand to reason as to why a third surveyor was required to be appointed. The contention was that the vehicle was used for commercial purpose is conjectural in nature. Merely because the vehicle was parked with other vehicles deployed for commercial use does not establish that the vehicle was being used for commercial purpose. It cannot also be said that the parking of the vehicle under a live high tension wire constitutes negligence on the part of the appellant. The order of the State Commission has erred in not considering this aspect and proceeded to dismiss the complaint. The impugned order relies upon the findings of the investigator Mr Anup Mehta whose appointment itself is not justified. Therefore, his conclusion that use was for commercial purpose and therefore, not eligible under the Policy since sections 58 and 66 of the Motor Vehicle Act, 1988 and the terms of the insurance contract had been violated cannot be accepted. In Shri Venkateswara Syndicate (supra) it has been held by the Hon’ble Supreme Court that while the appointment of a surveyor is mandated under the Insurance Act, the insurance company could not keep on appointing surveyors till a favourable report was received. New India Insurance Co. Ltd. Vs. Pradeep Kumar, (2009) 7 SCC 787 decided on 09.04.2009 the Hon’ble Supreme Court also held that a surveyor report is not so sacrosanct that it cannot be disregarded if it is arbitrary or perverse. The conclusion of the Investigator is perverse and arbitrary. The respondent clearly erred in relying on it.

13.   In view of the foregoing, we find that the appeal to have merit. The same is accordingly allowed in part. The order of the State Commission in CC no.33 of 2015 is set aside. The respondent is directed to pay the appellant Rs.20,38,500/- as determined by its own surveyor with interest @ 6% per annum from the date of repudiation of the claim within eight weeks failing which the interest payable shall be 9% per annum till realisation. Respondent is also directed to pay litigation cost of Rs.25,000/- to the appellant within the same period.

14.   Pending IAs, if any, stand disposed of with this order.