CONSUMER DISPUTES REDRESSAL FORUM – X
GOVERNMENT OF N.C.T. OF DELHI
Udyog Sadan, C – 22 & 23, Institutional Area
(Behind Qutub Hotel)
New Delhi – 110 016
Case No.763/2009
M/S TRINITY TOUCH PRIVATE LTD.,
D-10, DEFENCE COLONY,
NEW DELHI-110024
…………. COMPLAINANT
Vs.
- M/S RELIANCE GENERAL INSURANCE COMPANY LTD.,
60, OKHLA INDUSTRIAL ESTATE-III,
NEW DELHI-110020
- CONTINENTAL AUTO SERVICES
A-13, MOHAN CO-OPERATIVE INDUSTRIAL AREA,
MATHURA ROAD, NEW DELHI-110044
- SKODA AUTO INDIA PRIVATE LIMITED
A-1/1, M.I.D.C., FIVE STAR INDUSTRIAL AREA,
SHENDRA, AURANGABAD-431201
…………..RESPONDENTS
Date of Order: 05.08.2016
O R D E R
A.S. Yadav – President
During the course of proceedings complaint against OP-2 and OP-3 was withdrawn on 19.02.2010, accordingly proceedings against them were dropped.
In brief the case of the complainant is that the Skoda Laura car of the complainant company was duly insured with the OP-1 for the period 13.08.2008 to 12.08.2009. It is submitted that the said policy inter alia covered any damage to the vehicle due to flood, cyclone etc. On 27.07.2009 due to heavy rain in Delhi, there was water logging on the roads of Delhi and flood like situation was created and lot of vehicles were submerged in water. The car of the complainant was also submerged in water and stopped near Arya Samaj Mandir, Greater Kailash-II and the said car had to be taken to the workshop of the OP-2.
It is further stated that on 30.07.2009, complainant lodged insurance claim with OP-1. The claimant even sent reminder on 06.8.2009. OP-1 vide letter dated 18.08.2009 rejected the claim of claimant on the ground that inlet of water into the engine of the car and subsequent cranking is a mechanical failure for which the company is not liable. Complainant vide letter dated 21.08.2009 requested OP-2 to give reason for engine failure. However, without assigning any reason, the OP stated that the said damages were not covered under the warranty clause. It is stated that OP-1 has wrongly rejected the claim. It is prayed that OP be directed to pay a sum of Rs.85,383/- spent by complainant towards cost of repairs and also pay Rs.1 lakh as damage for mental harassment and Rs.50,000/- for litigation expenses etc.
OP in the reply took the plea that complaint is liable to be dismissed as in the present case, the damage to the insured vehicle is not related to any accident as per the coverage of perils in the policy but by inlet of water into the engine as the vehicle was driven in water logged area in contravention of the manufacturer guidelines and subsequent cranking was done. This is a mechanical failure and also a consequential loss as a result of failure on the part of complainant to protect the vehicle from deteriorating further. The claim was rejected under exclusion clause 4(a) of the Motor Policy which states that the insured shall take all reasonable steps to safeguard the vehicle from loss or damage and the company is not liable for consequential loss. It is prayed that the complaint be dismissed.
We have carefully perused the record and gone through the written submissions of the parties.
In fact insurance company has taken shelter of clause 4(a) of the Motor Policy. The contention of the insurance company is that there was no external impact to the car hence there was no accident and the engine was damaged as complainant tried to drive the car in the water logged area in contravention of manufacturer guidelines and it was the case of mechanical failure.
We are not convinced with the submission of the OP. It is significant to note that any damage caused to the vehicle on account of flood is covered under the policy. The complainant has specifically stated that almost a flood like situation was created. The car stopped while moving. It is nothing but an accident. So far as mechanical failure is concerned, OP has not placed anything on the record that it tantamounts to mechanical failure.
Here it is useful to refer to the case of Reliance General Ins. Co. Ltd. Vs Dr. Anish Sebastian – 111(2015) CPJ 644(NC) - In that case it was argued that damages are not the direct damages, but only consequential damages, not covered under the purview of the policy. The investigation conducted by the Insurance Company revealed that the vehicle fell in a gutter full of water, due to which the water entered into the engine, the vehicle stopped there. The vehicle was restarted and run resulting in engine damage.
Clause 4 of the terms and conditions of the policy reads that the insured may authorize the repair of the vehicle necessitated by damage for which the company may be liable under this policy provided that:-
- …..
- ……
- …….
Further the general exceptions provided that even after any accidental loss or damage to any property whatsoever or any loss or expenses whatsoever resulting or arising there from or any consequential loss.
It was held that even if ”consequential damage” in this case is taken to be the allegation that the respondent restarted the vehicle and ran it after the initial damage resulting in water entering the engine and damaging the same, the petitioner has not given any evidence to support its case. As per the version of the respondent the car did not restart. Any normal person, stuck in water and with the water entering the car, would make an attempt to restart the car and drive out of the water. This cannot be termed as ‘negligence of the driver’ resulting in ‘consequential damage’.
So there is no question of terming the damage as consequential.
It is further significant to note that the complainant got his car inspected by an expert chartered engineer Mr. D.B. Mehta who has given his report on 28.08.09 wherein it is mentioned that during inspection it was informed to him by Mr. Joshi who was workshop incharge that it was a case of hydrostatic locking in the engine due to the entering of water in engine through air filter. It was confirmed that the said car stopped working due to the flood on road caused by the rain.
Ld. Counsel for the complainant has referred to the case of G. Sridhar Goud Vs Future General India Insurance Co. Ltd. - C.C.No.720/2012 decided by the Hon’ble State Commission of A.P. State on 20.01.2014 where in para 22, it was held:-
“22. Therefore, it becomes clear that there was heavy rain on 22.08.2011 and the car was stalled on the water logged road. The cause for the engine going off is due to hydrostatic locking. It is pertinent to note that the hydrostatic locking is considered as an accident and covered by the terms of the insurance policy by this Commission in Vasireddy S.V. Prasad Vs Mercedes Benz India Pvt. Ltd., (MB India) and other in CC.No.6 of 2012 decided on 27.12.2013 which reads as under:-
The surveyor deputed by the opposite parties no.3 and 4 had reported that water entered into the engine through air cleaner and he found hydrostatic lock of the engine. The surveyor had not said anything about cranking of the engine. Thus, no fault can be attributed to the complainant in attempting to drive the vehicle on the water logged road. Chandigarh State Commission referring to its earlier decision, in Tata AIG General Insurance Company (supra) held that damage caused to the engine of insured car cannot be termed as consequential damage when the vehicle was stopped due to splash of water on account of another vehicle.”
The loss caused to the vehicle is not a consequential damage. The rejection of the claim by the OP was not justified. It is a clear cut case of deficiency in service on the part of OP.
OP is directed to refund the amount of Rs.85,383/- to complainant alongwith 9% interest p.a. from the date of filing of the complaint plus Rs.10,000/- towards compensation and Rs.5,000/- towards litigation expenses.
Let the order be complied with within one month of the receipt thereof. The complaint stands disposed of accordingly.
Copy of order be sent to the parties, free of cost, and thereafter file be consigned to record room.
(D.R. TAMTA) (RITU GARODIA) (A.S. YADAV)
MEMBER MEMBER PRESIDENT
