Haryana

StateCommission

A/727/2016

CHOLAMANDALAM MS GEN.INSURANCE CO. - Complainant(s)

Versus

RICKY JAIN - Opp.Party(s)

RAJNEESH MALHOTRA

14 Nov 2017

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA

                                                 

First Appeal No  :      727 of 2016

Date of Institution:      08.08.2016

Date of Decision :       14.11.2017

1.     M/s Cholamandlam MS General Insurance Company Limited having its Registered/Head Office situated at Dare House 2^nd Floor No.2, N.S.C. Bose Road, Chennai-600001 through its Managing Director/Authorised person.

2.     Cholamandlam MS General Insurance Company Limited Office situated SCO No.103, 2^nd Floor, Mugal Canal, Karnail through its Manager/Authorised person.

                                      Appellants-Opposite Parties

Versus

 

Mss Ricky Jain d/o Sh. Sanjay Jain, Resident of House No.2459-A, Sector-3, Ballabgarh, Faridabad (Haryana) through her General Power of Attorney Sh. Yogesh Bhatia s/o Sh. Vijay Kumar Bhatia, Resident of House No.160, Model Town, Panipat.

 

                                      Respondent-Complainant

 

CORAM:             Hon’ble Mr. Justice Nawab Singh, President.

                             Shri Balbir Singh, Judicial Member.

                             Shri Diwan Singh Chauhan, Member.            

 

Argued by:          Shri Rajneesh Malhotra, Advocate for appellants.

                             Respondent ex parte.

 

                                                   O R D E R

 

BALBIR SINGH, JUDICIAL MEMBER

 

        This appeal has been preferred against the order dated February 16^th, 2016 passed by District Consumer Disputes Redressal Forum, Panipat (for short ‘the District Forum’) in Complaint No.311 of 2013.

2.                Miss Ricky Jain-complainant (respondent herein) registered owner of car (Hyundai i-10) bearing registration No.HR-29T-1666, got the above mentioned car vehicle insured with Cholamandalam MS General Insurance Company Limited (for short ‘the Insurance Company’)-Opposite Parties/appellants, vide insurance cover note No.9055304 (Annexure C-2/Exhibit R-8) regarding the period from December 08^th, 2012 up to December 07^th, 2013 mentioning the total Insured Declared Value (IDV) as Rs.2,50,000/-. On March 10^th, 2013 (wrongly mentioned in the complaint as February 10^th, 2013), Yogesh Bhatia, a close relative as well as General Power of Attorney of the complainant, was returning from Kalandar Peer Dargah, Panipat while driving the above mentioned car vehicle. Suddenly a child appeared on the road in front of his car. Yogesh Bhatia tried to save the child and in this process, the car vehicle struck with an electric pole and badly damaged. Entries were made in Daily Diary Register of Police Station City Panipat dated March 15^th, 2013 at Sr. No.440 (Annexure C-4). After the accident, the car vehicle was parked in the garage of Krishna Motors near MJR School, Panipat. Information was given to the Insurance Company-Opposite Parties. Thereafter, the complainant filed the insurance claim before the Insurance Company alongwith insurance cover note and copy of DDR etc.  Despite service of legal notice dated September 03^rd, 2013, the Insurance Company did not accept the insurance claim of the complainant.

3.                Alleging deficiency in service on the part of the opposite parties-Insurance Company the complainant filed complaint under Section 12 of the Consumer Protection Act, 1986 with a prayer that the opposite parties be directed to pay an amount of Rs.2.00 lacs to the complainant on account of loss caused to the complainant with interest at the rate of 18% per annum; to pay an amount of Rs.50,000/- on account of un-necessary harassment and mental agony and an amount of Rs.11,000/- as litigation expenses.

4.                The Opposite Parties in their written version have taken plea that the District Forum, Panipat has no jurisdiction to decide the complaint; that the complaint is not maintainable in the present form and that the complainant has concealed material facts from the District Forum; Soon after the complainant lodged insurance claim with the opposite parties, Mr. Alok, an independent surveyor and Shri R.N. Sharma, an independent Investigator were appointed. Insurance claim of the complainant was repudiated on account of fraud as the pre-inspection report of the vehicle was different from the final report. The insurance claim was repudiated on this ground also as information was given to the Insurance Company regarding damage caused to the vehicle on March 15^th, 2013 after 34 days from the date of occurrence. First Information Report (Annexure A-2) was also lodged after 28 days. The Police of Police Station City, Panipat was also informed regarding this accident on March 10^th, 2013 after 28 days. In fact, the vehicle at the time of pre-inspection report was different from the vehicle produced at the time of preparation of the final surveyor report. The complainant is not entitled to receive any amount as claimed in the complaint. It is prayed that the complaint filed by the complainant be dismissed with cost.

5.                Both the parties adduced evidence in support of their respective claims before the District Forum.

6.                After hearing arguments, vide impugned order dated February 16^th, 2016 passed by the learned District Forum, the complaint filed by the complainant was allowed directing the opposite parties-Insurance Company to pay an amount of Rs.2,50,000/- being IDV of the vehicle involved in the accident considering it a case of total loss to the complainant with interest at the rate of 9% per annum from the date of filing of the complaint and to pay an amount of Rs.3300/- as litigation expenses.

7.                Aggrieved with the impugned order dated February 16^th, 2016, the opposite parties have filed the present appeal bearing No.727 of 2016 with a prayer to set aside the impugned order and to dismiss the complaint filed by the complainant.

8.                Notice was issued to the respondent but the respondent did not appear in the proceedings of this case despite service. Vide order dated November 13^th, 2017 the respondent was proceeded against ex parte.

9.                We have heard learned counsel for the appellants and perused the case file.

10.              During the course of arguments, there was no controversy of any type that the complainant Ricky Jain, registered owner of the insured car (Hyundai i-10) bearing registration No.HR-29T-1666, got insured the above mentioned car vehicle with the Insurance Company-opposite parties vide insurance cover note (Exhibit R-8) regarding the period from December 08^th, 2012 up to December 07^th, 2013 mentioning the IDV as Rs.2,50,000/-. Insurance Policy Certificate is Exhibit R-9. It is evident from the Special Power of Attorney (Annexure C-1) that Yogesh Bhatia is Special Power of Attorney of Ms. Ricky Jain, registered owner of the vehicle and Yogesh Bhatia was driving the above mentioned car vehicle at the time of accident. Regarding this accident, FIR No.440 was lodged in Police Station City Panipat on March 15^th, 2013 on the basis of statement of Yogesh Bhatia, Special Power of Attorney of the complainant.

11.              From the contents of the FIR it is clear that Yogesh Bhatia mentioned the date of accident as March 10^th, 2013. Shri R.N. Sharma, DSP (Retd.) was appointed as Investigator in this case by the insurance company. In his report Exhibit R-4 Shri R.N. Sharma, has mentioned that he visited the Police Station on March 15^th, 2013 and on the same date, he visited the place of accident also where owner of the vehicle was also present. It means, the vehicle involved in this accident was lying at the place of accident on August 15^th, 2013 also. In the final survey report Exhibit R-3 prepared by the surveyor also, date of loss and accident is mentioned as March 10^th, 2013. In this way, surveyor as well as investigator also opined that the accident took place on March 10^th, 2013. The opposite parties have taken plea in the written version that the accident took place on February 10^th, 2013. It appears that the opposite parties took this plea on the basis of a mistake which appears to be clerical in the complaint as at one place date of accident is mentioned as February 10^th, 2013 instead of March 10^th, 2013. Anyhow from the record on the file as discussed above, we have no hesitation in holding that actually accident took place on March 10^th, 2013. It does not appear that there was un-necessary delay in lodging FIR. More particularly, when the car vehicle was being driven by Yogesh Bhatia, General Attorney of the complainant and the complainant was not available near the place of occurrence. No prejudice has been caused to the opposite parties in any way. After lodging FIR, the vehicle was taken to the garage of Krishna Motors, Panipat. Estimate regarding loss caused to the vehicle was assessed by Krishna Motors Rs.1,37,133/-.

12.              In the complaint, it is mentioned that information was sent to the Insurance Company soon after the accident. The opposite parties have taken plea that the insurance claim in writing was submitted on behalf of the complainant first time on March 23^rd, 2008.

13.              Learned counsel for the complainant-respondent argued that in the beginning, the complainant and her General Power of Attorney made efforts to trace the vehicle and thereafter some delay was caused by the Police in lodging FIR. This fact also cannot be completely overlooked and in fact is a matter of common knowledge that Police also avoids lodging FIR in such type of matters to avoid increase figure of untraced criminal cases. Moreover, the complainant was also not so serious in the beginning as accident did not take place due to fault of any other person. In this way, the insurance claim was submitted in writing after 13 days from the date of accident. Admittedly, the accident did not take place due to fault of any other person. The accident took place as the vehicle hit with the electricity pole when driver of the vehicle tried to save life of a child who appeared before the vehicle all of a sudden. The intimation, in fact, was sent to the Insurance Company only to start process for assessment of the total loss caused to the vehicle and to obtain reports of the surveyor as well as investigator. Little delay in submitting the insurance claim in writing by the complainant has caused no prejudice to the opposite parties.

14.              Even otherwise, the Insurance Regulatory Development Authority (IRDA), which control and regulates the Insurance Companies, vide Circular Ref: IRDA/ HLTH/ MISC/ CIR/ 216/ 09/ 2011 dated September 20^th, 2011 issued by Insurance Regulatory Development Authority (for short ‘IRDA’), issued direction not to reject the genuine claims simply because of delay in registration of FIR and intimation to the Insurance Company. In the instructions of the IRDA it was mentioned that claims shall be intimated to the insurer with prescribed documents within a specified number of days is necessary for insurers for effecting various post claim activities like investigation, loss assessment provisioning, claim settlement etc.  However, this condition should not prevent settlement of genuine claims, particularly when there is delay in intimation or in submission of documents due to unavoidable circumstances.  The insurer’s decision to reject a claim shall be based on sound logic and valid grounds.  Support to this view can be taken from the case law cited as Bharti Axa General Insurance Company Limited vs. Ms. Monu Yadav and another, 2014(4) PLR 861, decided by Hon’ble Punjab and Haryana High Court, Chandigarh.  As per facts of that case, the delay in lodging claim with the Insurance Company was of 54 days. The findings in that case were also given in favour of the claimants on the basis of the guidelines issued by IRDA.  The Insurance Companies were advised that they must not repudiate such claims on the ground of delay especially when the Police have been promptly informed in this regard.

15.              It is very clear from the circular that the insurance company cannot repudiate the bonafide claims on technical grounds like delay in intimation and submission of some required documents. The decision of insurers’ to reject a claim of the claimant should be based on sound logic and valid grounds. The limitation clause does not work in isolation and is not absolute. One needs to see the merits and good spirit of the clause, without compromising on bad claims. Rejection of claims on purely procedural grounds in a mechanical fashion will result in policy holders losing confidence in the insurance industry, giving rise to excessive litigation. It has been further advised in the above said letter that the insurers must not repudiate such claims unless and until the reasons of delay are specifically ascertained, recorded.     What is the spirit of Insurance Policy should be kept in mind by the officials dealing with the genuine claims of the sufferers and the same should not be rejected on methodological grounds in a mechanical manner. The tendency of Insurance Companies in rejecting genuine claims is the reason of increasing litigation between the insurers and the insured/their legal heirs.  In this case the repudiation of complainants’ claim was contrary to the instructions issued by the IRDA, mentioned above.

16.              Now coming to the question as to how much amount the Insurance Company is liable to pay to the complainant. In this case, after the accident the car vehicle bearing registration No.HR-29T-1666 was brought to the garage of Krishna Motors, Panipat, an authorised dealer for preparation of the estimate. Thereafter, the vehicle was inspected by the surveyor, Mr. Alok, who prepared a report Exhibit R-3 and assessed the total loss caused to the vehicle as Rs.49,961/- after deducting depreciation. The surveyor mentioned the net liability of the insurer as Rs.49,961/-. In the report of the surveyor, in the last lines in the assessment remarks, it is mentioned that after investigation breaking inspection invoice amount was Rs.1,05,000/-. It was an old model car vehicle.

17.              During the course of arguments, none appeared on behalf of the complainant. The complainant also appears to be not so much interested in this litigation as he did not appear despite service. Keeping in mind all these circumstances, there appears to be no reason to disbelieve the well reasoned assessment report prepared by the surveyor (Exhibit R-3). In this way, net liability of the Insurance Company to make payment to the complainant is assessed as Rs.49,961/-. Learned District Forum while passing the impugned order awarded total IDV of the vehicle Rs.2,50,000/-, mentioning that it should be considered in case of total loss as the estimate prepared exceeds 75% of the IDV.  After the accident, when the car vehicle was brought to the garage of Krishna Motors, rough estimate was prepared as Rs.1,37,133/-. Even if the loss assessment prepared by Krishna Motors being considered as correct, even then the loss is certainly much more less than 75% of the total IDV.

18.              We have already given findings that the report of the surveyor is well reasoned and justified who assessed the total liability of the Insurance Company as Rs.49,961/- after deducting the depreciation. In this way, findings of the learned District Forum while awarding the total IDV amount Rs.2,50,000/-, are held to be invalid and illegal and without any good reason. Resultantly, findings of the learned District Forum to this extent stand set aside holding that the complainant is entitled to receive from the opposite parties only an amount of Rs.49,961/- as compensation on account of loss caused to the vehicle. However, findings of the learned District Forum regarding awarding litigation expenses as Rs.3300/- and interest at the rate of 9% per annum are justified and the impugned order to this extent stands affirmed.

19.              As a result, as per discussions above, the appeal is partly allowed. The opposite parties are directed to pay an amount of Rs.49,961/- to the complainant along with interest at the rate of 9% per annum from the date of filing the complaint till its realisation and Rs.3300/- as litigation expenses.

20.              The statutory amount of Rs.25,000/- deposited at the time of filing the appeal be refunded to the complainant against proper receipt and identification in accordance with rules, after expiry of period of appeal/revision, if any.

 

Announced 14.11.2017

Diwan Singh Chauhan Member

Balbir Singh Judicial Member

Nawab Singh President

CL