Chandigarh

DF-I

CC/564/2020

M/s City Clinic Pvt. Ltd. - Complainant(s)

Versus

Royal Sundaram General Insurance Co. Ltd. - Opp.Party(s)

Anant Pal Singh

04 Oct 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

                                     

Consumer Complaint No.	:	CC/564/2020
Date of Institution	:	27/11/2020
Date of Decision	:	04/10/2023

 

M/s City Clinic Pvt. Ltd. at SCO No.47, Sector 34-A, Chandigarh through its Director Dr. Ravi Inder Singh r/o #503, Sector 36-B, Chandigarh.

… Complainant

V E R S U S

1. Royal Sundaram General Insurance Co. Ltd. Corp. Office Vishranti Melaram Towers No.2/319, Rajiv Gandhi Salai (OMR) Karapakkam, Chennai 600097.
2. Royal Sundaram General Insurance Co. Ltd. SCO-82, 1^st Floor, Sector 40-C, Chandigarh 160040, through its Branch Manager or its authorised official/representative.
3. Panjab Motors at C-19, Industrial Area, Phase 1, Near New Inter State Bus Terminal Stand, Punjab 160055 through its Branch Manager or its authorised official/representative.

… Opposite Parties

CORAM :	SHRI PAWANJIT SINGH	PRESIDENT
	MRS. SURJEET KAUR	MEMBER

                                                                       

ARGUED BY	:	Sh. Anant Pal Singh, Advocate for complainant
	:	Sh. Sachin Ohri, Advocate for OPs 1 & 2
	:	Sh. Harjot Singh Bedi, Advocate for OP-3.

 

Per Pawanjit Singh, President

1. The present consumer complaint has been filed by M/s City Clinic Pvt. Ltd., through its Director, Dr. Ravi Inder Singh, complainant against the aforesaid opposite parties (hereinafter referred to as the OPs).  The brief facts of the case are as under :-

1. It transpires from the allegations as projected in the consumer complaint that the complainant is the registered owner of a Mercedes Benz car bearing registration No.CH-01-AY-9010 (hereinafter referred to as “subject car”) which was got insured with OPs 1 & 2 vide insurance policy (Annexure C-2) valid from 20.11.2019 to 19.11.2020 (hereinafter referred to as “subject policy”).  On 20.11.2019, the subject car met with an accident regarding which DDR (Annexure C-3) was also recorded by the police. Thereafter the subject car was taken to the authorised service centre (OP-3) and after reaching there, necessary formalities for repair of the subject car were completed and intimation was also given to OP-2, who appointed surveyor to assess the loss. The surveyor deputed by OP-2 visited the premises of OP-3 and assessed the loss to the tune of ₹22.00 lacs. Thereafter, OP-2 instead of instructing OP-3 to go ahead with repair work, had appointed a private investigator by the name of Karnal Associates to assess the claim of damaged vehicle without the consent of the complainant and in this manner had delayed the repair work, showing malafide intent of the OPs.  On seeing the conduct of OPs 1 & 2, complainant asked OP-3 to start the repair work of the subject car and when the car was finally repaired, total repair cost had come to ₹6,48,330/- instead of ₹22 lacs. The said repair cost was paid by the complainant from his own pocket, which is also clear from the copy of bank transactions (Annexure C-4 Colly.). The subject car remained with OP-3 till 13.3.2020 and no repair work was carried out since it was waiting for approval from OP-2. The complainant repeatedly requested OPs 1 & 2 through emails (Annexure C-5 colly.) to release the claim amount, but, nothing had been done.  On 22.1.2020, complainant had sent a legal notice (Annexure C-6) through his counsel to OPs 1 & 2. Finally, on 13.3.2020, complainant got back the subject car from OP-3 after repair.  As OPs 1 & 2 have not settled the genuine claim of the complainant, the said act amounts to deficiency in service and unfair trade practice on their part. OPs were requested several times to admit the claim, but, with no result. Hence, the present consumer complaint.
2. OPs resisted the consumer complaint and filed their separate written versions.
3. In their written version, OPs 1 & 2, inter alia, took preliminary objections of maintainability, concealment of facts, cause of action, limitation, jurisdiction and non-joinder of necessary parties and the consumer complaint is gross abuse of process of law.  However, it is admitted that the subject car was insured by the answering OPs and the same was valid w.e.f. 20.11.2019 to 19.11.2020. It is further averred that the subject car was alleged to have met with an accident on 20.11.2019 at around 11:30 p.m. and it has been narrated by the complainant that the same was hit by another car in which it was damaged. It is further alleged that as per investigation, complainant was taken to GMSH, Sector 16, Chandigarh and when he was medically examined, the complainant was stated to have consumed alcohol at the time of the alleged accident, as has also been mentioned in the MLR (Annexure R-3) and in this manner the driving of the subject car by the complainant under the influence of liquor is clear violation of the terms and conditions of the subject policy and accordingly the claim of the complainant was rightly repudiated by the answering OPs vide repudiation letter (Annexure R-5).  It is further alleged that it has been held in various judgments passed by the Hon’ble Apex Court and the Hon’ble National Commission that where the driver has driven the vehicle under the influence of liquor, the same amounts to clear violation of the terms and conditions of the policy and the claimants are not entitled for any claim. On merits, the facts as stated in the preliminary objections have been reiterated. The cause of action set up by the complainant is denied.  The consumer complaint is sought to be contested.
4. In its written version, OP-3 denied all the allegations made in the consumer complaint against it and prayer has been made that the consumer complaint be dismissed.
5. In separate rejoinders, complainant re-asserted the claim put forth in the consumer complaint and prayer has been made that the consumer complaint be allowed as prayed for.

2. In order to prove their case, complainant and OPs 1 & 2 have tendered/proved their evidence by way of respective affidavits and supporting documents.  However, as OP-3 failed to file evidence despite grant of sufficient opportunity, therefore, vide order dated 9.1.2023 of this Commission, opportunity to file the same was closed.
3. We have heard the learned counsel for the parties and also gone through the file carefully, including the written arguments.
   1. At the very outset, it may be observed that when it is an admitted case of the parties that the complainant is the registered owner of the subject car through its Director, Dr. Ravi Inder Singh and the same was insured with OPs 1 & 2 vide subject policy at the time of accident, which had taken place on 20.11.2019, the case is reduced to a narrow compass as it is to be determined if OPs 1 & 2 are justified in repudiating the claim of the complainant on the ground that the subject car was being driven by the complainant under the influence of liquor and in clear violation of the terms and conditions of the subject policy and the complainant is entitled to the reliefs prayed for in the consumer complaint, as is the case of the complainant, or if OPs 1 & 2 are justified in repudiating the claim and the consumer complaint of the complainant, being false and frivolous, is liable to be dismissed, as is the defence of OPs.
   2. In the backdrop of the foregoing admitted and disputed facts on record, one thing is clear that the entire case of the parties is revolving around the terms and conditions of the subject policy (Annexure C-2/R-1), DDR (Annexure C-3) recorded by the police after the accident, surveyor report (Annexure R-4), repudiation letter (Annexure R-5) and the medical record i.e. the MLR (Annexure R-3) of the complainant and the same are required to be scanned carefully, especially when it is not in dispute that the complainant was possessing a valid driving licence at the time of the accident.
   3. Annexure C-3 is the DDR recorded by the police after the accident which clearly indicates that the complainant had disclosed the manner in which subject car met with an accident near light point of Sector 34/35, Chandigarh with another car bearing registration No.CH04K7740, having been driven by Harpreet Singh and both cars were damaged in the accident and parties had entered into a compromise. 
   4. Perusal of the MLR (Annexure R-3) clearly indicates that when the complainant was brought to the GMSH, Sector 16, Chandigarh for medical examination the doctor observed as under :-

“Breath smell of alcohol present. Gait and speech normal. In my opinion he has consumed alcohol but is not under its toxic influence.”

 

5. Similarly, Annexure R-4 is investigation report dated 10.2.2020 submitted by the investigator deputed by OPs 1 & 2 in which it was concluded as under :-

              “On the basis of the above findings, we are of the view that Mercedes Benz Car No.CH01AY-9010 met with an accident on 20-11-2019. As per MLR Report of Dr. Ravi Inder Singh (Prop. of M/s City Clinic Pvt. Ltd.) that breath smell of alcohol present. Gait and speech normal. He has consumed alcohol but is not under its toxic influence. It is found in our investigation that Dr. Ravi Inder Singh (Prop. of M/s City Clinic Pvt. Ltd.) was driving his vehicle after consumed alcohol at the time of accident. It is the violence of section 185 Motor Vehicle Act. Otherwise, the Place of Accident, Its Reason and Date & Time are found to be correct. So you may take any action on your behalf.”

 

6. The next document which is required to be considered in this case is the repudiation letter dated 24.2.2020 (Annexure R-5) which clearly indicates that the claim was repudiated by the OPs by observing as under :-

       “With reference to the above mentioned claim, we observe from the claim papers that the driver was under the influence of alcohol at the time of accident thereby violating the provision of ‘Limitations as to use’ of the policy.”

 

7. Perusal of the subject policy (Annexure R-1) clearly indicates that the insurer is not liable to make any payment in case the accidental loss or damage is suffered whilst the insured or any person driving the private car under the influence of intoxicating liquor or drugs. The relevant portion/clause of the subject policy is reproduced as under :-

“SECTION  I

LOSS OF OR DAMAGE TO THE PRIVATE CAR INSURED

        xxx                   xxx                   xxx

The Company shall not be liable to make any payment in respect of

(a)    xxx                   xxx                   xxx

(b)    xxx                   xxx                   xxx

and

(c)    any accidental Loss or Damage suffered whilst the Insured or any person driving the Private Car with the knowledge and consent of the Insured is under the influence of intoxicating liquor or drugs.”

 

8. It has been contended on behalf of the complainant that as it stands proved on record that the accident had not taken place due to the rash and negligent driving of the complainant, or even if it is proved on record that the subject car was being driven by the complainant by consuming alcohol and it has come on record in the MLR that he was not under its intoxicating influence, as has been opined by the medical officer in Annexure R-3, which fact has also been verified by the investigator in his report R-4, that gait and speech of the driver were normal when he was medically examined and also that though he had consumed alcohol, but, he was not under its toxic influence and further that the subject car was hit by another vehicle from its left rear side, which fact has also not been disputed by the OPs, there is no violation of Section 185 of the Motor Vehicles Act and the OPs cannot escape from its liability.
9. On the other hand, it has been contended on behalf of the OPs that as it stands proved on record that the complainant by consuming alcohol started driving the subject car, as a result of which it met with an accident, the said act of the complainant amounts to gross violation of the terms and conditions of the subject policy and the claim of the complainant was rightly repudiated by the OPs. In this regard reliance has been placed on the judgment of the Hon’ble Apex Court in the case of Iffco Tokio General Insurance Co. Ltd. Vs. Pearl Beverages Ltd., III (2021) CPJ 44 (SC) in which it was held that the insurer is not required to establish that there was alcohol intoxication and equally it need not be shown that vehicle was driven by a person who was chronic alcoholic, rather what is required to be shown is at the time of driving the vehicle, resulting in accident, the driver was under the influence of alcohol. The gist of the said judgment is reproduced below for ready reference :-

        “(i) Consumer Protection Act, 1986 — Sections 2(1)(g), 23 — Motor Vehicles Act, 1988 — Sections 185, 203, 204, 205 — Indian Penal Code, 1860 — Sections 279, 427 — Insurance — Drunken driving — Accident of vehicle — Total loss — Influence of intoxicating liquor — Exclusion clause — Claim repudiated — Alleged Deficiency in service — Exclusion requires driving of vehicle by person under influence of intoxicating liquor — Mere presence of alcohol in any small degree would not be sufficient — Court cannot re-write contract and hold that mere presence of alcohol, in slightest degree, is sufficient to exclude liability of insurer — It requires something more, namely, that driver of vehicle was at time of accident acting under influence of intoxicating liquor — It must be shown that in facts and circumstances of each case that consumption of liquor had, if not caused accident, which undoubtedly would bring accident within mischief of clause but at least contributed in perceptible way to causing of accident — To be under influence of alcohol must be understood as question going to facts and matter to be decided with reference to impact of consumption of alcohol on particular driver — If in case without there being any blood test, circumstances, associated with effects of consumption of alcohol, are proved, it may certainly go to show that person who drove vehicle, had come under influence of alcohol — Manner in which vehicle was driven, may again, if it unerringly points to person having been under influence of alcohol, be reckoned — Evidence of unsteady gait, smell of alcohol, eyes being congested, apart from actual consumption of alcohol, either before commencement of driving or even during process of driving, along with manner in which accident took place, may point to driver being under influence of alcohol — It would be finding based on effect of pleadings and evidence — Repudiation justified.

[Paras 35, 36, 50, 51]

(ii)    Motor Vehicles Act, 1988 — Section 185 — Drunken driving— Section 185 deals with driving or attempting driving of motor vehicle by person with alcohol in excess of 30 mg per 100 ml in blood which is detected in test of breath analyser — Being criminal offence, it is indisputable that ingredients of offence must be established as contemplated by law which means that case must be proved beyond reasonable doubt and evidence must clearly indicate level of alcohol in excess of 30 mg in 100 ml blood and what is more such presence must be borne out by test by breath analyser. [Para 53]

(iii) Consumer Protection Act, 1986 — Sections 2(1)(g), 23 — Motor Vehicles Act, 1988 — Sections 185, 203, 204, 205 — Evidence Act, 1872 — Section 106 — Insurance — Drunken driving — Accident of vehicle — Total loss — Influence of intoxicating liquor — Exclusion clause — Claim repudiated — Criminal offence vis- a-vis deficiency of service — Burden of proof — Facts within special knowledge — If prosecution has not filed case under Section 185, that would not mean that competent Forum in action alleging deficiency of service, under Consumer Protection Act, is disabled from finding that vehicle was being driven by person under influence of alcohol — Presence of alcohol in excess of 30 mg per 100 ml. of blood is not indispensable requirement to enable Insurer to successfully invoke clause — Where there is no scientific material, in form of test results available, it may not disable insurer from establishing case for exclusion — Totality of circumstances must be considered — Scope of enquiry, in case under Consumer Protection Act, which is summary proceeding, cannot be lost sight of — What is required to be proved is driving by person under influence of alcohol — There is no case for respondent that terms of contract to exclude liability of appellant, are in any way illegal — It cannot then be said that merely because there is no test performed, Insurer would be deprived of its right to establish case which is well within its rights under contract — Burden of proof, insofar as appellant insured seeks to establish exclusion of liability is concerned, burden of proof is upon it — What was nature of alcohol and what was quantity of alcohol consumed, and where he had consumed, it would certainly be facts within special knowledge of person who has consumed alcohol — Driver has not indicated when he has consumed alcohol — It would be “disproportionately difficult” for insurer in facts to have been proved as to whether driver has consumed liquor on empty stomach or he had food and then consumed alcohol or what was quantity and quality of drink (alcohol content) which would have been circumstances relevant to consider as to whether he drove vehicle under influence of alcohol — Driver has merely stated that he was not under influence of intoxicating liquor and he was in his full senses — There are no interrogatories served on driver by appellant — Unlike in proceeding in Court, ordinarily insurers may not be in position to cross examine — Effects of drinking by way of signs discernible, after accident took place, in facts, cannot be said to be within knowledge of driver only — Insurer or his agent may not have been given notice at that stage — It would not be proper or legal to hold that in such circumstances, insurer would still be in position to prove through breath test or blood test that driver was under influence of alcohol — Repudiation justified.

[Paras 57, 58, 76, 77, 78, 79, 81, 82, 83, 103]

(iv) Res ipsa loquitur — Drunken driving — Influence of intoxicating liquor — Principal is used in cases of tort and where facts without anything more clearly and unerringly points to negligence — Principle of Res ipsa loquitur, as such, appears to be inapposite, when, what is in question, is whether driver was under influence of alcohol — Though principle as such is inapplicable, manner in which accident occurred may along with other circumstances point to driver being under influence of alcohol. [Para 85]

(v) Consumer Protection Act, 1986 — Sections 2(1)(g), 23 — Motor Vehicles Act, 1988 — Sections 185, 203, 204, 205 — Indian Penal Code, 1860 — Sections 279, 427 — Insurance — Drunken driving — Accident of vehicle — Total loss — Influence of intoxicating liquor — Exclusion clause — Claim repudiated — Alleged deficiency in service — What is in a summary proceeding noteworthy, is in the setting of the width of road (a road near India Gate, New Delhi) and the thinnest possible traffic, and without slightest excuse, hitting at the footpath with massive force, not being able to maintain control, hitting the electric pole, the wall of the children park—Impact is so much that it led to the overturning of car and what is more, catching fire of the vehicle — NCDRC was in error in conflating requirement under Section 185 of Act, with that under exclusion clause in contract of insurance in question — Requirement under Section 185 of Motor Vehicles Act is not to be conflated to what constitutes driving under influence of alcohol under policy of insurance in Own Damage Claim — Such claim must be considered on basis of nature of accident, evidence as to drinking before or during travel, impact on driver and very case set up by parties — FIR has been prepared on basis of Report of Police Officer — Use of FIR in criminal case is to be distinguished from its employment in consumer case — This is so, in particular, when FIR is relied upon by complainant himself — Case set up of respondent that person driving car had not consumed liquor, is clearly false — Person driving vehicle had consumed alcohol — Exact quantity, which he had consumed, is not forthcoming — Fact that he smelt of alcohol, is indisputable, having regard to contents of FIR and also MLC — Vehicle was driven in rash and negligent manner, having regard to conviction entered under Section 279 of IPC — Person can be rash and negligent without having been under influence of alcohol — At same time, being under influence of alcohol can also lead to rash and negligent driving — They are not incompatible — Even NCDRC has proceeded on basis that driver had consumed some alcohol — Appellant has established that driver had consumed alcohol and was driving vehicle, when accident took place — Respondent has no case that accident occurred as result of sudden event which took place, which necessitated car being driven into footpath — There is material under Consumer Protection Act, in form of FIR — Police Officer, who has lodged information has specifically stated that car was being driven in very fast manner — Repudiation justified — Impugned order set aside.

[Paras 88, 89, 92, 97, 104, 106, 108]”

      

10. However, the ratio of law laid down in the aforesaid judgment is not applicable in the present case as the facts of the present case are quite different from the facts narrated in the aforesaid judgment.  Moreover, it has been held by the Hon’ble Apex Court in the concluding part of the aforesaid judgment that such a claim i.e. in case of vehicle being driven by the driver under the influence of liquor must be considered on the basis of the nature of the accident, evidence as to drinking before or during the travel and more specifically the impact on the driver while driving the vehicle as well as the case set up by the parties. 
11. In the case in hand, as it stands proved on record that, in fact, the accident did not take place due to the rash and negligent driving of the complainant/ insured, rather the subject car was hit by another car from the rear left hand side, which fact has also been endorsed by the investigator deputed by the insurer/OPs 1 & 2 in his report (Annexure R-4) by stating that “Otherwise, the Place of Accident, its Reason and date & time are found to be correct”, making clear that whatever facts have been stated by the complainant in the claim form i.e. about the manner in which the subject car was hit by another car from the rear left side has been endorsed by the surveyor and further makes clear that the accident did not take place due to the negligence of the complainant. 
12. Not only this, even it has also come in the report of the surveyor that though breath smell of alcohol was found present by the hospital, but, his speech was found normal at that time and it has been specifically found during investigation that at the time of accident, Dr. Ravi Inder Singh had consumed alcohol, but, he was not under its intoxicating influence. Even in the judgment in the case of Iffco Tokio General Insurance Co. Ltd. Vs. Pearl Beverages Ltd. (supra) the Hon’ble Apex Court has not held that in case of presence of smell of alcohol in the breath of the driver, the insurer shall escape from its liability, rather it has been held in the said judgment that such claim must be on the basis of the nature of the accident as well as the impact of such alcohol on the driver.  In the said case, in fact, the driver was convicted under Section 279 of the Indian Penal Code and he was penalized for rash and negligent driving and it was also held that the driver had not specifically denied that he had not consumed alcohol and the evidence on the part of the driver was lacking on that point and also that the insurer has no case that the accident occurred as a result of sudden event which took place which necessitated the car being driven into the footpath or that the accident was caused by another vehicle being driven in any manner or any person or animal attempting to cross the road or otherwise deflecting the intention of the driver, as a result of which it was held that drinking of alcohol by the driver had impact on him, which resulted in causing the accident.  Whereas, the facts of the present case are contrary to the facts as discussed in the aforesaid judgment, especially when the complainant has specifically denied about consumption of alcohol/liquor by him in his rejoinder filed by him alongwith his affidavit and also that in the present case it has come on record that the subject car was hit by another car from rear left hand side and the accident had not taken place due to the rash and negligent driving of the complainant/insured. 
13. In this manner, it is safe to hold that the ratio laid down in the aforesaid judgment is not applicable in the present case, especially when it has come on record that the accident had not occurred on account of smell of alcohol, if at all found by the medical officer during the medical examination of the complainant, rather, the same had taken place due to the rash and negligent driving of the third person whose car had hit the subject car from rear left hand side.  Hence, it is safe to hold that OPs 1 & 2 were unjustified in repudiating the claim of the complainant and the present consumer complaint deserves to succeed against them.
14. OPs/insurer have also resisted the consumer complaint on the ground that as the subject car was being used by the complainant firm through its sole proprietor for commercial/business purposes of the firm, the instant consumer complaint, being not filed by a consumer under the Act, is not maintainable and the same is liable to be dismissed.  However, the law on this point has already been settled by the Hon’ble Apex Court in the case of National Insurance Co. Ltd. Vs. Harsolia Motors & Ors., II (2023) CPJ 33 (SC), and the relevant paragraphs of the same are reproduced as under :-

42. Thus, what is finally culled out is that each case has to be examined on its own facts and circumstances and what is to be examined is whether any activity or transaction is for commercial purpose to generate profits and there cannot be a straight-jacket formula which can be adopted and every case has to be examined on the broad principles which have been laid down by this Court, of which detailed discussion has been made.

43. Applying the above principles in the present case, what needs to be determined is whether the insurance service had a close and direct nexus with the profit generating activity and whether the dominant intention or dominant purpose of the transaction was to facilitate some kind of profit generation for the insured or to the beneficiary and our answer is in the negative and accordingly we are of the view that the complaint filed by the respondent insured herein has no close or direct nexus with the profit generating activity and the claim of insurance is to indemnify the loss which the respondent insured had suffered and the Commission has rightly held that the respondent is a “consumer” under Section 2(1)(d) of the Act, 1986.

44. We further reiterate that ordinarily the nature of the insurance contract is always to indemnify the losses. Insurance contracts are contracts of indemnity whereby one undertakes to indemnify another against loss/damage or liability arising from an unknown or contingent event and is applicable only to some contingency or act likely to come in future.”

 

15. In the case in hand, when nothing has come on record that the subject car was being used by the complainant for commercial purposes to generate profit or that the insurance service had a close and direct nexus with the profit generating activity, rather it has come on record that the proprietor/director of the complainant firm has been running a clinic under the name and style of M/s City Clinic Private Limited, it safe to hold that the complainant is a ‘consumer’, as defined under the Consumer Protection Act, and the OPs/insurer cannot escape from their liability and they have to indemnify the loss, suffered by the complainant/ insured due to the accident.
16. So far as the quantum of relief to be awarded to the complainant is concerned, since the complainant has proved through tax invoice/bill and certificate that he has paid an amount of ₹6,48,330/- to the repairer, it is safe to hold that the complainant is entitled for the said amount (less excess clause, if any) alongwith interest and compensation etc. for the harassment suffered.

4. In the light of the aforesaid discussion, the present consumer complaint succeeds, the same is hereby partly allowed and OPs 1 & 2 are directed as under :-

1. to pay ₹6,48,330/- (less excess clause, if any) to the complainant alongwith interest @ 9% per annum from the date of repudiation of the claim i.e. 24.2.2020 onwards.
2. to pay an amount of ₹10,000/- to the complainant as compensation for causing mental agony and harassment;
3. to pay ₹10,000/- to the complainant as costs of litigation.

5. This order be complied with by the OPs 1 & 2 within thirty days from the date of receipt of its certified copy, failing which, the payable amounts, mentioned at Sr.No.(i) & (ii) above, shall carry interest @ 12% per annum from the date of this order, till realization, apart from compliance of direction at Sr.No.(iii) above.
6. Since no deficiency in service or unfair trade practice has been proved against OP-3, the consumer complaint against it stands dismissed with no order as to costs. 
7. Pending miscellaneous application(s), if any, also stands disposed of accordingly.
8. Certified copies of this order be sent to the parties free of charge. The file be consigned.

Announced 04/10/2023 hg			Sd/- [Pawanjit Singh] President
			Sd/- [Surjeet Kaur] Member