Order by:
Sh.Amrinder Singh Sidhu, President
1. This Consumer Complaint has been received by transfer vide order dated 26.11.2021 of Hon’ble President, State Consumer Disputes Redressal Commission, Punjab at Chandigarh under section 48 of CPA Act, vide letter No.04/22/2021/4 C.P.A/38 dated 17.1.2022 from District Consumer Commission, Ludhiana to District Consumer Commission, Moga to decide the same in Camp Court at Ludhiana and said order was ordered to be affected from 14th March, 2022.
2. The complainant has filed the instant complaint under section 12 of the Consumer Protection Act, 1986 (now section 35 of Consumer Protection Act, 2019) on the allegations that he got insured his vehicle Trailer bearing RC No.PB-10-DA-0975, make 2010 with Opposite Parties vide cover note No.VGC-0397688000100 valid for the period 08.01.2016 to 07.01.2017 for Insured Declared Value of Rs.17 lakhs. Unfortunately, said insured vehicle of the complainant met with an accident while it was coming from Guwahati towards Durgapur and the intimation in this regard was immediately given to the Opposite Parties and concerned police station. Thereafter, the claim was lodged by the complainant with the Opposite Parties as total loss/ damages to the insured vehicle and completed all the formalities and accordingly, the Opposite Parties appointed surveyor to survey and assess the loss to the insured vehicle. But the Opposite Parties repudiated the claim of the complainants on the frivolous ground that the repairs of the vehicle was carried before inspection of the vehicle, but it is totally wrong because the vehicle is still lying with B.K.Motors Raikot in the same condition as it was on the day of accident and no repair was done as alleged till date. Hence, the repudiation of the claim by the Opposite Parties is illegal, wrong and arbitrary. Since the insured vehicle has been totally damaged and is beyond repair and hence the complainant is entitled to the sum of Rs.17 lakhs. Vide instant complaint, the complainant has sought the following reliefs.
a) The Opposite Parties may be directed to make the payment of Rs.17 lakhs being the insured value alongwith interest @ 18% per annum from the date of accident, to pay Rs.5000/- per day as loss of income and Rs.55,000/- as litigation expenses or any other relief to which this District Consumer Commission may deem fit be also granted.
3. Opposite Parties appeared through counsel and contested the complaint by filing the written version taking preliminary objections therein inter alia that the complaint filed by the complainant is not maintainable and is liable to be dismissed as the complainant has attempted to misguide and mislead this District Consumer Commission. In brief, the complainant has admittedly obtained policy in question subject to policy terms and conditions for vehicle in question and on the receipt of the claim intimation regarding the loss dated 12.10.2016, the Opposite Parties immediately deputed M/s.Secure Risk management & Insurance Services, Mohali to investigate the genuineness of the claim and who required to submit some documents and after that, he submitted his report dated 29.12.2016 and on the receipt of report from the surveyor, the Opposite Parties applied its mind and refused to entertain the claim of the complainant on the ground that repairs to the vehicle were carried out before inspection of the vehicle, thereby not giving them a opportunity to inspect the vehicle in damaged condition and hence, they are unable to entertain the claim. On merits, the Opposite Parties took up the same and similar pleas as taken up by them in the preliminary objections. Hence, Opposite Parties have rightly repudiated the claim of the complainant after application of mind and the complaint may be dismissed with costs.
4. In order to prove his case, the complainant has tendered into evidence his affidavit Ex.CA and CB alongwith copies of documents Ex.C1 to Ex.C1 and closed the evidence on behalf of the complainant.
5. On the other hand, to rebut the evidence of the complainant, Opposite Parties also tendered into evidence the affidavit of Sh.V.Harishanker Ex.RA alongwith copies of documents Ex.R1 to Ex.R6 and closed the evidence.
6. We have heard the ld.counsel for the parties, written submissions of the Opposite Parties and also gone through the documents placed on record.
7. During the course of arguments, ld.counsel for the Complainant has mainly reiterated the facts as narrated in the complaint and contended that the written version filed on behalf of Opposite Parties-Insurance Company has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. Opposite Party is limited Company and written version has been filed on the basis of special power of attorney given to ld.counsel for the Opposite Party. Further contended that no such terms and conditions were ever conveyed or supplied to the complainant at the time of insurance of the cows and the alleged terms and conditions are not applicable on the case of complainant. Further contended that the complainant got insured his vehicle Trailer bearing RC No.PB-10-DA-0975, make 2010 with Opposite Parties vide cover note No.VGC-0397688000100 valid for the period 08.01.2016 to 07.01.2017 for Insured Declared Value of Rs.17 lakhs. Unfortunately, said insured vehicle of the complainant met with an accident while it was coming from Guwahati towards Durgapur and the intimation in this regard was immediately given to the Opposite Parties and concerned police station. Thereafter, the claim was lodged by the complainant with the Opposite Parties as total loss/ damages to the insured vehicle and completed all the formalities and accordingly, the Opposite Parties appointed surveyor to survey and assess the loss to the insured vehicle. But the Opposite Parties repudiated the claim of the complainants on the frivolous ground that the repairs of the vehicle was carried before inspection of the vehicle, but it is totally wrong because the vehicle is still lying with B.K.Motors Raikot in the same condition as it was on the day of accident and no repair was done as alleged till date. Hence, the repudiation of the claim by the Opposite Parties is illegal, wrong and arbitrary.
8. On the other hand, ld.counsel for the Opposite Party has repelled the aforesaid contention of the ld.counsel for the complainant on the ground that the complainant has admittedly obtained policy in question subject to policy terms and conditions for vehicle in question and on the receipt of the claim intimation regarding the loss dated 12.10.2016, the Opposite Parties immediately deputed M/s.Secure Risk management & Insurance Services, Mohali to investigate the genuineness of the claim and who required to submit some documents and after that, he submitted his report dated 29.12.2016 and on the receipt of report from the surveyor, the Opposite Parties applied its mind and refused to entertain the claim of the complainant on the ground that repairs to the vehicle were carried out before inspection of the vehicle, thereby not giving them a opportunity to inspect the vehicle in damaged condition and hence, they are unable to entertain the claim.
9. Perusal of the contention of the ld.counsel for the complainant shows that the written version filed on behalf of Opposite Party has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party is limited Company and written version has been filed on the basis of special power of attorney given to ld.counsel for the Opposite Party. In this regard, Hon’ble Supreme Court of India in case titled as Shubh Shanti Services Limited v. Manjula S.Agarwalla and others (2005) 5 SCC 30, decided on 11.05.2005 has and observed to the following effect:
“..............As already stated, it has not been averred in the plaint nor sought to be proved that any resolution had been passed by the Board of Directors of the plaintiff company authorising Shri A.K. Shukla to sign, verify and institute the suit. It has also not been averred that the memorandum/articles of the plaintiff company give ny right to Shri A.K. Shukla to sign, verify and institute a suit on behalf of the plaintiff company. It, therefore, follows that the plaint has been instituted by Shri A.K. Shukla only on the authority of Sh. Raj K.Shukla, CEO of the plaintiff company. Such an authority is not recognized under law and, therefore, I held that the plaint has not been instituted by an authorised person. Issue No.1 is accordingly, decided against the plaintiff and in favour of the defendants.”
Further, Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment, has held that
“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”
Recently Hon’ble State Consumer Disputes Redressal Commission, Punjab at Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by an unauthorized person has no legal effect.
10. The main plea raised by Opposite Party is that the complainant has violated the terms and conditions of the policy in question and as per the terms and conditions of the policy, the complainant is not entitled to the claim as claimed. But the Opposite Party could not produce any evidence to prove that terms and conditions of the policy were ever supplied to the complainant insured, when and through which mode? It has been held by Hon’ble National Commission, New Delhi in case titled as The Oriental Insurance Company Limited Vs. Satpal Singh & Others 2014(2) CLT page 305 that the insured is not bound by the terms and conditions of the insurance policy unless it is proved that policy was supplied to the insured by the insurance company. Onus to prove that terms and conditions of the policy were supplied to the insured lies upon the insurance company. From the perusal of the entire evidence produced on record by the Opposite Party, it is clear that Opposite Party has failed to prove on record that they did supply the terms and conditions of the policy to the complainant insured. As such, these terms and conditions, particularly the exclusion clause of the policy is not binding upon the insured. Reliance in this connection can be had on Modern Insulators Ltd.Vs. Oriental Insurance Company Limited (2000) 2 SCC 734, wherein it is held that “In view of the above settled position of law, we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant, the respondent can not claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law.” Our own Hon’ble State Commission, Punjab, Chandigarh in First Appeal No.871 of 2014 decided on 03.02.2017 in case titled as Veena Mahajan (Widow) and others Vs. Aegon Religare Life Insurance Company Limited in para No.5 has held that
“Counsel for the appellant argued that copy of insurance policy was not supplied to the appellant and hence, the exclusion clause in the contract of the insurance policy is not binding upon him. He further argued that no proof of sending of insurance policy was ever produced by the respondent despite specific contention raised by the complainant that the insurance policy was never received by him. He argued that though there is an averment of the OP that the policy in question was delivered through Blue Dart Courier to the complainant. In order to prove their contention, no affidavit of any employee of Blue Dart was produced who would have made a statement to have the effect that the policy was delivered to the complainant nor any acknowledgement slip for having received the article by the complainant through courier company was produced by the insurance company. He argued that since no policy document was received by the insured and argued that the terms and conditions as alleged to be part of the insurance policy were not binding upon the insured. He argued that policy was issued in the name of deceased Sh.Vijinder Pal Mahajan with his wife Mrs.Veena Mahajan as beneficiary and the same was never refused by the OP and the proper premium for insurance was paid by late complainant. He argued that as per the specific allegations made in the complaint in para No.4, no rebuttal to that contention was specifically there in their written reply in para No.2 and para No.4 in the reply filed by OP in the District Forum. He argued that Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case of "Ashok Sharma Vs. National Insurance Co. Limited", in Revision Petition No. 2708 of 2013 held in para No.8 to the point of non-delivery of terms and conditions of the policy. He also cited Hon'ble Supreme Court's decision given in the matter of "United India Insurance Co. Limited Vs. M.K.J.Corporation" in Appeal (civil) 6075-6076 of 1995 (1996) 6 SCC 428 wherein the Apex court held that a fundamental principle of Insurance Law makes it that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured has a duty to disclose, "similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge, since obligation of good faith applies to them equally with the assured and further argued that since the terms and conditions were not supplied even on repeated requests the same cannot be relied upon by the opposite party in order to report to repudiate the genuine claim of the wife of the deceased policy holder.”
- We have heard the learned counsel for the parties at considerable length and have also examined the record of the case. The main contention of the Opposite Party is that on the receipt of report from the surveyor, the Opposite Parties applied its mind and refused to entertain the claim of the complainant on the ground that repairs to the vehicle were carried out before inspection of the vehicle, thereby not giving them a opportunity to inspect the vehicle in damaged condition and hence, they are unable to entertain the claim. On the other hand, ld.counsel for the complainant has strenuously repelled the aforesaid contention of the ld.counsel for the Opposite Parties and vehemently contended that it is totally wrong because the vehicle is still lying with B.K.Motors Raikot in the same condition as it was on the day of accident and no repair was done as alleged till date. Perusal of the record shows that on the report of surveyor, the Opposite Parties have repudiated the claim of the complainant. But bare perusal of the report of surveyor Ex.R6, said surveyor has not clearly mentioned on which account or basis, he has observed that the repairs to the vehicle were3 carried out before inspection of the vehicle. In this regard, Hon’ble State Consumer Disputes Redressal Commission, Punjab at Chandigarh has recently held in First Appeal No.370 of 2019 decided on 19.01.2022 in case Vishav Jindal Versus ICICI Lombard General Insurance Company Limited, that the surveyor’s report is not the last and final word. It is not that sacrosanct that it cannot be departed from; it is not conclusive. The approved surveyor’s report may be basis or foundation for settlement of a claim by the insurer in respect of the loss suffered by the insured but surely such report is neither binding upon the insurer nor insured. The relevant para of the judgement passed by Hon’ble State Consumer Disputes Redressal Commission, Punjab at Chandigarh is reproduced as under:-
“We are of the opinion that if there are some flaws in the surveyor’s report, it is not binding upon the insured/insurer. We are further fortified with the judgment of the Hon’ble Supreme Court reported in (2009) CPJ 46 (SC) titled “New India Assurance Company Limited v. Pardeep Kumar” wherein it has been laid First Appeal No. 370 of 2019 12 down that surveyor’s report is not the last and final word. It is not that sacrosanct that it cannot be departed from; it is not conclusive. The approved surveyor’s report may be basis or foundation for settlement of a claim by the insurer in respect of the loss suffered by the insured but surely such report is neither binding upon the insurer nor insured’
Hence, keeping in view the aforesaid judgement of Hon’ble Supreme Court reported in (2009) CPJ 46 (SC) as well as Hon’ble State Commission, Punjab at Chandigarh (supra), the aforesaid report of the surveyor can not be deemed to be correct.
12. In such a situation the repudiation made by Opposite Parties regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation. This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible. It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-
“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.
13. In view of the above discussion, we hold that the Opposite Party-Insurance Company have wrongly and illegally rejected the claim of the complainant.
14. To support their contention, the Opposite Party has cited the rulings, but these rulings are not applicable to the facts of the present case and are not supportive to the instant case.
15. The complainant in his complaint has claimed the Insured Declared Value of the insured vehicle to the extent of Rs.17 lakhs on total loss/ damages basis, and on the other hand, the Opposite Parties has not denied this claim by filing any cogent and convincing evidence and hence, the claim of the complainant to that amount is genuine and we allow the claim of the complainant accordingly.
16. In view of the aforesaid facts and circumstances of the case, we allow the complaint of the Complainant and direct Opposite Party-Insurance Company to pay the Insured Declared Value (IDV) of the vehicle bearing RC No.PB-10DA-0975 amounting to Rs.17 lakhs (Rupees Seventeen lakhs only) to the complainant, subject to furnishing the letter of subrogation, power of attorney for transfer of RC of the vehicle in question in favour of the Opposite Parties, by the complainant. Compliance of this order be made within 45 days from the receipt of copy of the order, failing which amount awarded will carry interest @ 8% per annum from the date of filing the complaint i.e. 25.10.2017 till its actual realisation. Opposite Party–Insurance Company is also directed to pay compensation to the complainant for causing mental tension and harassment to the tune of Rs.5,000/- (five thousands only). Copies of the order be furnished to the parties free of cost by District Consumer Commission, Ludhiana and thereafter, the file be consigned to record room after compliance.
Announced in Open Commission at Camp Court, Ludhiana.
Dated:29.04.2022.
