PER MR PREM NARAIN, PRESIDING MEMBER

The present appeal has been filed against the judgment dated 30.10.2017 of the Punjab State Consumer Disputes Redressal Commission, Chandigarh (‘the State Commission’) in Complaint no.257 of 2016.

2.     The brief facts of the case are that complainant no.1/ respondent through complainant no.2 purchased a truck bearing registration no.PB 06 Q 8333. Insurance for the said vehicle was taken for the period 04.09.2014 to 03.09.2015 for a sum of Rs.22,00,000/-. On 30.09.2014, the said vehicle met with an accident. Claim was intimated on 05.11.2014. Surveyor has reported that the loss appeared to be of an earlier date than the reported date. On 26.02.2016, the claim of the complainant was repudiated on the ground of misrepresentation of fact violating condition 8 of the terms of the insurance policy.

3.     The State Commission vide its order dated 30.10.2017 had allowed the complaint and observed as under:

“This complaint is allowed with cost of Rs.20,000/- and the opposite party is directed to pay the IDV of the vehicle to the complainants, being total loss, as per the terms of the insurance cover along with interest at the rate of 9% per annum with effect from the date of filing of the complaint, i.e., 11.08.2016 till realisation within a period of one month from the date of receipt of certified copy of this order.  However, it is made clear that if the vehicle is hypothecated from some Bank or Financial institution, then the first right will be of that Bank/ Institution over the above said amount and the remaining amount shall be payable to the complainants”.

4.     Hence, the present appeal.

5.     Heard the learned counsel for the parties and perused the record. Learned counsel for the appellant has stated that the surveyor in his report has observed that the vehicle which was inspected by the surveyor after the accident seems to be a different one than the vehicle which was pre-inspected before the issuance of the insurance policy. In this regard the learned counsel for the appellant has argued that the date of accident is not clear as no FIR in respect of the accident has been lodged though the accident was a major accident and the vehicle was allegedly totally damaged. As there was no FIR in the matter, even the accident may be of a prior date than the date of commencement of the policy. In that case, the claim cannot be covered under the policy.

6.     It was further argued by the learned counsel that no intimation of the accident was timely given to the police, nor the insurance company was informed timely. As per condition no.1 of the policy, the insurance company was required to be immediately informed about the accident, however, intimation to the insurance company was given only after 36 days. There has been an inordinate delay in intimating the accident to the insurance company which is a violation of condition no.1 of the policy and the claim is not payable due to this delay. In support of his argument the learned counsel referred to the judgment of this Commission in HDFC Ergo General Insurance Co. Ltd., vs Shri Bhagchand Saini son of Suvalal – 2014 SCC online NCDRC 874 decided on 04.12.2014, wherein FIR was lodged within two days of the accident, however, intimation to the insurance company was given after five months and in this case this Commission has dismissed the complaint. In the present case, the position is still worse as even no FIR has been lodged in the matter, therefore, the complaint deserves to be dismissed on the ground of delay.

7.     The complainant has taken the stand that issue of delay has not been taken as a ground in the repudiation letter and therefore, the same cannot be taken as ground for dismissing the complaint. Learned counsel for the respondent/ insurance company states that even if this ground has not been taken in the repudiation letter but the same is taken in the written statement. Therefore, it is required to be considered by a Consumer Forum. In respect of this argument, the learned counsel for the respondent referred to the judgment of this Commission in the case of Reliance General Insurance Company Limited vs Vinod Kumar son of Mr Kanshi Ram – 2016 SCC online NCDRC 2182 dated 20.07.2016, wherein it has been held that:

“The learned counsel for the complainant submits that delay in lodging the FIR and intimating the theft to the insurer was not a ground of repudiation. In my opinion, since the aforesaid plea is based on admitted facts it could be allowed to be taken in the reply of the insurer even if it was not a ground of repudiation. In any case, the complaint is liable to be dismissed on account of failure of the insured to take reasonable steps to protect and safeguard the vehicle”.

8.     The learned counsel for the insurance company has further argued that as no intimation was immediately given to the insurance company, no spot survey could be conducted by the insurance company and therefore, the circumstances and the reasons for the accident could not be ascertained by the surveyor. Therefore, clearly, it cannot be said that the complainant had taken reasonable precaution in safeguarding the vehicle. Thus, there is also a violation of condition no.5 of the policy which reads as under:

“The insured shall take all reasonable steps to safe guard the vehicle insured from the loss of damage and to maintain it in efficient condition and the company shall have at all time free and full access to examine the vehicle insured or any part thereof or any driver or employee of the insured. In the event of any accident or breakdown, the vehicle insured shall not be left unattended without proper prosecution being taken to prevent further damage or loss and if the vehicle insured be driver before the necessary repairs are effected any extension of the damage or any further damage to the vehicle shall be entirely at the insured’s own risk.”

9.     Learned counsel for the insurance company has also drawn my attention that the licence of the driver Randhir Singh was not a valid driving licence. As per the circular issued by the Government of Nagaland wherein it has been stated that if the driver’s licence is not in the smart card format then the same shall not be valid. In the present case the driver’s licence was in the booklet form and therefore, the vehicle was being driven without a valid driving licence. From this aspect also, this claim is not payable. On the basis of the aforesaid grounds, the learned counsel for the appellant has stated that the order passed by the State Commission is against the legal norms and deserves to be set aside and the complaint also needs to be dismissed.

10.   On the other hand, the learned counsel for the respondent/ complainant states that the issue of delay in giving intimation to the insurance company cannot be considered at this stage because the same has not been made a ground for repudiation of the claim. Learned counsel has further stated that the FIR could not be filed in time as the owner of the vehicle was in America at the time of accident. As soon as, he came back from America he filed the DDR with the police and also gave intimation to the insurance company. Thus, the delay in filing the DDR and giving intimation to the insurance company is not deliberate, rather, only incidental. It was further argued by the learned counsel that genuine claims cannot be repudiated only on the ground of delay which is only a technical reason.

11.   Learned counsel for the complainant has also argued that the State Commission has correctly examined both the points, i.e., point relating to delay as well as point relating to observation of the surveyor. In respect of the observation of the surveyor, the learned counsel has stated that so far as the engine and chassis number of the vehicle are the same, it cannot be said that it was a different vehicle that was presented to the surveyor for survey after the accident. Learned counsel has stated that after considering all the aspects, the State Commission has allowed the complaint and passed the impugned order. There is no error in the order passed by the State Commission.

12.   I have carefully considered the arguments advanced by the learned counsel for the parties and examined the material on record. The decision of this Commission in the case of HDFC Ergo General Insurance Co. Ltd., vs Shri Bhagchand Saini son of Suvalal – 2014 SCC online NCDRC 874 decided on 04.12.2014, is applicable to the present case and I also agree that the issue of delay can be raised in the written statement and the same has been actually raised. Therefore, it needs to be examined by the consumer fora. If the owner was not available in India, nobody had stopped the driver or any authorised representative of the owner to lodge an FIR. Moreover, the driver of the truck has entered into an agreement with the driver of the other truck with which this truck had collided, clearly stating that as no loss of life has occurred, both the parties have agreed that there was no negligence on the part of any of the party to the accident. This type of agreement cannot give any basis to the insurance company to assume that there was no fault in the driving or there was no negligence in taking reasonable care of the vehicle as per condition no.5 of the policy. Thus, clearly the violation of condition no.5 of the policy cannot be ruled out. Clearly, there has been delay of 36 days in giving intimation to the insurance company and even the date of accident may be different than what has been told by the complainant. However, one thing is clear that when the vehicle was pre-inspected by the surveyor before the insurance, the vehicle was not an accidented vehicle. I don’t find any force in the observation of the surveyor that the vehicle inspected after the accident was a different vehicle. The State Commission has rightly observed that as the engine and chassis numbers are the same, it cannot be said that a different vehicle was shown to the surveyor for inspection. The possibility of the accident prior to the commencement of the policy is ruled out because the vehicle was pre-inspected before the insurance and then the vehicle was not accidented, therefore, the vehicle must have met with an accident only after the commencement of the policy.

13.   The Insurance Regulatory & Development Authority (IRDA) vide its circular IRDA/ HLTH/ MISC/ CIR/ 216/ 09/ 2011 dated 20.09.2011 has instructed all its general insurance companies to consider the genuine claims filed with delay and the claim should not be rejected on the grounds of delay alone. In the present case also, as observed above, the claim seems to be a genuine accident claim, though the matter has been reported late to the insurance company without filing any FIR and which is clearly violation of condition no.1 of the policy. It is also seen that there has been violation of condition no.5 of the policy. Thus, the two important conditions of the policy have been violated by the complainant in the present case. The Hon’ble Supreme Court in the case of Amalendu Sahoo Vs. Oriental Insurance Co. Ltd., II (2010) CPJ 9 (SC) has observed that if certain condition of the policy which is not a fundamental condition is violated, the insurance claim can be settled on non-standard basis under which the claim can be accepted upto 75% of the permissible claim.  In the present case, two important conditions of the policy have been violated and therefore, I am of the view that the insurance claim upto 50% of the total claim can be admitted.

14.   On the basis of the above discussion, the appeal is partly allowed and the order dated 30.10.2017 passed by the State Commission is modified to the extent that the insurance company shall pay Rs.11,00,000/- (rupees eleven lakh only i.e., 50% of Rs.22,00,000/-). Rest of the order of the State Commission shall remain unchanged.