DISTRICT CONSUMER DISPUTES REDRESSAL FORUM (CENTRAL)

ISBT KASHMERE GATE DELHI

CC/315/2013

No. DF/ Central/

Smt. Shakuntla Kundu

W/o Shri Raj Kumar Kundu

R/o Flt. No. 102, Tower No. 16,

Unitech Havitate PI 2, Knowledge Park-3,

Greater Noida, Gautam Budh Nagar,

Uttar Pradesh-201308.                                                              …..Complainant

Versus

1. SBI General Insurance Company Ltd.

State Bank of India Corporate Centre,

Madame Came Road, Nariman Point,

Mumbai-400021.

Through its Principal Officer.

2. The Branch Manager

SBI General Insurance Company Ltd.,

7-B, Near Rajindera Place Metro Station,

Opposite Sidharth Hotel, Pusha Road,

Bank Street, Delhi-110005.                                                  ….. Opposite Party                                                                   

Coram:       Ms. Rekha Rani, President

                   Ms. Manju Bala Sharma, Member

Sh. R.C. Meena, Member

ORDER

Rekha Rani, President

1. Smt. Shakuntla Kundu (in short the Complainant) filed the instant complaint u/s 12 of the Consumer Protection Act, 1986 as amended up to date (in short the Act) pleading therein that she purchased a Verna GL 1.5 GRD DI VGT car bearing No. UA-07-S-1974, Chasis No. MALCM41VR6M000614, Engine No. D4FA6U960752, Make Hyundai Motors India Ltd., Model 2007 which were insured with SBI General Insurance Company Ltd., (in short the OP) which was valid from 15.12.2011 to 14.12.2012.
2. The vehicle was stolen on 17.04.2012. Accordingly an FIR was registered with police Station Kasna Gautam Budh Nagar (UP) OP rejected the claim of complainant vide letter dated 30.06.2012 for having claimed no claim bonus wrongfully from the OP. Complainant never concealed anything from the OP and OP has repudiated her claim wrongfully. Hence, complainant filed instant complaint for seeking direction to OP to pay to the complainant a sum of Rs.3,60,000/- being the insured amount and Rs.2,00,000/- as compensation for harassment with interest at the rate of 24% per annum and cost of litigation.
3. OP contested the claim vide its written statement. Mainly on the ground that at the time of issuance of insurance policy complainant made false declaration to OP that she had not lodged any claim against the previous policy No. 015102635700 which was issued to the complainant by TATA AIG General Insurance company ltd. and therefore, OP deeming the declaration to be true provided a No Claim Bonus to the complainant and issued policy No. 156127 along with its terms and conditions. Subsequently, OP confirmed from the previous insurer namely TATA AIG General Insurance Co. Ltd. regarding any claim that was lodged with them for the vehicle in question during their policy tenure to which the said previous insurer of the vehicle namely TATA AIG General Insurance Co. Ltd. furnished the information that the complainant had lodged a claim against the previous policy issued to the complainant by them. Accordingly, OP vide their letter dated 22.03.2012 informed the complainant that on account of false and wrong declaration any or all coverage under Section 1 of the policy  and no claim on the loss and damage to the vehicle in question would be entertained. It is further pleaded that an option was provided to the Complainant to pay the deficit amount of Rs.2,216/- towards the premium to reinstate the Own Damage benefits under Section 1 of the Policy but complainant did not pay the deficit to reinstate the Own Damage benefits under Section 1 of the Policy. It is pleaded that all benefits and premium paid under the policy stood forfeited under GR-27 of the India Motor Tariff (IMT).
4. In Rejoinder complainant has not specifically dealt with the allegation of wrongfully availing NCB from the OP.  It is pleaded that she never violated any undertaking as the complainant is a law abiding citizen of India and the complainant duly informed each and every fact to the executive of the OP and paid the amount to the executive as per his calculation for the policy in question. If there is any fault it is on the part of the executive of the OP.
5. It is not disputed in the rejoinder that no claim bonus was availed by the

complainant from the OP. Copy of private car certificate of insurance-cum policy schedule indicates that 20% no claim bonus was allowed to the complainant.  

6. Both sides adduced their evidence by way of affidavits.
7. We have heard Shri Aman Sharma Ld. Counsel for complainant and Shri Manoj Kr. Tyagi Ld. Counsel for OP.
8. In Para-2 of the written statement, it is pleaded that no claim bonus was allowed to the complainant on the basis of declaration made by her that he had not lodged any claim with the previous insurer namely TATA AIG General Insurance Co. Ltd. against previous insurance policy No. 015102635700. It is not denied in corresponding Para-2 of rejoinder that such declaration that no claim was lodged with the previous insurer was made with the OP to claim no claim bonus.
9. It was submitted during the course of arguments by learned counsel for the complainant that complainant did not fill any form and that the same was filled by an executive of OP. It is pleaded that complainant had faithfully disclosed all particulars concerning the policy in question and the executive of the OP filled in the same.
10. In Para-4 of the written statement, it is pleaded that vide letter dated 22.03.2012 OP had even intimated the complainant about her false declaration qua No Claim Bonus and had given an option to pay the deficit amount of Rs.2216/- for reinstatement of Own Damage benefits under Section 1 of the policy but the complainant did not pay deficit for reinstatement of the policy.
11. Learned counsel for the OP has drawn our attention to their letter dated 22.03.2012 placed at page-16 of the case file which is addressed to the complainant and it is written therein that as per her submission that she was entitled to 20% NCB which was granted to her. Further since her previous insurer namely TATA AIG General Insurance Co. Ltd. denied confirmation of entitlement of NCB renewal she was liable to pay Rs.2216/- which she was required to remit within 16 days.
12.  Copy of postal receipt is also placed on record indicating that the letter was sent to the complainant on 26.03.2012. Complainant has denied receiving this letter.
13. Learned counsel for complainant argued that OP cannot be permitted to challenge the validity of the policy on the ground of rebate of premium and such action would amount to deficiency of service on the part of the insurer.  He further argued that any verification of NCB claim should have been made immediately after the issue of policy and not several months later.

Same contention was raised on behalf of the complainant on similar facts in Brij Bhushan vs. National Insurance Company Limited & Ors. Revision Petition No.33 of 2012 before the National Commission.  In the said case the truck owned by the complainant was insured which met with an accident.  The claim was repudiated on the ground that “complainant had deliberately and fraudulently misrepresented and misled the insurer, while getting benefit of 55% NCB, transferred on his new truck no.PB-13-I-5375, and thereby he had breached the principle of utmost good faith and that as per the Indian Motor Tariff 2002, framed by the Tariff Advisory Committee, a statutory body under the Insurance Act, 1938, he was not entitled to any own damage claim, since in the light of General Regulation no.27, all the benefits under Section-I of the policy of insurance, stood forfeited”.  The State Commission held that although the insurer granting no claim bonus has right to write to the previous insurer within 21 days after granting the cover note, yet complainant cannot take any benefit of the same having fraudulently mis-represented the facts and obtained the cover note which was in the name of Balwinder Singh. It was further observed that principle of equity is that who seeks equity must do the equity but complainant had not done so. It was held that complainant tried to cheat insurance company and claimed no claim bonus although he was not entitled for the same. As such no benefit of this lapse of the insurance company was extended to the complainant.  National Commission upheld the order of the State Commission.

Similar question arose before the National Commission in Tata AIG General Insurance vs. Gulzari Singh R. P. No. 1255 of 2009.  Facts of the case were that during the validity of the insurance, vehicle met with an accident which got repaired. A claim for reimbursement of the repair charges was lodged with the insurer which was repudiated on the ground that complainant had suppressed material fact with regard to having received claim from the previous insurance company.  When the matter was cross checked from the previous insurer it came to light that the complainant had filed claims and availed reimbursement under their policy.  District Forum dismissed the complaint.  However the State Commission taking note that the surveyor had assessed the loss at Rs. 97,960/- passed the following order:

“However, so far as the no claim bonus is concerned, the appellant was given discount of Rs.1120/- and, therefore, the respondent could not have denied that claim against the instant policy as the insurance company was bound to pay the claim for the insured period. However, in view of the assessment of the loss as assessed by the surveyor, we allow the appeal by directing the respondent to pay an amount of Rs.97,960/- less the discount of Rs.1,120/- to the appellant besides Rs.25,000/- as compensation which shall include cost of litigation.”

National Commission did not agree with the State Commission and observed that:

“State Commission while allowing the appeal could not direct the petitioner to pay an amount of Rs.97,960/- less the discount of Rs.1,120/- given on account of No Claim Bonus as the State Commission, thereby altered the terms of the policy which it had no authority to do. Clearly it had no such jurisdiction. In case of LIC of India Vs. Smt. G.M. Channabasamma (1991) 1 SCC 357, the Hon’ble Supreme Court has held that a contract of insurance is a contract of uberrima fides and there must be complete good faith on the part of the assured. The assured thus is under a solemn obligation to make full disclosure of material fact which may be relevant for insurer to take into an account. Further in the case of General Assurance Society Ltd. Vs. Chandumull Jain & Anr. (1966) 3 SCR 500, the Hon’ble Apex Court has observed that the duty of the Court is to interpret the words in which the contract is expressed by the parties, because it is not for the Court to make a new contract, however, reasonable, if the parties have not made it themselves. The direction to adjust the No Claim Bonus against the

amount of damage assessed passed by the State Commission, clearly violates this settled principle of law and, therefore, cannot be sustained.”

14.           In the instant case complainant has stated that he never signed the declaration form on the basis of which he was given NCB of 20% by the OP.  Learned counsel for complainant submitted that requisite documents for obtaining insurance policy in question were filled in by an executive of the Insurer and complainant simply signed the same as per dictation of the said executive. He further submitted that complainant had faithfully disclosed all the particulars concerning the policy in question to the said executive of the insurer and there was no concealment of any material fact regarding the policy in question.

          There is no dispute that insurer gave no claim bonus of 20% to the complainant.  Insurance Policy is an important document terms whereof have to be read and then signed by the insured.  Complainant cannot take a plea that the terms of the policy were not read over and explained to her.  She should have insisted that the alleged executive of the insurer should explain the terms to her before she was called upon to sign the same.

15.     In para 2 of page 2 of the written statement OP pleaded that it issued Insurance Policy No. 156127 along with its terms and conditions.  In corresponding para 2 of her rejoinder complainant admitted that the said Insurance Policy was issued.   Complainant did not allege that the terms and conditions of the policy were not issued to her which means that she was aware of the terms and conditions of the policy.    Repudiation of her claim is justified for want of good faith in terms of the judgements as discussed above.    The complaint is therefore dismissed.  Copy of this order be sent to the parties as statutorily required. File be consigned to record room.

 Announced on this  27^th  Day  of  Jan. 2020.