MRS. NEENA SANDHU, PRESIDING MEMBER

1.       This is an appeal filed by United India Insurance Co. against order dated 4.5.2010 passed by District Consumer Disputes Redressal Forum-II, UT, Chandigarh (for short hereinafter to be referred as District Forum) passed in complaint case No. 1153 of 2009.

2.       Briefly stated, the facts of the case are, that the complainant purchased the Maruti Esteem Car bearing registration No. DL-8CF-1754, Chassis No.250121 Engine No. 617756 from its original owner i.e. M/s Everest Press on 17.3.2007 and while purchasing the said vehicle, all the documentary and other formalities required for the sale transactions were completed at the time of purchasing the vehicle. Thereafter the representative of OPs No. 1 and 2 namely Sh.Amarjit approached the complainant in the month of March, 2007 and also acquainted the complainant with various kinds of risks covered under the said insurance policy. Accordingly, the complainant being allured by the said representative, decide to take the insurance policy and paid an amount of Rs.2043/- on account of premium, which was duly received by OPs No. 1 and 2. Thereafter the said representative of OPs No. 1 and 2 issued the insurance cover note and subsequently the policy in favour of the complainant, which was valid from 20.3.2007 to 19.3.2008. It was submitted that the above said vehicle was stolen from New Colony, Gurgaon and in that regard FIR was duly lodged by the complainant on 30.11.2007 with the Police Station of the concerned area on the same day. Subsequently, the complainant vide letter dated 10.12.2007 intimated the OPs No. 1 and 2 regarding the said theft. It was further submitted that after the delay of more than 5 months, the OPs No. 1and 2 appointed M/s Jatinder and Harkrishan Investigators and the complainant made a payment of Rs.3170/- as professional fee against their invoice dated 11.5.2008. As desired by OPs No. 1 and 2, the complainant completed all the formalities and submitted all the relevant documents to the above said investigators for processing the claim. After completed all the formalities, the complainant requested OPs No. 1 and 2 to disburse the claim vide letter dated 13.8.2008 but inspite of incessant visits and innumerable reminders to OPs No. 1 and 2 for doing the needful but the same failed to disburse the claim of the complainant as well as failed to comply the terms and conditions of the insurance policy. It was submitted that to the utter surprise and dismay of the complainant, he received a letter dated 9.9.2008 from OPs No. 1 and 2 whereby they repudiated the claim of the complainant taking the stand that on the date of theft of the vehicle, the same did not stand in the name of the complainant in the registration certificate and therefore he has no insurable interest. It was further submitted that investigators illegally and malafidely charged an amount of Rs.3170/- from the complainant and in the instant case, concerned official of OPs No. 1 and 2 visited the complainant and only after proper scrutiny of the documents, the cover note was issued by the representative of OPs No.1 and 2 and OPs No.1 and 2 wrongfully alleged in the letter of repudiation dated 9.9.2008 that the proposal form was filled up by the complainant as the same was neither filled up nor signed by the complainant. The aforesaid acts of OPs No.1 and 2 amount to deficiency in service and unfair trade practice. Hence, the complaint was filed.

3.       Reply was filed by the OPs No. 1 and 2 and admitted that the vehicle was insured for sum assured of Rs.90,000/- against the premium of Rs.2043/- and also admitted that the vehicle in question was stolen. It was pleaded that the vehicle was registered in the name of M/s Everest Press on the date of theft and as such, the complainant has no insurable interest in the vehicle and therefore, the claim of the complainant was not payable in view of the provisions of Section 157(2) of the Motor Vehicle Act and GR-17 of the Motor Tariff. It was further pleaded that the complainant was required to give written intimation immediately on the date of occurrence of any accidental loss or damage but the complainant failed to do so. It was pleaded that in these circumstances, there was no deficiency in service on the part of OPs No. 1 and 2 and prayed for dismissal of the complaint. 

4.       Notice was issued to the OPs but OP No.3 did not appear, despite its service. Hence, the OP No.3 was proceeded against exparte vide order dated 23.9.2009.

5.       The parties led their evidence in support of their contentions.

6.       The learned District Forum allowed the complaint and directed the OPs No.1 and 2 to pay Rs.90,000/- being the insured declared value of the vehicle in question to the complainant along with a sum of Rs.20,000/- as compensation for mental agony and harassment as well as Rs.5,000/- as costs of litigation. The order be complied with by OPs No.1 and 2 within 45 days from the date of receipt of its certified copy, failing which the OPs No.1 and 2 shall be liable to refund Rs.1,10,000/- to the complainant along with penal interest @ 18% p.a. from the date of filing of the complaint i.e. 13.8.2009 till its realization besides costs of litigation.

7.          Aggrieved by the order passed by the learned District Forum, the present appeal has been filed by the United India Insurance Co.  Sh.Vishal Chaudhary, Advocate has appeared on behalf of appellant and Sh.D.K.Singhal, Adovcate has appeared on behalf of respondent No.1 as none has appeared on behalf of respondent No.2.

8.       In appeal, it is submitted that the learned District Forum has erred in law in not appreciating the fact that there was no privity of contract between the parties as the registered owner was M/s Everest Press, as would be seeen from the letter attached as Annexure A-1. It is submitted by the appellant that policy was purchased by one Sh.Shiv Anchal and the insurance company issued the policy on the basis of the proposal form and assurance to the effect that he would get the vehicle transferred in his name but the vehicle was not transferred and it remained in the name of M/s Everest Press. In this situation, it was patently wrong to have burdened the insurance company with the liability when there was no proper relationship established between the parties. It is further submitted that the compensation of Rs.20,000/- granted by the learned District Forum is highly excessive as the interest @ 7% on Rs.90,000/- would not increase beyond Rs.5,000/-. Since the courts can only grant one thing i.e. either interest or compensation and the grant of exorbitant compensation is a mismatch vis-à-vis the interest. The learned District Forum has erred in law in accepting the complaint of the complainant as the matter in question cannot be brought within the ambit of consumer jurisdiction. There is no deficiency in providing service to the complainant and the learned District Forum ought to have exonerated the insurer. It is further submitted that if the complainant felt aggrieved, the remedy was a civil court of competent jurisdiction, where both parties could led elaborate evidence, examine witness and prove their respective stands to the hilt. Hence, it is prayed that the appeal may kindly be allowed and the impugned order passed by the learned District Forum may kindly be set aside.

9.       We have perused the record and heard the learned counsel for the appellant/OP (United India Insurance Co.), the learned counsel for respondent No.1/complainant and perused the record.

10.     The learned counsel for the respondent No.1/complainant argued that he purchased the Maruti Esteem Car bearing registration No. DL-8CF-1754 from OP No.3 on 17.3.2007 and the same was insured from OPs No.1 and 2 for insured value of Rs.90,000/- against a premium of Rs.2043/- which was valid from 20.3.2007 to 19.3.2008. The said vehicle was stolen from New Colony, Gurgaon and in that regard FIR was duly lodged with the Police. Subsequently, the complainant vide letter dated 10.12.2007 intimated the OPs No. 1 and 2 regarding the said theft and after the delay of more than 5 months, the OPs No. 1and 2 appointed the surveyor to investigate the claim and the complainant paid Rs.3170/- as professional fee to the said investigator. The complainant completed all the formalities and submitted all the relevant documents to the above said investigators for processing the claim but the OPs No. 1 and 2 repudiate the claim of the complainant on the ground that he has no insurable interest. The repudiation of the claim on the ground that the complainant has no insurable interest is illegal and amounts to deficiency in service. 

11.     The learned counsel for the appellant argued that there was no privity of contract between the parties as the registered owner was M/s Everest Press. The insurance policy was purchased by one Sh.Shiv Anchal and on the basis of the proposal form, the insurance company issued the insurance policy and assurance to the effect that he would get the vehicle transferred in his name but the vehicle was not transferred in his name and it remained in the name of M/s Everest Press. In this situation, it was patently wrong to have burdened the insurance company with the liability when there was no proper relationship established between the parties and the compensation granted by the learned District Forum is highly excessive. It is further argued that the learned District Forum has erred in law in accepting the complaint and there is no deficiency in service on the part of insurance company. Hence, it is prayed that the appeal may kindly be allowed and the impugned order passed by the learned District Forum may kindly be set aside.

12.     From the cover of insurance policy, Annexure C-4 it is clear that the said car was got insured by the complainant himself from the insurance company (OP) covering the risk of theft. This above said insurance policy was valid from 20.3.2007 to 19.3.2008 and the said car was stolen on 30.11.2007 (Annexure C-3). Thus it is clear that the above said car was stolen during the continuation of the said insurance policy. Even for the sake of arguments, if we agree with the arguments put forth by the learned counsel for the appellant that the insurance company has issued the insurance policy on the name of the complainant on the assurance given by the complainant that the complainant would get the vehicle transferred in his favour immediately as per GR-17, which the complainant failed to do so within stipulated time. As in the present case, the complainant failed to get the vehicle transferred on his name within stipulated time as prescribed under Motor Vehicles Act. In this situation, the insurance company has every right to cancel the insurance policy on the plea that the complainant had failed to get the vehicle transferred in his name from the previous owner but are afraid that if any efforts were made by the insurance company to cancel the insurance policy issued to the complainant.  Thus, it has been proved on file that on the date of theft i.e. 30.11.2007, the insurance policy was very well in the name of the complainant and there was a privity of contract between the complainant and the insurance company. The provision under the Motor Vehicles Act are independent provisions and the failure of a person to get the vehicle registered in his name on purchase from previous owner is not relevant to the insurable interest. Even in our view, the cover note was issued by the insurance company after satisfying itself that the complainant is the owner of the vehicle in question and the rejection of the claim of the complainant now at this stage is unjustified and illegal. Mere fact that the complainant has not been registered as owner by the Registering Authority does not make the policy invalid and the repudiation of the claim lodged by the complainant tentamounts to deficiency in service on the part of insurance company. Therefore, the order passed by the learned District Forum is just, fair and proper. No interference is called for. The appeal filed by the United India Insurance Company is dismissed without any order as to costs and the order passed by the learned District Forum is upheld. The parties are left to bear their own costs.

13.            Copies of this order be sent to the parties, free of charge.   

Pronounced.                                                                        

2^nd February, 2011.