Per Shri S.R.Khanzode, Hon’ble Presiding Judicial Member:

This appeal takes an exception to an order dated 08/02/2008  passed in consumer complaint no.71/2004, Smt. Sunita Udaysingh Desai & Ors. V/s. New India Assurance Co. Ltd., passed by District Consumer Redressal Forum, Kolhapur (Forum below in short).  Undisputed facts are that the vehicle bearing registration no. MH/09/S/4502 purchased for personal use was insured with appellant/Opponent/ New India Assurance Co. Ltd.  It met with an accident on 26/04/2003 when the insurance policy was in force and effective.    The owner of the said vehicle, namely, Mr.Udaysingh Ganapati Desai, who is the husband of respondent no.1/org.complainant no.1/Smt.Sunita Udaysingh Desai and father of respondentno.2/org.complainant no.2/ Kum.Aditi Udaysingh Desai   died in the said accident and the vehicle was severely damaged and therefore, insurance claim was made.  Insurance claim was repudiated on the ground that said vehicle was used on hire and reward basis contrary to the terms of insurance  policy.  Therefore, consumer complaint was filed. 

Forum below upheld the claim and directed the insurance company to pay Rs.2,00,000/- as an insurance cover which was available to the owner/driver and further directed the insurance company to pay Rs.1,60,849.66 after complainant submitting bill of repairs to the company.  Further interest @10% p.a. from 05/06/2003 till actual payment was directed to be paid along with compensation of Rs.3,000/- towards mental and physical torture.  Rs.5,000/- as garage expenses, Rs.1,000/- towards towing expenses and cost of Rs.1,000/- were also directed to be paid to the complainant.  Feeling aggrieved thereby, org.opponent/insurance company has filed this appeal.

        We heard Adv.Mr.R.P.Bafna for appellant and Adv.Mr.Sandip Koregave for respondent.  Perused the record. 

        In the instant case after lodging of the claim, insurance company had appointed an investigator and relied upon investigation report dated 15/07/2003 of investigator-Charter House Detective Services, came to the conclusion that contrary to the terms of the policy the vehicle was used on hire and reward basis and repudiated the claim.  Forum below while considering the case of the parties ignored the affidavit of Investigator- Mr Prasad Krishnaji Kasture.  In the said affidavit the investigator has stated on oath as to how the passengers were taken by late owner of the vehicle accepting RS.200/- as a fare.  The investigator visited Village-Dabhewadi, Post- Konoli, Tal- Ajara Dist- Kolhapur and recorded the statements of those persons who were witnesses and got recorded their statement duly signed by these persons in his presence and under his supervision. On the contrary it is the case of the complainant that the owner of the vehicle  was carrying his relatives in his vehicle and the said vehicle was not used on hire and reward basis.  But the complainant failed to substantiate their such plea.  There is  no reason to not to accept the report of the investigator/surveyor.  Thus, one has to accept the situation as established in the instant case, namely, that at the relevant time the vehicle was used contrary to the insurance policy on hire and reward basis.

        Forum below relied upon the decision of Apex Court in the matter of B.V.Nagaraju V/s. Oriental Insurance Co. Ltd.(1996 ACJ 1178, Supreme court), in which it is interpreted that policy of the insurance need to be construed strictly or be read to advance the main purpose of the contract.  The reliance is further placed at the time of arguments, on the recent judgement of Apex court in the matter of Amalendu Sahoo V/s. Oriental Insurance Co. Ltd. (2010 ACJ 1250) wherein the Division Bench of Apex Court upheld the ratio applied by Hon’ble National Commission to grant compensation on non-standard basis even if it is case of breach of terms of insurance policy.  However, we find decision on which respondent/org.complainant relies are the judgement per incuriam since it ignored the decision of Hon’ble Five Judges Bench of Apex Court in the matter of The General Assurance Society Ltd. V/s. Chandmull Jain and another (1966, ACJ 267).  The ratio of said case is that insurance being the contract and when the terms of the insurance policy are not in question by the parties and ifi they are not ambiguous, those terms need to be  given effect    to and it is not for the court or quasi judicial authority dealing to the question for interpretation otherwise or those clauses are not subject to inquiry by such authorities.  In the instance case, the terms of the insurance policy are clean and no ambiguity is left.  The exclusion clause is part and parcel of the insurance policy.  Therefore, when it is established that there is a breach of terms of the insurance policy, repudiation of the insurance claim cannot be faulted with.  Furthermore, even as observed by the Hon’ble National Commission in the matter of  National Insurance Co.Ltd. V/s. Nitin Khandelwal (2008 ACJ 2035 (SC)  that  the appellant insurance company is liable to indemnify the owner of the vehicle when the insured has obtained comprehensive policy for the loss caused to the insured.  The respondent submitted that even assuming that there was a breach of condition of the insurance  policy, the appellant insurance company ought to have settled the claim on non-standard basis.  It is the discretion of the insurance company to consider the case in the light of the policy. When the question of discretion comes which is used in a just and proper manner one cannot presume deficiency in service on part of the insurance company within the meaning of Consumer Protection Act, 1986.  Thus, we find that Forum below erred in settling the dispute.  We cannot support the impugned order.  Holding accordingly, we pass the following order:-

                                        :-ORDER-:   

1.           Appeal is allowed.

2.           Impugned order dated 08/02/2008 is set aside.

3.           Consumer complaint stands dismissed.

4.           We made it clear that we are deciding the issue of compensation of accident in light of Consumer Protection Act, 1986 and material placed before us.  The original complainant is free to seek their remedies as may be available in law before other authorities/court.

5.           In the given circumstances, there is no order as to costs.

6.           Amount deposited per Section 15 proviso of Consumer Protection Act, 1986 by the appellant at the time of filing of appeal be returned to them.

7.           Copies of the order herein be furnished to the parties.