Order dictated by:
Sh.S.S. Panesar, President.
1. Sh.Satnam Singh has brought the instant complaint under section 12 & 13 of the Consumer Protection Act, 1986 on the allegations that the complainant has no land and previously, he was running JCB Machine and for that he has purchased tractor bearing No.PB-02-CK-5662, Swaraj 744 FF Engine No. 433009STE0835, Chassis No. WXCE45922997050 for earning his livelihood. The complainant purchased the said tractor after getting the same financed from Opposite Parties No.3 and 4. Copy of the RC and driving licence of the complainant are enclosed herewith. At the time of finance of the above said tractor, the same was insured by Opposite Party No.1 vide policy No.0100989394 under policy cover ‘Auto Secure Commercial Vehicle Package Policy’ for the total insured declared value of Rs.5,25,350/- and the said policy commenced from 10.6.2014 till 9.6.2015 and the premium amounting to Rs.9552/- was received by Opposite Party No.1 from the complainant. Copy of the insurance cover note is enclosed herewith. The complainant paid the premium to Opposite Parties and hired the services of Opposite Parties and as such, he is consumer of the Opposite Parties. That ill luck would have been, the tractor of the complainant met with an accident on 18.10.2014 in the area falling under the jurisdiction of P.P.Dialgarh and the report vide DDR No.4 dated 21.10.2014 was lodged in P.P.Dialgarh, P.S.Sadar, Batala. Copy of the report is enclosed herewith. The complainant approached the dealer of Swaraj Company i.e. M/s.Guru Arjan Dev Tractors, G.T.Road, Near Padda Petrol Pump, Rayya and got the loss assessed from the said dealer which calculated to Rs.3,82,750/-. Copy of the assessment is enclosed herewith. The complainant lodged his claim in respect of the loss suffered by him and has been regularly approaching Opposite Party No.1 to pass his claim, but the matter was lingered on and ultimately vide letter dated 10.2.2015, refused to pass the claim on flimsy grounds. The refusal letter dated 10.2.2015 is enclosed herewith. The refusal on the part of Opposite Party No.1 is arbitrary, unlawful and against the terms and conditions of the policy issued by Opposite Party No.1 and also the correspondence made by Opposite Party and documents issued by the Opposite Party. The vehicle is issued under ‘Auto Secure Commercial Vehicle Package Policy’. Said vehicle is also registered under the category of transport and even in the letters dated 18.6.2014 and 24.5.2014, he Opposite Party has himself written that the vehicle is commercial one. The vehicle was purchased only to earn the livelihood to ply with the JCB machine. The complainant also approached the Opposite Parties time and again and requested to pass the claim, but the Opposite Parties have not heard the genuine request of the complainant and inspite of the repeated requests, they have not passed the claim of the complainant. The complainant has sought the following reliefs vide instant complaint:-
a) Opposite Parties be directed to pay the loss suffered by the complainant Rs.3,82,750/- alongwith interest @ 18% per annum thereon.
b) A compensation of Rs.2 lacs on account of mental pain, agony and harassment suffered by the complainant may also be granted in his favour and against the Opposite Parties.
c) Costs of the proceedings Rs.11,000/- may also be granted.
Hence, this complaint.
2. Upon notice, Opposite Parties No.1 to 4 appeared. Opposite Parties No.1 and 2 filed their joint written statement while Opposite Parties No.3 and 4 also filed separate joint written statement contesting the complaint of the complainant.
3. In their joint written statement, Opposite Parties No.1 and 2 took preliminary objections therein inter alia that in the present case, the tractor No.PB-02CK-5662 was insured with answering Opposite Party vide policy No. 0100989384 which is Auto Secure Commercial Vehicle Package Policy for misc. & special type of vehicle limiting the use of same for agricultural and forestry purposes from 10.6.2014 to 9.6.2015. Copy of the policy is attached. The policy was issued with respect to the provisions laid down in India Motor Tariff (IMT) which states:-
The provisions of this tariff are binding on all concerned and any breach of tariff shall be a breach of the provisions of Insurance Act, 1938.
Section 1 | General Regulations (GR) |
Section 2 | Tariff for Private Car |
Section 3 | Tariff for Motorised Two-Wheelers |
Sector 4 | Tariff for Commercial Vehicles |
| A. Tariff for goods carrying vehicles. |
| B. Tariff for Trailers |
| C. Tariff for vehicles used for carrying passengers for hire or reward. |
| D. Tariff for Miscellaneous and Special Type of Vehicles. |
| E. Tariff for Motor Trade-Road Transit Risks |
| F. Tariff for Motor Trade-Road Risks. |
| G. Tariff for Motor Trade-Internal Risks. |
The claim was lodged by the complainant on 19.10.2014 with Opposite Parties No.1 and 2 and they immediately deputed an independent IRDA Licensed surveyor, Mr.Deepak Gupta to assess the loss. During claim processing, it was noted that the vehicle was used for hire and reward at the time of accident. Hence, the surveyor wrote letter dated 3.12.2014 to the complainant seeking clarification to the effect that as per insurance policy and RC, the tractor is registered for agriculture purpose. However, as per the DDR/ application, it was mentioned that the tractor was attached with IRB Company and was used at the time of accident for loading and unloading of loose soil. It is clear that this is not an agricultural or forestry use as covered under the terms of the policy, but the complainant did not give any reply to the letter. Copy of the letter dated 3.12.2014 is attached; that after receipt of the survey report and relying on the documents submitted by the complainant, the Opposite Parties No.1 and 2 again sent letters dated 24.12.2014 and 14.1.2015 calling upon the complainant to give his comments regarding the use for vehicle against policy terms and conditions. However, since no reply was received by the answering Opposite Parties, the claim of the complainant was finally repudiated vide letter dated 10.2.2015; that on the last date of hearing, the counsel for the complainant, drew the attention of this Forum to one letter dated 18.6.2014 taking plea that the insurance is for commercial vehicle, hence the answering Opposite Parties are liable to pay for present loss. It is submitted that in reference to the contentions submitted above, the said letter is part of policy which is issued in accordance with the provisions of India Motor Tariff issued by TAC and the claim of the complainant is not payable for reasons stated above; that in the complaint filed by the complainant before this Forum, he has nowhere mentioned that his tractor was attached with IRB Company for loading and unloading loose soil and was being used for hire and reward, but has only given reference that the accident was caused to the tractor on 18.10.2014 regarding which DDR was recorded. The complainant has admitted that he has filed DDR with the jurisdiction Police. From this, it is apparent that indirectly the complainant has concealed the material acts before this Forum while filing the present complaint; that the claim of the complainant is repudiated strictly based on the terms of the policy which is the binding contract between the parties. It is now well settled that the terms of contract has to be strictly construed to identify the extent of cover and no exception can be made on the grounds of equity. On merits, it is stated that claim of the complainant has been repudiated in accordance with law and the provisions of the terms and conditions of the insurance policy in dispute. The tractor in dispute was being used for IRB Company for loading and unloading the loose soil, which does not cover within the agricultural or forestry use as per terms and conditions of the insurance policy. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint with cost was made.
4. In their joint written statement, Opposite Parties No.3 and 4 also took preliminary objections therein inter alia that the complaint is not maintainable against the answering Opposite Parties; that true facts are that the complainant took the financial assistance from the answering Opposite Parties and assured to discharge the liability in time. The answering Opposite Parties are not concerned with a accident or with any dispute between the complainant and remaining Opposite Parties. The complainant is bound to discharge the liability as per the loan agreement, but he has failed to do so and accordingly, the matter was referred to the arbitrator. The arbitrator after proper adjudication has passed an award and the complainant is bound to comply with the award. Copy of the award is attached. So, the present complaint is without any cause of action and is liable to be dismissed; that in case this Forum allows the complaint filed by the complainant, the answering Opposite Parties are entitled for the insurance claim as there is a first charge of the answering Opposite Parties on the claim to be awarded. On merits, the facts narrated in the complaint have been denied being false and frivolous and a payer for dismissal of the complaint with costs was made.
5. In his bid to prove the case, complainant tendered into evidence his affidavit Ex.CW1/A, affidavit of Gurpreet Singh Ex.CW2/A, copy of RC Ex.C2, copy of driving licence Ex.C2, copy of insurance cover note Ex.C3, copy of DDR Ex.C4, copy of assessment Ex.C5, copy of refusal letter Ex.C6, copies of letters Ex.C7 and Ex.C8, photographs Ex.C9 to Ex.C11, copy of sale certificate of JCB machine Ex.C12, copy of form Ex.C13, copy of order Ex.C14, copies of receipts Ex.C15 to Ex.C17 and closed his evidence.
6. To rebut the evidence of the complainant, Opposite Parties No.1 and 2 tendered into evidence affidavit of Sanjay Bhagat, Chief Manager Ex.OP1-2/1, affidavit of Deepak Gupta Ex.OP1-2/2, survey report dated 8.12.2014 Ex.Op1/2/3, letter Ex.Op1-2/4, copy of RC Ex.OP1/2/5, letters Ex.OP1-2/6 to Ex.OP1-2/8, certified copy policy Ex.OP1-2/9, copy of Indian Motor Tariff Ex.OP1-2/10, comparative chart Ex.OP1-2/10, copy of order of Permanent Lok Adalat Ex.OP1-2/12. Similarly, Opposite Parties No.3 and 4 tendered into evidence affidavit of Parwinder Singh Ex.OP3,4/1, copy of power of attorney Ex.OP3.4/2, copy of award Ex.OP3,4/3, copy of letter Ex.OP3,4/4 and closed their evidence.
7. We have heard the ld.counsel for the parties and have carefully gone through the evidence on record.
8. On the basis of evidence on record, ld.counsel for the complainant has vehemently contended that the complainant is admittedly the owner of tractor bearing RC No.PB-02-CK-5662 Swaraj 744 FF and this tractor was financed by Opposite Party No.3. Previously, the complainant was doing work of earth filling and he was having JCB Machine and said tractor was purchased by him for using with JCB Machine for loading and unloading of loose earth. Except this job, the complainant has no agricultural or non agricultural land. At the time of finance of the above said vehicle, the complainant specifically told Opposite Party No.1 that he wants the said vehicle insured as commercial vehicle to earn his livelihood and as such the same was insured by Opposite Party No.1 vide policy No.010098938400 under policy cover ‘Auto Secure Commercial Vehicle Package Policy’, copy whereof is Ex.C3 on record. The policy in question was effective w.e.f. 10.6.2014 to 9.6.2015 against premium amount of Rs.9552/- which was received by Opposite Party No.1 from the complainant. Opposite Party No.1 assured that in case of any damage, loss to the vehicle, Opposite Party No.1 will reimburse the damage. But as ill luck would have been that tractor of the complainant met with an accident on 18.10.2014 in the area falling in the jurisdiction of P.P.Dialgarh. Report vide DDR No.4 dated 21.10.2014 was lodged in P.P.Dialgarh, P.S.Sadar, Batala, copy of DDR is Ex.C4. The complainant approached the dealer of Swaraj Company i.e. M/s.Guru Arjan Dev Tractors, G.T.Road, Near Padda Petrol Pump, Rayya and got the loss assessed from the said dealer which was estimated to be Rs.3,82,750/-. The complainant lodged his claim in respect of the loss suffered by him and has been regularly approaching Opposite Party No.1 to pass his claim, but the Opposite Party No.1 has lingered the matter and ultimately on 10.2.2015 repudiated the claim, copy of repudiation letter accounts for Ex.C6. The refusal on the part of Opposite Party No.1 is arbitrary and unlawful and the complainant has been suffering financial loss and mental agony on the part of illegal act of Opposite Party No.1. It is pertinent to be noted here that in RC of the tractor, said tractor was registered as Transport Vehicle and definition of transport vehicle is enshrined in the Motor Vehicle Act, 1988 section 2(47) which runs as “transport vehicle means a public service vehicle, a goods career and education institution bus or a private bus or a private service vehicle”. Insurance policy also describes itself to be ‘Auto Secure Commercial Vehicle Package Policy’. In the column of profession the insured has been shown as “self employed” meaning thereby that the complainant is not agriculturist and he has purchased the tractor for his self employment. It is also pertinent to mention over here that policy was to commence w.e.f. 10.6.2014 and this policy was not handed over to the complainant on 10.6.2014. No conditions and terms were explained to the complainant. The policy was prepared and signed lateron 18.6.2014 as mentioned on second page of the policy. The complainant is a common man and rustic villager who trusted Opposite Party No.1 as the Opposite Party No.1 insisting that this policy was meant for the commercial purpose. Letter dated 18.6.2014 was sent to the complainant in which it is also specifically stated that the said tractor is for commercial purpose and that application is already on the judicial file which is Ex.C7. Opposite Party No.1 also issued letter dated 24.5.2014 (Ex.C8) in which product detail is mentioned tractor commercial. So, from all these documents one thing is very much clear that all the correspondence of the Opposite Parties with the complainant show that tractor was purchased for commercial purpose to earn livelihood by complainant. But the Opposite Parties vide their letter dated 10.2.2015 repudiated the claim of the complainant on the flimsy grounds that the said tractor was insured for the purpose of agriculture. Said stand of Opposite Party No.1 is contrary to the very object of the insurance. All terms in insurance policies must be directed towards achieving the object of the Act by satisfying the purpose of insurance. Any such complicated or misleading conditions and clauses which are beyond the understanding and expectation of the common man and lead to defeating the very purpose of insurance, must be modified. In the present case also the alleged terms and conditions of the policy in question are vague and misleading. The terms and conditions are contrary to each other. It is therefore, contended that claim of the complainant to the tune of Rs. 3,82,750/- alongwith compensation as well as litigation expenses to be assessed by this Forum may be awarded in favour of the complainant and against Opposite Party No.1.
9. But however, from the appreciation of the facts and circumstances of the case, it becomes evident that the repudiation in the case in hand has been made in accordance with terms and conditions of the policy in question. The claim was lodged by the complainant on 19.10.2014 with Opposite Party No.1 and it immediately deputed an independent IRDA licensed surveyor Mr.Deepak Gupta to assess the loss. During the claim proceedings, it was noted by the said surveyor that the vehicle was used for Hire & Reward at the time of accident although it was only insured for agricultural purposes. Hence the said surveyor wrote letter dated 3.12.2014 to the complainant seeking clarification to the effect that as per insurance policy and RC, the tractor is registered for agricultural purposes. However, as per DDR/ application lodged with the police authorities, the tractor was attached with IRB company and was being used at the time of accident for loading and unloading of loose soil. Hence, it is clear that said use of the tractor was not an agricultural and forestry use as covered under the policy. However, inspite of said query, the complainant did not give any reply to the said letter dated 3.12.2014 Ex.OP1,2/4 and as such, the said surveyor finally assessed the loss to the tune of Rs.3,70,145/-. After receipt of the said survey report, even the Opposite Party No.1 also wrote letter dated 24.12.2014 and 14.1.2015, copies whereof are Ex.OP1-2/6 and Ex.OP1-2/7 respectively on record calling upon to the complainant to submit his clarification that since the tractor was insured only for agriculture purposes, then how the same was used for commercial purposes. However, inspite of said letters, the complainant did not give any reply and as such finally the claim was repudiated by Opposite Party No.1 vide repudiation letter dated 10.2.2015, copy whereof Ex.C6 on record.
10. During the course of arguments, ld.counsel for the complainant drew the attention of this Forum to one letter dated 18.6.2014 Ex.C-7 taking plea that the insurance was for commercial vehicle, hence the answering Opposite Party is liable to pay for the present loss. However in reference to the contention submitted above, said letter is part of the policy which was issued in accordance with the provisions of Indian Motor Tariff issued by TAC and the claim of the complainant is not payable for reasons stated therein.
11. The claim of the complainant has been repudiated by Opposite Party No.1 on merits in accordance with law and the provisions of the terms and conditions of the insurance policy in dispute. Therefore, the repudiation made by the insurance company is fully justified as per the law and as such, the present complaint is liable to be dismissed.
12. There is no question of any delay or deficiency on the part of Opposite Party No.1, as such there is no deficiency in service on the part of Opposite Party No.1 and the amount of Rs.2 lacs claimed as compensation by the complainant or any other relief is not payable by Opposite Party No.1. In fact basically no claim is payable in the present case and even the amount of loss assessed by the surveyor because there is clear cut violation of terms and conditions of the policy in question as discussed hereinabove. The complainant earlier filed complaint before Permanent Lok Adalat and according to the procedure of the said Court and provisions of law applicable for the said cases, it is apparent that the cases are considered at two stages in the said court i.e. firstly upto the stage of reconciliation and if reconciliation is not done, then the Permanent Lok Adalat has to decide to proceed further with the claim on merits. As far as reconciliation stage is concerned, it is made clear that as the claim has already been repudiated by Opposite Party No.1, therefore, there is no possibility of any reconciliation and thereafter the said court proceeded to decide the case on merits and when final arguments were filed by both the parties and the case was fixed for orders, the complainant moved an application for withdrawal of the case with permission to file the same before the Forum/ Court which was allowed by said Permanent Lok Adalat. In fact the said order was against the spirit of the procedure because once the said court has come to the conclusion to decide the matter on merits and received affidavits, documents and arguments from both the parties, therefore, basically there was no occasion to allow to withdraw the said complaint.
13. Opposite Parties No.1 and 2 produced on record the comparative chart which shows that as far as premium payable with respect to own damage premium in the case of tractor is Rs.6251.66 paisa whereas the OD Premium with respect to commercial vehicle is Rs.9067.54 paisa. Certified copy of insurance policy is Ex.OP1-2/9 from which it is very clear that under the category regarding premium payable with respect to own damage, the same is mentioned as Rs.6252/- from which it is apparent that in fact the said vehicle was only insured as a tractor and not as a commercial vehicle. Hence the complainant has admittedly paid the premium to the tune of Rs. 6252/- for own damage, hence the plea taken by the complainant that it was commercial vehicle and was insured, as such, is untenable. As far as the interpretation of terms and conditions of the policy in question are concerned, this court can not add or subtract anything from the terms and conditions of the policy in question. Reliance in this connection can be placed on M/s.Suraj Mal Ram Niwas Oil Mills (P) Limited Vs. United India Insurance Company Limited and another 2010(4) RCR (Civil) SC wherein it has been held that in the contract of insurance, rights and obligations are strictly governed by terms of the policy and no exception or relaxation can be given on the ground of equity. It has been further held that the word used in the contract of insurance must be given paramount importance and it is not open for the court to add, delete or substitute any words. It has been further held by Hon’ble Supreme Court of India that where there is breach of condition of the insurance of contract by the insured, the insurance company not liable to pay compensation in case of loss. Where there is a fundamental breach of the terms and conditions of the policy, the insurance company is not liable to pay the compensation. It has been held in judgement rendered down by Hon’ble National Commission in Reliance General Insurance Company Limited-Petitioner Vs. Shivakumara S-Respondent 2014(2) CLT page 87. The insured can not claim anything more than which is not covered by the insurance policy. This being so the insured has also to act strictly in accordance with the statutory limitations or terms of the policy expressly set out therein. This has been so held in Oriental Insurance Company Limited Vs. Soni Cheriyan published in 2000(10 CPC 5 (SC). The liability of the Opposite Party with respect of the tractor which is insured for agriculture purposes but the same is used as otherwise has also been discussed by our own High Court in Mani Chand and another Vs. Sunita Devi and another 2013 ACJ 1332. In this case, although the tractor was insured for agriculture purpose but was carrying sand. In para No.12 of the said judgement of Hon’ble High Court, it has been held that it was not the duty of the insurance company to prove that the vehicle was being used for commercial purpose rather, it was the duty of the owner and driver that the tractor was used for agriculture purposes for which it was used. Carrying of sand can also be defined as agriculture use, but for that the owner and driver have to make statement to that effect and have to prove the agricultural use of sand being carried. This judgement is fully applicable in the case in hand, as it fully established that the vehicle has been insured only for agricultural purposes and as per admission of the complainant himself that the said vehicle was being used for commercial gain, hence the Opposite Party has rightly repudiated the claim. In another latest judgement delivered by Hon’ble High Court Amarjeet Singh and other Vs. Ram Kumar and others 2015(2) 629, Hon’ble High Court has considered the concept of use of tractor for commercial purposes and has held that the vehicle was insured comprehensively. The wooden logs were being taken to market for sale for another person. Since the tractor was insured for agricultural purposes and was being used for commercial purpose, therefore, no liability was fixed against insurance company. In the said case, there was also admission on the part of the owner that he had used the tractor for the sale of other person and as such, Hon’ble High Court has rightly held that the tractor was insured only for agricultural purposes and in the light of the insurance policy the clause for the limitation purposes was provided, hence the insurance company has not been held liable to pay an compensation. This judgement is also fully applicable in the case in hand because in the policy produced by the complainant himself as well as Opposite Party No.1 it has been clearly set up and agreed between the parties as under:-
7A. POLICY SCHEDULE WORDKIGN REGARDING ‘LIMIATIONS AS TO USE’ AND DRIVER CLAUSE.
A. LIMITATION AS TO USE.
i. Agricultural and Forestry Vehicles IZ-303
Use only for agricultural and forestry purposes.
The policy does not cover
Use for hire or reward or for racing pace making reliability trial or speed testing.
Use for the carriage of passengers for hire or reward.
Use whilst drawing a greater number of trailers in all than is permitted by law.
2. that as per police intimation given by the petitioner, the said tractor was attached with I.R.B.Company and used for loading and unloading the loose soil at roadside at the time of accident. The act of the complainant is apparent to prove that the tractor was used in violation of the policy terms and conditions issued under the provisions of India Motor Tariff.
Limitation as to Use:-
Use only for agricultural and forestry purposes.
The policy does not cover.
1) Use for hire and reward or for racing, pase making, reliability trails or speed testing…
In view of above Insurance contract/agreement, it is held that as per the policy issued to the complainant, the tractor was covered for risk/ loss resulting from use of vehicle for agricultural and forestry purposes only and the same does not cover the loss if the tractor is used for hire or reward etc. i.e. commercial purpose.
14. From the aforesaid discussion, it becomes apparent that the complainant has made use of the tractor in dispute for commercial purposes in contravention of the terms and conditions of the policy in question and as such, the insurance claim has been rightly repudiated by Opposite Parties. Therefore, the complaint is liable to be dismissed and the same is ordered to be dismissed accordingly Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room. Case could not be disposed of within the stipulated period due to heavy pendency of the cases in this Forum.
Announced in Open Forum
Dated: 12.08.2016.
