BEFORE THE DAKSHINA KANNADA DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT MANGALORE

                                                                Dated this the 30^th March 2010

COMPLAINT NO.03/2009

PRESENT:       

       1.   Smt. Asha Shetty, B.A. L.L.B., President                                                                                                                                                                                                                                     

       2.   Sri. K. Ramachandra, Member

                                                       3.   Smt.Lavanya M. Rai, Member

BETWEEN:

Sri.Guruchandra Hegde,

Aged about 46 years,

So. Late Gopala Hegde,

RA. Panjimogaru, Kulur Kavoor,

Mangalore.                                       …….. COMPLAINANT

(Advocate for the Complainant: Sri.Umesh Kumar Y)

          VERSUS

The Branch Manager,

United India Insurance Co. Ltd.,

Shree Vittal, N.H. 17, Main Road,

Surathkal, Mangalore.                         ……. OPPOSITE PARTY

(Advocate for the Opposite Party: Sri.M.S.Jain)

                                      ***************

ORDER DELIVERED BY PRESIDENT SMT. ASHA SHETTY:

1.       The facts of the complaint in brief are as follows:

This complaint is filed under Section 12 of the Consumer Protection Act alleging deficiency in service against the Opposite Party claiming certain reliefs. 

The Complainant submits that, he is the registered owner of the vehicle Maruthi Omni bearing Registration No.KA-19B-4222.  The said vehicle was insured with the Opposite Party as per policy No.070804/31/06/01/ 00004084.  The Complainant states that he had obtained a comprehensive policy for a sum of Rs.1,80,500/-.

It is stated that, on 12.10.2007 in between 4.30 a.m. to 5.30 a.m. the said vehicle was met with an accident at a place called Kuntte Halla Sethuve while carrying newspaper from Mangalore to Shimoga.  It is stated that after the accident the Complainant has lodged a complaint and the case was registered under Sections 279 and 337 of I.P.C. 

The Complainant further states that, after the accident he has intimated the same to the Opposite Party Company and the Opposite Party Company has deputed a Surveyor and conducted survey.  Thereafter as per the instructions of the Surveyor and the Opposite Party Company, the Complainant has repaired the vehicle.  It is stated that to repair the vehicle he has spent Rs.2,30,000/- but the Opposite Party has failed to consider the claim of the Complainant and repudiated the claim after the lapse of more than one year on the ground that the vehicle was carrying goods at the time of accident and which is not permitted as per the permit issued by the RTO.

It is stated that as per clause No.9 of the permit issued by the RTO Mangalore the permit is not issued either for stage carriage or as a goods vehicle.  The definition of the word ‘goods’ does not include the newspaper, actionable claim etc. as defined under the provisions of Central Sales Tax Act.  It is stated that the vehicle in question has suffered total loss and to repair the insured vehicle the Complainant has spent more than the Insured Declared Value.  The Complainant is unable to pay the amount and the said vehicle is still lying in the garage.  It is stated that the Opposite Party failed to consider the claim of the Complainant which amounts to deficiency in service and hence the Complainant filed the above complaint before this Hon'ble Forum under Section 12 of the Consumer Protection Act 1986 (herein after referred to as ‘the Act’) seeking direction from this Hon'ble Forum to the Opposite Party to pay Rs.1,80,500/- for the loss of the vehicle along with interest at 18% p.a. from the date of accident till the realization and further claimed Rs.1,50,000/- as compensation and cost of the proceedings.

2.       Version notice served to the Opposite Party by RPAD. Opposite Party appeared through their counsel filed version admitted the policy but it is contended that the insured vehicle is covered by permit as a tourist taxi with carrying capacity of four passenger on hire with driver i.e., 4 + 1.  As per the permit the Complainant is not entitled to use the vehicle as a stage carriage or a goods vehicle for hire.  It is stated that, on the day of alleged accident the vehicle was used for carrying or transporting other than passengers it amounts to violation of the terms of the policy and the Complainant is not entitled any claim as the Complainant violated the terms of the policy.  It is further stated that on receipt of the intimation dated 26.10.2007 the Opposite Party had deputed the Surveyor/loss assessor to inspect and survey the vehicle.  The Surveyor inspected the vehicle on 30.10.2007 after inspection submitted the report dated 29.09.2008.  It is further stated that on receipt of intimation of repairs affected to the insured vehicle one Sri.Vishwanath Shetty, General Surveyor has inspected the vehicle and filed final survey report.  It is stated that the Surveyor after deducting depreciation as per the terms and conditions of the policy has assessed the net repair liability at Rs.1,30,381.74 and it is contended that the expenses for repair is not more than the Insured Declared Value.  And further contended that the repudiation made by the Opposite Party is correct and there is no claim for the reason that the vehicle was carrying goods which was not permitted as per the permit issued by the RTO and contended that there is no deficiency and prayed for dismissal of the complaint. 

3.       In view of the above said facts, the points now that arise for our consideration in this case are as under:

1. Whether the Complainant proves that the Opposite Party has committed deficiency in service?

2. If so, whether the Complainant is entitled for the reliefs claimed?

3. What order?

4.         In support of the complaint, Guruchandra Hegde (CW1) filed affidavit reiterating what has been stated in the complaint and answered the interrogatories served on him.   Ex C1 to C4 were marked for the Complainant as listed in the annexure.   One Sri.Praveenchandra Shetty (RW1), Licenced Surveyor and Loss Assessor of the Opposite Party filed counter affidavit and answered the interrogatories served on him.  Ex R1 to R5 were marked for the Opposite Party as listed in the annexure.   Both parties produced notes of arguments.

          We have considered the notes/oral arguments submitted by the learned counsels and also considered the materials that was placed before the Hon'ble Forum and answer the points are as follows:                         

          Point No.(i): Affirmative.

          Point No.(ii) & (iii): As per the final order.    

Reasons

5.  Point No. (i) to (iii):

It is undisputed fact that, the Complainant is the registered owner of the vehicle Maruthi Omni bearing Registration No.KA-19B-4222.  The said vehicle was insured with the Opposite Party as per policy No.070804/31/06/01/ 00004084 and the said policy is valid from 04.02.2007 to 03.02.2008 (as per Ex R1).  The policy in question is a comprehensive policy/package policy issued by the Opposite Party for a sum of Rs.1,80,500/-.  The accident in question took place on 12.10.2007 at a place called Kuntte Halla Sethuve at Shimoga is also not denied.  And further the receipt of the intimation of the accident by the Complainant to the Opposite Party Company also not denied and the Opposite Party Company deputed a Surveyor to survey the vehicle and to submit the report and also filed a final survey report (as per Ex R3) also not denied by the respective parties before the FORA.

The only point raised by the Opposite Party while considering the claim in question is that, the vehicle at the time of alleged accident was carrying newspaper.  The vehicle in question was issued with the permit not to entitle the holder to use the vehicle as a stage carriage or a goods vehicle for hire.  The Regional Transport Authority of Mangalore issued a permit only to carrying passenger four in all with a driver in total 4+1 and it is a tourist taxi but the Complainant by violating the limitation as to use carried the bundles of newspaper on hire is a gross violation of permit conditions.   Hence he has not entitled any claim.        

On the contrary, the Complainant vehemently contended that the newspaper in question is not a goods defined under the provisions of the Sale of Goods Act and further the permit issued by the RTO Mangalore is not issued either for stage carriage or as a goods vehicle and contended that the contention taken by the Opposite Party Company is not correct.

However, we have gone through the Sale of Goods Act, wherein the definition of word ‘goods’ defined as follows:-

‘Goods’ means every kind of movable property other than actionable claims and money; and includes stock and shares, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale but does not include the newspaper, actionable claims, stocks, shares and securities. 

We have also referred the Motor Vehicle Act under which the term ‘goods’ defines as under:-

“Goods includes livestock and anything other that equipment ordinarily used with the vehicle carried by a vehicle except living persons, but does not include luggage or personal effects carried in a motor car or in trailor attached to a motor car or the personal luggage of passengers traveling in a vehicle”.

In the given case, we have heard the learned counsel for both the parties.  There is no dispute in the fact that the said vehicle was authorized to carry 4+1 passenger whereas at the time of met with an accident it was carrying bundle of newspaper, the driver was holding a driving licnece to drive the above said vehicle.  As we see, this is not the case before us that the accident was not caused by carrying a bundle of newspaper in the said vehicle.  The accident in question took place on 12.10.2007 while he was moving from Mangalore towards Bhadravathi, it went out of control, rammed into a bridge and sustained damage.  Driver cum insured sustained injury.  There is no material on record on one way or the other as to who was responsible for the accident?  However as we stated herein above in the survey report it has stated that the accident took place while proceeding from Mangalore to Bhadravathi, it went out of control rammed into a bridge and sustained damage.  When that being the case, the cause of accident entirely different from the contentions raised by the Opposite Party because the violation of permit is not the cause for accident.  Under such circumstances, even though the Opposite Party carried the newspaper, it is not a primary violation of the terms and conditions. 

In this regard, we would 1^st refer to the judgment rendered by the National Consumer Disputes Redressal Commission, Circuit Bench at Bangalore in a case New India Assurance Company Ltd. Vs. Narayan Prasad Appaprasad Pathak reported in II (2006) CPJ 144 (NC) held that –

1. Consumer Protection Act, 1986 – Section 15 – Appeal – Insurance – Challenge against order of State Commission – violation of terms of policy – Claim to be settled on non-standard basis – Vehicle insured for Rs.5,40,000/- - Depreciation @ 20% - Vehicle driven while carrying more passengers than permitted without driver being duly licensed – impugned order directing payment of full insured amount with cost and compensation not sustainable – Claim settled at 75% of Rs.4,32,000/- with interest at 9% p.a. – compensation set aside – costs awarded. 

2. Insurance – Settling claim on non-standard basis – Guidelines issued by GIC.

It is for covering these contingencies that GIC has issued the guidelines for the Insurance Company for settling the claim on non-standard basis which is as follows:

Non-standard claims:

Following types of claims shall be considered as non-standard and shall be settled as indicated below after recording the reasons:

                                                          [CPJ II (2006) CPJ 144 (NC)]

Keeping in view of the guidelines, the repudiation of the claim by the Insurance Company cannot be sustained. 

To consider the claim of the Complainant, our attention was drawn towards the survey report dated 04.10.2008 i.e., Ex R4.  After careful scrutiny of the above survey report, the Surveyor deleted 22 items of spare parts costing total sum of Rs.46,972.12 recommended by the repairer for replacement by estimate dated 22.10.2007 and supplementary estimate dated 20.09.2008 with remarks ‘as found unaffected’ and the labour charges involved to renovate the insured vehicle including towing charges recommended at Rs.28,651.80 appears to be reasonable and rest of the items i.e., glass items and spare parts considered by the Surveyor also reasonable and some of the spare parts the Surveyor deducted the depreciation at 50%.  The Surveyor appointed in this case assessed the loss in detail and the net repair liability of the vehicle in question assessed at Rs.1,30,381.74 which is reasonable.  The Complainant not provided any contra evidence to show that the observation/ assessment made by the Surveyor is not correct.  The Complainant ought to have examined the repairer, but no such attempt was made by the Complainant.  In the absence of the same, the survey report filed by the Surveyor holds good in this case.  The Opposite Party Company by considering the claim papers of the Complainant repudiated the claim arbitrarily without applying their mind.  Surveyor being an independent person, his report has due weightage.  The Opposite Party company atleast after the receipt of the survey report ought to have considered the claim of the Complainant but in the given case, the Opposite Party Company repudiated the claim by stating that the Complainant violated the terms and conditions.  No doubt the vehicle in question is registered as a tourist taxi to carry passengers but the vehicle was used to carry the goods at the time of accident.  The breach of the terms of the policy/permit in the given case is not the cause for the accident, under that circumstances the Opposite Party Company ought to have honoured the claim under non-standard claims rather than repudiating the claim which amounts to deficiency in service.

In view of the above discussions, we are of the considered opinion that the Complainant admitted that the vehicle in question was carrying with the newspaper bundles without there being any passenger/owner of the goods.  In a case of like this nature, the goods defined under Motor Vehicle Act is to be looked into.  By considering the goods defined under the Motor Vehicle Act, we are satisfied that the Complainant carried the newspaper bundles in his motor vehicle without the passengers definitely he violated the term good defined under the M.V. Act.   Under that circumstances, the Complainant is entitled a claim under non-standard claims.  Under non-standard claims it is indicated that any breach of warranty/condition of policy including limitation as to use the claim shall be considered as non-standard basis by paying upto 75% of admissible claim. By considering the above the Complainant is entitled Rs.97,786.31 and the repudiation made by the Opposite Party Company is arbitrary and amounts to deficiency.  Therefore, the Opposite Party Company i.e., United India Insurance Co. Ltd., represented by its Branch Manager is hereby directed to pay to the Complainant Rs.97,786.31 along with interest at 12% p.a. from the date of accident till the date of payment. However, the interest as well as compensation both cannot be allowed. Interest is always inclusive of compensation. And further Rs.1,000/- awarded as cost of the litigation expenses.  Payment shall be made within 30 days from the date of this order.

6.       In the result, we pass the following:                          

ORDER

            The complaint is allowed.  Opposite Party Company i.e., United India Insurance Co. Ltd., represented by its Branch Manager is hereby directed to pay to the Complainant Rs.97,786.31 (Rupees ninety seven thousand seven hundred eighty six and paise thirty one only) along with interest at 12% p.a. from the date of accident till the date of payment. And further Rs.1,000/- (Rupees one thousand only) awarded as cost of the litigation expenses.  Payment shall be made within 30 days from the date of this order.

Copy of this order as per statutory requirements, be forward to the parties free of costs and file shall be consigned to record room.

(Dictated to the Stenographer typed by her, revised and pronounced in the open court on this the 30^th day of March 2010.)

PRESIDENT

                                 (SMT. ASHA SHETTY)

         MEMBER                                                                                                  MEMBER

(SRI. K.RAMACHANDRA)                 (SMT. LAVANYA M. RAI)

ANNEXURE

Witnesses examined on behalf of the Complainant:

CW1 – Guruchandra Hegde – Complainant.

Documents produced on behalf of the Complainant:

Ex C1 – 01.12.2008: Letter issued by the Opposite Party to the Complainant.

Ex C2 –  12.12.2008: Lawyer’s notice issued to the Opposite Party on behalf of the Complainant.

Ex C3 –                   : Postal receipt.

Ex C4 –                   : Postal acknowledgement.

Witnesses examined on behalf of the Opposite Party:

RW1 – Sri.Praveenchandra Shetty, Licenced Surveyor and Loss Assessor of the Opposite Party.

Documents produced on behalf of the Opposite Party:   

Ex R1 –              : Schedule to passenger carrying commercial vehicle package policy issued in respect of vehicle KA 19B-4222 with terms and conditions.

Ex R2 -              : Copy of permit bearing number P.Co.P. No.204/2005-06 issued by Regional Transport Authority to vehicle KA-19/B-4222 T/Taxi.

Ex R3 – 29.09.2008: Survey and loss assessment report issued by Surveyor Sri.Praveenchandra Shetty.

Ex R4 – 04.10.2008: Re-inspection report issued by Surveyor Sri.Vishwanath Shetty.

Ex R5 – 20.11.2008: Letter of repudiation.

Dated:30.03.2010                            PRESIDENT