DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

Civil Station, Palakkad – 678001, Kerala

Dated this the 30^th day of January, 2010

Present: Smt.Seena.H, President

Smt.Preetha.G.Nair, Member

Smt.Bhanumathi.A.K, Member

C.C.No.65/2009

V.Rajendran,

S/o.Velayudhan,

Lakshmi Nivas,

Nenmeni(P.O),

Kollengode,

Palakkad. - Complainant

(By Adv.K.Sasidharan)

Vs

The New India Assurance Company Ltd.,

Represented by the Manager,

Divisional Office, N.S.Towers,

Near Stadium Bus Stand,

Palakkad. - Opposite party

(By Adv.T.P.George)

O R D E R

By Smt.H.Seena, President

Case of the complainant is as follows.

Vehicle No.KL7 Y5370 car purchased by the complainant was validly insured with the opposite party. The vehicle met with an accident on 05.06.07 and amount of Rs.82,500/- was spent for repairing and replacing damaged parts. The claim petition along with bills were submitted before the opposite party and the same was approved. Subsequently opposite party rejected the claim of the complainant on the ground that the transfer of vehicle was not intimated to the opposite party before the accident and it is a condition in the policy. According to the complainant after getting the vehicle insured the Insurance Company has no right to make any contention so as to absolve their liability. The act of opposite party amounts to deficiency in service.

2. Opposite party filed version contending the following. Opposite parties admits that the vehicle was insured with the opposite party and that the accident happened during the period of the policy. According to opposite party the policy was not transferred in the name of the complainant at the time of the accident. The complainant is not the insured as per the policy. Transfer of policy in the name of the transferee of the vehicle can be done only on getting acceptable evidence of sale of the vehicle as per General Regulation 17 of the India Motor Tariff. Complainant has not produced any evidence to the effect that the vehicle has been transferred in the name of the complainant. According to opposite party the policy still stands in the name of K.Vijayan and that is why he has submitted the claim form on 05.06.07. As per the Tariff provision when the vehicle is transferred insurance policy should be transferred within 14 days in the name of transferee. Transferor should have intimated the company within 14 days from the date of transfer of possession of the vehicle and surrender the original policy certificate along Rs.50/- towards transfer charges. Neither the complainant nor the insured intimated the opposite party regarding the transfer of the vehicle. On 14.01.08 opposite party has sent a letter to the insured requesting him to inform who owns the vehicle at the time of accident. On 25.01.08 he sent a reply stating that the vehicle was already sold to the complainant and the transaction was completed and therefore the claim amount if any is to be released to the complainant. According to opposite party in view of the sale of the vehicle the insured had not insurable interest. The claim form submitted by insured himself to the opposite party on 05.06.07 shows that the vehicle was sold. This suppression of material facts makes a contract of insurance void ab initio. It is also further submitted that it is only in respect of third party risk, Section 157 of the Motor Vehicle Act which provides that the policy of the insurance shall be deemed to have been transferred in favour of person to whom the vehicle is transferred, is applicable. Hence opposite party is not liable to make good the damage caused to the vehicle of the complainant.

3. Evidence adduced consists of chief affidavit of both parties. Exts.A1 to A6 were marked on the side of the complainant. Ext.B1 to B7 marked on the side of

opposite party.

4. Issues for consideration;

1. Whether there is any deficiency in service on the part of opposite party?

2. If so, what is the relief and cost?

5. Issues 1 & 2:

The undisputed fact of the complaint are that the vehicle holds valid insurance coverage during the period from 01.06.07 to 31.05.08 and the accident happened during the existence of the insurance coverage. The only dispute with is respect to the fact that after sale, the policy was not transferred in the name of

the complainant as per law. The original insured has intimated by letter dtd.25.01.08 that the vehicle was already sold to the complainant and claim amount if any can be released to the complainant. According to opposite party, by way of sale, the insured lost insurable interest in the property. Further Section 157 of Motor Vehicle Act which provides that the policy of insurance would be deemed to have been transferred in the name of the person to whom the vehicle was transferred is applicable only in the case of third party risk.

6. Heard both parties and has gone through the entire evidence on record.

7. Opposite party has placed before us the decision rendered by Hon'ble Supreme Court in Complete Insulation (P) Ltd. Vs. New India Assurance Company Ltd., 1996 Act 65 wherein it was held that it is only in respect of third party risk, Section 157 of Motor Vehicle Act that which provides that the certificate of insurance together with the policy of the insurance described therein shall be deemed to have been transferred in the name of the person to whom the motor vehicle is transferred. Opposite party also produced copy of the General Regulation wherein it is provided that the transferee shall apply within 14 days from the date of transfer in writing to the insurer who has insured the vehicle with the details of the registration of the vehicle. General Rule 17 also provides that the date of transfer of the vehicle, the previous owner of the vehicle and the number and date

of the insurance policy so that the insurer may make the necessary changes in his

record and issue fresh certificate of insurance. Transfer of package policy in the name of the transferee can done only on getting acceptable evidence of sale and fresh proposal form dully filled and signed.

8. It is well settled by Hon'ble National Commission in Sri.Narayanan Singh Vs New India Assurance Company Ltd., (IV)2007 CPJ 289(NC) which is followed by the Hon'ble Himachal Pradesh State Commission in New India Assurance Company Ltd Vs. Mrs.Santhosh Kumari 2009 CTJ576(CP)(SCDRC) that the provision regarding automatic transfer of insurance policy in favour of the transferee is applicable in the case of own damages also. If the stand of the opposite party that the original insurer is not entitled for the claim amount since he had lost insurable interest in the property and the subsequent purchaser also is not eligible for the claim amount since the policy is not transferred in his name is accepted, the Insurance Company will be unjustly enriched. In view of the above circumstances of the case we are of the view that the act of the opposite party amounts to deficiency in service and complainant is entitled for the claim amount.

9. Complainant has claimed amount of Rs.82,500/- together with compensation and cost. Complainant has stated that the surveyor of the company has estimated the loss as Rs.62,500/- after depreciation. Nothing has been stated in the affidavit of the opposite party regarding the claim amount. Hence we are of the view that complainant is entitled for the said amount together with compensation. In the result, complaint allowed.

10. Opposite party is directed to pay the complainant an amount of Rs.62,500/- (Rupees Sixty two thousand and five hundred only) along with compensation of

Rs.10,000/- (Rupees Ten thousand only) and cost Rs.1,000/- (Rupees One thousand only). Order shall be complied within one month from the date of receipt of this order failing which the whole amount shall carry interest @ 9% p.a from the date of order till realisation.

11. Pronounced in the open court on this the 30^th day of January, 2010

Sd/-

Seena.H,

President

Sd/-

Preetha.G.Nair,

Member

Sd/-

Bhanumathi.A.K,

Member

Appendix

Witnesses examined on the side of complainant

Nil

Witnesses examined on the side of opposite party

Nil

Exhibits marked on the side of complainant

Ext.A1 – Photo copy of Insurance policy

Ext.A2 – Photo copy of Letter dtd.13.10.08 sent by opposite party to complainant

Ext.A3 – Photo copy of lawyer notice dtd.10.11.08 sent by complainant to opposite

party

Ext.A4 - Photo copy of Letter dtd.12.11.08 sent by opposite party to complainant

Ext.A5 - Photo copy of lawyer notice dtd.24.11.08 sent by complainant to opposite

party

Ext.A6 – Reply dtd.29.01.09 sent by opposite party to complainant

Exhibits marked on the side of opposite party

Ext.B1 – Copy of Certificate of Insurance

Ext.B2 – Photo copy of General Regulation

Ext.B3 – Motor Accident Claim Intimation

Ext.B4 - Motor Claim Form

Ext.B5 -Copy of letter dtd.14.01.08 sent by opposite party to Mr.K.Vijayan

Ext.B6 – Letter sent by Mr.K.Vijayan to opposite party

Ext.B7 – Letter dtd.27.02.08 sent by opposite party to Mr.K.Vijayan

Cost (Allowed)

Rs.1,000/- (Rupees One thousand only) allowed as cost