STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Harvinder Singh Son of Sh. Kuldeep Singh, resident of Village Bartana, P.O. Rani Majra, P.S. Handesra, Tehsil Dera Bassi, District S.A.S. Nagar (Punjab).

                                                                 ……Appellant

V e r s u s

1]   The Oriental Insurance Co. Limited, Branch Office, Chopra Tower, Ground Floor, Below Oriental Bank of Commerce, Ambala – Chandigarh Road, Dera Bassi, District S.A.S. Nagar (Punjab)  through its Branch Manager.

2]   The Oriental Insurance Co. Limited, Regional Office, SCO No. 109-110-111, Sector 17-D, Chandigarh, through its Chief Regional Manager.

                                                …….Respondents

            Appeal under Section 15 of the Consumer Protection   Act, 1986 against order dated 19.04.2017 passed by District Consumer Disputes Redressal Forum-I, U.T. Chandigarh in Consumer Complaint   No. 1019/2016.

BEFORE:       JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

                         MRS. PADMA PANDEY, MEMBER

Argued by:        Mr.Ajmer Lal Pundeer, advocate for the appellant.

                           Mr.B.S.Taunque, advocate for the respondents.

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                Appellant/Complainant has filed this appeal against order dated 19.4.2017 passed by the   District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (in short the Forum only), dismissing his complaint. 

 2.        Admittedly the complainant was owner of Hero Honda Splendor motorcycle bearing Regn.No.PB-65P-6921. It was purchased by him on 4.12.2011 and on the said date it was also got insured against theft/loss etc.  The insurance Policy was renewed from time to time and the last renewed Policy was valid between 4.12.2014 to 3.12.2015(C-1). The vehicle was insured with OPs against Insured Declared Value of Rs.31,000/-.  On 10.8.2015, the said vehicle was stolen when it was parked in a parking place near tax barrier, Balongi. When efforts made to trace the vehicle failed, the complainant went to the Police Station. FIR was not recorded by the police officials and he was asked to make efforts to locate the motorcycle. The police officials assured him that they will also make efforts to trace the vehicle and if it was not found within a week or so, FIR would be registered. Ultimately, FIR  No.103/2015 was recorded on 29.8.2915(C-2).  Immediately on the next day, the complainant gave intimation of theft to the OPs. The police failed to recover the vehicle and accordingly  submitted untraced report before the competent court on 28.7.2016 which was affirmed by the Court.  The said report (C-3) was also supplied to the OPs. It was further case of the complainant that in the meantime, OPs appointed an investigator to ascertain the factum of theft. The said report of the investigator was also positive.  The complainant continued to take up the matter with the OPs, however, he failed to get any result. After about 10 months of lodging his claim, the complainant received one letter on 10.10.2016 (C-4) wherein he was intimated that his claim was not tenable on the following grounds;

1.Date of theft is 10.8.2015 and loss intimated to         office on dated 01.09.2015 after 20 days.

            2. FIR lodged 19 days i.e. on 29.8.2015 vide FIR         No.103

            3. Engine No. and CH No. not inserted in FIR

By that letter, the complainant was given one more opportunity to substantiate his claim. The requisite explanation was to be given within 7 days from the receipt of that letter.  It was stated by the complainant that thereafter he sent reply in the shape of legal notice on 29.10.2016 clarifying objections raised by the OPs and making request to settle his claim in a positive manner. However, nothing was done thereafter. No fresh order to repudiate his claim was passed. Compelled under above circumstances, the complainant filed a consumer complaint bearing No.1019 of 2016 before the Forum seeking following relief;

1. To pay Rs.31,000/- as per IDV of policy towards indemnification of loss due to theft of Motor cycle No.PB 65 P-6921 alongwith 18% P.A. from the date of intimation of claim till realization.
2. To pay Rs.30,000/-as compensation for harassment, mental tension, suffering and agony for their deficiency in service and harassed on false pretexts, thus played an unfair trade practice & deficient in service.
3. To pay Rs.22,000/- as cost of litigation.

           3.           Upon notice, a joint reply was filed by OPs No.1 & 2. The OPs did not dispute the factual matrix of the case.  It was admitted that the motorcycle was insured with them.  It was said with vehemence that on account of breach of terms and conditions of the Policy, the claim was rightly repudiated on 16.9.2016.   It was specifically said that the theft had occurred on 10.8.2015 whereas intimation of the same was given to the Police on 29.8.2015 and to the OPs on 1.9.2015.  By receipt of late intimation qua theft, right of the OPs to investigate the matter was defeated. Copy of the investigation report dated 21.9.2015 was produced as annexure OP/2 and affidavit of investigator was placed on record as OP/3. Copy of insurance cover note and the policy was also brought on record to show that there was violation of terms and conditions of the Policy. Copies of FIR and untraced report were also produced on record to justify the rejection of claim filed by the complainant. 

4.                 Both the parties led evidence. The Forum, on analysis of pleadings, documents on record, and arguments addressed, dismissed the complaint filed by the appellant/ complainant by observing as under; 

“The allegation of the Opposite Parties is that the FIR was lodged after a delay of 19 days and OPs-Insurance Co. was also informed about the theft of the vehicle with a delay of 20 days. Evidently all the required documents were duly received by the Opposite Parties for the purpose of settlement of the claim. Thereafter, untraced report dated 28.07.2016 was duly supplied to the Opposite Parties. The claim of the Complainant has been repudiated by the Opposite Party only due to the reason that there was delayed FIR and delayed information to the Opposite Party with regard to the theft of the insured vehicle.

     On perusal of the Condition No.1 of the terms & conditions of the Policy, the Complainant was required to give intimation of the alleged theft of his motorcycle on 10.08.2015. It is a matter of record that the Complainant intimated the theft of his motorcycle on 1.9.2015, after a delay of 20 days which constitutes a fundamental breach of the terms and conditions of the policy. In compliance with Condition No.1, the Complainant was also required to institute FIR with the Police immediately but from a perusal of the FIR, it is clearly discernible that the theft of the motor cycle took place on 10.08.2015; whereas, the FIR was lodged on 29.08.2015, after a delay of 19 days, which also constitutes a fundamental breach of Condition No.1 of the terms and conditions of the Policy. In Silversons Vs. OIC, IV(2011) CPJ 9 (SC), the Hon'ble Supreme Court has laid down in Para 6 of the judgment that, “Purpose of prompt notice is to enable the insurer to inspect the goods, satisfy about the cause of loss/damage and to ascertain if it falls within the Policy”. Further, it was held that insured should give intimation within 24 hours or 48 hours or at best within 72 hours. The Hon'ble National Consumer Disputes Redressal Commission in Parveen Dalal Vs. OIC, I (2014) CPJ 546 (NC) has held that immediate intimation to police and also to the insurance company are of paramount importance in theft cases and held that the repudiation of the claim was justified. The ratio of the aforesaid judgments is squarely applicable to the facts and circumstances of the present case, in as much as, it is the Complainant himself who has committed breach of the terms and conditions of the Insurance and, thus, he is held to be not entitled to any relief as prayed for by him in the instant Complaint.”

When rejecting claim raised by the complainant, it was noticed that the  fact of theft was reported to the police very late. By relying upon Condition No.1 of the terms and conditions of the Policy, it was stated that qua theft, it was duty of the appellant/complainant to report it immediately to the police and also to the OPs. However, the matter was reported after a delay of 20 days.  Terming it as violation of terms and conditions of the Policy, the claim was rejected.

5.           After hearing Counsel for the parties and perusing the record, we are of the opinion that the view taken by the Forum is not correct for the reasons to be stated hereinafter.

6.          Before proceeding further, we would like to note down condition No.1 of the terms and conditions of the Policy, by placing reliance upon which, the claim of the appellant was rejected. The said condition reads thus;

“Notice shall be given in writing to the Company immediately upon the occurrence of any accidental loss or damage and in the event of any claim and thereafter the insured shall give all such information and assistance as the company shall require. Every letter, claim writ, summons and/or process or copy thereof shall be forwarded to the Company immediately on receipt by the insured. Notice shall also be given in writing to the company immediately the insured shall have knowledge of any impending prosecution inquest for fatal inquiry in respect of any occurrence which may give rise to a claim under the policy.  In case of major loss/theft or other criminal act which may be the subject of a claim under this Policy the insured shall give immediate notice to the police and co-operate with the Company in securing the conviction of the offender.” 

 In the first part of the said condition, it is mandated that on suffering of any loss or damage, immediate intimation be sent to the Company. The latter part of the condition states that in case of major loss/theft, the insured shall give immediate notice to the police and co-operate  with the Company in securing the conviction of the offender. To say that violation of condition No.1 was fatal, reliance was placed by the OPs upon judgment of Hon’ble Supreme Court in the case titled Silversons Vs Oriental Insurance Company Ltd. & Anr. 2011(4)CLT465. We have gone through the said judgment.  It was a case where intimation of loss was sent to the Company by the insured after a gap of three months.  By noting that and also interpreting the meaning of word ‘immediate’, the Hon’ble Supreme Court said as  under ;

             “Although, the view taken by the National Commission that for availing benefit of the Policy, the insured should give intimation to the insurer within 24 hours or 48 hours or at best within 72 hours appears to be too narrow and we are inclined to agree with the learned Counsel for the appellant that it would sufficient if intimation is given to the insurer within a reasonable period, but what should be the reasonable period within which the insured should inform the insurer about the loss of goods would depend upon the facts of each case and no strait-jacket formula can be laid down to determine as to what would constitute prompt notice within the contemplation of Clause 9 of the Institute Cargo Clauses.  Insofar as this case is concerned, we are convinced that the long time gap of almost three months between the date when the appellant had been informed about discharge of the cargo by MV ”Aken” at Colombo Port and the intimation given by the appellant to the insurer was unreasonable and by no stretch of imagination, it could be construed as a prompt notice.”

7.          It was specifically stated that word  ‘immediate’ would not mean information to be sent within 24 hours, 48 hours or 72 hours.  It needs to be sent within a reasonable time and what is the  reasonable time,  it all dependents upon facts of each case.  In the present case, it is specifically submitted by the appellant/complainant that on theft of his vehicle, on 10.8.2015, he had intimated the police. FIR was not registered and he was asked to search for the vehicle and to approach the police official after about a week or so.  When efforts of the police and the complainant failed to trace the vehicle, the FIR was recorded only on 29.08.2015. Plea taken by the appellant appears to be justified. We have seen with concern attitude of the  police officials.  In most of the cases, they tried to avoid registration of FIR and put the informant away on one pretext or the other. It has been so observed by the Punjab State Consumer Disputes Redressal Commission in the case titled as National Insurance Company Ltd. Vs Rajesh Kumar Kalra 2013(2)CLT 417. Believing similar circumstances where FIR was recorded late, it was observed as under ;

    “In the present case vehicle was stolen in the midnight of 30/31.5.2008 and the FIR was registered on 1.6.2008 immediately from the knowledge of the theft. This is a routine practice in the Punjab Police that they did not register the case of theft immediately on intimation by the sufferer.  It is advised that the sufferer should first trace the vehicle at his own level and in case it is not found then the case will be registered by the Police.  It is also sometime told to the sufferer that after the registration of the FIR the legal complications will arise of taking the said vehicle on superdari from Illaqa magistrate etc. Almost the owners of the trucks/tractors are illiterate persons and they did not know the problems which they have to face for the settlement of their claims afterwards.”

8.        Similar view was also reiterated by this Commission in the case of ICICI Lombard General Insurance company Ltd. & another Vs Ashish Sharma, Appeal No.92 of 2016 decided on 26.5.2016. The relevant para reads thus;

“It is known to all that how the Police Officials work. They always try to put off the matter, on one pretext or the other. Same might have been done in the present case.  It was specifically held by the Forum that delay in recording the FIR, lays on the part of the Police and the complainant/respondent cannot be blamed for the same.”

In the latter case, this Commission has not considered delay of about 14 days in recording FIR as unreasonable.

9.           We have also to see whether any loss was caused to the OPs by late receipt of the fact of theft or not. The facts on record clearly indicate that no such loss was caused.  It is on record that immediately on receipt of intimation from the appellant on 1.9.2015, an investigator was appointed to verify theft of the vehicle. The appellant/complainant fully cooperated with the said investigator, got recorded his statement wherein he specifically stated that after theft of the vehicle, he searched for it and when remained unsuccessful, he went to the Police Station. He was asked to come after  few days and get copy of the FIR which was supplied to him on 29.8.2015. The investigator  also went to the Police Station and collected the requisite documents.  He gave the following findings in his report dated 21.9.2015 ;

1. That Motorcycle No.PB-65P6921 was stolen between 11 AM to 6AM, while it was parked in the parking lot in Belongi Market.
2. That I met the insured in his House No.3, Village Bartana, Tehsil Dera Bassi, District Mohali, Punjab, where he had parked his motorcycle.
3. That the insured in his statement confirmed that he had parked his motorcycle in the parking area of Belongi, SAS Nagar, Mohali on Ist September,2015 and went to Chandigarh for some personal work. When they came back they could not find the motorcycle.
4. That the theft of Motorcycle has been confirmed by his neighbor and his statement was taken in writing, which is enclosed in the file.
5. That the complainant in his statement gives date, time and place of theft, which match with the copy of FIR as well as claim form.
6. That registration certificate issued by the Registration Authority match with the insurance Policy. All other details furnished by the owner match with the R.C., hence found in order. The same has been verified by the authority and is enclosed in the report.
7. Only one key of the Motorcycle is handed over to me, which is enclosed in the file.
8. The insured has written a letter to the Registration Authority to keep the file in safe custody. The receipt of letter is enclosed herewith in the file.
9. That loss has been confirmed by the insured, his neighbourer as well as his friends.
10. Cheque leaf as required is also enclose in the file to enable you to make the payment directly.
11. That vehicle is insured for Rs.31,000/-. The vehicle is four years old and attracts 40% depreciation. Since bill was not available with the insured, hence no comments can be given on IEV.

Keeping in view the above facts, I feel that the theft of motorcycle No.PB-65P6921 is genuine and hence claim may be paid to insured after collecting non-traceable report under Section 173Cr. PC, on merits, subject to terms, conditions of the Policy.”

10.            It was specifically stated by him that theft of the vehicle in question on the given date was genuine and claim of the insured be paid on getting untraceable report under Section 173 Cr.PC subject to terms and conditions of the Policy. The above facts clearly show that theft was proved and no loss was caused to the OPs. It cannot be said that on account of delay caused in giving intimation, evidence was not available to conduct investigation. If the claim was to be rejected only on getting  late information, it could/should have been rejected on getting that information and/or  immediately thereafter.  However, it was not done. By appointing an investigator, getting his report and also getting many documents from the appellant/complainant to process his claim, the OPs have acquiesced their right to raise objection qua delay in giving intimation of theft to the OPs.

11.         Furthermore, it has been held by this Commission in the case of National Insurance Company Ltd. Vs Surinder Singh Appeal No.149 of 2017 decided on 31.5.2017, that in case of theft of insured vehicle, violation of terms and conditions have no nexus and claim cannot be repudiated on that score. It was so said by placing reliance upon a judgment of Hon’ble Supreme Court in the case of National Insurance Company Ltd. Vs Nitin Khandelwal IV(2008) CPJ 1(SC), where under similar circumstances, the Hon’ble Supreme Court observed as under ;

“Since the vehicle in question had been stolen, therefore, in the case of theft of vehicle, the breach of condition is not germane. In National Insurance Co. Ltd. Vs Kusum Rai & Others, II(2006)CPJ, the cases of Jitendra Kumar v. Oriental Insurance Co. Ltd. & Another, IV (2003) SLT 497=I (2008) ACC 139 (SC)=(2003) 6 SCC 420, and National Insurance Co. Ltd. v. Swaran Singh & Others, I (2004) SLT 345=109 (2004) DLT 304 (SC)=I (2004) ACC 1 (SC)=(2004) 3 SCC 297 were also considered. This Court in Jitendra Kumar’s case, in paras 9 and 10, observed as under:

“9. The question then is; can the Insurance Company repudiate a claim made by the owner of the vehicle which is duly insured with the company, solely on the ground that the driver of the vehicle who had nothing to do with the accident did not hold a valid licence? The answer to this question, in our opinion, should be in the negative. Section 149 of the Motor Vehicles Act, 1988 on which reliance was placed by the State Commission, in our opinion, does not come to the aid of the Insurance Company in repudiating a claim where the driver of the vehicle had not contributed in any manner to the accident. Section 149(2)(1)(ii) of the Motor Vehicles Act empowers the Insurance Company to repudiate a claim wherein the vehicle in question is damaged due to an accident to which driver of the vehicle who does not hold a valid driving licence is responsible in any manner. It does not empower the Insurance Company to repudiate a claim for damages which has occurred due to acts to which the driver has not, in any manner, contributed i.e. damages incurred due to reasons other than the act of the driver.

         10. It is the case of the parties that the fire in   question which caused damage to the vehicle occurred due to mechanical failure and not due to any fault or act, or omission of the driver. Therefore, in our considered opinion, the Insurance Company could not have repudiated the claim of the appellant.”

Similarly, in Swaran Singh’s case (supra),   this Court has held as under:

“If on facts, it is found that the accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with the driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence.”

 In the case in hand, the vehicle has been snatched or stolen. In the case of theft of vehicle breach of condition is not germane. The appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy for the loss caused to the insurer. 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. The Insurance Company cannot repudiate the claim in toto in case of loss of vehicle due to theft.

        In the instant case, the State Commission allowed the claim only on non-standard basis, which has been upheld by the National Commission. On consideration of the totality of the facts and circumstance in the case, the law seems to be well settled that in case of theft of vehicle, nature of use of the vehicle cannot be looked into and the Insurance Company cannot repudiate the claim on that basis.

                   The ratio of judgment of Hon’ble Supreme Court is applicable to the facts of the present case.

12.          It has also been noticed that by writing letter dated 16.9.2016 the claim was not repudiated by the OPs, rather  the complainant was asked to furnish his explanation which was given by serving legal notice on 29.10.2016. No fresh order was passed rejecting his claim. However, in the reply it was said that the claim was rejected vide the said letter. The above fact clearly shows non-application of mind in dealing with the claim of the poor customer.

13.           For the reasons recorded above, the appeal is accepted. The order passed by the Forum is set aside and directions are issued to the respondents as under ;

(i) to pay Rs.31,000/- being Insured Declared Value of the Motorcycle in question, along with interest @ 8% p.a. (simple) w.e.f. 29.10.2015 (one month after report of investigator dated 29.9.2015)

(ii) to pay Rs.5000/- towards mental and physical harassment

(iii) to pay Rs.3000/- towards litigation expenses

The amount awarded be paid within 45 days from the date of receipt of copy of this order, failing which, the amount granted will entail penal interest @ 10% p.a. till the date payment is made.

14.         Certified copies of this order, be sent to the parties, free of charge.

15.      The file be consigned to Record Room, after completion.

Pronounced.

16.08.2017