(Passed this on 18th July, 2017)
Shri. S.P. Muley, President –
1. Both these complaints are being disposed of by a common order since same question of facts and law are involved in both the cases, besides the complainants and Opposite Party 1 are also same.
2. Brief facts are that the complainant is a Financial Corporate Body registered under the Company Act. It provides finance for sale purchase of goods and commercial vehicles. The O.P.1 is Reliance General Insurance Company and O.P.2 are the owners of their respective vehicles bearing No. CG-04-E-2665 and CG-04-G-2185. The complainant has provided financial assistance to the O.P.2 for purchasing their vehicles.
3. Accordingly, a loan agreement has been executed between the complainant and O.P.2. The loan amount was to be repaid by monthly installments in a fixed a period. The vehicles were insured with the O.P.1. The vehicles of the O.P.2 were hypothecated with the complainant under the Deed of Hypothecation. During subsistence of policy cover the vehicles of the O.P.2 were stolen and in that respect they had lodged insurance claim with the O.P.1. Since the complainant has provided finance to purchase said vehicles and the same are hypothecated with it, the complainant is a beneficiary and therefore is a consumer of the O.P.1 and has right to get insurance claim. The O.P.2 are not taking any steps to get the insurance claim and the O.P.1 is not paying the claim to it. This is deficiency in service of the O.P.1 due to which the complainant is suffering huge loss. Hence, it is prayed that the O.P.1 be directed to pay insurance claim of Rs.9,99,343/- to it with 18% interest, besides compensation for harassment and litigation cost.
4. The O.P.1 filed reply and raised question of locus standi of the complainant. It is denied by the O.P.1 that the complainant is a beneficiary under the policy and has right to file complaint for insurance amount. It is not denied the vehicles are hypothecated in favour of the complainant as a financier. It is admitted that the vehicles were insured with it for the period mentioned in the complaints. There was much delay in giving intimation of the incident to police as well as to the O.P.1. Therefore there was breach of policy condition No.1 and 5 also as the O.P.2 did not take reasonable steps to safeguard the vehicles from loss. The O.P.2 also failed to supply documents. Hence, the claims were closed as NO CLAIM. The complaints are time barred. On these grounds, it is submitted to dismiss the complaints.
5. The O.P.2 failed to appear despite service of notice. Hence, the cases are heard ex-parte against O.P.2.
6. We have heard Ld counsels and perused notes of argument and documents. On considering the same following points arise for our consideration and we have recorded our findings thereon for the reasons given below.
POINTS : FINDINGS
1. Whether the complainant has locus standing : No
to file consumer complaint in the facts and
circumstances of the case ?
2. What order ? : As per final order
POINT No. 1:-
7. The O.P.1 has questioned the locus of the complainant (financier) to file consumer complaint against it. We would, therefore, like to examine this aspect first before going into merits of the case.
8. Ld. counsel for the O.P.1 submitted there is no relation of service provider and consumer between the complainant and O.P.1 nor is any contract executed between them regarding insurance. Therefore the complainant cannot be a consumer of the O.P.1. As against this, Ld counsel for the complainant relying on some judgments contended the finance was provided by the complainant and the vehicle was hypothecated in its favour. The O.P.2 has not repaid entire loan amount. Therefore the complainant has first charge over the vehicle and under the insurance policy of the vehicle the complainant became beneficiary to claim insurance amount in the event of theft of the vehicle and default of the O.P.2 in repaying loan amount. He further submitted the charge over the vehicle is in nature of actionable claim and it can be put to execution by the complainant. Our attention is drawn to the insurance clause in the Loan-cum-Hypothecation Agreement, wherein it is written that the first claim of any insurance proceedings shall be of the Lender. The Borrower authorised the Lender to receive the claim proceeds of the insurance policy. In the Registration certificate the vehicle is shown hypothecated in favour of the complainant. Thus, it is contended the complainant has every right to claim insurance amount of stolen vehicle as the O.P.2 has not paid entire dues.
9. Reliance is placed on one judgment in the case of Chief Eexecutive Officer & Vice Chairman, Gujrat Maritime Board v/s Shri Haji Daud Haji Harun Abu (1996) 11 SCC 23. This judgment was relied on in a subsequent case of M/s Krishna Food & Baking Industry P. Ltd. v/s M/s New India Assurance Co. Ltd 2008 (13) SCALE 747. We have gone through these judgments. What is held in those judgments is that as soon as a decree or order is made in favour of the complainant (borrower), the bank/financier is entitled to the said amount. Thus it is to noted that there must be a decree or order in favour of the borrower and then only the financier can claim the amount. Therefore these two judgments do not come in aid of the complainant, in as much as, no decree or order is made in favour of the O.P.2 (borrower).
10. Ld counsel for the complainant further advancing his argument submitted the vehicle was hypothecated with the complainant who has charge over the vehicle to secure the loan amount. The charge created by the agreement is in the nature of an actionable claim, which is executable by the complainant against the O.P.1 without the consent of the O.P.2. This legal position is not disputable. But the point is that there is no transfer or assignment of actionable claim in its favour. Section 130 of the Transfer of Property Act says that transfer of an actionable claim with or without consideration shall be effected only by the execution of an instrument in writing signed by the transferor. There is no such instrument of transfer in writing in favour of the complainant. Therefore this argument does not hold water.
11. The right of the complainant to claim outstanding dues from the O.P.2 is not disputed nor denied; what is disputed is its locus to file consumer complaint in absence of any order passed against the O.P.2. We agree with the objection as to the locus and hold that the complainant, in the facts and circumstances of the case has no locus standi to maintain the consumer complaint. The first point is therefore held in the negative.
Point No.2:-
12. The complainant having no locus to file the complaint, the same is liable to be dismissed. Moreover, the complaint is also time barred. Because the claim filed by the OP2 was closed in the year 2009 and 2010 respectively. The complaints were filed after the lapse of two years without application for condonation of delay. The cause of action arose when the claims were closed. Hence, for all these reasons the complaints are not tenable and the complainant is not entitled to get reliefs asked for. We, therefore pass the following order.
ORDER
- Both the complaints (12/461 & 12 /462) are dismissed.
- No order as to cost.
- Copy of judgment be given to both the parties, free of cost.
