Order by:

Sh.Amrinder Singh Sidhu,  President.

1.       The   complainant has filed the instant complaint under section 35 of  the Consumer Protection Act, 2019 (as amended upto date) on the allegations that on 02.05.2011 he purchased  car bearing RC No. PB-29M-0548 having Engine No. 0137674 and the said vehicle was insured with the Opposite Party vide policy No. 2012003110P103388226 valid for the period w.e.f. 04.07.2019 to 03.07.2020 for IDV of Rs.3,30,000/-. Further alleges that unfortunately on 11.02.2020 said insured vehicle met with an accident with truck No. PB11BR9453 and it was got totally damaged and in such accident, four persons who were traveling in the insured vehicle also died and FIR No. 84 dated 19.09.2022 under section 283, 304-A IPC in this regard also registered at P.S.Mehna. After accident, the complainant informed the Opposite Party and lodged the claim under the insurance with the Opposite Party. Accordingly, the Opposite Party appointed surveyor, but the surveyor of the Opposite Party lateron repudiated the claim of the complainant on the ground  of don submission of documents whereas all the necessary documents and other formalities wee duly completed by the complainant from time to time. Said repudiation dated 21.12.2020  of the Opposite Party is illegal, unjust and without any justified reason.  The complainant made so many requests to the Opposite Party to make the payment of insurance claim, but the Opposite Party refused to admit the rightful claim of the complainant.  As such, there is deficiency in service on the part of the Opposite Party. Vide instant  complaint, the complainant has sought the following reliefs.

a)       To direct the Opposite Partys to pay the insurance amount of Rs.3,30,000/- alongwith interest @ 12% per annum and also to pay Rs.1 lakh on account of damage and harassment and Rs.50,000/- on account of mental tension and agony besides Rs.5500/- as litigation expenses. Hence, the present complaint is filed by the Complainant  for the redressal of  their grievances.

2.       On notice, Opposite Party appeared through counsel and contested the complaint  by filing the written version taking preliminary objections therein inter alia that the present complaint is not maintainable; that there is no deficiency in service on the part of the Opposite Party.  Brief facts are that on receipt of claim from the Opposite Party, the Opposite Party immediately appointed Sh.Harjinder Singh Bedi, investigator who opined in his report dated 21.10.2020 that the complainant Sohan Singh had sold his fiat Lines PB 29M-0548 to Ram Kumar Singla long time back and he has further sold it to Rajiv Kumar, but the RC is still in the name of Sohan Singh. In this way, the complainant alongwith his further vendees of the said car are trying to claim compensation in a fraudulent manner, and therefore, the case is not triable by this commission. Hence, the complainant has violated the terms and conditions of the policy.   On merits, Opposite Party took up the same and similar pleas as taken up by them in the preliminary objections and hence, it is prayed that the complaint of the complainant is liable to be dismissed against Opposite Party.

3.       In order to prove his case, the complainant has tendered into evidence  affidavit  of complainant Ex.C1 alongwith copies of documents Ex.C2 to Ex.C12 and closed the evidence.

4.       On the other hand, to rebut the evidence of the complainant, Opposite Party  tendered  into evidence affidavit of  Sh.R.N.Bansal, closed the evidence on behalf of the Opposite Party. 

5.       We have heard the ld.counsel for the parties and also gone through the documents placed on record.

6.       During the course of arguments, ld.counsel for the Complainant as well as Opposite Party have mainly reiterated the facts as narrated in the complaint as well as in the written statements respectively. We have perused the rival contentions of  the parties and also gone through the record on file. The main contention of the ld.counsel for the complainant is that first of all, the written version  filed on behalf of the Opposite Party has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party. Further contended that the insured vehicle is registered in the name of the complainant and he is getting the insurance policy from the Opposite Party from to time, but now when unfortunately, the accident occurred, the Opposite Party is wriggling out of its liability to pay the claim of the insured vehicle. On the other hand, ld.counsel for the Opposite Party has repelled the aforesaid contention of the complainant on the ground that   on receipt of claim from the Opposite Party, the Opposite Party immediately appointed Sh.Harjinder Singh Bedi, investigator who opined in his report dated 21.10.2020 that the complainant Sohan Singh had sold his fiat Lines PB 29M-0548 to Ram Kumar Singla long time back and he has further sold it to Rajiv Kumar, but the RC is still in the name of Sohan Singh. In this way, the complainant alongwith his further vendees of the said car are trying to claim compensation in a fradulent manner, and therefore, the case is not triable by this commission. As such, the complainant has violated the terms and conditions of the policy.

7.       Perusal of the contention of the ld.counsel for the shows  that  the written version  filed on behalf of the Opposite Party  has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party  is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party. In this regard,  Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment,  has held that

“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”

Similar proposition came before the Hon’ble Delhi High Court in “Nibro Ltd. Vs. National Insurance Co. Ltd.”, 2 (2005) 5SCC 30 that the

“bear authority is not recognized under law and ultimately, it was held that the plaint was not instituted by an authorized person. Here also appellant has not placed on record any resolution passed by any Board of Director in favour of Mr. Soonwon Kwon and that he was further authorised to delegate his power in favour of any other person. Further there is no memorandum/articles of the Company to show that Mr. Soonwon Kwon is one of the Director of the Company. In the absence of that evidence on record we cannot say that the special power of attorney given by Director Soonwon Kwon is a competent power of attorney issued in favour of Sh. Bhupinder Singh. In the absence of any resolution of the Company or any memorandum/articles of the Company to show that Sh. Soonwon Kwon is Director and that he was further authorised to issue power of attorney in favour of Sh. Bhupinder Singh.”

Recently our own Hon’ble State Commission, Punjab Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by  an unauthorized person has no legal effect.

8.       For the sake of arguments, for the time being, if the written reply is presumed to be correct, the next  plea  raised by Opposite Party  is that the complainant has breached the terms and conditions of the policy as the complainant has already  further sold the insured vehicle and he is getting the policy in his name. But bare perusal of the copy of the RC of the insured vehicle Ex.C3 as well as policy purchased by the complainant Ex.C4 shows that the vehicle is in the name of Sohan Singh Saggu. Ex.OP8 copy of policy produced by the Opposite Party proves that they have sold the policy of the vehicle in question in favour of Sohan Singh son of Pal Singh (complainant).   However, we are of the view that even if the complainant has breached the terms and conditions of the policy in question, even then the  Insurance Company ought to have settled the claim of the complainant on “non standard basis” even if some of the conditions of the insurance policy are not adhered by the insured. In this regard, we are supported with judgment  in  case titled National Insurance Company Limited versus Kamal Singhal IV (2010)CPJ297 (NC) wherein the Hon'ble National Consumer Disputes Redressal Commission, New Delhi relying upon various decisions of the National Consumer Disputes Redressal Commission in the matter of (1) National Insurance Company Ltd. v. J. P. Leasing & Finance Pvt. Ltd. (RP No. 643/2005), (2) Punjab Chemical Agency v. National Insurance Company Ltd. (RP No. 2097/2009), (3) New India Assurance Co. Ltd. v. Bahrati Rajiv Bankar, (RP) No. 3294/2009) and (4) National Insurance Company Ltd. v. Jeetmal, (RP No.3366/2009) and also judgment of the Hon'ble Apex Court in the matter of Insurance Company Versus Nitin Khandewal IV (2008) CPJ 1(SC), held the  breach of condition of the policy was not germane and also held further that : “the appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy to the loss caused to the insurer”. The Hon'ble Supreme Court has further held that; “even assuming that there was a breach of policy, the appellant Insurance Company ought to have settled the claim on “non-standard basis.” Hon'ble Apex Court in back drop of these features, in these cases, allowed 70% of the claim of the claimant on the “non-standard basis”. This view was again reiterated by the Hon'ble Apex Court in the matter of Amalendu Sahoo versus Oriental Insurance Company Limited. II(2010) CPJ 9(SC)=II (2010)SLT 672.  Hon'ble National Commission in the case National Insurance Company Limited versus Kamal Singhal referred to above relying upon the law laid down by the Hon'ble Supreme Court has held that;

“there being a long line of decisions on this score, we have no option but to uphold the finding of Fora below with modification that the claim be settled on 'non-standard' basis”, in terms of the guidelines issued by the Insurance Company. In case petitioner company fails to carry out the direction contained therein, the amount payable on 'non-standard' basis, shall carry interest @ 6% p.a from the date of expiry of six weeks till the date of actual payment”.

9.       In such a situation the repudiation made by Opposite Party regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation.  This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible.  It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

10.     Now come to the quantum of compensation. As per the policy Ex.C4, the IDV (Insured’s Declared Value) of the insured vehicle is Rs.3,30,000/- and it is not disputed by the Opposite Party that the vehicle was got totally damaged in such a horrible accident in which four persons were died on the spot. Hence, having  regard to the position of the law, as has been laid down, by the Hon'ble Apex Court in the various decisions referred to here-in-above and also the view expressed by the Hon'ble National Commission, we are of the considered view that in the present case the complainant, if not entitled for the entire insurance amount, the Insurance Company definitely ought to have settled the complainant's claim on 'non-standard basis”, which in the facts and circumstances taking the assistance of the view expressed by the Hon'ble Apex Court and also by the Hon'ble National Commission, we allow 70% of the amount on 'non-standard' basis” of the IDV of the insured vehicle.

11.     In view of the aforesaid facts and circumstances of the case,  we allow the complaint of the Complainant partly and direct the Opposite Party to make the payment of Rs.2,31,000/- (Rupees Two Lakh Thirty One thousands only) i.e. 70% of the IDV of the insured vehicle to the Complainant alongwith interest @ 8% per annum from the date of  filing the present complaint i.e. 22.12.2021  till its actual realization.  The compliance of this order be made by  Opposite Party  within 60 days from the date of receipt of this order, failing which the complainant  shall be at liberty to get the order enforced through the indulgence of this District Commission. Copies of the order be furnished to the parties free of cost. File be consigned to record room after compliance.

Announced in Open Commission.