Date of filing : 27-12-2010
Date of order : 04-04-2011
IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD
CC. 271/2010
Dated this, the 4th day of April 2011
PRESENT
SRI.K.T.SIDHIQ : PRESIDENT
SMT.P.RAMADEVI : MEMBER
SMT.K.G.BEENA : MEMBER
Baby Thomas, } Complainant
S/o.Thomas.P.T,
Pulinthamathu House,
Vattakayam, Panathady Village,
Panathoor, Hosdurg Taluk
(Adv. A.K.V.Balakrishnan, Hosdurg)
United India Insurance Co.Ltd, } Opposite party
P.B.No.29, 2nd floor, Nithyananda Building,
Kottacherry, Po.Kanhangad.
(Adv.C.Damodharan, Kasaragod)
O R D E R
SRI.K.T.SIDHIQ, PRESIDENT
Complainant is the Registered Owner of the transport vehicle bearing Reg.No.LKL.60/A/1022 Tata Sumo. It involved in an accident and suffered damages while he was plying the vehicle with a patient to a Hospital. Complainant spent `65,000/- to rectify the defects. When the claim is preferred before the opposite parties they repudiated the claim on the ground that at the material time of accident the driver had no authorization to drive transport vehicle. Hence the complaint.
2. According to opposite party the complainant/Owner/driver was not having effective driving licence to drive a transport vehicle at the time of accident. Therefore he violated section 3 (1) of the MV Act and policy terms and conditions and therefore the claim is repudiated.
3. On the side of complainant Exts A1 to A3 marked. On the side of Exts B1 & B2 marked.
4. The issues to be settled in the case are whether the opposite party is justified in repudiating the claim of the complainant and the relief & cost?
5. The vehicle involved in this case is a motor cab as defined under the MV Act. As per Sec.3 (1) of the MV Act one can drive a motor cab if it is hired for his own use even without any specific endorsement to drive transport vehicle on his driving licence.
6. What is motor cab is defined U/S 2 (25) of the MV Act. As per the definition ‘Motor Cab’ means any motor vehicle constructed or adopted to carry not more than 6 passengers excluding the driver for hire or rewarded.
7. Here the vehicle involved is a motor cab. So if some one hires the said transport vehicle for his own purpose then no specific endorsement is required in his driving licence to ply the same.
8. In the case on hand it is the case of the complainant that at the time of accident. Complainant being the owner of the vehicle plying it for carrying a patient to a hospital free of cost since the patient was his neighbour. Though this can be considered as ‘own use’ but it cannot be considered a ‘hired for own use’ as envisaged U/s 3 (1) of the Motor Vehicles Act. Hence this Section will not help the complainant to justify his claim.
9. But in the case of B.V. Nagaraju V M/s Oriental Insurance Company reported in 1996 AIR 2056 the Hon’ble Apex Court has held that the terms of the insurance policy must be read down so as to serve the main purpose of the policy that is to indemnify the damage caused to the vehicle. It is true that in the case of New India Assurance Co.Ltd V. Prabhulal reported in 2008 AIR 614 I 2008 CPJ(1)(SC) . The Honb’le Apex court has held that the repudiation of claim on the ground of lack of authorization to drive transport vehicle is a violation of terms & conditions of policy and hence it is not a deficiency in service.
10. But recently the Hon’ble Apex Court in the case of Amalendu Sabu V Oriental Insurance Company Ltd reported in II (2010) CPJ 9 (SC) by referring to the decisions of the Hon’ble National Consumer Disputes Redressal Commission as well as the guidelines issued by the Insurance Company about the settling of non-standard claims has held below:
Reference in this case may be made to the decision of National Commission rendered in the case of United India Insurance Company Limited v. Gian Singh,reported in II (2006) CPJ 83 (NC)=2006 CTJ 221 (CP) (NCDRC). In that decision of the National Consumer disputes Redressal Commission (NCDRC) it has been held that in a case of violation of condition of the policy as to the nature of use of the vehicle, the claim ought to be settled on a non-standard basis. The said decision of the National Commission has been referred to by this Court in the case of National Insurance Company Limited v. Nitin Khandelwal, reported in IV (2008) CPJ 1 (SC)=2008 (7) SCALE 351. In paragraph 13 of the judgment, in the case of Nitin Khandelwal (supra) this Court held:
“………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.”
In the case of Nitin Khandelwal (supra) the State Commission allowed 75% of the claim of the claimant on non-standard basis. The said order was upheld by the National Commission and this Court refused to interfere with the decision of the National Commission.
In this connection reference may be made to a decision of National Commission in the case of New India Assurance Company Limited v. Narayan Prasad Appaprasad Pathak, reported in II (2006) CPJ 144 (NC). In that case also the question was, whether the insurance company can repudiate the claims in a case where the vehicle carrying passengers and the driver did not have a proper driving licence and met with an accident. While granting claim on non-standard basis the National Commission set out in its judgment the guidelines issued by the insurance company about settling all such non-standard claims. The said guidelines are set out below:
Sr.No. | Description | Percentage of settlement |
(i) | Under declaration of licensed carrying capacity | Deduct 3 years difference in premium from the amount of claim or deduct 25% of claim amount, whichever is higher. |
(ii) | Overloading of vehicles beyond licensed carrying capacity | Pay claims not exceeding 75% of admissible claim. |
(iii) | Any other breach of warranty/condition of policy including limitation as to use | Pay upto 75% of admissible claim. |
From a perusal of the aforesaid guidelines it is clear that one of the cases where 75% claim of the admissible claim was settled was where condition of policy including limitation as to use was breached.
11. In the instant case the stand of the insurance company is that the driver was not holding an effective driving licence to ply the vehicle at the relevant time of accident. The guidelines mentioned above can be applied in this case also and therefore the repudiation of claim of the complainant amounts to deficiency in service of opposite party.
12. Relief & Cost
As per the survey report the total cost for the indemnification of the loss is `43,093 and paisa 84. The complainant is entitled for 75% of the above amount that would be `32319.75 (rounded to `32,300).
In the result, complaint is allowed and opposite party is directed to pay `32,300/- with 9% interest from the date of complaint till payment together with a cost of `2,000/-. Time for compliance is limited to 30 days from the date of receipt of copy of order.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Exts.
A1. Photocopy of F.I.R.
A2. Report of Inspection of a Motor Vehicle involved in an Accident.
A3.24-9-10 letter sent by OP to complainant.
B1.Copy of the policy
B2. 24-04-2010 Survey report
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
PJ/ Forwarded by Order
SENIOR SUPERINTENDENT
