Order by:

Sh.Amrinder Singh Sidhu, President

1.       The complainant  has filed the instant complaint under section 12 of  the Consumer Protection Act, 1986 (now under section 35 of the Consumer Protection Act, 2019)  on the allegations that he is owner of heavy goods vehicle bearing RC No.PB-05L-9957 and the said vehicle was fully insured the Opposite Parties  vide policy No.2012043115P116246929 valid for the period w.e.f. 27.03.2016 to 26.03.2017 against the premium of Rs.32,238/-. Further alleges that during the policy period, on 24.01.2017 said vehicle was met with an accident at Gargali and was badly damaged. In this regard, FIR  No. 36/2017 dated 24.01.2017 under section 279/337 IPC was registered with P.S.Sanchore District Jalore. The intimation in this accident was given to the Opposite Parties  and they deputed the surveyor. The complainant got repaired the insured vehicle and spent about Rs.5 lakhs, but the surveyor of the Opposite Parties  assessed the net loss to the extent of Rs.3,50,000/-. The complainant lodged the claim with the Opposite Parties  and submitted all the requisite documents i.e. copy of insurance policy, permit etc and original bills of the repair.  Thereafter, the complainant visited the office of Opposite Parties  for the reimbursement of his repair bills, but the Opposite Parties  did not pay any heed  to the request of the complainant.   In this way, said conduct of the Opposite Parties clearly amounts to deficiency in service and as such, the Complainant is left with no other alternative but to file the present complaint.  Vide instant complaint, the complainant has sought the following reliefs.

a)       Opposite Parties may be directed to pay a sum of Rs.3,50,000/- i.e. the amount of claim alongwith interest @ 2% per month and Rs.11,000/-as compensation on account of mental tension, physical harassment and professional loss and Rs.22,000/- on account of litigation expenses.

2.       Opposite Parties  appeared through counsel and contested the complaint by filing  the written version  on the ground that the claim of the complainant  was duly processed and even appointed surveyor for getting the loss of the insured vehicle determined. The surveyor namely OP Garg & Associates duly reported the loss on net salvage basis with RC at Rs.3,25,000/- and the complainant  even submitted his consent letter at the said amount though Rs.1500/- was separately required to be deducted from the same on account of Excess Clause, thus the amount of loss comes to Rs.3,25,500/-. However, the complainant  had submitted one builty dated 23.01.2017 bearing No. 5615 of Bagha Purana Road lines stating that the goods of said firm were got loaded on the insured vehicle of the complainant  through said firm and vide detailed builty/ goods receipt, but when the Opposite Parties got it verified, said builty/ goods receipt was found to be fake as the owner of the said firm even made his statement in this regard. However, the second surveyor namely Jiten V.thacker duly reported vide his report dated 08.07.2017 found that the photocopy of GR No. 5615 dated 23.01.2017 produced by the insured as fake as its detail does not tallies with the records of the transport copy and hence the Opposite Parties  rightly repudiated the claim of the complainant  vide repudiation letter dated 15.09.2017  thereby breaching the terms and conditions of the insurance policy of misrepresentation of material facts. Moreover, the driving license of the driver of the insured vehicle of the complainant  was only for driving LMV-GV, whereas the insured vehicle of the complainant  is admittedly of HGV and thus the driver of the vehicle was not having valid driving licence and in this manner, the complainant  has again breached another material condition of the policy by allowing a person to drive the insured vehicle who was never competent to drive the same. On merits, the Opposite Parties  took up almost same and similar pleas as taken up by them in the preliminary objections.   Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.

3.       In order to  prove  his  case, the complainant has tendered into evidence his affidavit Ex.CW1/A alongwith copies of documents Ex.C1 to Ex.C56 and closed his evidence.

4.       On the other hand,  to rebut the evidence of the complainant,  Opposite Parties tendered into evidence affidavit of Sh.R.N.Bansal, Sr.Divisional Manager Ex.OP1 alongwith copies of documents Ex.OP2 to Ex.OP12 and closed the evidence on behalf of the Opposite Parties.

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

6.       During the course of arguments, both the ld.counsel for the Complainant as well as Opposite Parties  have mainly reiterated the facts as narrated in the complaint as well as in written reply respectively.   

7.       Ld.counsel for the complainant has mainly contended that  the written version  filed on behalf of Opposite Parties  has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. 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 more at the time of issuance of the said policy  to the complainant, no term and conditions were ever explained or supplied by Opposite Parties to the complainant. Further contended  the complainant  is owner of heavy goods vehicle bearing RC No.PB-05L-9957 and the said vehicle was fully insured the Opposite Parties  vide policy No.2012043115P116246929 valid for the period w.e.f. 27.03.2016 to 26.03.2017 against the premium of Rs.32,238/-. Further alleges that during the policy period, on 24.01.2017 said vehicle was met with an accident at Gargali and was badly damaged. In this regard, FIR  No. 36/2017 dated 24.01.2017 under section 279/337 IPC was registered with P.S.Sanchore District Jalore. The intimation in this accident was given to the Opposite Parties  and they deputed the surveyor. The complainant got repaired the insured vehicle and spent about Rs.5 lakhs, but the surveyor of the Opposite Parties  assessed the net loss to the extent of Rs.3,50,000/-. The complainant lodged the claim with the Opposite Parties  and submitted all the requisite documents i.e. copy of insurance policy, permit etc and original bills of the repair.  Thereafter, the complainant visited the office of Opposite Parties  for the reimbursement of his repair bills, but the Opposite Parties  did not pay any heed  to the request of the complainant.

8.       On the other hand, ld.counsel for the Opposite Parties  has repelled the aforesaid contention of the ld.counsel for the complainant  on the ground that the claim of the complainant  was duly processed and even appointed surveyor for getting the loss of the insured vehicle determined. The surveyor namely OP Garg & Associates duly reported the loss on net salvage basis with RC at Rs.3,25,000/- and the complainant  even submitted his consent letter at the said amount though Rs.1500/- was separately required to be deducted from the same on account of Excess Clause, thus the amount of loss comes to Rs.3,25,500/-. However, the complainant  had submitted one builty dated 23.01.2017 bearing No. 5615 of Bagha Purana Road lines stating that the goods of said firm were got loaded on the insured vehicle of the complainant  through said firm and vide detailed builty/ goods receipt, but when the Opposite Parties got it verified, said builty/ goods receipt was found to be fake as the owner of the said firm even made his statement in this regard. However, the second surveyor namely Jiten V.thacker duly reported vide his report dated 08.07.2017 found that the photocopy of GR No. 5615 dated 23.01.2017 produced by the insured as fake as its detail does not tallies with the records of the transport copy and hence the Opposite Parties  rightly repudiated the claim of the complainant  vide repudiation letter dated 15.09.2017  thereby breaching the terms and conditions of the insurance policy of misrepresentation of material facts. Moreover, the driving license of the driver of the insured vehicle of the complainant  was only for driving LMV-GV, whereas the insured vehicle of the complainant  is admittedly of HGV and thus the driver of the vehicle was not having valid driving licence and in this manner, the complainant  has again breached another material condition of the policy by allowing a person to drive the insured vehicle who was never competent to drive the same and hence the claim of the complainant  was rightly repudiated after application of mind.

 9.      Perusal of the contention of the ld.counsel for the complainant   shows  that  the written version  filed on behalf of Opposite Parties   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.

10.     For the sake of arguments, for the time being, if the written reply filed by Opposite Parties is presumed to be correct, the plea  raised by Opposite Parties  is that the complainant has violated the terms and conditions of the policy in question and as per the terms and conditions of the policy, the complainant is not entitled to the claim as claimed.  But the Opposite Party could not produce  any evidence to prove that terms and conditions of the policy were ever supplied to  the complainant insured, when and through which mode? It has been held by Hon’ble National Commission, New Delhi in case titled as The Oriental Insurance Company Limited Vs. Satpal Singh & Others 2014(2) CLT page 305 that the insured is not bound by the terms and conditions of the insurance policy unless it is proved that policy was supplied to the insured by the insurance company. Onus to prove that terms and conditions of the policy were supplied to the insured lies upon the insurance company. From the perusal of the entire evidence produced on record by the Opposite Party,  it is clear that Opposite Party  has failed to prove on record that they did supply the terms and conditions of the policy to  the complainant insured. As such, these terms and conditions, particularly the exclusion clause of the policy is not binding upon the insured. Reliance in this connection can be had on Modern Insulators Ltd.Vs. Oriental Insurance Company Limited (2000) 2 SCC 734, wherein it is held that “In view of the above settled position of law, we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant, the respondent can not claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law.”  Our own Hon’ble State Commission, Punjab, Chandigarh in First Appeal No.871 of 2014 decided on 03.02.2017 in case titled as Veena Mahajan (Widow) and others Vs. Aegon Religare Life Insurance Company Limited in para No.5 has held that

“Counsel for the appellant argued that copy of insurance policy was not supplied to the appellant and hence, the exclusion clause in the contract of the insurance policy is not binding upon him. He further argued that no proof of sending of insurance policy was ever produced by the respondent despite specific contention raised by the complainant that the insurance policy was never received by him. He argued that though there is an averment of the OP that the policy in question was delivered through Blue Dart Courier to the complainant. In order to prove their contention, no affidavit of any employee of Blue Dart was produced who would have made a statement to have the effect that the policy was delivered to the complainant nor any acknowledgement slip for having received the article by the complainant through courier company was produced by the insurance company. He argued that since no policy document was received by the insured and argued that the terms and conditions as alleged to be part of the insurance policy were not binding upon the insured. He argued that policy was issued in the name of deceased Sh.Vijinder Pal Mahajan with his wife Mrs.Veena Mahajan as beneficiary and the same was never refused by the OP and the proper premium for insurance was paid by late complainant. He argued that as per the specific allegations made in the complaint in para No.4, no rebuttal to that contention was specifically there in their written reply in para No.2 and para No.4 in the reply filed by OP in the District Forum. He argued that Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case of "Ashok Sharma Vs. National Insurance Co. Limited", in Revision Petition No. 2708 of 2013 held in para No.8 to the point of non-delivery of terms and conditions of the policy. He also cited Hon'ble Supreme Court's decision given in the matter of "United India Insurance Co. Limited Vs. M.K.J.Corporation" in Appeal (civil) 6075-6076 of 1995 (1996) 6 SCC 428 wherein the Apex court held that a fundamental principle of Insurance Law makes it that utmost good faith must be observed by the contracting parties. Good faith forbids either party from concealing what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. Just as the insured has a duty to disclose, "similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge, since obligation of good faith applies to them equally with the assured and further argued that since the terms and conditions were not supplied even on repeated requests the same cannot be relied upon by the opposite party in order to report to repudiate the genuine claim of the wife of the deceased policy holder.”

11.     For the sake of arguments, if it is admitted that the written version filed by the Opposite Party is  legal. Now come to the merit of the case.  It is not the denial of the case of the parties that vehicle bearing RC No.PB-05L-9957 of the complainant was fully insured the Opposite Parties  vide policy No.2012043115P116246929 valid for the period w.e.f. 27.03.2016 to 26.03.2017 against the premium of Rs.32,238/-. It is also not denied that during the policy period, on 24.01.2017 said vehicle was met with an accident at Gargali and was badly damaged. In this regard, FIR  No. 36/2017 dated 24.01.2017 under section 279/337 IPC was registered with P.S.Sanchore District Jalore. The intimation in this accident was given to the Opposite Parties  and they deputed the surveyor. The complainant got repaired the insured vehicle and spent about Rs.5 lakhs, but the surveyor of the Opposite Parties  assessed the net loss to the extent of Rs.3,50,000/-. The complainant lodged the claim with the Opposite Parties  and submitted all the requisite documents i.e. copy of insurance policy, permit etc and original bills of the repair. But the only ground for the repudiation of the claim of the complainant  is that the complainant  has himself breached the terms and conditions of the policy in question.  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”.

12.     In such a situation the repudiation made by Opposite Parties 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 seams 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.

13.     Now come to the quantum of compensation.  The surveyor namely OP Garg & Associates in his report Ex.OP2 has  reported the loss on net salvage basis with RC at Rs.3,25,000/- and the complainant  even submitted his consent letter (Ex.OP3) at the said amount though Rs.1500/- was separately required to be deducted from the same on account of Excess Clause, thus the amount of loss comes to Rs.3,23,500/-.  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 assessed 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 assessed amount on 'non-standard' basis” of the consented amount.

14.     In view of the aforesaid facts and circumstances of the case,  we allow the complaint of the Complainant partly and direct the Opposite Parties to make the payment of Rs.2,26,450/- (Rupees two lakh twenty six thousands four hundred and fifty only) i.e. 70% of the consented amount of Rs.3,23,500/- to the Complainant alongwith interest @ 8% per annum from the date of  filing the present complaint i.e. 03.10.2018  till its actual realization.  Opposite Parties are also directed to pay the lump sum compensation to the complainant to the tune of Rs.10,000/- (ten thousands only) on account of harassment, mental tension  and litigation expenses. The compliance of this order be made by  the Opposite Parties  within 45 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.

15.     Reason for delay in deciding the complaint.

          This complaint could not be decided within the prescribed period because the government has not appointed any of the Whole Time Members in this Commission for about 3 years i.e. w.e.f. 15.09.2018 till 27.08.2021 as well as due to pandemic of COVID-19.

Announced in Open Commission.

Dated:14.12.2021.