DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II U.T. CHANDIGARH [Consumer Complaint Case No: 534 of 2011] -------------------------------- Date of Institution : 18.11.2011 Date of Decision : 28.09.2012 -------------------------------- Saurav Batti son of Late Shri M.C. Batti, aged about 27 years, resident of House No. 211, Sector 40-A, Chandigarh. ---Complainant V E R S U S United India Insurance Company Limited, Regional Office: United India Insurance Company Limited, SCO No. 123-124, Sector 17-B, Chandigarh, through its Manager. ---Opposite Party BEFORE: SH. LAKSHMAN SHARMA PRESIDENT MRS.MADHU MUTNEJA MEMBER SH. JASWINDER SINGH SIDHU MEMBER Argued By: Sh. Gaurav Bhardwaj, Proxy Counsel for Sh. Vijay Mangla, Counsel for Complainant. Sh. G.D. Gupta, Counsel for Opposite Party. PER JASWINDER SINGH SIDHU, MEMBER 1. Complainant has filed the present complaint, against the Opposite Party on the ground that the Complainant owned a Maruti Swift vehicle VDI bearing Registration No. cH-04-E-7492 insured with the Opposite Party, vide Policy No. 1103003109-P000015235 effective for the period starting 02.09.2009 upto mid night of 01.09.2010 (Annexure-1). The said vehicle met with an accident on 6.7.2010, due to a sudden appearance of a stray animal in front of it. The vehicle got damaged as well as the Complainant too suffered some injuries. Copy of D.D.R. is Annexure-2. The car was taken to the authorized service centre, Berkeley Automobiles, Chandigarh for repairs. The Complainant also lodged the claim with the Opposite Party – the insurer of the car. The Opposite Party appointed a Surveyor who noted down the statements of the relatives of Complainant who had actually shifted the damaged vehicle to the Workshop, as he himself was under hospitalization. The Complainant states that the car was declared as total loss by the Surveyor and Opposite Party. The very first communication from the side of the Opposite Party dated 12.8.2010 was to the utter surprise of the Complainant, as it was claimed that the vehicle was wrongly insured for Rs.4.60 lacs and that the Complainant had been given 20% no claim bonus and there is no record of previous insurance with the Opposite Party. The Complainant claims that at the time of subscribing for the said policy of the Opposite Party, the agent of the Opposite Party was duly handed over copy of the registration certificate, driving licence, earlier insurance, along with all other requirements. At the time of insuring the vehicle, the value of the vehicle for this purpose was assessed as Rs.4.60 lacs being its prevailing price. The Complainant also claims that he had disclosed all the information asked by the Agent and there was no occasion to hide anything. A premium of Rs.10,320/- on the assessed value of Rs.4.60 lacs was paid by the Complainant. The Complainant is aggrieved of the repudiation of his genuine claim by the Opposite Party through their letter dated 27.09.2010 on the ground that the Complainant has availed No Claim Bonus (NCB), inspite the fact that he has already taken claim twice earlier and the Complainant has got the vehicle wrongly insured for Rs.4.60 lacs and has thus violated the terms and conditions of the policy. The Complainant also claims that despite all disclosures of earlier claims by the Complainant, the Agent of the Opposite Party has pointed that he is giving discount of 20% on Own Damage premium at his own level and the same does not relate to N.C.B. The Complainant claims that he had to shell out Rs.28,000/- as Parking charges demanded by the Berkeley Automobiles (Workshop) and due to the non-settling of the claim of the Complainant, had to dispose off the vehicle in salvage for a sum of Rs.1,85,000/-. The Complainant served a legal notice dated 29.8.2011, through registered post, registering his grievance and on not getting his problem resolved, has preferred the present complaint seeking the following relief:- i) | Claim amount after deducting salvage | : | Rs.2,75,000/- | ii) | Amount paid to Berkeley | : | Rs.28,000/- | iii) | Compensation for mental agony, harassment suffered | : | Rs.2,00,000/- | iv) | Cost of litigation | : | Rs.22,000/- |
The complaint of the complainant is duly verified and supported by his detailed affidavit. 2. The Opposite Party has contested the claim of the complainant by filing their reply, taking preliminary objections to the effect that the present complaint is not maintainable in its present form under the law as there is suppression of material facts of N.C.B. and the Complainant has not come to this Forum with clean hands. The Complainant is also alleged to have furnished wrong and false declaration at the time of seeking insurance and has thus breached the principle of good faith. The Complainant has also not given information about the claim availed in the previous insurance policy to the Opposite Party at the time of seeking the insurance through which the present claim of the Complainant had arisen. The copy of the proposal form submitted by the Complainant is Annex.R-1. Cover note issued on the basis of this proposal form is Annexure R-2. Copy of Policy of Insurance is Annexure R-3. The Opposite Party while claiming that the Complainant had availed a claim through the previous policy, and thus, was not entitled to any type of discount by way of N.C.B. The Complainant had taken undue benefit of 20% N.C.B. discount on his insurance dated 2.9.2008, bearing Policy No. 450093349, covering his car bearing No.CH-04-E-7492, with New India Assurance Company Limited, Ferozepur. The Policy is annexed at Annexure R-4. The Opposite Party had made a communication with the previous insurer on 19.8.2010 which was replied by the previous insurer through its communications dated 26.8.2010, 6.9.2010 and 31.8.2010 mentioning that the Complainant had availed two claims in the previous policy. The Opposite Party thus claims that the Complainant was not entitled to N.C.B. in his present insurance policy with the Opposite Party. Thus, justifying the repudiation of the claim of the Complainant, on these grounds, the Opposite Party has categorically mentioned the G.R.27 of the India Motor Tariff annexed as Annexure R-9, which provides that where the insured is unable to produce such evidence of N.C.B. entitlement, from the previous insurer, the claimed N.C.B. may be permitted after obtaining from the insured a declaration to that effect. The declaration clause is found reproduced in para 11 (Pg.13) of the reply. The Opposite Party has also cited the letters dated 9.8.2010, 12.8.2010, 27.8.2010 and 14.9.2010 (Annexure R-10 to R-13) respectively, in this regard. Furthermore, justifying the repudiation of claim of the Complainant, the Opposite Party has also cited a judgment titled TATA AIG General Insurance Co. Limited versus Gulzari Singh, RP No. 1255 of 2009, decided on 26.02.2010 by the Hon’ble National Commission. The Opposite Party admitting the receipt of Complainant’s letter dated 24.9.2010, which was replied by them through their repudiation letter dated 27.9.2010 (Annexure R-15). In order to strengthen their claim, the Opposite Party has also annexed the explanation of the Agent/representative vide letter dated 20.9.2010 (Annexure R-17), along with their reply. The Opposite Party claims that on intimation dated 6.7.2010, the same was got assessed by the Surveyor Sh. Kailash Chander, IRDA Accredited/ Licensed Surveyor, who assessed the loss for Rs.2,18,791/- on net of salvage basis, leaving the salvage of the vehicle assessed as Rs.1,00,000/-. Copy of the survey report is at Annexure R-18. The Opposite Party thus claims that having assessed the claim of the Complainant, and completing the formalities, and finally, not finding the claim to be payable, in the light of breach of terms & conditions of the policy, the repudiation is held to be as per law. On merits, the Opposite Party has repeated their preliminary objections, while replying to the averments of the present complaint, in their para-wise reply. Thus, claiming no deficiency in service or unfair trade practice on their part, the answering Opposite Party has prayed for the dismissal of the complaint with heavy costs. The reply of the Opposite Party is duly supported by detailed affidavit of Sh. A.K. Grover, Deputy Manager, of the opposite party. 3. Having gone through the entire complaint, version of the Opposite Party, the evidence of the parties and with the able assistance of the learned counsel for the parties, we have come to the following conclusions. 4. The fact with regard to the Complainant having subscribed for the insurance for his Maruti Swift car bearing Reg. No. CH-04E-7492, for the period 02.09.2009 to 01.09.2010 by paying the requisite premium is admitted and there is no dispute with regard to that. Even the event of accident in which the complainant too suffered injuries is confirmed by the Surveyor/Loss Assessor through his Final Survey Report dated 20.08.2010. The Surveyor in the last paragraph of his report has opined that the settlement of the loss on Net of Salvage basis with R.C. is economical to the insurer as compared to the settlement on other basis. 5. However, the main dispute that had cropped up due to the letter dated 27.9.2010 (Annexure R-14) from the side of the Opposite Party through which it had repudiated the claim of the Complainant on two basic grounds; firstly, that the sum insured of Rs.4.60 lacs of the vehicle in question is claimed to be wrong, and the Opposite Party had demanded the purchase bill of the vehicle, to ascertain the correct insured value. As the Opposite Party had insured the vehicle after having received a proposal (Annexure R-1), as well as the said proposal form also contained the information with regard to the previous policy subscribed by the Complainant from the New India Assurance Co. Ltd. (Ferozepur) and had also mentioned the number 450093349 and its expiry date as 01.09.2010. We feel that the Opposite Party should have demanded the purchase bill before issuing the cover note (Annexure R-2) and having demanded the premium of Rs.11383/- while taking the value of the vehicle as Rs.4.60 lacs. It was incumbent upon the officer under whose signature the said cover note was issued to make himself sure about the value of the vehicle he was insuring. As the contract of insurance having been completed on the acceptance of the proposal of the Complainant, and after the consideration amount having exchanged hands, the Opposite Party is bound to honour its commitment and not to deviate from it at any cost. However, even if there was an iota of doubt then before reaching a conclusion and having decided to repudiate the claim of the Complainant on this ground, the Opposite Party should have given a reasonable opportunity to the Complainant to prove his credentials. The Opposite Party having failed in its own duty cannot punish the Complainant. The Opposite Party is found deficient in rendering proper service to the Complainant on this score. 6. We are also of the view that the custodian of public money and its officers are supposed to take diligence while dispensing with their responsibilities. We feel that if the Opposite Party had suffered any loss on this score, then it was incumbent upon its authorities to investigate at its own end to ascertain as to which of its officer(s) had failed in taking due care while issuing the cover note. Our views in this matter finds concurrence in the judgment titled as United India Insurance Co. Limited Vs. Vivek Kumar, IV (2008) CPJ 321 (HP), wherein the Hon’ble Himachal Pradesh State Commission has conclusively held that the Agent/ Development Officer of the Insurer totally reckless and negligent in undertaking insurance without having checked necessary documents, proved – Insurer liable to pay awarded amount to Complainant – Entitled to recover the amount from concerned officer/ official. 7. The second reason for repudiation of the claim, mentioned in letter (Annexure R-14) dated 27.9.2010, is with regard to the Complainant having availed the N.C.B. at the rate of 20% without disclosing his having claimed own damage losses in his previous policy, too is hollow, for the reasons that the very proposal form (Annexure R-1) submitted by the Complainant, on the basis of which, the Opposite Party offered 20% N.C.B., also contains the detail of the previous policy subscribed by the Complainant from New India Assurance Co. Ltd. (Ferozepur). The Opposite Party in its reply is very categorical about the Complainant‘s ‘breach of good faith and non- disclosure of material facts’ and has also quoted G.R. 27 of India Motor Tariff (Annexure R-9). 8. The Opposite Party has only quoted a part of G.R. 27 of India Motor Tariff, the same is found reproduced in Para 11 of their reply also. However, on going through the provisions of G.R. 27 of India Motor Tariff, completely, we find that the Opposite Party has choosen to only reproduce the selective part, which actually benefits them and has deliberately choosen not to bring to our notice the relevant portions, which binds them to follow a particular procedure while granting N.C.B. The entire G.R. 27 (f), as annexed by the Opposite Party at page 35, is being reproduced hereunder: - “G.R.27 (f) In the event of the insured, transferring his insurance from one insurer to another insurer, the transferee insurer may allow the same rate of NCB which the insured would have received from the previous insurer. Evidence of the insured’s NCB entitlement either in the form of a renewal notice or a letter confirming the NCB entitlement from the previous insurer will be required for this purpose. Where the insured is unable to produce such evidence of NCB entitlement from the previous insurer, the claimed NCB may be permitted after obtaining from the insured a declaration as per the following wording:- “I/we declare that the rate of NCB claimed by me/ us is correct and that no claim as arisen in the expiring policy period (copy of the policy enclosed). I/we further undertake that if this declaration is found to be incorrect, all benefits under the Policy in respect of Section I of the Policy will stand forfeited.” Notwithstanding the above declaration, the insurer allowing the NCB will be obliged to write to the policy issuing office of the previous insurer by recorded delivery calling for confirmation of the entitlement and rate of N.C.B. for the particular insured and the previous insurer shall be obliged to provide the information sought within 30 days of receipt of the letter of enquiry failing which the matter will be treated as a breach of Tariff on the part of the previous insurer. Failure of the insurer granting the NCB to write to the previous insurer within 21 days after granting the cover will also constitute a breach of the Tariff.” The Opposite Party claims that while demanding the N.C.B. the Complainant had appended his signatures on the declaration (at Pg.20) of the proposal form and has tried to assign the same meaning to the declaration found mentioned in Clause (f) of G.R. 27 of India Motor Tariff, which is altogether wrong, because the declaration mentioned in Clause (f) of G.R. 27 is very much crystal clear and relevant only to the clause of claim of N.C.B., which is not found in any portion of the proposal form submitted by the Complainant. The Opposite Party has actually tried to locate the discrepancy on the part of the Complainant, however, it has miserably failed in its efforts and at the same time, the Opposite Party has also committed an impropriety by reproducing a partial part of the G.R. 27 of India Motor Tariff, so as to hide the relevant clause from our observation too. Thus, the Opposite Party is found deficient in rendering proper service to the Complainant on this score also. 9. The Opposite Party while investigating the claim of loss by the Complainant from his previous insurer has written a letter dated 19.8.2010 (Annexure R-5 & R-6) i.e. just one month before the policy subscribed by the Complainant was to expire. However, this very inquiry was to be obtained by the Opposite Party from the previous insurer of the vehicle of the Complainant, within 21 days of having given the N.C.B. to the Complainant, as is envisaged in G.R. 27(f) of India Motor Tariff, annexed by the Opposite Party as Annexure R-9. Thus, the Opposite Party itself has breached the provisions of the G.R. 27(f); hence, the Complainant cannot be made to suffer for the lackadaisical attitude of the officials of the Opposite Party. The Opposite Party is found gravely deficient in rendering proper service to the Complainant. 10. From the above two findings, we are of the view that the vehicle of the Complainant was insured for the IDV of Rs.4.60 lacs and the Opposite Party having insured it for that value, and having received the premium, relevant to this value, there can be no change in its IDV, whatsoever the circumstances may be. The loss of the Complainant is to be assessed on the basis of IDV alone and there can be no deviation from it. Hence, the assessment of the loss of the Complainant as assessed by the Surveyor “on total loss basis” with R.C., and the value of the Salvage realized by the complainant( Rs 1,85,000) comes out to be Rs.2.75 lacs claimed by him, as per the provisions of G.R.8 reproduced below:- “The schedule of age-wise depreciation as shown below is applicable for the purpose of Total Loss/ Constructive Total Loss (TL/ CTL) claims only. A vehicle will be considered to be a CTL, where the aggregate cost of retrieval and / or repair of the vehicle subject to terms and conditions of the policy exceeds 75% of the IDV. The claim of the Complainant deserves to be assessed on CTL basis as the Surveyor had assessed the loss of the vehicle to the tune of Rs.3.48 lacs on “REPAIR BASIS”, which is more than 75% of the IDV of the vehicle. Thus, the Complainant is entitled to Rs.2.75 lacs i.e. IDV –the value of Salvage realized Rs.1,85,000/-. 11. Even the objection that the insurance particulars of previous insurance were not furnished by the Complainant, found mentioned in the letter dated 27.9.2010 (Annexure R-14) is also a blatant lie as the Opposite Party before writing this letter to the Complainant had itself got in touch with the previous insurer of the vehicle through its communications dated 19.8.2010 (Annexure R-5, R-6 & R-8) and also that this information is found mentioned in Annexure R-1 the proposal form, filled by the Complainant, annexed by the Opposite Party. Thus, the claim of the Opposite Party in this regard is nothing but an act to mislead and deny the just claim of the Complainant. 12. Hence, in the light of above observations, we find a definite deficiency in service on the part of the Opposite Party. The present complaint of the Complainant succeeds against the Opposite Party, and the same is allowed. The Opposite Party is directed:- [a] To release the claim of the Complainant (IDV – Rs.1.85 lac i.e. value of Salvage realized) of Rs 2,75.000-/. [b] To pay a compensation of Rs.50,000/- for mental harassment and agony to the Complainant; [c] To pay Rs.10,000/- as litigation costs. 13. The above said order shall be complied within 45 days of its receipt by Opposite Party; thereafter, Opposite Party shall be liable for an interest @18% per annum on the awarded amount as mentioned in Para [a] & [b] above, from the date of filing of the present complaint i.e. 18.11.2011, till it is paid, besides cost of litigation. 14. The Opposite Party while releasing the award of this order, is also directed to also investigate, at its end, about the lapses and the acts of omissions committed by its officials, while issuing the cover note (Annexure R-2), within a period of three months, and after fixing the responsibility, the Opposite Party should recover its losses suffered by it, in the present case from the concerned officials. 15. Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room. Announced 28th September, 2012 Sd/- (LAKSHMAN SHARMA) PRESIDENT S/- (MADHU MUTNEJA) MEMBER Sd/- (JASWINDER SINGH SIDHU) MEMBER ‘Dutt’
| | MRS. MADHU MUTNEJA, MEMBER | HONABLE MR. LAKSHMAN SHARMA, PRESIDENT | MR. JASWINDER SINGH SIDHU, MEMBER | | 
