DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)

Consumer Complaint No.683 of 2016

                                             Date of institution:  12.10.2016                                         Date of decision   :  03.01.2018

Jaswinder Singh son of Basakha Singh resident of House No.266, Phase-6, Mohali.

…….Complainant

Vs

United India Insurance Company through its Divisional Manager, SCO 72, Phase 9, Mohali.

……..Opposite Party

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:   Shri G.K. Dhir, President,

                Shri Amrinder Singh Sidhu, Member

Present:    Complainant in person with counsel Shri
Gopal Krishan Saini.

                Shri Madan Lal Chaudhary, counsel for the OP.

Order by :-  Shri G.K. Dhir, President.

Order

               Complainant, owner of Toyota Etios VD car bearing registration No.PB-65-Q-7654 got the same insured from OP by paying net calculated premium of Rs.7,905/- after submitting proposal form dated 19.03.2015. This car was purchased in March, 2012 for Rs.7,58,388/-, but the insurance coverage was for an amount of Rs.5,80,000/-. Policy bearing No.1121003114P111786861 was issued with validity for the period from 20.03.2015 to midnight of 19.03.2016. The said car was stolen from residence of complainant on 10.09.2015 at about 5.00 p.m. qua which FIR No.0168 dated 14.09.2015 was registered at Police Station Phase-I, Mohali under section 379 IPC. Insurance claim was submitted with OP on 11.09.2015. At that time the OP pointed out as if the vehicle in question insured for Rs.5,42,500/- and not for Rs.5,80,000/-. On insistence of complainant, proposal form was shown to the complainant. OP company admitted that due to some technical fault, insurance policy was issued for Rs.5,42,500/- instead of Rs.5,80,000/- inspite of receiving premium amount of Rs.7,905/-. Complainant was disclosed that he will have to pay additional premium of gap amount of Rs.37,500/- before insurance claim can be passed. So the complainant had to pay Rs.363/- as premium vide receipt dated 02.11.2015. The OP company while settling theft claim, approved claim amount of Rs.4,54,000/- qua which intimation letter dated 05.01.2016 was dispatched. That amount was accepted under protest, being far below the insured amount of Rs.5,80,000/-, for which premium paid by complainant.  Complainant demanded balance amount of Rs.1,26,000/- with interest @ 18% per annum from OP vide representation dated 17.03.2016. It is claimed that complainant is entitled to claim Rs.5,80,000/-, but due to less payment he has incurred monetary loss of Rs.1,26,000/-.  By pleading deficiency in service on the part of the OP, prayer made for directing OP to pay balance amount of Rs.1,26,000/- with interest @ 18% per annum from the date of filing of insurance claim till realisation. Compensation for mental harassment and agony of Rs.50,000/- and for deficiency in services of Rs.30,000/-  and litigation expenses of Rs.11,000/- more claimed. Interest @ 12% per annum from the date of filing of the complaint till actual realisation even claimed.

2.             In reply filed by OP, it is pleaded inter alia, as if the civil court alone has jurisdiction because determination of questions involved requires elaborate evidence; complainant has no cause of action available in his favour. Admittedly car in question owned by complainant was insured with OP and theft of the same having taken place on 10.09.2015. Intimation to OP was submitted on 11.09.2015. It is admitted that theft of the car took place from near House No.266, Phase-6, Mohali regarding which FIR No.168 dated 14.09.2015 was got registered at P.S. Phase-I, Mohali. M/s. Sai Investigating Services were appointed as investigator after receipt of information from complainant. Untraced report accepted by the court of Chief Judicial Magistrate, Mohali on 05.12.2015 also is an admitted fact. After completing all the formalities, OP asked complainant vide e-mail dated 01.01.2016 to send letter of subrogation, original copy of untraced report issued by the police as duly accepted by Ld. Magistrate so that processing of claim may be done as per IRDA Regulations. It was found that claim in respect of vehicle in question payable to the extent of Rs.4,55,033/- less the policy excess  amount of Rs.1,000/-. Insured Declared Value fixation was done as per table contained in terms and conditions of policy. Insured Declared Value as per India Motor Tariff 2002; GR 8 to be declared as the sum insured for the purpose of tariff. IDV to be fixed at the time of commencement of each policy period for each insured vehicle. As per GR 8, the IDV of the vehicle is to be fixed on the basis of manufacturer’s listed selling price of the brand and model as the vehicle proposed for insurance at the commencement of insurance/renewal and adjusted for depreciation (as per schedule specified below). The IDV of the side car (s) and/or accessories, if any, fitted to the vehicle but not included in the manufacturer’s listed selling price of the vehicle is also likewise to be fixed. 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 exceed 75% of the IDV.

Schedule of depreciation for arriving at IDV

                As per e-mail dated 01.01.2016 total cost of the vehicle is Rs.7,58,388/- and after taking into consideration the percentage of depreciation @ 40%, the claim of complainant was settled at Rs.4,54,000/- vide letter dated 15.01.2016. Admittedly due to some technical fault in the insurance policy, additional premium amount of Rs.363/- paid by complainant was accepted by the OP for fixation of IDV as per above referred table. IDV was fixed at Rs.4,55,033/-, but by lessening the policy excess amount of Rs.1,000/-, amount was assessed at Rs.4,54,033/- and said amount has already been paid to complainant. So it is claimed that there is no deficiency in service on the part of the OP and nor they adopted any unfair trade practice. As claim of the complainant has already been settled and as such the complaint alleged to be filed maliciously.

3.             Complainant to prove his case tendered in evidence his affidavit Ex.CW-1/1 alongwith documents Ex.C-1 to C-7 and then closed evidence.

4.             Counsel for OP tendered in evidence affidavit Ex.OP-1/1 of Hem Lata Panwar, Deputy Manager alongwith documents Ex.OP-1 to Ex.OP-3 and thereafter closed evidence.

5.             Written arguments submitted by both the parties. Oral arguments heard and records gone through.

6.             From pleadings of the parties as well as from the submitted written and oral arguments, it is made out that on submission of proposal form Ex.C-2, policy Ex.C-3 was issued after acceptance of premium. On theft of the insured vehicle bearing registration No.PB-65-Q-7654, being committed by someone, FIR was lodged, copy of which is produced on record as Ex.C-4. Even it is undisputed that on lodging of insurance claim by complainant, investigator was appointed by OP and after assessing the amount, claim for an amount of Rs.4,54,000/- was approved and thereafter payment of that amount was made by issue of letter Ex.OP-3 dated 15.01.2016. That amount, as per claim of complainant credited in his account through NEFT on 21.01.2016 and denial of the same is not made specifically by OP.

7.             Certificate of insurance is produced on record as Ex.C-5. Perusal of the same reveals that Insured Declared Value (IDV) of the vehicle in question was pegged at Rs.5,80,000/-. Validity of insurance cover was for period from 02.11.2015 to 19.03.2016 as per certificate of insurance Ex.C-5. This cover note was issued after acceptance of additional premium amount of Rs.363/- . As per claim of the complainant,  initially IDV was pegged at Rs.5,42,500/- and as such it is contended by counsel for the OP that complainant at the most entitled for refund of this additional accepted amount of premium of Rs.363/- and not to any other amount. This submission of counsel for the OP certainly has no force because as per law laid down in case titled as Dharmendra Goel Vs. Oriental Insurance Co. Ltd., 2008(8) SCC 279 (SC) and New India Assurance Company Limited Vs. Ramesh Rao Bhounsle, 2013(3) CPC 583 (NC), IDV fixed by insurer at the time of issue of insurance policy should be taken as payable amount in case of total loss of vehicle. It is laid down in these cases that as Section 146 of the Motor Vehicles Act, 1988 casts an obligation on the owner of the vehicle to take out an insurance policy as provided under Chapter 11 of the Act and  driving of the vehicle without such policy invites punishment under Section 196 of that Act and as such after having accepted the value of a particular insured good (IDV), the insurer cannot disown the said figure of IDV on one pretext or the other, when called upon to pay compensation in claim of total loss of the insured vehicle. In these cases, it is also laid down that it is not for insured to produce evidence to prove that report of surveyor assessing the loss was on lower side, if kept in view the price of the vehicle. Rather in these cases it has been held that the insurer is bound by value put on the vehicle while renewing the policy. In case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd. (supra) deduction of amount of Rs.10,000/- alone was allowed by keeping in view the fact that period of 7 months elapsed between the date of total loss of the vehicle and issue of policy. Ratio of both these cases fully applicable to the facts of the present case and as such keeping in view, IDV of the vehicle in question as Rs.5,80,000/- through renewed certificate of insurance Ex.C-5, now OP estopped by its act and conduct from claiming that this IDV was not properly fixed. Even if Ex.C-3 = Ex.OP-1 may be showing that earlier IDV of vehicle was put at Rs.5,42,500/-, but despite that contents of last issued insurance policy Ex.C-6 cannot be ignored for finding that the OP itself acknowledged IDV of the vehicle as Rs.5,80,000/-. One cannot be allowed to approbate and reprobate. If OP after accepting additional premium amount issued policy Ex.C-6 for acknowledging IDV as Rs.5,80,000/-, then OP cannot back out from that valuation. The vehicle in question insured w.e.f. 20.03.2015 to 19.03.2016 in the first instance is a fact borne from the package policy document Ex.C-3, but the theft of vehicle in question took place on 10.09.2015 is borne by contents of copy of FIR Ex.C-4 and same fact is acknowledged by the parties and as such on account of theft of vehicle in question, complainant suffered total loss of vehicle after about 6 months of issue of policy in question. So keeping in view this fact in mind, deduction of depreciation amount of Rs.9,000/- is appropriate by keeping in view similar deduction made in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd.(supra). Rs.1,000/- more liable to be deducted on account of excess clause and as such in view of receipt of payment of Rs.4,54,000/- by complainant on 21.01.2016, he becomes entitled to balance amount of Rs.1,15,000/-. This figure worked out by keeping in view the IDV as Rs.5,80,000/- and the admitted fact of receipt of Rs.4,54,000/- by complainant. So balance of Rs.1,26,000/- virtually was left to be paid, but after deducting amounts of Rs.9,000/- on account of depreciation and Rs.1,000/- on account of excess clause, balance amount payable by OP to complainant  works out at Rs.1,15,000/-. An un-exhibited letter produced by complainant to show that he raised protest on 17.03.2016 by writing this letter regarding receipt of less amount of Rs.1,26,000/-. So received amount by complainant cannot be termed as amount of full and final settlement.

8.             In the written arguments submitted by OP, the table mentioned discloses about criteria of fixation of IDV by keeping in view the depreciation clause contained in clause-4 of Section-1 of Ex.C-6 or Ex.C-3 or Ex.OP-1. That depreciation of 5% in matter of fixation of IDV permissible if the age of vehicle does not exceed 6 months. However, vehicle in question manufactured in March, 2012 is a fact borne from copy of registration certificate produced on record as Ex.C-1 by complainant himself. If the IDV has once been fixed by the OP, then the OP is bound by that valuation in view of law laid down in above cited cases and as such the valuation for assessing total loss to be taken as Rs.5,80,000/- and not less than that, more so when we are dealing with question of providing deficiency in service by OP in matter of paying less amount of insurance claim than entitlement of complainant as per terms and conditions of policy and as per law laid down in above referred cases.

9.             Complainant was called upon to submit letter of subrogation and other documents before receipt of approved amount of Rs.4,54,000/- and as such certainly in view of issue of letter dated 17.03.2016 by complainant to the OP, it can be said that he accepted the amount under protest. In case of National Insurance Co. Ltd. Vs. Gobind Chandra Nayak, 2008(3) CPC 429 (NC) it has been held that if the evidence on record establishes that complainant was compelled to execute discharge voucher for receiving insured amount under protest, then he is entitled to challenge the action of insurer in paying less amount before appropriate Forum. Same is the position in the case before us and as such in view of ratio of this case as well as of case National Insurance Co. Ltd. & Anr. Vs. Vikas Sahakari Bank Ltd. & Anr., 2009(1) CPC 284, there is no escape from the conclusion that amount of Rs.4,54,000/- accepted by complainant was not the full and final settled amount. In view of payment of less amount of Rs.1,15,000/-, the OP provided deficient services and adopted unfair trade practice and as such complainant entitled to this amount of Rs.1,15,000/- with interest @ 6% per annum w.e.f. 21.01.2016 till payment. As complainant was dragged in this litigation due to lapse of OP, as discussed above, and as such for the mental harassment and agony, complinant certainly is entitled for compensation under that head alongwith litigation costs commensurate with amount receivable as balance by him. The insurer can be said to have committed mistake in paying less amount and as such mistaken action may be not malafide, which itself is a mitigating circumstance. This aspect also needs be taken in consideration, while fixing quantum of compensation and litigation costs.

10.           As a sequel of above discussion, the complaint is allowed by directing the OP to pay balance amount of Rs.1,15,000/- with interest @ 6% per annum w.e.f. 21.01.2016 till payment. Compensation for mental harassment and agony of Rs.8,000/- and litigation cost of Rs.7,000/- more allowed in favour of the complainant and against the OP. Amount of compensation and litigation expenses be paid within 30 days from the date of receipt of  certified copy of the order. File be indexed and consigned to the record room.

Announced

January 03, 2018.

                                                                (G.K. Dhir)

                                                                President

                                                            (Amrinder Singh Sidhu)                                                                      Member