Appeal no. FA-8/876
(Appeal against the order dated 30.04.2008 passed by District Forum- New Delhi District , in complaint case no.242/2007)
Shri Ashwani Arora,
United India Insurance Co. Ltd.,
Divisional Office NO. V,
68/1, Janpath, New Delhi-110002.
Shri S. Ghosh, Advocate
Justice Barkat Ali Zaidi, President.
M.L. Sahni, Member
1. Whether reporters of local newspaper be allowed to see the
2. To be referred to the reporter or not?
M.L. SAHNI, MEMBER
1. By this appeal the complainant (hereinafter referred as to as the Appellant), dis-satisfied with the order passed by the District Consumer Forum (New Delhi District) on 30.04.2008, has prayed for modification of the impugned order to the extent that Opposite Party no. 1 i.e . Respondent here in this appeal, be directed to pay an amount of Rs. 91,584/- towards interest paid by the Appellant to the I.C.I.C. I Bank , who had financed the vehicle in question at Rs. 6,00,000/-.
2. Undisputed facts of the case are that the appellant purchased a new motor car, Mahindra Scorpion bearing registration No. DL 4 CN B 0646 from the opposite party No. 2 (the dealer) and got the same insured from the Respondent(Opposite Party-1), immediately after its purchase vide insurance policy /cover note in which the value of the vehicle (IDV) was assessed at Rs. 7,21,519/- i.e. 5% less than the priced amount. The car of the Appellant was stolen on the night of 2nd -3rd July, 2006 for which a complaint was made to the local police on 3.7.2006. An FIR was registered on 10.7.2006. On 21.7.2006 the representative of the surveyor of the Respondent namely Pritam Kumar visited the residence of the Appellant and collected some documents and keys of the stolen vehicle vide letter dated 21.7.2006. Thereafter on 26.7.2006 the Appellant wrote a letter to Respondent as well as to ICICI Bank through whom the vehicle was got financed, informing about the representative of the surveyor of Respondent and his collecting documents and keys of the stolen vehicle. Since the vehicle was not traced by the police, hence an untraced report was filed by the police on 10.8.2006. On 11.8.2006 the Appellant handed over the report, original registration certificate and all other documents along with the duplicate keys of the vehicle , as demanded by the Respondent. On 20.8.2006 the Appellant was contacted by the surveyor of the Respondent who asked the complainant to give the consent for deduction of discounts which the appellant had availed from Respondent at the time of purchase of the car. The appellant asked for settlement of his claim on the basis of the IDV amount i.e . on which the Respondent had taken the premium. When the Respondent failed to settle the claim, . the Appellant sent a letter dated 13.02.2007 stating that they have approved the claim for a sum of Rs. 6,78,377/- being the full and final settlement. The appellant refused to accept the said settlement and issued a notice to the Respondent on 24.2.2007, with a copy to OP-2. Therefore, he filed complaint before District Consumer Forum on 17.3.2007.
3. The respondents, contested the complaint, before the District Forum. By filing reply to the appeal they reiterated that the Appellant had, at the time of proposing for insurance of his vehicle, declared that the selling price of the said vehicle was Rs. 7.59,494/-. The respondent had taken his word for the same and insured his vehicle , after deducting 5 % from the said declared value, as per the terms and conditions of the Insurance Policy for fixing the IDV (Insured’s Declared Value) for the first year. However, after the appellant suffered the loss and the same was surveyed by the Surveyor, it came to the light from the invoice submitted by the appellant, that the appellant had purchased the said vehicle for only Rs. 7,15,134/- i.e. at an amount lesser by Rs. 44,360/- than what was represented by him. However, it is correct that the premium for the above insurance had been deposited by the appellant with the Respondent. The delay in settlement of the appellant’s claim was due to his own refusal to accept the IDV amount offered by the Respondent, calculated at the actual purchase price of the vehicle. The respondent had offered an amount of Rs. 6,78,377/- towards full and final settlement of the appellant’s claim. However, the same amount could not be deposited with the Ld. Forum as there was neither any direction of the Forum, nor any prayer by the appellant seeking the same. The contract of insurance is based on the contract between the seller and the buyer, the IDV of the vehicle is calculated on the actual selling price, based on the insurance contract. The Appellant cannot hide the actual price at which he purchased the vehicle from the seller, give an inflated figure for the same, pay the premium, which is less than 4 % of the said value and get the same insured from the Respondent and later on , claim indemnification based on the inflated figure, which is not the actual cost price. The respondent cannot indemnify the appellant for any amount higher than the IDV calculated at the actual cost price of the vehicle. The present appeal is not maintainable , as it is a consequential loss and is clearly excluded under the terms and conditions of the contract of insurance . Moreover , the appellant has already received a higher amount towards his alleged claim, apart from an amount of Rs. 50,000/- towards compensation and Rs. 10,000/- towards cost of litigation, which have been duly paid by the Respondent and he should have no further grievance regarding the same. The higher amount awarded by the Ld. District Forum towards the insurance claim, alongwith the compensation, covered the aspect of interest and there can be no separate award of interest alongwith compensation.
4. The Appellant , who had been prosecuting this appeal in person, filed his written submission alongwith case law to fortify his arguments. We have heard the Ld. Counsel for the Respondent. We have also examined carefully the impugned order of the Ld. District forum , whereby the complaint has been allowed providing following relief to the Appellant.
1. OP-1 (Respondent) will pay to the complainant the entire insurance amount of Rs. 7,21,519/- to the complainant and the complainant will issue a letter of subrogation to the OP and will do all acts necessary to change the title on this vehicle into the name of OP-1 and will also fill forms for transfer authorities for change of title and the complainant will have no title on this vehicle as and when the same is traced out.
2. OP-1 (Respondent) will pay Rs. 50,000/- towards compensation for causing mental agony and harassment to the complainant.
3. OP-1 (Respondent) will pay Rs. 10,000/- towards cost of litigation.
5. We have thoughtfully considered the case law submitted on behalf of parties.
6. It is contended on behalf of Respondents that interest paid by the Appellant to ICICI Bank on the loan raised by him is subsequent loss suffered by the Appellant and is not payable by the Respondents in view of the order of the National Commission passed in New India Insurance Co. Ltd. Vs Kamal Nayan -IV (2006) CPJ 84(NC), wherein it was observed that, claim regarding subsequent loss cannot be allowed since no separate policy is taken by the complainant relating to consequent loss. Principle of indemnity is to restore status of complainant.
7. To support his claim, the Appellant has relied upon a number of decisions of this Commission as well as of the Hon’ble National Commission all these judgments, facts of the case in “Abhey Neelwarne Vs The New India Assurance Company Ltd. & Othrs.” decided on 26.3.2008 by the Hon’ble National Commission are quite akin to that of the present case before us. Their lordships modified the order of Karnataka State Commission by directing the Insurance Company to pay interest @ 10% on the amount of Rs. 6.25 lacs for the period from 9th April, 2001 to 21st April, 2003 and also interest @ 10% p.a. on the amount of Rs. 1,17,000/- from 21st April, 2001 till 28th February, 2005. However, the award passed by the State Commission directing the Insurance Company to pay compensation of Rs. 50,000/- is set aside because the payment of interest would take care of compensation part.
8. Considering the facts of the present case, in the light of the law as discussed in the cited case and observations made there in, we feel satisfied that the appeal can be modified as prayed, but to the extent that the Appellant can either be entitled to compensation or interest.
9. The Ld. District Forum has awarded compensation of Rs. 50,000/- and the Appellant claims the amount of Rs. 91,584/- paid by him to ICICI Bank on loan of Rs. 6,00,000/-. Thus he can be allowed re-imbursement of that amount by way of compensation. Accordingly, partly allowing the appeal impugned order is modified to the extent that the Respondent shall pay Rs. 91,584/- instead of Rs. 50,000/- awarded by the Ld. District Forum towards compensation. Rest of the impugned order shall remain unaltered and parties shall discharge their respective obligations.
10. The aforesaid payment shall be made after adjusting the amount , if any, already paid to the appellant within 30 days of the receipt of this order, failing which, Respondent shall be liable to pay interest @ 10% p.a. on the awarded amount.
11. A copy of this order as per statutory requirements be forwarded to the parties free of charge and also to the concerned District Forum . The file thereafter be consigned to Record Room.