H.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT SHIMLA.





DATE OF DECISION: 26.3.2009.





First Appeal No.180/2007

In the matter of:



National Insurance Company Limited, Divisional Office, Himland Hotel, Circular Road, Shimla, through its Assistant Manager.

… … Appellant.

Versus



Smt. Bishani Devi wife of Shri Dalel Singh, resident of Village Mann, Tehsil Arki, District Solan, through her Special Attorney Shri Gurdial Singh son of Shri Dalel Singh, resident of Village Mann, Tehsil Arki, District Solan, H.P.

… … Respondent.

Present: Mr. Jagdish Thakur, Advocate.

For the appellant.



Mr. G.S. Rathore, Advocate,

For the respondent.



First Appeal No.354/2007.



Smt. Bishani Devi wife of Sh. Dalel Singh, resident of Vill. & P.O. Mann, Tehsil Arki, District Solan, H.P.

… … Appellant.

Versus



National Insurance Company Ltd. through its Branch Manager, Branch Officer, The Mall, Solan, Tehsil and District Solan, H.P.

… … Respondent.



Present: Mr. G.S. Rathore, Advocate,

For the appellant.



Mr. Jagdish Thakur, Advocate,

For the respondent.



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Hon’ble Mr. Justice Arun Kumar Goel (Retd.), President.

Hon’ble Mrs. Saroj Sharma, Member.



Whether approved for reporting? Yes.



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O R D E R:



Justice Arun Kumar Goel (Retd.), President (Oral).





1. Heard learned Counsel for the parties and have examined the record of this case. Since both these appeals are directed against the order of the District Forum, Solan, passed in Complaint No.145/2003 on 16.3.2007, as such these appeals were heard together and are being disposed of by this common order.



2. Admitted facts giving rise to these appeals are that vehicle bearing Registration No.HP-12-2258 was insured under a valid policy of insurance on 23.08.2001 in the sum of Rs.4,50,000/-. It was a 2001 model and was thus insured on Insured’s Estimated Value (I.E.V.). It met with accident on 12.3.2002 during the currency of Insurance policy.



3. At the time of hearing, it was not disputed on behalf of the parties that this was a case of total loss. To our query what would be the situation when it meets with accident within a year of its purchase and what is the extent of depreciation allowable in terms of the policy in such case, learned Counsel for the Insurance Company stated that for 6 months there is no depreciation and for subsequent 6 months, 5% is allowable. He further clarified that it is for his client to decide whether to indemnify the insured on the basis of the depreciated value or the market value whichever is less. In this background, we have been called upon to adjudicate both these appeals.



4. Mr. Thakur Submitted that on receipt of intimation of accident, his client appointed the Surveyor who assessed the market value of the vehicle on the date of accident at Rs.3,50,000/- and the salvage value of the vehicle was assessed by the Surveyor at Rs.1,35,000/-. Further according to Mr. Thakur, his client was always ready and willing and offered 75% of this amount on non-standard basis. However this offer was made during the pendency of the complaint which was declined by the insured – Bishani Devi is admitted by both the parties.



5. Fact remains that when claim was not settled by the Insurance Company, insured filed the complaint. When put to notice by the District Forum below, defence of the Insurance Company was that the insured had no cause of action, she was estopped from maintaining the complaint besides her being guilty of concealment of true and real facts. Loss was assessed at Rs.1,98,500/- on net of salvage basis as full and final settlement. Further according to the Insurance Company, salvage valued at Rs.1,35,000/- was to be retained by the complainant. The vehicle being goods carrying vehicle was carrying two unauthorized passengers at the time of accident, so the offer of Rs.1,98,500/- was made on non-standard basis i.e. 75% of the assessed amount of loss. District Forum below after considering respective submissions, allowed the complaint in the following terms:-



“In view of the foregoing reasons, we allow this complaint and direct the OP-Company to indemnify the complainant to the extent of Rs.2,56,500/-, alongwith interest at the rate of 9% per annum with effect from the date of filing of the complaint, which happens to be filed on 19.09.2003 till realization. The litigation cost is quantified at Rs.2500/-. These payments shall be made to the complainant by the opposite party-company within a period of forty five days from the date of receipt of copy of this order. With these directions, the complaint stands disposed of. The office shall make available a copy of this order to the parties free of cost as per procedure. The file after due completion, be consigned to records”





6. Insurance Company has filed Appeal No.180/2007 for allowing the same with a prayer to dismiss the complaint, whereas Appeal No.354/2007 has been filed by the insured for enhancement of compensation assessed.



7. According to Mr. Thakur, learned Counsel for the appellant, de hors of any other ground, this appeal needs to be allowed because 2 unauthorised passengers were travelling at the time of accident in the vehicle which was adapted and meant for carriage of goods. With a view to further his this submission, he urged that District Forum below erroneously ignored this vital aspect of the case and came to a wrong conclusion by allowing the complaint. Alternatively, he pressed into service the consent letter given by the insured, and also the offer to accept less amount. He pressed into service Annexures L & N filed with the reply of the Insurance Company.



8. While controverting all these pleas, Mr. Rathore submitted that documents Annexures L & N relied upon by the Insurance Company are of no consequence. Per him in case Insurance Company wanted to take advantage of these documents, claim of his client should have been settled then and there. Since both these documents are un-dated, therefore, they shall be deemed to have been given to the Insurance Company at best before filing of the complaint, which as per complaint file was presented on 19.9.2003. In case Insurance Company wanted to take benefit of these two documents, nothing prevented them to have settled the matter then and there once for all. Instead of doing the needful, we are of the view that insured has been forced to file the complaint out of which these appeals have arisen.

9. Suffice it to say in this behalf that in a given case a litigant like insured in these appeals before us may like to buy peace for lesser amount without going to litigation. Nationalized insurance companies are business organizations like other public sector undertakings. They are expected to act in a business like manner so as to ensure that the public money is saved as far as possible and in a legitimate way. Thus, not having taken advantage of these documents, i.e. Annexures L & N, we are of the view that now taking shelter under these by the Insurance Company is wholly mis-conceived, and it is estopped from placing reliance on these documents for allowing the appeal.



10. Another reason to take this view is that when consent letter or acceptance of amount lesser than to what the insured was entitled to in law agreed to accept the same, it is presumed that all codal formalities were completed and Insurance Company was satisfied as to the legitimacy of the claim of the insured. Since the Insurance Company missed the bus by not settling the matter, therefore it is excluded from taking benefit of these two documents in these appeals.



11. Even if it is assumed for the sake of argument without admitting that there were two unauthorized passengers, then it has to be seen whether their travelling in the goods vehicle was in any manner instrumental in causing the accident either directly or indirectly and at the same time contributed partly or otherwise in causing accident, would be other relevant factors. In case Insurance Company wanted to take advantage of carriage of unauthorized passengers then it was further required to establish that travelling of these persons was either sole or contributory cause of the accident in question. There is no such evidence produced on behalf of the Insurance Company and none could be pointed out from the complaint file. What is the effect of carriage of unauthorized passengers came up before the National Commission in a recent decision in the case of New India Assurance Co. Ltd. & Anr. Versus G.J. Ashok, I(2009) CPJ 297 (NC). Similar view has been taken by this Commission in the case of Oriental Insurance Company Ltd. Versus Smt. Sunaina Garg, Appeal No.496/2007 decided on 18.3.2009.



12. To be fair to Mr. Thakur, we may notice here that he referred to a few decisions of the Hon’ble Supreme Court as well as of the Hon’ble High Court of Himachal Pradesh to the effect that for carriage of unauthorized passengers in goods vehicle, Insurance Company is not liable to pay any compensation under Section 166 of the Motor Vehicles Act, 1988. According to us, when the number of persons sitting in the vehicle at the time of accident is within the seating capacity as per the Registration Certificate of the goods vehicle, as well as keeping in view the risk covered under the policy of insurance of such a vehicle was not the point at issue before the Hon’ble Supreme Court, therefore the ratio laid down in the decisions relied upon by Mr. Thakur does not advance the case of his client-Insurance Company, as such those are not being noted.



13. Now coming to the appeal filed by the insured. Suffice it to say in this behalf that after allowing 5% depreciation on the sum insured i.e. Rs.4,50,000/- amount payable works out to Rs.4,27,500/-. Mr. Rathore submitted that whatever salvage of the vehicle was retrieved is available with his client and he shall deliver the same to the Insurance Company on ‘as is where is’ basis in its Branch Office at Solan by or before 30.4.2009. At the same time, the insured-Bishani Devi is also directed to hand over the keys of the vehicle if any available with her alongwith Registration Certificate if it is available with her to the Insurance Company. In case same is not available with her, then she shall provide duplicate Registration Certificate after obtaining the same from the concerned Registering & Licensing Authority.



14. In case the Insurance Company wants the R.C. to be transferred in its name, Smt. Bishani Devi shall do the needful at the cost and expense of the insurer whenever called upon to do so in writing. It is further clarified that in case the insured-Bishani Devi fails to hand over the possession of the salvage of the vehicle in question on ‘as is where is’ basis alongwith key and original Registration Certificate/duplicate Registration Certificate as aforesaid by or before 30.4.2009, then in such a situation we direct that she will only be entitled to Rs.2,92,500/- alongwith interest at the rate and from the date on this amount alongwith cost as ordered by the District Forum below and in case she hands over the salvage etc. as aforesaid, then she will be entitled to Rs.4,27,500/- also with interest at the rate and from the date as well as cost assessed by the District Forum. On proof being placed on record regarding the delivery of the salvage etc. as aforesaid, only then Bishani Devi will be entitled to claim refund of the amount.



Subject to above modification in the impugned order of the District Forum below, both the appeals stand finally disposed of.



Office is directed to place authenticated copy of this order on the file of Appeal No.354/2007.



All interim orders passed from time to time in Appeal No.180/2007 shall stand vacated forthwith.



Learned Counsel for the parties shall collect copy of this order free of cost from the Court Secretary as per Rules.



Shimla,

March 26, 2009.





( Justice Arun Kumar Goel ) (Retd.)

President





( Saroj Sharma )

/BS/ Member.