1.      This Revision Petition is been filed by the Petitioner/OP-1/ Insurer under Section 21(b) of the Consumer Protection Act, 1986 (“the Act”) against the impugned order dated 24.01.2019, passed by the learned Maharashtra State Consumer Disputes Redressal Commission, Circuit Bench at Aurangabad (‘the State Commission’) in FA No. 817/2016 wherein the State Commission allowed the Appeal filed by the Respondent/ Complainant against the order dated 08.07.2016 passed by the District Consumer Disputes Redressal Forum, Latur, (‘the District Forum’) wherein the District Forum dismissed Complaint No.197/2015.

2.      For convenience, the parties are referred to as placed in the original Complaint filed before the District Forum.

3.      Brief facts, as per the Complainant, are that he purchased a Mahindra DI Tractor financed by Mahindra & Mahindra Financial Services Ltd. The tractor was insured with Petitioner/OP-1 vide policy No. 015298403400 valid from 15.04.2014 to 14.04.2015. On 23.04.2014, at about 10:00 AM the Complainant discovered that his tractor was missing from his field where he parked. Despite searching, he was unable to locate. He approached Murud Police Station and lodged a theft report. The police advised him to search for the tractor for 4-5 days before filing the report. The Complainant notified the insurance company about the theft and made efforts to locate the tractor but could not locate. Eventually, on 02.05.2014, he filed a report with police and CR. No. 44/14 was registered under section 379 of the IPC against unknown persons. Subsequently, he repeatedly inquired with the insurer to process his claim, providing them all necessary details, including claim No. 620778752. However, the insurance company avoided sanctioning the claim and requested additional documentation, including a copy of the FIR and an affidavit on a Rs.100/- stamp paper. Despite submitting the required documents, the insurer repudiated the claim without providing any valid reason, causing financial loss and mental agony to the Complainant. Consequently, he filed a Consumer Complaint before the District Forum seeking compensation of Rs. 5,50,000/-, expenses of Rs. 50,000/-, and costs of Rs. 10,000/-.

4.      In reply, the Petitioner/OP-1 refuted all allegations in the complaint. While acknowledging that the tractor was insured with them, the Petitioner emphasized that the policy was subject to specific terms and conditions. They denied the Complainant’s claim that he promptly reported the theft to the police and informed the insurance company via phone, stating that the police did not record the report immediately and asked the Complainant to return after 4 to 5 days. Additionally, they disputed the assertion that the Complainant executed an affidavit on a Rs. 100/- stamp paper and submitted it to the insurer. OP-1 refuted the claim that the insurance claim was repudiated solely due to delay in lodging the FIR, asserting instead that there was a breach of crucial policy terms and conditions, including the delay in reporting the theft to both the police and the insurance company. They argued that this delay deprived both parties of the opportunity to search for the vehicle effectively. The Petitioner/OP-1 asserted that there was no deficiency in service on their part and prayed for the dismissal of the complaint.

5.      In reply, OP-2, Mahindra Insurance Broker, asserted its role as a broker facilitating customers in obtaining suitable insurance policies to protect their interests. The Complainant approached them for information regarding insurance policies, and after consultation, decided to purchase a policy from OP-1. OP-2 clarified that it is the prerogative of OP-1 to determine whether to accept or reject insurance claims. As such, there was no cause of action against OP-2 and requested for its dismissal.

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6.      The learned District Forum vide Order dated 08.07.2016 dismissed the complaint with the following observations:-

  “According to the same, it is very clear that the Insurance Company has Non-applicant Insurance Company has aptly refused the policy claim of the complainant as per the rules governing the policy. Therefore, from that it becomes evident that the Non-applicant has not at all committed any deficiency of service to the complainant.  Therefore, by deciding the QOL No.1 in negative, the Ld. Forum is passing the order hereby as under:

                                        ORDER

1. The complaint application of the complainant is being hereby dismissed.
2. No order regarding expenses.
3. Free copy of the Order be issued to both the Parties.”

7.      Being aggrieved by the Order of the learned District Forum, the Complainant filed an Appeal No.817/2016 and the State Commission vide order dated 24.01.2019 allowed the Appeal and set aside the order of the District Forum with the following observations:

    “9. In this case it is not disputed that the complainant is the owner of tractor MH-24-D-6432 and it was insured with opponent No.1 insurance company through opponent No.2. at the relevant time, when alleged theft of tractor is committed. According to the complainant he has kept the tractor in his field on 21.4.14. He found that it was missing from his field on 23.4.14 at 10.00 a.m. when he visited his field. He immediately went to the police station Murud to lodge the report. However, police asked him to trace out the tractor and to come after 4 to 5 days. Accordingly, he took search for the same in the vicinity & made enquiry with his friends. He has also enquired with the finance company whether they have taken the tractor as the instalment was due. However, he came to know that, said tractor was not taken by the finance company. Therefore, he again went to police station and lodged report on 2.5.14.

10. According to complainant he has given intimation to opponents on telephone on the same day of theft as well as on the day of lodging report with police. The complainant has relied upon the documents produced along with list filed at page No. 45. There is copy of FIR and the report in writing submitted to police dated 2.5.14. In the said report he has specifically made clear that he has made enquiry with his friends, in the vicinity as well as with finance company as the instalment was due and the finance company was insisting him for the same. He has also executed affidavit on stamp paper thereby clarifying paper that he had been to police immediately to lodge the report. But the police asked him to come after taking search. He has also made enquiry with finance company and then again went to police station to lodge report on 2.5.14. According to on his intimation to opponent insurance company his claim was numbered as 620778752 He has also executed affidavit that immediately when he found his tractor was missing, he went to lodge report with police. He has further explained the delay in lodging FIR in writing that he has taken search and he again went to police station to lodge report and then on 2.5.14 his FIR was taken by police.

11. The opponent No.1 has denied that, the complainant has given any oral or written intimation till 6.5.14 through representative as alleged in the complaint. However, it is admitted that on 6.5.14 at about 4:30 pm on toll free number after delay of 13 days they received intimation of incident and they received the letter in writing on 16.6.14. It is also admitted that his claim was numbered as 620778752 on 6.5.14. The opponent insurance company has not produced any document on record. Copy of claim is not produced as 620778751-A. It reveals that no correspondence made by opponent No.1 with complainant till receipt of his subsequent notice dated 16.6.15, wherein the complainant has categorically mentioned that he has time and again asked the complainant about his claim. There is also mentioned about his claim number in it about report lodged with police and his execution of affidavit on stamp paper of Rs. 100/-. It reveals that thereafter, the opponent No.1 gave reply on 29.5.15 to the complainant wherein the opponent has admitted that he has given intimation to police after delay of 9 days and intimation to opponent after delay of 13 days and due to delay in giving information he has immediately to opponent or the police, his claim is repudiated on the ground that, the complainant has made violation of the policy condition No.1 which states as follows.

    "Notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage in the event of any claim and thereafter the insured shall give all such information and assistance as the company shall require…………. In case of theft or criminal act which may be the subject of a claim under this policy the insured shall give immediate notice to the police and co-operate with the company in securing the conviction of the offender." And it is informed to him that due to delay in registering the FIR and intimation to insurance company they are denying the liability under the policy.

12. On perusal of record it reveals that the complainant has made genuine submission with police but the police have not recorded his complaint for 4 to 5 days and asked him to take search for the vehicle. Accordingly he took search of the vehicle within the vicinity, with relatives, with finance company as his one instalment was due and they were insisting for recovery for the same. It has got corroboration from the arbitration proceeding which was initiated after one year wherein the financer has claimed interim relief before arbitrator for seizure of vehicle. While giving reply in the said proceeding and reply interim application, it is categorically mentioned that his vehicle is stolen away by unknown person and therefore, he is unable to vehicle is make payment. Thus, the fact of commission of theft is also made known to the financer. Thus, the consumer complaint of the complainant is supported by his affidavit as well as documents which disclosed that the delay is very well explained by the complainant just like police machinery he has also given intimation to opponent.

13. The statement of complainant on affidavit is not denied by 13.ter affidavit. Moreover, the affidavit executed by him is also on record wherein he has explained the delay. Apparently it reveals that the complainant tried to give intimation to police as well as opponent immediately. The police themself asked complainant to take search of the vehicle. He was also under impression that he should inquire with the finance company whether their representative have collected the vehicle and after making genuine efforts he again approached the police.

14. Therefore, in view of the aforesaid facts and circumstances of the present case we are of the opinion that, it is the genuine case in which in the light of judgment of Apex Court if the claim is denied certainly it may cause wrong impression with the insured insuring the policy. In this distinguishing facts & circumstances case in hand we are of the opinion that, the opponent NO.1 has denied the genuine claim of complainant only on the ground of delay by holding that he has committed breach of policy condition. Though it fact said delay was explained on affidavit & there was immediate intimation to police. With this the opponents have committed deficiency in service. In this case the ID value of the vehicle is shown as Rs.5,50,000/-. The theft is occurred on 23.4.14. During the policy period there is only some delay in lodging report, but it is not as such inordinate, so as to deprive to police or insurance company from taking search, because already the complainant had been to police station. Hence, in this case it will be just & proper to pay the ID value of the vehicle shown in the policy.

15. Admittedly the complainant has purchased the vehicle with finance assistance of Mahindra Finance. However, said finance company is not made party to this compliant. Hence, it will be just & proper that the direction to opponent No.1, will be required for depositing the amount of award subject to intimation to the finance company. Hence, in the circumstances there requires interference in the judgment and order of learned District Consumer Forum. Hence we answer the points in the affirmative & pass following order.

ORDER

1. The appeal is allowed.

2. The judgment and order of District Consumer Forum is quashed and Set aside.

3. The opponent No.1 shall pay amount of Rs.5,50,000/- to the complainant along with interest at 9 % p.a. from the date of complaint till realization of entire amount, under intimation to insurance company.

4. The complainant shall also pay cost of Rs. 5,000/. to complainant towards mental agony & Rs 5,000/- towards the costs.

5. No order as to costs in appeal.”

8.      Being dissatisfied by the Order dated 24.01.2019 passed by the State Commission, the Petitioner/OP-1 filed the instant Revision Petition.

9.      In his arguments, the learned Counsel for Petitioner/OP-1 asserted that there was clear violation of terms & conditions of the insurance policy by the Complainant. The policy issued to him explicitly states that the Claim for theft of vehicle is not payable if theft is not reported to the Insurance Company immediately. However, OP was informed about the incident only on 06.05.2014 with the delay of 13 days and also lodged the FIR on 02.05.2014 with the delay of 9 days which is clearly violation of the terms and conditions of the Insurance Policy in question. The learned Counsel argued in favor of the order passed by the District Forum and sought to set aside the impugned order dated 24.01.2019 passed by the State Commission.  He cited the following judgments:

(i) Oriental Insurance Co. Ltd. Vs. Parvesh Chander Chadha, Civil Appeal No.6739/2010 decided on 17.08.2010 by the Hon’ble Supreme Court;

(ii) New India Assurance Co. Ltd. Vs. Trilochan Jane, FA No.321 of 2005, decided by NCDRC on 09.12.2009;

(iii) United India Insurance Company Vs. Harchand Rai Chandan Lal (JT) (2004) 8 SCC;

(iv) Suraj Mal Ram Niwas Oil Mills Vs. United India Insurance Co. Ltd., (2010) 10 SCC 567;

(v) Vikram Greentech (I) Ltd. V. New India Assurance Co. Ltd.,(2009) 5 SCC 599;

(vi) Oriental Insurance Co. Ltd. V. Parvesh Chander Chadha, (2018) 9 SCC 798.

10.    On the other hand, the arguments of the learned Counsel for the Complainant were centred on the rejection of a claim due to a delay in notifying OP about the theft. He asserted that the vehicle was stolen on 23.04.2014. The oral intimation of the theft was given immediately to the police but the police asked him to take search of the tractor for 4-5 days.  Thereafter, he lodged the FIR vide C.R. No.44/14 dated 02.05.2014. The Intimation to the Insurance Company was also given on 06.05.2014 about the theft of vehicle. However, the insurer repudiated the claim citing a violation of the policy's terms and conditions. He argued in favour of the impugned order passed by the State Commission and sought to dismiss the Revision Petition.

11.    The Respondent No.2/OP2 did not appear on 20.02.2024 and therefore, he was placed ex-parte.

12.    I have examined the pleadings and associated documents placed on record and rendered thoughtful consideration to the arguments advanced by the learned Counsels for both the parties.

13.    The main issue arises in the matter is the delay in intimation to the police and insurance company.

14.    In the present case, it is established that the Complainant orally intimated the police station about the theft on the day of the incident. However, the police advised him to search for the vehicle for 4-5 days before lodging the FIR. Thereafter, the FIR was lodged on 02.05.2014. It is also undisputed that the Complainant informed the insurance company about the theft of the insured vehicle on 06.05.2024. These timelines indicate that the Complainant took reasonable steps to report the theft to the relevant authorities and the insurance company in a timely manner. The Hon’ble Supreme Court in Jaina Construction Committee V. Oriental Insurance Company Ltd., 2022 SCC OnLine SC 175 has held as under:

“12. In the opinion of the Court the aforestated ratio of the judgment clinches the issue involved in the case on hand. In the instant case also, the FIR was lodged immediately on the next day of the occurrence of theft of the vehicle by the complainant. The accused were also arrested and charge-sheeted, however, the vehicle could not be traced out. Of course, it is true that there was a delay of about five months on the part of the complainant in informing and lodging its claim before the Insurance Company, nonetheless, it is pertinent to note that the Insurance Company has not repudiated the claim on the ground that it was not genuine. It has repudiated only on the ground of delay. When the complainant had lodged the FIR immediately after the theft of the vehicle, and when the police after the investigation had arrested the accused and also filed challan before the court concerned, and when the claim of the insured was not found to be not genuine, the Insurance Company could not have repudiated the claim merely on the ground that there was a delay in intimating the Insurance Company about the occurrence of the theft.”

15.    The Hon’ble Supreme Court in Dharmender Vs. United India Insurance Co. Ltd. & Ors., Civil Appeal No.5705 of 2021 decided on 13.09.2021 has held as under:

“We have heard the learned counsel for the parties at length and find that the order passed by the NCDRC cannot be sustained. The claim of the appellant was repudiated by the Insurance Company on the ground that there is delay of 78 days in intimating the vehicle being stolen on the intervening night of 24-25.04.2010. It is the said ground which was raised and accepted by the NCDRC. The NCDRC has returned the following finding to set aside the orders passed by the District Forum, as affirmed by the State Commission:-

“7. The delay of 78 days was not explained. The complainant has failed to make a case that there was delay in intimation due to unavoidable circumstances as per the IRDA circular.”

  However, in respect of the argument that the FIR was delayed, the said arguments need not be examined in this case as the case of Insurance Company throughout was based upon delay in intimation to the Insurance Company.”

16.    The Hon’ble Supreme Court in the case of Gurshinder Singh Vs. Shriram General Insurance Company Ltd., 2020 (11) SCC 612 has held as under:

“9. We are of the view that much would depend upon the words “cooperate” and “immediate”, in Condition 1 of the standard form for commercial vehicles package policy. Before we analyse this case any further, we need to observe the rules of interpretation applicable to a contract of insurance. Generally, an insurance contract is governed by the rules of interpretation applicable to the general contracts. However, due to the specialised nature of contract of insurance, certain rules are tailored to suit insurance contracts. Under the English law, the development of insurance jurisprudence is given credence to Lord Mansfield, who developed the law from its infancy. Without going much into the development of the interpretation rules, we may allude to Neuberger, J. in Arnold v. Britton [Arnold v. Britton, 2015 AC 1619 : (2015) 2 WLR 1593 : 2015 UKSC 36 (SC)E] , which is simplified as under:

(1) Reliance placed in some cases on commercial common sense and surrounding circumstances was not to be invoked to undervalue the importance of the language of the provision which is to be construed.

(2) The less clear the words used were, the more ready the court could properly be to depart from their natural meaning, but that did not justify departing from the natural meaning.

(3) Commercial common sense was not to be invoked retrospectively, so that the mere fact that a contractual arrangement has worked out badly, or even disastrously, for one of the parties was not a reason for departing from the natural language.

(4) A court should be very slow to reject the natural meaning of a provision as correct simply because it appeared to be a very imprudent term for one of the parties to have agreed.

(5) When interpreting a contractual provision, the court could only take into account facts or circumstances which existed at the time that the contract was made and which were known or reasonably available to both parties.

(6) If an event subsequently occurred which was plainly not intended or contemplated by the parties, if it was clear what the parties would have intended, the court would give effect to that intention. [ Robert Merkin QC et el., Colinvaux's Law of Insurance (11th Edn.), p. 159.]

10. A perusal of the aforesaid shows that this contract is to be interpreted according to the context involved in the contract. The contract we are interpreting is a commercial vehicle package policy. There is no gainsaying that in a contract, the bargaining power is usually at equal footing. In this regard, the joint intention of the parties is taken into consideration for interpretation of a contract. However, in most standard form contracts, that is not so. In this regard, the court in such circumstances would consider the application of the rule of contra proferentem, when ambiguity exists and an interpretation of the contract is preferred which favours the party with lesser bargaining power.

11. It is argued on behalf of the respondents and rightly so, that the insurance policy is a contract between the insurer and the insured and the parties would be strictly bound by the terms and conditions as provided in the contract between the parties.

12. In our view, applying the aforesaid principles, Condition 1 of the standard form for commercial vehicles package policy will have to be divided into two parts. The perusal of the first part of Condition 1 would reveal that it provides that “a notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage”. It further provides that in the event of any claim and thereafter, the insured shall give all such information and assistance as the company shall require. It provides that every letter, claim, writ, summons and/or process or copy thereof shall be forwarded to the insurance company immediately on receipt by the insured. It further provides that a notice shall also be given in writing to the company immediately by the insured if he shall have knowledge of any impending prosecution inquest or fatal inquiry in respect of any occurrence, which may give rise to a claim under this policy.

13. A perusal of the wordings used in this part would reveal that all the things which are required to be done under this part are related to an occurrence of an accident. On occurrence of an accidental loss, the insured is required to immediately give a notice in writing to the company. This appears to be so that the company can assign a surveyor so as to assess the damages suffered by the insured/ vehicle. It further provides that any letter, claim, writ, summons and/or process or copy thereof shall be forwarded to the company immediately on receipt by the insured. As such, the intention would be clear. The question of receipt of letter, claim, writ, summons and/or process or copy thereof by the insured, would only arise in the event of the criminal proceedings being initiated with regard to the occurrence of the accident. It further provides that the insured shall also give a notice in writing to the company immediately if the insured shall have the knowledge of any impending prosecution inquest or fatal inquiry in respect of any occurrence which may give rise to a claim under this policy. It will again make the intention clear that the immediate action is contemplated in respect of an accident occurring to the vehicle.

14. We find that the second part of Condition 1 deals with the “theft or criminal act other than the accident”. It provides that in case of theft or criminal act which may be the subject of a claim under the policy, the insured shall give immediate notice to the police and cooperate with the company in securing the conviction of the offender. The object behind giving immediate notice to the police appears to be that if the police is immediately informed about the theft or any criminal act, the police machinery can be set in motion and steps for recovery of the vehicle could be expedited. In a case of theft, the insurance company or a surveyor would have a limited role. It is the police, who acting on the FIR of the insured, will be required to take immediate steps for tracing and recovering the vehicle. Per contra, the surveyor of the insurance company, at the most, could ascertain the factum regarding the theft of the vehicle.

15. It is further to be noted that, in the event, after the registration of an FIR, the police successfully recovering the vehicle and returning the same to the insured, there would be no occasion to lodge a claim for compensation on account of the policy. It is only when the police are not in a position to trace and recover the vehicle and the final report is lodged by the police after the vehicle is not traced, the insured would be in a position to lodge his claim for compensation.

16. As observed by the Bench of two learned Judges in Om Prakash [Om Prakash v. Reliance General Insurance, (2017) 9 SCC 724 : (2017) 4 SCC (Civ) 759] , after the vehicle is stolen, a person, who lost his vehicle, would immediately lodge an FIR and the immediate conduct that would be expected of such a person would be to assist the police in search of the vehicle. The registration of the FIR regarding the theft of the vehicle and the final report of the police after the vehicle is not traced would substantiate the claim of the claimant that the vehicle is stolen. Not only that, but the surveyors appointed by the insurance company are also required to enquire whether the claim of the claimant regarding the theft is genuine or not. If the surveyor appointed by the insurance company, upon inquiry, finds that the claim of theft is genuine then coupled with the immediate registration of the FIR, in our view, would be conclusive proof of the vehicle being stolen.

17. That the term “cooperate” as used under the contract needs to be assessed in the facts and circumstances. While assessing the “duty to cooperate” for the insured, inter alia, the court should have regard to those breaches by the insured which are prejudicial to the insurance company. Usually, mere delay in informing the theft to the insurer, when the same was already informed to the law enforcement authorities, cannot amount to a breach of “duty to cooperate” of the insured.

18. We concur with the view taken in Om Prakash [Om Prakash v. Reliance General Insurance, (2017) 9 SCC 724 : (2017) 4 SCC (Civ) 759] , that in such a situation if the claimant is denied the claim merely on the ground that there is some delay in intimating the insurance company about the occurrence of the theft, it would be taking a hypertechnical view. We find that this Court in Om Prakash [Om Prakash v. Reliance General Insurance, (2017) 9 SCC 724 : (2017) 4 SCC (Civ) 759] has rightly held that it would not be fair and reasonable to reject genuine claims which had already been verified and found to be correct by the investigator.

19. We find that this Court in Om Prakash [Om Prakash v. Reliance General Insurance, (2017) 9 SCC 724 : (2017) 4 SCC (Civ) 759] has rightly held that the Consumer Protection Act aims at protecting the interest of the consumers and it being a beneficial legislation deserves pragmatic construction. We find, that in Om Prakash [Om Prakash v. Reliance General Insurance, (2017) 9 SCC 724 : (2017) 4 SCC (Civ) 759] this Court has rightly held that mere delay in intimating the insurance company about the theft of the vehicle should not be a shelter to repudiate the insurance claim which has been otherwise proved to be genuine.

20. We, therefore, hold that when an insured has lodged the FIR immediately after the theft of a vehicle occurred and when the police after investigation have lodged a final report after the vehicle was not traced and when the surveyors/investigators appointed by the insurance company have found the claim of the theft to be genuine, then mere delay in intimating the insurance company about the occurrence of the theft cannot be a ground to deny the claim of the insured.”

17.    In view of the judgments of the Hon’ble Supreme Court cited above, short delay in intimation to the Insurance Company is no more a factor for the insurer to deny the claim Petitioner/ Complainant. 

Top of Form18.    In view of the foregoing deliberations, the impugned order of the learned State Commission dated 24.01.2019 in Appeal No.817/2016 does not suffer any illegality or irregularity and the same is upheld. Consequently, the Revision Petition No.1069 of 2019 is dismissed.

19.    There shall be no order as to costs. All pending Applications, if any, also stand disposed of accordingly.