Punjab

Ludhiana

CC/21/376

M/s yerik International - Complainant(s)

Versus

Bharti Axa General Ins.Co.Ltd - Opp.Party(s)

B.K.Rampal Adv

11 Nov 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                             Consumer Complaint No:  376 dated  12.08.2021.                                      Date of decision: 11.11.2024.

 

1. M/s. Yerik International, Village Rajgarh, G.T. Road, Doraha, Ludhiana through its partner Sh. Mohinder Kumar Chopra.
2. Meenu Sharma aged about 42 years Wd/o. S. Vinod Parshad,
3. Shivam aged about 20 years S/o. Sh. Vinod Parshad, R/o. House No.1745/27/212, Street No.5, Mahinder Nagar, Lohara, Tehsil & District Ludhiana.
4. Nitin aged 17 years S/o. Sh. Vinod Parshad through his mother, next friend, natural guardian plaintiff No.2 Meenu Sharma Wd/o. Sh. Vinod Parshad, R/o. House No.1745/27/212, Street No.5, Mahinder Nagar, Lohara, Tehsil & District Ludhiana.                                                                                                                                   ..…Complainants

                                                Versus

1. Bharti AXA General Insurance Co. Ltd., 3^rd Floor, Spectrum Tower, Opposite Evershine Mall, Chincoli Bandar, Malad (W) Mumbai-4000064 through its Managing Director.
2.  Bharti AXA General Insurance Co. Ltd., Unit No.6 & 7, 3^rd Floor, Kunal Tower, Mall Road, Ludhiana through its Manager/Authorized Signatory.                                                              …..Opposite parties 

Complaint Under Section 35 of the Consumer Protection Act, 2020 (as amended up to date).

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

 

COUNSEL FOR THE PARTIES:

For complainants            :         Sh. B.K. Rampal, Advocate.

For OPs                          :         Sh. Rajeev Abhi, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

 

1.                Shorn of unnecessary details, the facts of the case are that complainant No.1 is a partnership firm during registered with Registrar of Firms and is running its forging unit at Village Rajgarh, G.T. Road, Doraha where various persons are employed. One Sh. Vinod Parshad, husband of complainant No.2 and father of complainant No.3 and 4 was working with complainant No.1 for earning his livelihood.

                   The complainants stated that complainant No.1 in order to insure all his 453 employees, purchased Smart Group Personal Accident Insurance policy No.APJ/12451426/P1/12/004413 w.e.f. 13.12.2019 to 12.12.2020 by covering risk of 60 times of salary of each employee for disability, death etc. Complainant No.1 has been regularly purchasing the said policy since last many years. The complainants further stated that complainant No.1 got insured Sh. Vinod Parshad S/o. Sh. Bachi Ram under said policy, who was working as Supervisor in Finger Department and drawing salary of Rs.27,580/- and was insured for Rs.15,00,000/- under the said policy. On 06.12.2020, at about 04.00 PM when Sh. Vinod Parshad was returning to his house on his Activa after completing his duty. He was followed by Sh. Shivam on his motorcycle. When Sh. Vinod Parshad reached Jimidhar Dhaba Bridge at about 04.30 PM, one stray dog came in front of his Activa and he struck on the rallying of the road due to which he suffered grievance injury on his head and other parts of the body. He was got admitted in Mohandai Oswal Hospital, Ludhiana where he remained admitted from 06.12.2020 to 17.12.2020. Sh. Vinod Parshad died on 17.12.2020 at 09.22 PM in Mohandai Oswal Hospital, Ludhiana. A DDR no.25 dated 18.12.2020 was registered at P.S. Sahnewal, Ludhiana. His post mortem was conducted at Civil Hospital, Ludhiana on 18.12.2020. Thereafter, complainant No.1 applied for death claim of Sh. Vinod Parshad with the OPs and provided all the requisite documents but the OPs put the matter on one pretext or the other. However, on 30.04.2021, the OPs illegally repudiated the claim on flimsy grounds. According to the complainants, Sh. Vinod Parshad was covered under Smart Group Personal Accident Insurance Policy and the OPs are legally bound to pay compensation to them. The complainants claimed to have suffered mental tension, harassment, pain and agony as well as financial loss due to deficiency in service on the part of the OPs. In the end, the complainants prayed for issuing direction to the OPs to pay sum insured of Rs.15,00,000/- along with interest as well as to pay damages of Rs.3,00,000/- and litigation expenses of Rs.22,000/-.

2.                Upon notice, the OPs appeared and filed joint written statement by taking preliminary objection assailed the complaint on the grounds of maintainability; the complainant being estopped by his own act and conduct; the complainant has not come with clean hands; suppression of material facts; lack of jurisdiction; bad for mis-joinder and non-joinder of necessary parties etc. the OPs stated that the complainant had obtained Smart Group Personal Accident Insurance Policy Tax Invoice bearing policy No.APJ/12451426/P1/12/004413 valid from 13.12.2019 to midnight of 12.12.2020. The insurance policy is a contract in itself and the parties are bound by the terms and conditions of the policy. As per the insurance policy the type of risk covered is APG Group PA and the names of the members insured are NAMED GPA and occupation risk category II. As per the policy the number of members covered is 453 as per the list submitted during the policy issuance. As per the terms and conditions No.6 of the policy "the company shall not be liable under the policy for any claim arising or resulting from the insured persons committing any breach of law with criminal intend or participating in an actual or attempted felony." It is also one of the standard exclusion that "the company shall not be liable under this policy for any claim arising or resulting from the insured person committing any breach of law of land with criminal intent." As per the general exclusions of the policy applicable to all the benefits under the policy, it is clearly stated that "the company shall not be liable under this policy for arising or resulting from the insured persons committing any breach of law or participating in an actual or attempted felony, riot, crime, misdemeanor or civil commotion." It is further stated under the head Scope of Cover: "If at any time during the currency of this policy, the insured person shall sustain any bodily injury resulting solely and directly from accident caused by external, violent and visible means, then the company shall pay to the insured / insured person or his / her nominee or legal representative(s), as the case may be, the sum or sums hereinafter set forth, that is to say:"

                   According to the OPs, in case of death the maximum liability under the policy will be limited to 100% of the specified sum insured for death benefits as mentioned in the schedule to this policy which is Rs.15,78,000. The OPs further stated that a claim was lodged regarding the death of Sh. Vinod Prasad who died on 06.12.2020 in a road traffic accident. Immediately on the receipt of the claim, it was duly registered, entertained and processed. M/s. JD Health Care Services was appointed as investigator who made thorough investigation, prepared his report and submitted the same with the OPs. After the receipt of the claim, the complainant had also supplied certain documents required for processing of the claim including the self-attested letter of complainant No.2 Meenu Sharma widow of Sh. Vinod Prasad that her husband Vinod Prasad did not have the driving license. After the receipt of investigation report, documents including the self- attested letter of complainant No.2 Meenu Sharma dated 16.04.2021 and after scrutinizing the same, and after due application of the mind by officials of the OPs, in terms of the insurance policy and law of the land the claim of the complainant in respect to the death of Shri Vinod Prasad was repudiated as no claim vide letter dated 30.04.2021 on the grounds that the deceased Sh. Vinod Prasad was not holding a valid and effective driving license and as such, Vinod Prasad committed breach of law as per general exclusions mentioned in the policy and as such the claim was not tenable for the reasons stated above. As per section 3 of the Motor Vehicles Act, "no person shall drive a motor vehicle in any public place unless he holds an effective driving license issued to him authorizing to drive the vehicle". The insured Vinod Prasad had violated the provisions of Motor Vehicle Act which amounts to fundamental breach of the policy also. According to the OPs, the claim of the complainant was rightly repudiated on legal, valid, enforceable grounds in accordance with terms and conditions of the policy.

                    On merits, the OPs1 reiterated the facts mentioned in the preliminary objections. The OPs have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

3.                In evidence, Sh. Mohinder Kumar Chopra, Partner of complainant No.1 company tendered his affidavit as Ex. CA and reiterated the averments of the complaint as well as complainant No.3 Sh. Shivam tendered his affidavit Ex. CB and complainant No.2 Smt. Meenu Sharma tendered her affidavit as Ex. CC. The complainants also placed on record documents Ex. C1 to Ex. C15 and closed the evidence.

4.                On the other hand, the counsel for the OPs tendered affidavit Ex. RA of  Sh. Rohan Mishra, Manager  legal of the OPs along with documents Ex. R1 to Ex. R22 and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written statement along with affidavit and documents produced on record by both the parties.

6.                One Vinod Parshad ( now deceased), husband of complainant NO.2 and father of complainant No.3 and 4, was employed as Supervisor in Finger Department with complainant No.1 and was drawing a monthly salary of Rs.27,580/- as mentioned in certificate dated 11.01.2021 Ex. C6. Complainant No.1 obtained a Smart Group Personal Accident Policy Ex. C7 = Ex. R1 having risk coverage of 453 employees/members. The policy was valid from 13.12.2019 to midnight of 12.12.2020.

7.                 Unfortunately, on 06.12.2020 at about 04.30 PM, when the deceased Vinod Parshad was riding on his Activa scooter No.PB10-GP-6924 reached near Jimidara Dhaba, G.T. Road, Sahnewal, he sustained grievous injuries while rescuing a stray dog. He remained admitted in Mohandai Oswal Cancer Hospital, Ludhiana from 06.12.2020 to 17.12.2020 where he succumbed to accidental injuries. A DDR No.25 dated 18.12.2020 at P.S. Sahnewal Ex. C8  = Ex. R15 was also recorded. Post mortem of the deceased was conducted at Civil Hospital, Ludhiana and his cause of death as per post mortem report Ex. C11  was recorded as respiratory arrest due to septicemia which is due to injury to vital organ (i.e. brain), injuries are ante mortem in nature and sufficient  to cause death in ordinary form of nature.

8.                Complainant No.1 lodged a claim vide claim form Ex. C12 which was entertained, registered and investigated by the OPs. M/s. JD Health Care Services was appointed as investigator who after certain queries from the complainant, made the following observations in his report Ex. R8:-

                   “Observations

• All the circumstances of the accident and accidental death of Insured has been verified and confirmed from claimant, vicinity check and available medical records.
• No evidence of alcohol/Drug addiction at the time of accident found during investigation of case.
• No history of critical illness or any other chronic disease found during investigation of case.
• Insured doesn’t have a Valid driving license made ever in his life as evident from Claimant Statement.
• No any other Discrepancy found during investigation of case.”

Further the investigation concluded that the final decision may be taken by the OPs on the basis of aforesaid observations.

9.                The OPs scrutinized the report of the investigator and annexed documents and repudiated the claim vide letter dated 30.04.2021 Ex. C14 = Ex. R6. Operative part of Ex. C14 = Ex. R6 is reproduced as under:-

“We are in receipt of the claim intimation/documents pertaining to the claim details provided below:

Name of the Insured	Yerik International
Name of the Insured Member	Late Mr. Vinod Parshad
Policy Number	12451426
Claim Number	ZB000659
Type of Loss	Death Cllaim.

We have received the request for a death claim, and after checking the claim papers, it is understood i.e. Mr. Vinod Parshad Singh, who died on the 06th of December 2020, was involved in a road traffic accident and died as a result.

According to a self-attested letter from the late Mr. Vinod Parshad Singh's wife, the deceased did not have a driving license.

Please note that the claim has been repudiated due to general exclusions mentioned below:

General Exclusions of the Policy applicable to all the benefits under the Policy:

PROVIDED ALWAYS THAT the Company shall not be liable under this Policy for -

8. Any claim in respect of accidental death or permanent disablement of the Insured Person

vi. Arising or resulting from the Insured Person committing any breach of law or participating in an actual or attempted felony, riot, crime, misdemeanor or civil commotion.

Hence, claim is repudiated as per general exclusion under the policy.”

 

10.              Now the point of determination arises before this Commission is whether the repudiation of the claim of the complainants is justified or not?

11.              Admittedly, complainant No.1 is a master policy holder and its employees are beneficiaries being members of the policy. The OPs must have supplied the terms and conditions of the master policy holder only and it is not expected that either OPs or complainant No.1 had shared the terms and conditions with its members. It is also evident from the record that the claim has also been preferred by complainant and its own bank details have been filled in the claim form by complainant No.1. The policy Ex. C7 = Ex. R1 contains the following clauses on the back of policy schedule:-

“6.  The company shall not be liable under this policy for arising or resulting from the insured persons committing any breach of law with criminal intent or participating in an actual or attempted felony, riot, crime, misdemeanor or civil commotion."

Standard Exclusions:

1. Participation in actual or attempted felony, riot, civil commotion, crime misdemeanor.
2. Committing any breach of law of land with criminal intent.
3. Death or disablement resulting from Pregnancy or childbirth.

 

General Exclusions of the Policy applicable to all the benefits under the policy:-

8) any claim in respect of accidental death or permanent disablement of the insured person.

v) arising or resulting from the insured person committing any breach of law or participating in an actual or attempted felony, riot, crime, misdemeanor or civil commotion.”

 

The conjoint reading of aforesaid clauses makes it clear that the aforesaid terms and conditions are not on same page or wavelength. The clause 6 stipulates the breach of law with “criminal intent” while other conditions does not specify the criminal intent, thereby raising a grey area or an ambiguity. The death of Vinod Parshad as a result while saving a stray dog and it cannot be said that at that time he was having any criminal intent. Further non-holding of a valid and effective driving license by the deceased cannot said to be a breach of law with a criminal intent. Whether particular violation of terms and conditions is fundamental breach or not always depends upon the terms and conditions of the policy in question. So in the given set of peculiar circumstances canvassed hereinbefore, this Commission is of the opinion that non-holding  of a valid and effective driving license in this case cannot be held to be fundamental breach of the policy. Even assuming that there was a breach of condition of the insurance policy, the insurance company ought to have settled the claim on non-standard basis and the OPs were not justified in repudiating the claim in toto due to not having any legal and valid driving license by the deceased Vinod Parshad. Recently, the Hon’ble Supreme Court of India in Civil Appeal No.4758 of 2023 title as Ashok Kumar Vs New India Assurance Co. Ltd. decided on July 31, 2023 while relying the judgments in National Insurance Company Limited Vs Nitin Khandelwal (2008) 11 SCC 259 and Amalendu Sahoo Vs Oriental Insurance Company Limited (2010) 4 SCC (536) has held that even if there was breach of any clause in the insurance policy, the claim could not have been repudiated in toto and the claim should have been settled on non-standard basis. The Hon’ble Supreme Court made the following observations in Para No.15, 18 and 19 of the said Civil Appeal No.4758 of 2023:-

18) In Amalendu Sahoo (supra), this Court noticed the guidelines issued by the New India Assurance Co. Ltd. in settling claims on non-standard basis. The guidelines read as under:-

Sl. No.	Description	Percentage of settlement
(i)	Under declaration of licensed carrying capacity.	Deduct 3 years' difference in premium from the amount of claim or deduct 25% of claim amount, whichever is higher.
(ii)	Overloading of vehicles beyond licensed carrying capacity.	Pay claims not exceeding 75% of admissible claim.
(iii)	Any other breach of warranty/condition of policy including limitation as to use.	Pay up to 75% of admissible claim."

The above guidelines were followed by this Court in Amalendu Sahoo (supra) as is clear from para 14 of the said judgment. The District Forum and the State Commission have rightly applied Amalendu Sahoo (supra) to the facts of the present case and awarded 75% on non-standard basis.

19) Nitin Khandelwal (supra) and Amalendu Sahoo (supra) lay down the correct formula that where there is some contributory factor, a proportionate deduction from the assured amount would be all that the Insurance Company can aspire to deduct.

We are inclined to accept the plea of the appellant that in the case at hand, on the facts governing the scenario, Clause (iii) of the table set out in para 14 of Amalendu Sahoo (supra) is attracted and the District Forum and the State Commission were justified in awarding the entire 75% of the admissible claim.”

As such, in the given set of facts and circumstances, it would be just and appropriate if the OPs are directed to settle and pay the claim of death of Vinod Parshad to the extent of 75% of the sum insured.

12.              As a result of above discussion, the complaint is partly allowed with direction to the OPs to reimburse the insurance claim of the complainants to the extent of 75% on account of death of insured Vinod Parshad. The amount of the claim shall be paid to complainant No.1 with interest @8% per annum from the date of filing of the complaint till actual payment within 30 days from the date of receipt of copy of order. Further the OPs shall pay a composite costs of Rs.20,000/- (Rupees Twenty Thousand only) to complainant No.1 within 30 days from the date of receipt of copy of order. However,  complainant No.1 is directed to pay the settled amount as well as composite costs so received from the OPs, to complainant No.2 to 4 in equal shares as well as to other legal heirs of deceased Vinod Parshad, if any within 15 days from the date of receipt of settled amount from the OPs. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.

13.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)                               (Sanjeev Batra)           Member                                               President

Announced in Open Commission.

Dated:11.11.2024.

Gobind Ram.