Chandigarh

StateCommission

CC/173/2019

Bhagwant Singh Chadha - Complainant(s)

Versus

Bharti AXA General Insurance Company Limited - Opp.Party(s)

Sanjeev Trikha Adv.

30 Nov 2022

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

 

Compliant Case No.	:	173 of 2019
Date of Institution	:	02.08.2019
Date of Decision	:	30.11.2022

 

 

 

 

 

Bhagwant Singh Chadha son of Sh. T. S. Chadha R/o SCF No.325, 1^st Floor, Opp. Fun Republic Motor Market, Manimajra, U.T., Chandigarh.

……Complainant.

Versus

Bharti Axa General Insurance Company Ltd., through its Branch Head, SCO No.350-352, 1^st Floor, Sector 34-A, Chandigarh.

 …..Opposite Party.

 

BEFORE:  MRS. PADMA PANDEY, PRESIDING MEMBER

              MR. RAJESH K. ARYA, MEMBER

                MR. PREETINDER SINGH, MEMBER

 

ARGUED BY :-   

 

Sh. Rishab Goel, Advocate for the complainant alongwith Complainant in person.

Sh. Gaurav Bhardwaj, Advocate for the opposite party.

 

PER  RAJESH  K. ARYA, MEMBER

Brief facts:-

                The complainant got for his vehicle i.e. Mercedes      C-Class Car, which he purchased from Coimbatore vide invoice dated 18.11.2016, Annexure C-1, for total price of Rs.37,29,425/- at discounted rate of Rs.3.50 Lakhs, insured with the opposite party on 17.01.2017 vide Insurance Policy, Annexure C-2, effective from 17.01.2017, after paying premium of Rs.93,900/-. The said car was temporarily registered at Coimbatore vide Temporary Certificate of Registration dated 15.02.2017, Annexure C-3. After being transported from Coimbatore to Chandigarh, the said vehicle was permanently registered at Chandigarh against Regd. No.CH01BM3261 vide Registration Certificate dated 07.06.2017, Annexure C-9. The said car was being regularly serviced and maintained by Joshi Auto, Industrial Area, Chandigarh vide service bills, Annexure C-10. Thereafter, the complainant got renewed the Insurance Policy twice i.e. for the period 2018-2019 and then 2019-2020.

2.             Unfortunately, the car of the complainant met with an accident on 27.12.2018 at around 00.30 hours when the truck, which was in front of the car of the complainant, all of a sudden, applied brakes. In order to avoid hitting the truck, the complainant steered his car towards left side of the car but right front side of the car hit the rear of the truck and thereafter, the car hit cement block/boulder lying on the road of the left side as flyover construction was going on. A DDR, Annexure C-12, was lodged by the complainant on 27.12.2018. The complainant immediately lodged claim with the opposite party on 27.12.2018. However, to the utter shock of the complainant, the opposite party vide letter dated 27.03.2019. Annexure    C-13, informed the complainant that the vehicle was declared total loss on 14.06.2016 i.e. before the sale invoice dated 18.11.2016. The complainant contacted the opposite party and again requested that the stand of the opposite party is not true as he purchased the vehicle on discounted rates in November 2016 but the opposite parties again vide letter dated 25.05.2019, Annexure C-15, reiterated its stand as stated in letter dated 27.03.2019.

3.             It has further been stated that the opposite party also appointed its Surveyor to assess the loss, who assessed the loss to the tune of Rs.43,56,318/-. It has further been stated that as on today, the vehicle is lying unused/unlocked and day by day, its value is depreciating as is evident from photographs, Annexure C-18 colly. Alleging the stand of the opposite party absolutely false as the opposite party itself issued insurance policy of the vehicle, firstly, in January 2017 and then in January 2018and also issued renewal notice for the year 2019-2020 and therefore, the opposite party cannot deny the claim on flimsy ground. Thus, the complainant is seeking direction to the opposite party to pay Rs.40,07,417/- on account of total loss besides claiming Rs.3 Lakhs for mental harassment & agony and Rs.33,000/- towards litigation costs.

Reply of the opposite party.

4.             It has been pleaded by the opposite party that the entire incident on 27.12.2018 as shown by the complainant is managed one as he failed to give the detail of the truck with whom the vehicle was allegedly met with an accident. It has further been pleaded that as per the service record of the vehicle, the vehicle was already declared as total loss on 14.06.2016. It has further been pleaded that in the month of January 2017, the complainant obtained the Insurance Policy for risk period 18.01.2017 to 17.01.2018 in his name by declaring his vehicle as new vehicle, which was already declared as total loss and thereafter, he got renewed the policy from 18.012018 to 17.01.2019 based on previous year policy. It has further been pleaded that the fact of total loss was not brought into the notice of the opposite party at the time of getting the insurance policy. It has further been stated that the material fact of total loss declared vehicle was concealed from the opposite party while seeking the insurance cover at the time of inception of the policy, which is in violation of condition No.1 of the policy and misrepresentation and breach of condition mentioned in the declaration clause of the proposal form. It has further been pleaded that during investigation by the surveyor Mr. Anurag Midha, it was found that the vehicle was total loss and had been handed over to the buyer Mr. Ramodass. It has further been stated that as per information gathered, Mr. Ramodass is a Salvage buyer in South part of India and was the buyer of net of salvage/cash/loss/total loss luxury car. It has further been pleaded that the dealer i.e. Sundaram Motors Coimbatore, who initially declared the vehicle as total loss and sold the salvage to buyer Mr. Ramodass, has issued the invoice of the car as a new vehicle to the complainant, shown to be sold on 18.11.2016, whereas, as per Form No.21 (Sales certificate) which was also issued by Sundaram Motors Coimbatore, the vehicle was shown as manufactured in April 2016 and same was sold vide invoice No.000846 dated 28.04.2016 in the name of the complainant. It has further been pleaded that the vehicle was allegedly purchased by the complainant on 18.11.2016 from Sundaram Motors Coimbatore whereas the vehicle was got insured after passing of two months i.e. 18.01.2017 and there is no explanation for getting insured the vehicle with a delay of two months. Pleading no deficiency in rendering service or unfair trade practice on its part, opposite party prayed for dismissal of the complaint.

5.             We have heard the Ld. Counsel for the parties and have also carefully gone through the record.

Issue involved:-

6.           The core question, which needs to be decided by this Commission in the present complaint is as to whether the opposite party has been able to prove that the vehicle in question, which was allegedly a total loss vehicle, had been handed over by the scrap dealer to the dealer (Sundaram Motors) or not? It may be stated here that during the pendency of this complaint, the complainant has placed on record copy of Tax Invoice dated 28.04.2016, Annexure C-21, which clearly goes to prove that it was a brand new vehicle handed over to the dealer (Sundaram Motors) by the manufacturer i.e. Mercedes Benz India Private Limited on 28.04.2016 for Rs.32,04,776/-. At the same time, the complainant has also placed on record invoice dated 18.11.2016 vide which he purchased this brand new vehicle from the dealer (Sundaram Motors). Most importantly, even at the time of first insurance of the said vehicle, the opposite party did not raise any such allegation as has been raised vide letter dated 27.03.2019 & 25.05.2019 that it was already a total loss vehicle on 14.06.2016. Even the said insurance policy was renewed from time to time against hefty premiums paid by the complainant and it was for the first time, such allegation of the vehicle being already total loss vehicle was raised, when the said vehicle actually met with an accident on 27.12.2018. Thus, in the face of the documents referred to above, it is not proved that the vehicle was already a total loss vehicle as on 14.06.2016.

7.             As far as reliance placed on Surveyor’s Report dated 28.05.2019, Exhibit R-1 is concerned, it may be stated here that the Surveyor though had suggested in his report to collect the detailed information as to how the dealer managed to get tax invoice from manufacturer yet there is nothing on record to suggest that such information was ever gathered by the Insurance Company. Even as per report dated 15.09.2022 received from the Registering & Licensing Authority, U.T., Chandigarh, as per their office report, the vehicle in question bearing Regd. No.CH01BM-3261 make Mercedes Benz C220D model 2016 was got registered only on 07.06.2017 at Chandigarh. Thus, from the facts narrated above, it is clearly proved that the opposite party has failed to prove its case that the complainant had purchased the total loss vehicle and as such, is not entitled for claim arising out of accident thereof. Thus, there was no question of any kind of concealment on the part of the complainant, as alleged by the opposite party and rather, it was the brand new vehicle, for which, the complainant shelled out hefty amount of Rs.37,29,425/-. To this extent, the findings of the Surveyor are set aside. Therefore, the judgments relied upon by the opposite party in case Export Credit Guarantee Corporation of India Vs. M/s Garg Sons International’, 2013 (1) CPC 192; Vikram Greentech (I) Ltd. and another Vs. New India Assurance Co.Ltd., 2009 (4) CLT 313; Deokar Exports Pvt. Ltd. Vs. New India Assurance Co. Ltd., 2009 (2) CLT 15  and LIC of India and others Vs. Mahendra Singh, 2011 (4) CLT 39 are of no help to the opposite party being distinguishable on facts. We are of the concerted view that the Insurance Company cannot back out from indemnifying the claim of the complainant.

8.             Now the question arises, what relief the complainant is entitled for? Admittedly, the Surveyor vide its Report dated 28.05.2019, Exhibit R-1 has declared the vehicle in question as total loss. The Anatomy of Loss as given by the Surveyor in its report, inter-alia, reads thus:-

“……The repair assessment is exceeding 75% of IDV. Wreck value explored as per online bid through Auto online portal is of Amount Rs.1450000. The maximum Liability on Net of salvage basis is as IDV Rs.3200000 Less Wreck value Rs.1450000, Less Policy excess Rs.2000 = Rs.1748000 subject to admissibility confirmation and submission of purchase Transaction proof by insured.”

9.             It is well settled that in case of total loss, the claim is to be paid on non-standard basis i.e. 75% of IDV less salvage value or the salvage is to be returned to the Insurance Company. In Amlendu Sahoo Vs. Oriental Insurance Co. Ltd. II (2010) CPJ 9 (SC), the Hon’ble Supreme Court of India has held that if there is any violation of terms and conditions of a Motor Insurance Policy, the claim may be settled on non-standard basis. Moreover, in the instant case, there is no such violation on the part of the complainant, rather, the claim has been wrongly rejected by the opposite party on flimsy ground. Even Hon’ble National Consumer Disputes Redressal Commission, New Delhi in National Insurance Co. Ltd. Vs. Manish Ashokrao Kadu, 2019 (1) CLT 46, while relying upon the judgment of Amendu Sahoo (supra), has allowed the claim only on non-standard basis by observing that it was for the Insurance Company to see and verify all the record relevant for the Insurance of the vehicle. It further observed that if the Insurance Company has failed in its duty to check the registration certificate at that time and issued the policy to the respondent, it means that they had waived off condition of registration certificate and at this stage, the Insurance Company cannot repudiate the claim on that basis. In view of law settled on the subject, in our concerted opinion, the complainant is held entitled to claim on non-standard basis. Further in the case of National Insurance Company Ltd. Vs. Nitin Khandelwal, IV (2008) CPJ 1 (SC), Hon'ble Supreme Court has observed thus :

"12. In the case in hand, the vehicle has been snatched or stolen. In the case of theft of vehicle breach of condition is not germane. The appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy for the loss caused to the insurer……” 

10.         Further in the case of Lakhan Lal Keshari Vs. United India Insurance Company Limited and others; II (2014) CPJ 688 (NC) before Hon’ble National Consumer Disputes Redressal Commission, New Delhi, the vehicle was robbed and the claim of the insured was repudiated by the insurance company on the ground that the vehicle was being used for hire or reward. It was held that the claim of the insured should be settled on non-standard basis at 75% of the insured amount instead of full amount.

11.           Therefore, in view of above settled position of law, the opposite party is liable to pay to the complainant an amount of Rs.23,90,000/- i.e. (Rs.24,00,000/- being 75% of the IDV of the vehicle of Rs.32,00,000/- minus Rs.2,000/- as policy excess) alongwith interest @9% per annum from the date of rejection of his claim i.e. 27.03.2019. Besides this relief, the complainant is also held entitled to compensation of Rs.2,00,000/- for mental agony and physical harassment suffered by him on account of deficiency in rendering service on the part of the opposite party.

12.           For the reasons recorded above, the complaint is partly allowed with costs. The opposite party is directed as under:-

1. to pay an amount of Rs.23,98,000 to the complainant along-with interest @9% per annum w.e.f. 27.03.2019, within a period of 30 days from the date of receipt of certified copy of this order, failing which, the entire aforesaid amount shall carry penal interest @12% per annum from the date of passing of this order till actual realization.
2. to pay an amount of Rs.2,00,000/- as compensation to the complainant for mental agony and physical harassment within a period of 30 days from the date of receipt of certified copy of this order, failing which, the said amount shall carry interest @9% per annum from the date of passing of this order till actual realization.
3. to pay an amount of Rs.33,000/- to the complainant as litigation expenses within a period of 30 days from the date of receipt of certified copy of this order, failing which, the said amount shall carry interest @9% per annum from the date of passing of this order till actual realization.

13.         It is well settled law that in total loss basis of O.D claim of vehicle, insurance company is legally entitled for salvage of vehicle. Accordingly, we direct the complainant to return the salvage of the vehicle in question to the opposite party within a period of 30 days from the date of receipt of certified copy of this order.

14.           Certified copy of this order be sent to the parties free of charge.

15.           File be consigned to Record Room after completion.

Pronounced.

30.11.2022.

(PADMA PANDEY)

PRESIDING MEMBER

 

 

 

(RAJESH K. ARYA)

MEMBER

 

 

 

(PREETINDER SINGH)

MEMBER

 

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