Chandigarh

StateCommission

A/35/2021

Jagtaran Singh Nayyar - Complainant(s)

Versus

National Insurance Company Ltd. - Opp.Party(s)

Narinder Singh Pawar & H.S. Saini Adv.

21 Sep 2022

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

Appeal No.	:	35  of 2021
Date of Institution	:	12.04.2021
Date of Decision	:	21.09.2022

 

 

 

 

 

Jagtaran Singh Nayyar aged about 73 years son of Sh.Tarlochan Singh Nayyar, resident of House No.3374, Sector 15, Chandigarh (U.T).

…Appellant/complainant

 

V e r s u s

National Insurance Company Limited, Chandigarh Regd. Office, SCO 332-334, Sector 34-A, Chandigarh through its Regional Officer.

….Respondent/opposite party

 BEFORE:             JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT.

                            MRS. PADMA PANDEY, MEMBER.

                            MR.RAJESH K. ARYA, MEMBER.

                              MR.PREETINDER SINGH, MEMBER

 

Present:-              Sh. Narinder Singh Pawar, Advocate for the appellant

                             Sh.D.P. Gupta, Advocate for the respondent

 

PER JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

 

Prelude:-      

                   The narratives of the respondent/opposite party reflect the apathetic, negligent and irresponsible behavior, which has caused a grave financial loss to the Insured-Jagtaran Singh Nayyar as his genuine claim has been repudiated on flimsy grounds.

 

Order under challenge:-

2.           This appeal has been filed by the appellant-complainant, as he is aggrieved of the order dated 17.02.2021 passed by the District Consumer Disputes Redressal Commission-I, U.T., Chandigarh, whereby consumer complaint bearing no.596 of 2018 filed by him was dismissed with no order as to cost, holding that since he had already sold the vehicle to Sh.Swaran Singh Grewal, he had no insurable interest therein and also that there was delay of 11 months in intimation of accident of the vehicle in question, to the insurance company.

 

Facts of the case of the complainant: -

3.           Following facts of the case of the complainant have been noted down by the District Commission in the order impugned:-

“……  Averments are, one Sh. Swaran Singh Grewal, an NRI being permanent resident of Canada, was a close friend of the complainant and on his last visit to India he sometimes used the car of the complainant, out of love and affection, for his personal use for attending functions etc.  Maintained, on 16.11.2015, complainant got his vehicle bearing registration No.CH04-A-3163 insured from OP Insurance Company through its Derabassi, Mohali branch at premium of ₹14,135/- and the policy was valid upto midnight of 15.11.2016.  His case is, on 14.3.2016 during the currency of the insurance policy, the vehicle in question met with an accident at 7:30 p.m. at Banga, District Shahid Bhagat Singh Nagar while aforesaid Sh. Swaran Singh Grewal came out of a marriage Palace alongwith his driver, Sh. Manjit Singh who was driving the car.  Sh. Swaran Singh Grewal was sitting on the front seat and due to the head injury he became unconscious. He remained admitted in the Fortis Super Specialty Hospital, Mohali for about two months till April 2016 after which his wife and daughter took him to Canada.  He ultimately died on 4.5.2016 in a hospital at Edmonton in Canada. Averred, Sh. Manjit Sigh did not know who happened to be the owner of the vehicle. Information of the accident was given to the OP and OP hired Sh. R.N. Sharma, HPS, DSP (Retd.) to investigate the matter, but, the investigation was done in a casual manner on the basis of which the claim was repudiated.  Averred the vehicle in question is standing at Haneet Motor Works, Mohali which estimated the cost of repair at ₹7,65,015/-. Vehicle was hypothecated with GE Country Wide CFS Ltd. and it issued no objection certificate dated 30.1.2005. Complainant alleged deficiency in service and unfair trade practice on the part of OP. Hence, the present consumer complaint for directing the OP to pay ₹7,65,015/- being the total cost of repair; compensation of ₹2,00,000/- and ₹1,00,000/- as litigation expenses..………”

Reply filed by the opposite party before the District Commission:-      

4.           The contents of reply filed by the opposite party was noted down by the District Commission as under: -          

“………OP contested the consumer complaint and filed its written reply.  The claim of the OP is, as a matter of fact, during investigation by the investigator, it was revealed vehicle was sold off the record by complainant to deceased Sh. Swaran Singh Grewal and as per terms and conditions, in the event of accidental loss, it had to be immediately reported to the Insurance Company i.e. the OP, but, in the present case it was reported after 11 months. Alleged the story was cooked up after 11 months to submit the claim and the reason was complainant had no insurable interest as the vehicle was sold to the deceased.  The matter was got investigated from Sh. R.N. Sharma, HPS, DSP (Retd.) and on his report these facts were revealed and the claim was rightly repudiated being not within the terms and conditions of the insurance policy. On these lines, the cause is sought to be defended.….”

5.           The complainant filed rejoinder to the written reply of the opposite party controverting its stand and reiterating his own version.
6.           Since none put in appearance on behalf of the complainant, at the time of arguments, as such, the District Commission after hearing counsel for the opposite party and on going through the documents on record, dismissed the consumer complaint by holding as under:-

 

“… A meticulous perusal of the pleadings of the complainant shows OP Insurance Company had repudiated his claim keeping in view the report of Sh. R.N. Sharma, HPS, DSP (Retd.) who investigated the matter. The case of the complainant is, it was investigated in a casual manner. The grounds of attack had not been submitted how investigation was got done in a casual manner and on what point the investigation was needed which had not been completed by the investigator, therefore, there is a passing reference in the consumer complaint of casual manner, but, the casual manner has not been disclosed what lapses were left by investigator.

It is the case of the OP and not rebutted by the complainant, complainant had participated during the course of investigation. It was nowhere denied that he had not participated in the investigation. Now we shall refer to the statement of the complainant recorded by the investigator on 7.1.2017. This has been signed by  Sh. Jagtaran Singh i.e. the complainant and in his statement complainant himself had admitted that orally he had sold his vehicle to Sh. Swaran Singh Grewal and he had taken possession but the affidavit of sale was not executed and handed over.  There is also a statement of the driver who was allegedly hired by the deceased Sh. Swaran Singh Grewal and in the concluding part of his statement, he had also claimed that the deceased Sh. Grewal had purchased the vehicle from the complainant by way of oral sale.  These two statements were recorded during the course of investigation by the Investigator appointed by the OP.  The complainant had not furnished any specific cross affidavit that no such statement was given by him before the investigator while the investigation was being done. Not only this, even in the consumer complaint it was not referred that no such statement was made by him before the Investigator though he simply claimed investigation was done in a casual manner and what was the reckless manner has been kept as a closely guarded secret by the complainant.  In such a situation, when the complainant himself had admitted he had sold the vehicle to the deceased Sh. Swaran Singh Grewal, he had no insurable interest and, therefore, he is estopped to file the present consumer complaint claiming compensation from the Insurance Company.  In case B.L. Sreedhar Vs. K.M. Munireddy, AIR 2003 SC 578, the Hon’ble Apex Court had held where rights are involved estopppel may with equal justification be described both as a rule of evidence and as a rule creating or defeating rights. Thus, the complainant is estopped to file the present consumer complaint against the Insurance Company keeping in view his past act  i.e. statement made by him and non assigning specific ground of attack on the report of the Investigator.

We also had a glance to the report of the Investigator which is Annexure OP/R-2. The conclusion of the investigation referred at Page 23 is reproduced below :-

          “CONCLUSION :

In view of the facts stated above and circumstantial evidence available we conclude our report as under:-

i)   On 14.03 2016 Mr. Swaran Singh Grewal and Mr. Manjeet Singh were going from Ludhiana to Kharar on Car No.CH04A-3163 to attend the marriage which was being driven by Mr. Manjeet Singh. At about 7.30 PM when they reached near Banga, due to sharp glares of a coming Vehicle Car hit into a parked Truck and damaged.

ii)  Mr. Swaran Singh Grewal had suffered injuries in this accident. Mr. Manjeet Singh had not suffered injuries.

iii) Mr. Manjeet Singh has informed that Mr. Swaran Singh Grewal was admitted in Fortis Hospital, Mohali due to Brain Hemorrhage and thereafter he was taken to Canada where he died. He had not died due to injuries suffered in this accident.

iv)  Mr. Manjeet Singh has given us in writing that Mr. Swaran Singh Grewal had purchased Car No.CH04A-3163 from Mr. Jagtaran Singh before 3 months of the accident but Mr. Swaran Singh had not got transferred this Vehicle in his name.

v)   Mr. Jagtaran Singh has informed that he had sold Car No.CH04A-3163 to Mr. Swaran Singh Grewal in January 2016 and he not given any sale/purchase affidavit.

vi)  There is delay in intimation. Mr. Jagtaran Singh could not give any justification about delay in intimation.

vii) As per verification report of RTA Karnal that Mr. Manjeet Singh was holding valid and effective driving license at the time of accident.

viii)As per verification report of RA Chandigarh that Car No.CH04A-3163 is registered in the name of Mr. Jagtaran Singh.

ix)  The police authorities of Police Station, Banga have confirmed that G.D No.23, dated 15.03 2016 was registered in this Police Station about accident of Car No.CH04A-3163 on 14.03.2016 at about 7.30 PM near Banga with a parked Truck. As the accident was occurred all of sudden and Itfaqia and there was no fault of anyone, hence no one was arrested or challaned in this case and they have closed the case at their end.

x)   We had also written a registered letter to Mr. Jagtaran Singh, copy enclosed and requested him to supply the treatment document of Swaran Singh and NOC/ Affidavit from legal heirs of Swaran Singh that they had not purchased this car but till date Mr. Jagtaran Singh has not given any reply.

Keeping in view above points and facts that Mr. Jagtaran Singh had sold car No.CH04A-3163 to Mr. Swaran Singh Grewal.”

 The investigation conducted on behalf of the OP in which the complainant had also participated carries due weight and needs to be accepted when no cogent reasons assigned attacking the report furnished by the investigator with other circumstances which casts a needle of suspicion of claim being not genuine one. 

Per pleadings of the parties, admittedly one of the terms and conditions of the policy was in the event of accident, intimation has to be given immediately to the Insurance Company, but, in this case intimation regarding the accident was given after 11 months. This delayed information further cements the version of the OP that the complainant had no insurable interest in the vehicle as he had orally sold the same to the deceased Sh. Swaran Singh Grewal and subsequently after lapse of time i.e. 11 months, he filed the present consumer complaint and the reason assigned was, complainant is in old age.  However, it is not the case, throughout the complainant remained confined to bed. In fact during the period after 11 months, he had participated in the investigation, made a statement and also preferred the present consumer complaint. These acts could have been done by him immediately after the accident had taken place.  Hence, there has also been breach of the terms and conditions of the policy on the part of the complainant which makes the report of the investigator to be just and truthful.

True it is, still per R.C. complainant is the registered owner.  Being registered owner, he is bound by the terms and conditions to give intimation of loss in accident to the OP/Insurance Company immediately.  But, in this case it was given after 11 months.

A perusal of the record further shows Insured Declared Value of the vehicle was ₹3,38,625/- as mentioned in paragraph No.3 of the consumer complaint while after accident its repair cost, as per Annexure P-7, has been mentioned to be ₹7,65,015/-.  When the vehicle was operatable on the road its value was ₹3,38,625/- and when it was condemned in an accident, its estimated cost of repair was ₹7,65,015/-.  It is ridiculous and we are not in a position to reconcile these two figures which also casts doubt about the correctness of the claim submitted by the complainant.

Keeping in view the reasons which we have recorded hereinbefore, we do not find there was any deficiency in service or unfair trade practice on the part of the OP.  The consumer complaint is meritless and is accordingly dismissed leaving the parties to bear their own costs...”

7.           Hence this appeal.

Arguments of the parties:-

8.           We have heard the contesting parties and scanned the material available on the record, including their written arguments.
9.           Learned counsel for the appellant submitted that since there was no proof to the effect that the vehicle in question stood sold by the appellant to Swaran Singh Grewal and the surveyors appointed by the respondent have come to this conclusion, based on the statement of driver of the vehicle in question who was having no knowledge regarding the same and also at the same time, delay in intimation to the insurance company, regarding the said accident took place as the appellant being above 70 years of age went into mental trauma after hearing death of his friend, as such, the respondent was wrong in rejecting the claim filed by him, especially, when the surveyors did not question the genuineness of the accident.
10.           On the other hand, Learned counsel for respondent/opposite party argued that since the appellant had already sold the vehicle to  Swaran Singh Grewal, deceased, he (appellant) was having no insurable interest therein; that  there was an inordinate delay in intimation regarding the said accident, to the insurance company, which was fundamental breach of terms and conditions of the policy in question, as such, the claim of the appellant was rightly rejected by the respondent and that the District Commission was also right in holding so.  

 

Observations of this Commission:-

11.           We have considered the rival contentions and X-rayed the material available on the record.

 

Moot questions to be decided by this Commission: -

12.           Following questions arise for consideration before this Commission to adjudicate this case:- 
    1. Whether, the respondent has been able to prove its case to the effect that the vehicle in question had been sold by the appellant to Swaran Singh Grewal, who died in the said accident?
    2. Whether, the respondent was justified in repudiating the claim of the appellant on the grounds that the appellant was not having any insurable interest in the vehicle in question and that there was delay in intimation regarding the said accident to the insurance company?
    3. Whether the appellant is entitled to any claim, if yes, to what extent?

 

Answer to Question No.12 (i):-

13.           Whether, the respondent has been able to prove its case to the effect that the vehicle in question had been sold by the appellant to Swaran Singh, who died in the said accident. It may be stated here that except placing reliance on the statement of Mr.Manjeet Singh, driver (who was driving the vehicle in question at the time of accident, recorded by the Surveyor) and that too in the absence of the appellant, to the effect that the vehicle in question had been purchased by Swaran Singh Grewal; no other documentary evidence viz agreement to sell between the appellant and Swaran Singh Grewal, payment proof etc. has been placed on record by the respondent. At the same time, it is also coming out from the record that though Sh.R.N. Sharma, Investigator in his report dated 04.02.2017, Annexure OP-R/2 has opined therein that on inquiry Sh.Jagtaran Singh-complainant has informed him that Sh.Swaran Singh Grewal had purchased the car in question from him but had not given the sale/purchase certificate, yet, when we go through the statement annexed alongwith the said survey report, it can easily be read that it has been clearly stated by the appellant to the surveyor that Swaran Singh who is NRI (Canada) being his friend has borrowed the vehicle in question and that since he (complainant) has to take back some amount from Swaran Singh Grewal, therefore, talks were going on between them for selling the vehicle in question, yet, no document in the shape of affidavit etc. were executed. From this statement of the appellant, recorded  by the surveyor, it is nowhere proved that the appellant had sold the vehicle in question to Swaran Singh Grewal.                        

                   Furthermore, in his complaint also, the appellant has clearly stated that the vehicle in question was never sold by him to Swaran Singh Grewal, deceased. Thus, from the facts narrated above, it can easily be said that in the absence of any documentary evidence in the shape of agreement to sell between the appellant and Swaran Singh Grewal, payment proof etc. and on the other hand, by merely relying upon the statement of Mr.Manjeet Singh, driver, referred to above, it cannot be said that the vehicle in question was sold by the appellant to Swaran Singh Grewal. The answer to this question is in the negative.

 

Answer to Question No.12 (ii):-

14.           Whether, the respondent was justified in repudiating the claim of the appellant on the grounds that the appellant was not having any insurable interest in the vehicle in question and that there was delay in intimation regarding the said accident to the insurance company?

                   First coming to the ground of repudiation of claim on the ground that the appellant was not having any insurable interest in the vehicle in question, it may be stated here that in view of the finding given by this Commission in para no.13 above to the effect that in the absence of any documentary evidence in the shape of agreement to sell between the appellant and Swaran Singh Grewal, payment proof etc. and on the other hand, by merely relying upon the statement of Mr.Manjeet Singh, driver, referred to above, it cannot be said that the vehicle in question was sold by the appellant to Swaran Singh Grewal, as such, it can easily be said that the appellant being the registered owner of the vehicle in question, at the relevant time, is having insurable interest therein.

                   It is significant to mention here that a similar question fell for determination before the Hon’ble Supreme Court of India in Surendra Kumar Bhilawe Vs. The New India Assurance Company Limited, CIVIL APPEAL No. 2632 of 2020, decided on 18.06.2020. In that case also, the claim of the insured was repudiated by the insurance company on the ground that since the insured has allegedly sold the vehicle to one Mohammad IIiyas Ansari on 11.04.2008, as such, the insured has no insurable interest. It is interesting to note that in the said case, even sale agreement was executed between the parties with regard to sale of vehicle, yet, since there was no proof to the effect that the said vehicle was actually delivered/sold to the purchaser, as such, under those circumstances, it was held by the Hon’ble Supreme Court that where the registered owner purports to transfer the vehicle, but continues to be reflected in the records of the Registering Authority as the owner of the vehicle in law, in view of the statutory provisions of the Motor Vehicles Act, 1988, he would not stand absolved of his liability as owner and also at the same time, the Insurer cannot evade its liability in case of an accident. Relevant part of the said order passed in Surendra Kumar Bhilawe case (supra) is reproduced hereunder:-

 

“……However, the dictum of this Court that the registered owner continues to remain owner and when the vehicle is Insured in the name of the registered owner, the Insurer would remain liable notwithstanding any transfer, would apply equally in the case of claims made by the insured himself in case of an accident. If the insured continues to remain the owner in law in view of the statutory provisions of the Motor Vehicles Act, 1988 and in particular Section 2(30) thereof, the Insurer cannot evade its liability in case of an accident.…….”

 

In this view of the matter, it is held that repudiating the claim of the appellant, on one of these grounds i.e. he has no insurable interest, was illegal and arbitrary.

                    Now coming to the second ground of repudiating the claim of the appellant to the effect that there was delay in intimation regarding the said accident to the insurance company by the appellant, it may be stated here that no doubt there is a delay of 11 months in intimation of the said accident to the insurance company, yet, this Commission also cannot ignore the fact that intimation regarding the said accident was given by the appellant to the police on the very next date i.e. 15.03.2016 and DDR No.23 dated 15.03.2016 was recorded in that regard. Furthermore, this Commission also cannot ignore the fact that the appellant is a senior citizen, aged more than 70 years and in his complaint, he has clarified that due to sudden accident and death of his fast friend Swaran Singh Grewal in the said accident, he suffered a deep shock and remained under depression, as a result whereof, he could not report the incident to the insurance company. Thus, in our considered opinion, the appellant has explained sufficient cause of delay in intimation of accident to the  insurance company. Furthermore, the surveyor-Truevalue Insurance Surveyors and Loss Assessors Pvt. Ltd. vide its report dated 02.11.2017, Annexure OP-R/3 and also Sh.R.N. Sharma, Investigator in his report dated 04.02.2017, Annexure OP-R/2 have nowhere opined that the claim filed by the complainant is not genuine. Rather, on the other hand, Sh.R.N. Sharma, Investigator in his report dated 04.02.2017, Annexure OP-R/2 has clearly opined that the police station concerned i.e. Police Station Banga has confirmed about the said accident and that they have closed the case file at their end. Similarly, surveyor-Truevalue Insurance Surveyors and Loss Assessors Pvt. Ltd. vide its report dated 02.11.2017, Annexure OP-R/3 has also not questioned the genuineness of the accident in question. In our considered opinion, genuine claims which had already been verified and found to be correct by the Investigator and also if the reason for delay in making a claim is satisfactorily explained, should not be rejected by the insurance companies, under the shelter that there is delay in intimation regarding the same. Our this view finds support from the ratio of law laid down by the Hon’ble Supreme Court of India in Om Prakash v. Reliance General Insurance and Anr. [Civil Appeal No. 15611 of 2017] decided on 4th October, 2017, wherein, while dealing with an appeal challenging an order of the National Consumer Disputes Redressal Commission, it was held that the decision of the insurer to reject a “claim has to be based on valid grounds. Rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policy-holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay.” It was further 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. The condition regarding the delay shall not be a shelter to repudiate the insurance claims which have been otherwise proved to be genuine.”  In this view of the matter, it is held that by repudiating the claim of the appellant, on one of these grounds i.e. there was delay on the part of the appellant was also arbitrary.

 

Answer to Question No.12 (iii):-

15.           Whether the appellant is entitled to any claim, if yes, to what extent?  It may be stated here that genuine claim of the appellant was repudiated by the respondent, which has definitely caused him financial loss and also mental agony and harassment. In our considered view, the appellant being insured in the capacity of registered owner of the vehicle in question, is definitely entitled to get claim amount arising out of the said accident.

                   At this stage, the next question that arises is, as to what amount the appellant is entitled to?  A bare perusal of the policy in question reveals that  the insured declared  value  (IDV) of the vehicle in question  was fixed at Rs.3,38,625/-. As per estimate of repairs Annexure P-7 prepared by the repairer-Haneet Motor Works, it is evident that an amount of Rs.7,65,015/- was to be incurred towards repair of the accidental vehicle in question. At the same time, even the surveyor-Truevalue Insurance Surveyors and Loss Assessors Pvt. Ltd. vide its report dated 02.11.2017, Annexure OP-R/3 has also opined that the estimate of repairs will be going to increase on account of unforeseen damages to the vehicle in question beyond Rs.1,62,215/-. From the aforesaid documents, it can easily be said that the repair cost of the vehicle in question will definitely cross 75% of the IDV. As per Section 1 of terms and conditions of the policy in question, it has been clearly mentioned that IDV shall be treated as the Market Value throughout the policy period without any further deprecation for the purpose of Total Loss (TL)/Constructive Total Loss (CTL) claims and that the insured vehicle shall be treated as CTL if aggregate cost of retrieval and/or repair of the vehicle exceeds 75% of the IDV of the vehicle. It was further mentioned in Section 3 of terms and conditions of the policy that the company may replace the vehicle or part thereof or pay in cash the amount which shall not exceed the IDV for total loss/constructive total loss of the vehicle. Thus, in our considered opinion, since it is coming out from the record that the vehicle in question suffered total loss in the said accident, as its repair charges were going beyond 75% of the IDV, as such, the appellant is entitled to get the amount equivalent to the IDV i.e. Rs.3,38,625/- minus (-) wreck value of Rs.5689.60 (as assessed in report dated 02.11.2017, Annexure OP-R/3). It is therefore held that by repudiating the genuine claim of the  appellant, the respondent was deficient in providing service and also indulged into unfair trade practice. The District Commission fell into a grave error, in holding to the contrary.

                  

Result of this appeal:-

16.           In view of peculiar facts and circumstances of this case, it is held that the order passed by the District Commission being not based on the correct appreciation of facts and circumstances of the case, as also the record, suffers from illegality and perversity, warranting the interference of this Commission. The same is accordingly set aside.
17.           For the reasons recorded above, this appeal is partly accepted. Resultantly, the respondent/opposite party is directed as under:-
    1. To pay to the appellant, an amount of Rs.3,38,625/- towards IDV of the vehicle in question minus (-) wreck value of Rs.5689.60 (as assessed in report dated 02.11.2017, Annexure OP-R/3) alongwith interest @9% p.a. from the date of repudiation of the claim i.e. 28.12.2017, within a period of 30 days from the date of receipt of a certified copy of this order, failing which, thereafter, it shall be liable to pay the said amount alongwith penal interest @12% p.a. from the date of default till realization.
    2. To pay compensation to the tune of Rs.25,000/- and also Rs.20,000/- towards litigation expenses, to the appellant for causing him mental agony and harassment as also deficiency in providing service and adoption of unfair trade practice, within a period of 30 days from the date of receipt of a certified copy of this order, failing which, it shall be liable to pay the said amounts alongwith interest @12% p.a. from the date of default till realization.
    3. However, it is made clear that parking/holding charges/ miscellaneous charges, if any, in respect of the vehicle in question, shall be borne by the respondent only and not by the appellant.

 

18.           Certified Copies of this order be sent to the parties, free of charge.
19.           The file be consigned to Record Room, after completion.

Pronounced

21.09.2022

 

Sd/-

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

Sd/-

(PADMA PANDEY)

          MEMBER

 

 

Sd/-

(RAJESH K. ARYA)

 MEMBER

 

 

Sd/-

(PREETINDER SINGH)

MEMBER

 Rg.