Order by:
Sh.Amrinder Singh Sidhu, President
1. This Consumer Complaint has been received by transfer vide order dated 26.11.2021 of Hon’ble President, State Consumer Disputes Redressal Commission, Punjab at Chandigarh under section 48 of CPA Act, vide letter No.04/22/2021/4 C.P.A/38 dated 17.1.2022 from District Consumer Commission, Ludhiana to District Consumer Commission, Moga to decide the same in Camp Court at Ludhiana and said order was ordered to be affected from 14th March, 2022.
2. The complainant has filed the instant complaint under section 12 of the Consumer Protection Act, 1986 (now section 35 of Consumer Protection Act, 2019) on the allegations that he purchased Mahindra Pick up bearing RC No.PB-10-FF-0883 from Opposite Party No.2 which was financed by Opposite Party No.3. Said vehicle was purchased by the complainant for earning his livelihood for commercial purpose and even the said vehicle was registered for commercial purposes. Further alleges that the vehicle in question was insured with Opposite Party No.1 vide policy No.233905/31/2016/1260 for the period w.e.f. 30.04.2015 to 29.04.2016 for Rs.5,97,205/- by paying premium of Rs.16,752/-. However, at the time of issuance of cover note by Opposite Party No.1, it was wrongly written as for private use. Unfortunately, said insured vehicle met with an accident on 25.04.2016 and the driver of the complainant died in the said accident. The matter was immediately reported to the police as well as to the Opposite Parties and in this regard, DDR No.25 dated 25.4.2016 was registered with P.S.Sadar, Sirsa. Thereafter, the complainant lodged the claim with the Opposite Party No.1 for the payment of compensation, but the Opposite Parties wrongly and illegally repudiated the claim of the complainant vide letter dated 18.08.2017 on the ground that the vehicle is being used for commercial purpose, whereas as already stated above, the said vehicle was purchased by the complainant for earning his livelihood for commercial purpose and even the said vehicle was registered for commercial purposes and as such, there is deficiency in service on the part of the Opposite Parties. Vide instant complaint, the complainant has sought the following reliefs.
a) The Opposite Party may be directed to pay the insured amount of Rs.5,97,205/- and also pay compensation amounting to Rs.50,000/- for causing him mental tension and harassment besides Rs.22,000/- as litigation expenses or any other relief to which this District Consumer Commission may deem fit be also granted.
3. Opposite Party No.1 appeared through counsel and contested the complaint by filing the written version taking preliminary objections therein inter alia that the complaint filed by the complainant is not maintainable and is liable to be dismissed as the complainant has attempted to misguide and mislead this District Consumer Commission. It is submitted that immediately on the receipt of the claim, it was duly registered, entertained and processed. It is further submitted that the vehicle in question was insured with Opposite Party No.1 vide cover note No.676864 dated 30.04.2015 on the basis of which the policy GCCV- Private Carrier No.233905/31/2016/1260 valid for the period from 30.04.2015 to 29.04.2016 with IDV of Rs.5,67,345/- as private carrier was issued subject to IMT-42. It is clearly written in cover note No. 676864 dated 30.04.2015 in column No. 6 i.e. any limitation as to use of motor vehicle-private carrier. The IMT-42 is applicable for private carrier (goods carrying commercial vehicle only). The surveyor was appointed who thoroughly inspected/ scrutinised the matter and opined that the vehicle was insured as Private Carrier, but used as public carrier and hence, the complainant breached the terms and conditions of the policy. Hence, the claim of the complainant has rightly been repudiated in accordance with terms and conditions of the policy and the law of land. On merits, Opposite Party No.1 took up the same and similar pleas as taken up by them in the preliminary objections. Hence, the instant complaint is not maintainable and the same may be dismissed with costs.
4. Opposite Party No.2 appeared through counsel and contested the complaint by filing the written version taking preliminary objections therein inter alia that the complaint filed by the complainant is not maintainable and is liable to be dismissed as neither there is any negligence nor deficiency in service on the part of the Opposite Party No.2. Moreover, the answering Opposite Party has been unnecessarily arrayed as part must to extort money. On merits, Opposite Party No.2 took up the same and similar pleas as taken up by them in the preliminary objections. Hence, the instant complaint is not maintainable and the same may be dismissed with costs.
5. In order to prove his case, the complainant has tendered into evidence the affidavit Ex.CA alongwith copies of documents Ex.C1 to Ex.C7 and closed the evidence.
6. On the other hand, to rebut the evidence of the complainant, Opposite Party also tendered into evidence the affidavits Ex.RA to Ex.RD alongwith copies of documents Ex.R1 to Ex.R63 and further tendered affidavit Ex.RE alongwith documents Ex.R11 to Ex.F27 and closed their evidence.
7. We have heard the ld.counsel for the parties, perused the written arguments of the Opposite Party No.1 and also gone through the documents placed on record.
8. Ld.counsel for the Complainant as well as ld.counsel for the Opposite Parties have mainly reiterated the facts as narrated in the complaint as well as in their written statements respectively. We have perused the rival contention of the ld.counsel for the parties. The only contention of the complainant is that the complainant purchased Mahindra Pick up bearing RC No.PB-10-FF-0883 from Opposite Party No.2 which was financed by Opposite Party No.3. Said vehicle was purchased by the complainant for earning his livelihood for commercial purpose and even the said vehicle was registered for commercial purposes. Further alleges that the vehicle in question was insured with Opposite Party No.1 vide policy No.233905/31/2016/1260 for the period w.e.f. 30.04.2015 to 29.04.2016 for Rs.5,97,205/- by paying premium of Rs.16,752/-. However, at the time of issuance of cover note by Opposite Party No.1, it was wrongly written as for private use. Unfortunately, said insured vehicle met with an accident on 25.04.2016 and the driver of the complainant died in the said accident. The matter was immediately reported to the police as well as to the Opposite Parties and in this regard, DDR No.25 dated 25.4.2016 was registered with P.S.Sadar, Sirsa. Thereafter, the complainant lodged the claim with the Opposite Party No.1 for the payment of compensation, but the Opposite Parties wrongly and illegally repudiated the claim of the complainant vide letter dated 18.08.2017 on the ground that the vehicle is being used for commercial purpose and hence, alleged deficiency in service on the part of Opposite Party No.1. On the other hand, ld.counsel for Opposite Party No.1 has repelled the aforesaid contention of the ld.counsel for the complainant on the ground that immediately on the receipt of the claim, it was duly registered, entertained and processed. It is further submitted that the vehicle in question was insured with Opposite Party No.1 vide cover note No.676864 dated 30.04.2015 on the basis of which the policy GCCV- Private Carrier No.233905/31/2016/1260 valid for the period from 30.04.2015 to 29.04.2016 with IDV of Rs.5,67,345/- as private carrier was issued subject to IMT-42. It is clearly written in cover note No. 676864 dated 30.04.2015 in column No. 6 i.e. any limitation as to use of motor vehicle-private carrier. The IMT-42 is applicable for private carrier (goods carrying commercial vehicle only). The surveyor was appointed who thoroughly inspected/ scrutinised the matter and opined that the vehicle was insured as Private Carrier, but used as public carrier and hence, the complainant breached the terms and conditions of the policy. Hence, the claim of the complainant has rightly been repudiated in accordance with terms and conditions of the policy and the law of land.
9. In such a situation, we are of the view that even if the complainant has breached the terms and conditions of the policy in question, even then the Insurance Company ought to have settled the claim of the complainant on “non standard basis” even if some of the conditions of the insurance policy are not adhered by the insured. In this regard, we are supported with judgment in case titled National Insurance Company Limited versus Kamal Singhal IV (2010)CPJ297 (NC) wherein the Hon'ble National Consumer Disputes Redressal Commission, New Delhi relying upon various decisions of the National Consumer Disputes Redressal Commission in the matter of (1) National Insurance Company Ltd. v. J. P. Leasing & Finance Pvt. Ltd. (RP No. 643/2005), (2) Punjab Chemical Agency v. National Insurance Company Ltd. (RP No. 2097/2009), (3) New India Assurance Co. Ltd. v. Bahrati Rajiv Bankar, (RP) No. 3294/2009) and (4) National Insurance Company Ltd. v. Jeetmal, (RP No.3366/2009) and also judgment of the Hon'ble Apex Court in the matter of Insurance Company Versus Nitin Khandewal IV (2008) CPJ 1(SC), held the breach of condition of the policy was not germane and also held further that : “the appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy to the loss caused to the insurer”. The Hon'ble Supreme Court has further held that; “even assuming that there was a breach of policy, the appellant Insurance Company ought to have settled the claim on “non-standard basis.” Hon'ble Apex Court in back drop of these features, in these cases, allowed 70% of the claim of the claimant on the “non-standard basis”. This view was again reiterated by the Hon'ble Apex Court in the matter of Amalendu Sahoo versus Oriental Insurance Company Limited. II(2010) CPJ 9(SC)=II (2010)SLT 672. Hon'ble National Commission in the case National Insurance Company Limited versus Kamal Singhal referred to above relying upon the law laid down by the Hon'ble Supreme Court has held that;
“there being a long line of decisions on this score, we have no option but to uphold the finding of Fora below with modification that the claim be settled on 'non-standard' basis”, in terms of the guidelines issued by the Insurance Company. In case petitioner company fails to carry out the direction contained therein, the amount payable on 'non-standard' basis, shall carry interest @ 6% p.a from the date of expiry of six weeks till the date of actual payment”.
10. In such a situation the repudiation made by Opposite Party No.1 regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation. This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible. It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-
“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.
11. Now come to the quantum of compensation. Admittedly, as per policy cover note Ex.C2, the Insured Declared Value of the insured vehicle was Rs.5,67,345/- and hence having regard to the position of the law, as has been laid down, by the Hon'ble Apex Court in the various decisions referred to here-in-above and also the view expressed by the Hon'ble National Commission, we are of the considered view that in the present case the complainant, if not entitled for the entire sum assured as IDV, the Insurance Company definitely ought to have settled the complainant's claim on 'non-standard basis”, which in the facts and circumstances taking the assistance of the view expressed by the Hon'ble Apex Court and also by the Hon'ble National Commission, we allow 70% of the assessed amount on 'non-standard' basis” of the repair bills amount.
12. In view of the aforesaid facts and circumstances of the case, we allow the complaint of the Complainant partly and direct the Opposite party No.1-Insurance Company to make the payment of Rs.3,97,141/- (Rupees three lakh ninety seven thousands one hundred forty one only) i.e. 70% of the IDV of Rs.5,67,345/- of the insured vehicle to the Complainant alongwith interest @ 8% per annum from the date of filing the present complaint i.e. 13.11.2017 till its actual realization. The compliance of this order be made by Opposite Party No.1 within 60 days from the date of receipt of this order, failing which the complainant shall be at liberty to get the order enforced through the indulgence of this District Commission. Copies of the order be furnished to the parties free of cost by District Consumer Commission, Ludhiana and thereafter, the file be consigned to record room after compliance.
13. Reason for delay in deciding the complaint.
This Consumer Complaint was originally filed at District Consumer Disputes Redressal Forum (Now Commission) at Ludhiana and it keep pending over there until Hon’ble State Consumer Disputes Redressal Commission, Punjab vide letter No.04/22/2021/4 C.P.A/38 dated 17.1.2022 has transferred the instant Consumer Complaint alongwith Other Complaints to District Consumer Commission, Moga with directions to work on this file onward from 14th March, 2022 and accordingly District Consumer Commission, Moga has decided the present complaint at Camp Court, Ludhiana, as early as possible as it could decide the same
Announced in Open Commission at Camp Court, Ludhiana.
