Chandigarh

StateCommission

A/156/2019

Reeta Devi - Complainant(s)

Versus

Reliance General Insurance Company Limited - Opp.Party(s)

Dhruv Gupta & Poorva Gupta Adv.

10 Jul 2021

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

 

Appeal No.	:	156 of 2019
Date of Institution	:	26.07.2019
Date of Decision	:	10.07.2021

 

1.     Smt. Reeta Devi aged 55 years-widow;

2.     Satinder Rana aged 35 years-son;

3.     Harinder Singh aged 31 years-son;

4.     Balwinder Singh about 24 years-son;

of late Shri Kanwar Pal Singh son of Shri Ghasitu Singh, all residents of village Jaffarpur, Tehsil Barara, District Ambala.

……Appellants/Complainants.

Versus

1.     Reliance General Insurance Company Limited, 60-Phase-III, Okhla, Delhi, through its Divisional Manager/Authorised Signatory.

2.     Reliance General Insurance Company Limited, SCO No.145-146, Sector 9-C, Chandigarh through its Authorised Signatory.

……Respondents/Opposite parties.

 

Appeal U/s 15 of the Consumer Protection   Act, 1986.

 

BEFORE:    JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                   MRS. PADMA PANDEY, MEMBER

                   MR. RAJESH K. ARYA, MEMBER

 

Present through Video Conferencing:-        

Sh. Dhruv Gupta, Advocate for the appellants.

Sh. Satpal Dhamija, Advocate for the respondents.

 

 

PER RAJESH K. ARYA, MEMBER

                   This appeal has been filed by the complainants (appellants herein) against order dated 23.04.2019 vide which, their consumer complaint bearing No.402 of 2017 has been dismissed by District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (Now District Commission-I) (in short the District Commission).

2.           Before the District Commission-I, U.T., Chandigarh, it was the case of the complainants that predecessor in interest of the complainants, namely, Late Sh. Kanwar Pal Singh, husband of complainant No.1 and father of complainants No.2  to 4, was doing his business as property dealer in District Ghaziabad alongwith one Shri Veer Pal Singh Tomar.  He had purchased a Scorpio for Rs.8,39,000/- from Chandgothia Motors Private Limited vide invoice dated 8.1.2007 under hypothecation with HDFC Bank Ltd. The said vehicle was got registered against registration No.HR01-V-4143 and was also duly insured with the opposite parties for Rs.7,87,000/-. On 4.6.2008, during the validity of the insurance policy a gentleman claiming himself to be engineer of National Highway Authority approached Sh. Kanwar Pal Singh for the purchase of some land and agreed to purchase land measuring 10 bighas.  The said gentleman made an excuse that he would bring his CEO and token money from Agra and requested Sh. Kanwar Pal Singh to send his driver with him alongwith the vehicle. His request was acceded to and the driver of Sh. Kanwar Pal Singh alongwith the vehicle was deputed and they stayed in a Hotel of UP Tourism in Agra. The driver was administered some intoxicant in his meal and when he got up on 6.6.2008, vehicle as well as the gentleman was missing. The vehicle had been stolen and FIR No.375 dated 9.6.2008 was lodged at P.S. Hari Parwat (Agra) which was later on ordered to be kept as untraced. Sh. Kanwar Pal Singh submitted claim with the opposite parties and on being objected, the loan amount taken to borrow vehicle from HDFC Bank was also discharged. However, claim submitted was repudiated. Hence, a complaint was filed before District Commission.
3.           On the other hand, the complaint was contested by the opposite parties by stating that terms and conditions of the insurance policy were not adhered to by the complainants and the matter was reported late to the insurer.  It was further stated that there was no substance in the claim preferred, therefore, it was rightly repudiated. 
4.           The parties led evidence, in support of their cases, before the District Commission.
5.           As already stated above, the District Commission after hearing the argument of the Counsel for the parties and going through the record, dismissed the complaint of the complainants.
6.           We have heard the Counsel for the parties and carefully gone through the material available on the record, including the written arguments filed on behalf of the appellants. 
7.           It may be stated here that the complaint of the complainants has been dismissed by the District Commission on the ground that the theft took place on 5.6.2008 and there was a delay of 3 days in reporting the matter to the police at Agra, which was done on 8.6.2008 and further that the claim was submitted to the opposite parties belated by five days and further the complainant’s predecessor in interest failed to link subsequent owner Sh. Veerpal Singh Tomar who had lodged the report.  The District Commission held that all these facts show violation of the terms and conditions of the insurance policy. While dismissing the complaint, the District Commission placed reliance on the judgment of Hon’ble National Consumer Disputes Redressal Commission, New Delhi passed in the case of Reliance General Insurance Co. Ltd. Versus Jai Prakash, Revision Petition No.2479 of 2015 decided on 11.1.2016. 
8.           Counsel for the appellant has submitted that the District Commission has failed to appreciate the facts on record and the law settled on the subject. He cited the judgment of Hon’ble National Consumer Disputes Redressal Commission, New Delhi in the case of Shriram General Insurance Co. Ltd. Vs. Mahipal & Anr., Revision Petition No.2172 of 2016 decided on 10.07.2019. In this case, the contention of the insurance company was that the complainant violated the terms and conditions of the insurance policy as he reported the matter to the police after three days of the occurrence and to the insurance company after 23 days of the loss of the vehicle and thus, the claim was not reimbursed. The District Forum concerned after placing reliance on the case of Aamalendu Sahoo Vs. Oriental Insurance Company,         2010 CTJ 485 (Supreme Court), allowed the complaint and directed opposite party No.1 Insurance Company to make payment of 75% of the sum insured to the complainant with interest @9% pa. from the date of filing the complaint till realization besides Rs.3100/- as cost of litigation. Appeal No.103 of 2016 filed against District Forum’s order was dismissed by Haryana State Commission vide order dated 29.03.2016. The Hon’ble National Consumer Disputes Redressal Commission, New Delhi after considering the entirety of the facts and specificities of the case, dismissed the revision petition with cost of Rs.50,000/- to be paid to the complainant. While doing so, the Hon’ble National Consumer Disputes Redressal Commission, New Delhi held in Paras 9 to 11 of its order as under:-

“9.     We find no reason on facts or law to disagree with the State Commission concurring with the findings of the District Forum in allowing 75% of the insured declared value on non-standard basis.

The District Forum’s Order dated 26.11.2015, as upheld and affirmed by the State Commission, is sustained.

10.     The Act 1986 is for better protection of the interests of consumers, in recognizedly a fight amongst unequals.

We see the chronology as also the undisputed fundamental material facts enunciated in para 8 above. We further see that the complainant had availed loan from a financial institution for the subject vehicle. We observe that if a consumer’s vehicle (exclusively for the purpose of earning his livelihood by means of self-employment) is stolen, and his insurance claim is not settled dutifully and promptly, he faces financial hardship, both with the financial institution and in earning his livelihood.

11.     We find this to be a plain and simple case of a mega insurance co. on the one side, and an ordinary common consumer on the other side, with the insurance co., unwarrantedly and unnecessarily, first, wrongly repudiating the claim (by not considering it for 75% of the insured declared value on non-standard basis), and then indulging in protracted litigation in, one, two, and finally, three, consumer protection fora, over a period of about nine years.

We also find that, before the third forum, i.e. this Commission, its case fails on merit.

The time and resources of this Commission have been unwarrantedly and unnecessarily wasted, which is not viewed favourably.”

 

9.           Counsel for the appellants further cited the judgment of Hon’ble Supreme Court of India in the case of Om Prakash Versus Reliance General Insurance and anr., Civil Appeal No.15611 of 2017, decided on 04.10.2017, wherein the theft of the truck took place on 23.03.2010 at Chopanki, Biwani, Rajasthan and FIR was lodged in P.S. Tapukra, District Alwar on 24.03.2010 and the claim petition was filed on 3103.2010. The Hon’ble Supreme Court of India while setting aside the orders of District Forum, State Commission and National Commission, held in Paras 11 and 12 of its judgment as under:-

“11. It is common knowledge that a person who lost his vehicle may not straightaway go to the Insurance Company to claim compensation. At first, he will make efforts to trace the vehicle. It is true that the owner has to intimate the insurer immediately after the theft of the vehicle. However, this condition should not bar settlement of genuine claims particularly when the delay in intimation or submission of documents is due to unavoidable circumstances. The decision of the insurer to reject the 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 is also necessary to state here 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. It needs no emphasis that the Consumer Protection Act aims at providing better protection of the interest of consumers. It is a beneficial legislation that deserves liberal construction. This laudable object should not be forgotten while considering the claims made under the Act.

 

12. In the instant case, the appellant has given cogent reasons for the delay of 8 days in informing the respondent about the incident. The Investigator had verified the theft to be genuine and the payment of Rs.7,85,000/- towards the claim was approved by the Corporate Claims Manager, which, in our opinion, is just and proper. The National Commission, therefore, is not justified in rejecting the claim of the appellant without considering the explanation for the delay. We are also of the view that the claimant is entitled for a sum of Rs.50,000/- towards compensation.”

 

10.           The Hon’ble Supreme Court of India allowed the appeal and set aside the orders of the National Commission, State Commission and the District Forum. It directed respondents 1 and 2 to pay a sum of Rs. 8,35,000/- to the appellant with interest @ 8% per annum from the date of filing of the claim petition till the date of payment within a period of 8 weeks from the date of passing of the order.
11.           In the instant case, there is delay of only 3 days in intimating the incident of theft to the Police at Agra as the theft of vehicle took place on 05.06.2008 and intimation to Police was made on 08.06.2008 and FIR got recorded on 09.06.2008. Further the claim was submitted to the opposite party on 5^th day. There is no hotchpotch in the case in hand as observed by the District Commission in Para 11 of its order. It is a clear case of theft of the vehicle on account of which, the complainants suffered loss. The Police submitted untraced report to ACJM 3, Ghazibad on 10.04.2009, which was accepted. Perusal of Annexures C-5, which are HDFC Bank letters dated 11.12.2009 and 18.12.2009 and Full and Final payment receipt for Rs.3 Lakhs dated 11.12.2009, makes it clear that the auto loan was fully settled as per payment plan offered by the said Bank. Not only this, Sh. Kanwar Pal Singh vide letter dated 14.12.2009 wrote to the Claim Manager of Reliance General Insurance based at Delhi that he was not in knowledge regarding submitting papers for claim, and time was spent and the Company did not send any letter so that he could complete the process. Vide this letter, he requested the opposite parties to condone the delay for submitting papers for claim and also requested to reopen the closed file. Thereafter, he submitted all the requisite documents related to the claim to the opposite parties. When nothing was heard from the side of the opposite parties, finally, he served a legal notice dated 01.08.2011 upon the opposite parties. The law is very much clear as settled by Hon’ble National Consumer Disputes Redressal Commission, New Delhi and Hon’ble Supreme Court of India in the afore-cited cases of Aamalendu Sahoo Vs. Oriental Insurance Company (supra) and Om Prakash Versus Reliance General Insurance and anr. (supra). In such like cases, as per the settled law on the subject, the Insurance Company is liable to indemnify the owner of the vehicle on non-standard basis, that is, to the extent of 75% of the Insured Declared Value (IDV).
12.           On the other hand, the Counsel for the opposite parties (respondents herein) failed to  rebut the contentions raised by the Counsel for the appellant both on facts and settled law as referred to above.
13.           Therefore, in our considered opinion, the act of the opposite parties in repudiating the genuine claim of the complainants amounted to deficiency in rendering service and indulgence into unfair trade practice.
14.           In the instant case also, the complainants are also entitled to 75% of the IDV of the vehicle, in question, on non-standard basis. The IDV of the vehicle, in question, is Rs.7,08,000/- as mentioned in Certificate cum Policy Schedule, Annexure C-2, Therefore, the complainants are entitled to 75% of the said IDV, which comes to Rs.5,31,000/- alongwith interest from the date of filing of the complaint till realization.
15.           For the reasons recorded above, the appeal is allowed. The impugned order dated 23.04.2019 passed by District Commission-I, U.T., Chandigarh is set aside. The complaint is partly allowed  and the opposite parties are, jointly and severally, directed:-

1. to pay an amount of Rs.5,31,000/- (being 75% of IDV of the vehicle in question) alongwith interest @9% per annum (simple) from the date of filing of the complaint i.e. 16.05.2017 till actual realization, within a period of 30 days from the date of receipt of certified copy of this order, failing which, the aforesaid amount shall carry penal interest @12% per annum from the date of default i.e. after expiry of period of 30 days till actual realization.
2. to pay an amount of Rs.15,000/- to the complainants as litigation costs 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 (simple) from the date of filing the complaint i.e. 16.05.2017 till actual realization.

16.           Certified copies of this order be sent to the parties free of charge.
17.           The file be consigned to Record Room, after completion.

Pronounced.

10.07.2021

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

(PADMA PANDEY)

          MEMBER

 

 

 (RAJESH K. ARYA)

MEMBER

•  

 

 

 

STATE COMMISSION

(Appeal No.156 of 2019)

Present through Video Conferencing:-

 

Sh. Dhruv Gupta, Advocate for the appellants.

Sh. Satpal Dhamija, Advocate for the respondents.

 

Dated:  10.07.2021.

ORDER

 

                   Vide our detailed order of even date, recorded separately, the appeal has been allowed and the impugned order dated 23.04.2019 passed by District Commission-I, U.T., Chandigarh has been set aside.

 

 

(RAJESH K. ARYA) MEMBER

(JUSTICE RAJ SHEKHAR ATTRI) PRESIDENT

(PADMA PANDEY) MEMBER

 

Ad