Haryana

Karnal

CC/169/2022

Brij Bhushan - Complainant(s)

Versus

United India Insurance Company Limited - Opp.Party(s)

Sanjay Chaudhary

22 Mar 2024

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KARNAL.

 

                                                        Complaint No.169 of 2022

                                                        Date of instt.28.03.2022

                                                        Date of Decision:22.03.2024

 

Brij Bhushan son of Shri Dharam Pal, resident of Village Naru Kheri, Tehsil and District Karnal.

                                               …….Complainant.

                                              Versus

 

1.     United India Insurance Company Limited, Opposite Bus Stand, G.T. Road, Karnal, through its Branch Manager.

2.     Cholamandlam Investment and Finance Limited, SCO 193, Sector-12, Urban Estate, Karnal, through its Manager.  

 

                                                                      …..Opposite parties

 

Complaint Under Section 35 of Consumer Protection Act, 2019.

 

 

Before   Sh. Jaswant Singh……President.

              Sh.Vineet Kaushik…….Member

      Dr. Suman Singh………Member

          

 Argued by: Shri Sanjay Chaudhary, counsel for complainant.

                    Shri Naveen Khetarpal, counsel for OP No.1.

                    Shri Dheeraj Sachdeva, counsel for OP No.2.

 

 

                    (Jaswant Singh President)

 

 

ORDER:

                

                The complainant has filed the present complaint Under Section 35 of Consumer Protection Act, 2019 against the opposite parties (hereinafter referred to as ‘OPs’) on the averments that complainant in order to earn his livelihood purchased a truck bearing registered No.HR-45A-8844 Eicher-III OHD and got the aforesaid vehicle financed from OP No.2 and an amount of Rs.8.50 lacs were financed to the complainant vide loan application No.XVFPKAL00 001049684 in the year 2013 and the loan was to be repaid in 45 monthly installments. The complainant had paid the entire loan amount prior to the accident and nothing was due against the complainant. The complainant got insured the above said vehicle with the OP No.1. The total value of the vehicle was assessed at Rs.4,80,000/-. On 24.06.2022, the aforesaid vehicle was driven by its driver at a moderate speed after observing all traffic rules and was going from Bawanpur to Barelly, when the vehicle reached at Molagarh Reliance Petrol met with an accident with unknown vehicle. Driver of the vehicle died due to injuries suffered and in the above said accident, the vehicle was totally damaged. Complainant informed the OPs about the above said accident, they advised to go to the police and to report the matter with police and the OPs further told that thereafter, the necessary claim will be carried out. After the accident, the driver had taken to Hospital and intimation of accident was sent to the police station on the same day and in this regard, a GD No.50 dated 27.06.2020 was got recorded by the son of the deceased. The complainant has submitted all the relevant documents with the OP No.1 but the OP No.1 has been lingering on the matter on the lame excuses and demanded the NOC from the financer. The complainant submitted no dues statement of account to OP No.1 but the same has not been considered due to the best reason known to OP No.1. Complainant approached OP No.2 and requested to give NOC but OP No.2 has refused to release NOC. At the time of advancement of loan, OP No.2 took signature of complainant on blank papers and also took blank signed cheques which have not been returned by OP No.2 till today and there is a great deficiency on the part of OP No.2 because they have not issued the NOC despite receipt of entire loan amount. Despite several requests, the OP No.1 has repudiated the claim of complainant vide letter dated 12.10.2021 on the lame ground of delay in intimation regarding accident and vehicle left unattended and vehicle as given for rent/reward. In this way there is deficiency in service and unfair trade practice on the part of the OP. Hence this complaint.

2.             On notice, OPs appeared and filed their separate written version. OP No.1 has raised preliminary objections with regard to maintainability, cause of action, misuse of process of law, suppression of true and material facts, locus standi, jurisdiction, concealment of true and material facts, etc. On merits, it is pleaded vehicle got damaged on 24.06.2020 and insurance company was intimated on 08.10.2020, i.e. after delay of about 106 days of accident and vehicle is left negligently by leaving the same unattended for a  long period.  Moreover, the said vehicle was given for rent/reward by the complainant, which amounts to gross violation of terms and conditions of the policy as well as limitation of use of vehicle. The company is not liable to pay the claim as per conditions No.1 & 5 of the terms and conditions of the policy. There is no deficiency in service and unfair trade practice on the part of the OP. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

3.             OP No.2 filed its written version raising preliminary objections with regard to maintainability; cause of action; locus standi; bad for non-joinder and mis-joinder of necessary parties. On merits, it is pleaded that the complainant has also executed another loan agreement with the OP wherein the complainant stood as borrower for the said loan agreement and in the said loan agreement, there occurred an event of default in the repayment of loan in the said loan agreement and the company as per rights in the agreement, has charge over loan agreement of an amount of Rs.9,66,603/- due as on date 12.05.2022 and complainant being borrower in the said loan, liable to pay the said amount and the OP has charge over the other loan of complainant, therefore, the present complaint is liable to be dismissed. It is also pertinent to mention here that as per arbitration clause of loan agreement, therefore, the present complaint is not maintainable before this Commission. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

4.             Parties then led their respective evidence.

5.             Learned counsel or the complainant has tendered into evidence affidavit of complainant Ex.CW1/A, copy of policy Ex.C1, copy of permit Ex.C2, copy of fitness certificate Ex.C3, copy of renewal of authorization certificate Ex.C4, copy of DDR Ex.C5, copy of driving licence Ex.C6, copy of repudiation letter Ex.C7, copy of letter dated 26.08.2021 Ex.C8 and copy of statement Ex.C9 and closed the evidence on 08.08.2022 by suffering separate statement.

6.             On the other hand, learned counsel for the OP No.1 has tendered into evidence affidavit of Raj Kamal, Assistant Manager, as Ex.RW1/A, copy of repudiation letter Ex.R1, copy of letter dated 26.08.2021 Ex.R2, copies of mails Ex.R3 and Ex.R4, copy of reply Ex.R5, copy of surveyor report Ex.R6, copy of intimation Ex.R7, copy of policy Ex.R8 and closed the evidence on 24.05.2023 by suffering separate statement.

7.             Learned counsel for OP No.2 has tendered into evidence affidavit of Sunny SAini, GPA Holder-cum-Legal Manager Ex.OP2/A, copies of loan agreement Ex.OP2/1 to Ex.OP2/4, copies of statement of accounts Ex.OP2/5 to Ex.OP2/9 and closed the evidence on 15.09.2024 by suffering separate statement.

8.             We have heard the learned counsel for the parties and perused the case file carefully and have also gone through the evidence led by the parties.

9.             Learned counsel for complainant, while reiterating the contents of the complaint, has vehemently argued that complainant got insured his vehicle with the OP. On 24.06.2022, the said vehicle was met with an accident and has become totally damaged. Matter was report with the police and to the OPs. The OPs demanded NOC from the financier. The complainant submitted statement of account to OP No.1, but the same has not been considered due to the best reason known to OP No.1. Complainant approached OP No.2 and requested to give NOC but OP No.2 has refused to release NOC. Despite several requests, the OP No.1 has repudiated the claim of complainant vide letter dated 12.10.2021 on the lame ground of delay in intimation regarding accident and vehicle left unattended and vehicle as given for rent/reward and lastly prayed for allowing the complaint.

10.           Per contra, learned counsel for the OP No.1, while reiterating the contents of written version, has vehemently argued that complainant the vehicle got damaged on 24.06.2020 and insurance company was intimated on 08.10.2020, i.e. after delay of about 106 days of accident. The vehicle is left negligently by leaving the same unattended for a long period, which amounts to gross violation of terms and conditions of the policy as well as limitation of use of vehicle, thus complainant is not liable to any claim and lastly prayed for dismissal of the complaint.

11.           Learned counsel for the OP No.2, while reiterating the contents of written version, has vehemently argued that complainant has also taken another loan and has become defaulter, therefore, the NOC cannot be issued to the complainant. He further argued that in the loan agreement, there is an arbitration clause, therefore, the present complaint is not maintainable before this Commission and lastly prayed for dismissal of the complaint.

12.           Admittedly, the vehicle in question was met with an accident during the subsistence of the insurance policy. It is also admitted that the IDV of the vehicle is Rs.4,80,000/- (Rs. Four lacs Eighty thousand only). It is also admitted that the complainant has repaid the entire loan amount of the vehicle in question.

13.           The claim of the complainant has been repudiated by the OP, vide letter Ex.C7 dated 12.10.2021, on the following grounds:-

“That the date of accident is 24.06.2020 but intimation of same was given on 08.10.2020. There is delay of 106 days on your part which is neither justified nor explained vide your reply. The general condition No.1 clearly states that the insured has to inform the insurer about the accident immediately after any mis hap. Same is reproduced here as under:-

“Notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage and in the event of any claim and thereafter, the insured shall give all such information and assistance as the company shall require. Every letter claim writ summons and or process or copy thereof shall be forwarded to the company immediately on receipt by the insured.

Notice shall also be given in writing to the company immediately the insured shall have knowledge of any impleading prosecution inquest or fatal inquiry in respect of any occurrence which may give rise to a claim under this policy.”

That the vehicle is left negligently by leaving the same unattending for a long period. Not taken any precautions for the safeguard of vehicle from any further damage due to unattended. By this way you have violated the condition No.5 of policy, which is being reproduced here as under:-

“The insured shall take all reasonable steps to safeguard the vehicle from loss or damage and to maintain it in efficient condition and the company shall have at all time free and full access to examine the vehicle or any part thereof or any driver or employee of the insured. In the event of any accident or breakdown, the vehicle shall not be left unattended without proper precautions being taken to prevent further damage or loss and if the vehicle be driven before the necessary repairs are effected any extension of the damage or any further damage to the vehicle shall be entirely at the insured’s own risk.”

That as per your letter the said vehicle was given for rent/reward. By this act you had breached the limitation in regard to the terms and conditions of the insurance policy.

We therefore, regret to inform you that due to the above your claim against the captioned policy stands repudiated.”

 

14.           The OP has alleged that accident in question has occurred on 24.06.2020 and intimation in this regard was given to OP on 08.10.2020, i.e. after the gap of 106 days and that the vehicle has been left negligently by leaving the same unattending for a long period. The onus to prove its case was relied upon the OP and in order to prove its case the OP has placed on file application moved by complainant Ex.R7 dated 08.10.2020 for lodging his claim, whereby it has been proved that the complainant has lodged his claim after a gap of 106 days. Moreover, the OP has failed to prove the fact that the complainant has left his vehicle unattended for a long period by leading cogent and convincing evidence. Admittedly, the driver of the vehicle has died in the accident due to that the complainant could not lodge the claim with the OP in time, which was beyond his control. Moreover, the present claim is with regard to damage of vehicle and not with regard to theft of vehicle, wherein immediate intimation is required to be given. Furthermore, for the sake of arguments, if it is presumed that complainant has breached any terms and conditions of the insurance policy, in that eventuality, the claim of the complainant cannot be repudiated in toto. In this regard, we can relied upon the case laws cited in Revision Petition no.1870 of 2015(NC) decided on 14.08.2018 titled as New India Assurance Co. Ltd. Versus Thirath Singh Brar and authority of our own Hon’ble State Commission in First Appeal no.717 of 2016 decided on 6.4.2017 titled as United India Insurance Company Limited and others Versus Anshul Bansal.  In both judgments it was held that in case of any breach of warranty/condition of the policy the insurer is liable to pay 75% of admissible claim on non-standard basis.

15.           No doubt, there is an arbitration clause in the loan agreement, even then this Commission has jurisdiction to try and entertain the present complaint. In this regard, we are of the considered view that if for the sake of argument it may be considered that there exists an arbitration agreement between the OP No.2 and the complainant in that case also this Commission has jurisdiction to try and entertain the present complaint as it is a settled proposition of law that complaint under Consumer Protection Act, being an additional remedy, despite there being an arbitration agreement, the proceedings before Consumer Commission have to go on. The remedy under Consumer Protection Act is a remedy provided to a consumer when there is a defect in any goods or services. In this regard, we place reliance on the case titled “M/s Emaar MGF Land Limited Versus Aftab Singh, review petition © Nos.2629-2630 of 2018 (SC), wherein Hon’ble Supreme Court of India held in para no.55 as under:-

“We may, however, hasten to add that in the event a person entitled to seek an additional special remedy provided under the statutes does not opt for the additional/special remedy and he is a party to an arbitration agreement, there is no inhibition in disputes being proceeded in arbitration. It is only the case where specific/special remedies are provided for and which are opted by an aggrieved person that judicial authority can refuse to relegate the parties to the arbitration.”  

16.           The OP No.2 has alleged that the complainant has obtained another loan except the loan of vehicle in question, thus the NOC cannot be issued. It is admitted that the loan of vehicle in question has been repaid by the complainant. This fact has also proved from the statement of account Ex.C9, thus, the OP No.2 cannot refuse to issue the NOC of the loan pertaining the vehicle in question. If any other loan is due and the complainant has become defaulter, then the OP No.2 is having efficacious remedy for recovery of other loan from the complainant. Thus, the OP No.2 has wrongly withheld the NOC of the loan of vehicle in question.

17.           Further,  Hon’ble Punjab and Haryana High Court in case titled as New India Assurance Company Ltd. Versus Smt. Usha Yadav & others 2008 (3) RCR (Civil) 111, has held as under:-

“It seems that the Insurance Companies are only interested in earning the premiums which are rather too stiff now a days, but are not keen and are found to be evasive to discharge their liability. In large number of cases, the Insurance companies make the effected people to fight for getting their genuine claims. The Insurance Companies in such cases rely upon clauses of the agreements, which a person is generally made to sign on dotted lines at the time of obtaining policy. This is, thus pressed into service to either repudiate the claim or to reject the same. The Insurance Companies normally build their case on such clauses of the policy, but would adopt methods which would not be governed by the strict conditions contained in the policy”.   

18.           Keeping in view that the ratio of the law laid down in aforesaid judgments, facts and circumstances of the present complaint, we are of the considered view that acts of the OP while closing the claim of the complainant amounts to deficiency in service and unfair trade practice, which is otherwise proved genuine one. 

19.           As per cover note of the insurance policy Ex.C1, the Insured Declared Value (IDV) of the vehicle in question is Rs.4,80,000/-, whereas as per surveyor report Ex.R6, net insurance liability on net salvage basis is Rs.3,43,000/-. Hence, the report of the surveyor will prevail. In this regard we are relying upon the authority 2(2008) CPJ paged 182 (NC), United India Insurance Co. Vs. Maya, wherein it has been held that a surveyor report should not be dismissed summarily as the surveyor is independent and qualified person under the relevant provision of Insurance Act, 1938.

20.           Keeping in view the ratio of the law laid down in the abovesaid judgments and the facts and circumstances of the present complaint, we are of the considered view that the act of the OP No.1 amounts to deficiency in service and unfair trade practice while repudiating the claim of the complainants in toto. Hence, complainant is entitled to get 75% of the amount assessed by the surveyor in his report Ex.R6 on non-standard basis.

 

21.           In view of the above discussion, we partly allow the present complaint and direct the OP No.1 to pay Rs.2,57,250/- (Rs.Two lacs fifty seven thousand two hundred and fifty only) i.e. 75% of Rs.3,43,000/- as assessed by the surveyor of the OP in his report Ex.R6 alongwith interest @ 9% per annum from the date of repudiation of the claim till its realization. We further direct the OP No.1 to pay Rs.25,000/- to the complainant on account of mental agony and harassment suffered by him and Rs.11,000/- for the litigation expense. The OP No.2 is also directed to issue NOC of the loan pertaining to vehicle in question, to the complainant. This order shall be complied within 45 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

 

Announced

Dated:22.03.2024

                                                                 President,

                                                     District Consumer Disputes

                                                     Redressal Commission, Karnal.

 

(Vineet Kaushik)                (Dr. Suman Singh)

                           Member                                  Member