State Consumer Disputes Redressal Commission
National Insurance Company Ltd. vs Vinod Vithal Gawas on 17 August, 2015
1
BEFORE THE GOA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION,
PANAJI- GOA
FA No. 46/2015
with cross objections (MA-41/15)
National Insurance Company Ltd.,
Insurer of vehicle bearing registration
Number GA-09-U-2678,
through its Divisional Manager,
Having branch office at II Floor,
Marchon Building,
Varde Valaulikar Road,
Margao Goa 403 601. ...Appellant/OP
v/s.
Shri. Vinod Vithal Gawas,
Son of late Vithal Gawas,
Aged 34 years, married,
Resident of 103/Anandwadi,
Sanvordem, Taluka,
Sanguem Goa. ....Respondent/Complainant
MA(C.O.) 41/2015
Shri. Vinod Vithal Gawas,
Son of late Vithal Gawas,
Aged 34 years, married,
Resident of 103/Anandwadi,
Sanvordem, Taluka,
Sanguem Goa. ...Applicant/Cross Objector
(Original Respondent)
v/s.
National Insurance Company Ltd.,
Insurer of vehicle bearing registration
Number GA-09-U-2678,
through its Branch Manager,
having branch office at II Floor,
Marchon Building,
Varde Valaulikar Road,
Margao Goa 403 601. ...Respondent
(Original Appellant)
2
Appellant/OP is represented by Adv. Shri. U.R. Timble.
Respondent/Complainant is represented by Adv. Shri. S.S. Kakodkar.
Coram: Shri Justice N.A. Britto, President
Shri. Jagdish G. Prabhudesai, Member
Dated: 17/08/2015
ORDER
[Per Shri. Justice N. A. Britto, President] This appeal is filed by the OP in C.C. No. 50/13 and is directed against order dated 30/3/15, by which the complaint filed by the complainant has been partly allowed. The complainant has filed cross objections.
2. Some facts are required to be stated to dispose off the appeal, as well as the cross objections.
3. The complainant is the owner of TATA Tipper truck bearing registration No. GA-09-U-2678. The complainant had obtained from the OP, a commercial vehicles package policy valid from 24/8/11 to 23/8/12 showing its IDV as Rs. 10,69,486/-. The said policy had what is known as driver's clause, and, as per this clause the vehicle had to be driven by a person holding an effective driving licence at the time of accident and was not disqualified from holding or obtaining such licence.
4. The complainant's truck was being driven by Sanjay C. Naik on 7/1/12 at about 9.30 a.m. and was carrying iron ore from Sukhtalem to Capxem- Sanvordem when it met with an accident at Dharbandora. The OP, being informed of the accident, appointed Shri. R.S. Sukhthanker, surveyor, to carry out a spot survey and he carried out a spot survey on the same day at noon and submitted his report dated 19/1/12 (copy at page 59).
35. The complainant then informed the OP in writing about the accident on 10/1/12 and then filed a claim-form on 20/1/12. Final survey report dated 17/2/12 was submitted by Shri. Audhut V. Apte, Loss Assessor and Valuer, assessing liability, on total loss basis at Rs. 8,44,486/- and liability on repair basis at Rs. 13,14,415.75. By letter dated 20/2/12 (copy at page 42) the complainant was asked to produce, with reference to his claim, certain documents and thereafter was orally informed to produce an extract of the driving licence of the driver Mr. Sanjay C. Naik to enable the OP to process the claim further. The complainant sent a reminder dated 23/2/12 to the OP to settle his claim as early as possible. On the failure of the complainant to give the extract of the driving licence, the OP obtained a letter dated 1/7/12 from the Regional Transport Officer, Karwar, stating that Sanjay C. Naik was not issued the driving licence by their office. The driving licence number was mentioned as 6439/03-04. After obtaining the same, the complainant was issued on 4/10/12 a notice to show cause as to why his claim should not be repudiated. The complainant claims to have shown cause by his letter dated 15/10/12 (Receipt of this letter is disputed). The complainant took two grounds of defence in this letter. One, that the accident had taken place on account of the mechanical failure i.e. the steering wheel of the truck getting locked and as such the question whether the driver had a valid licence or not was immaterial. Two, that the complainant had taken a trial of the said driver Sanjay C. Naik and the complainant had found him to be competent to drive the said vehicle, and prior to that, the said driver was working as a driver for one Chetan P. Shetkar of Sanvordem and also to Sunil Wagurmekar, Anandwadi, Sanvordem, Goa for carrying mineral ore. The complainant also stated that the said Sanjay C. Naik was holding licence bearing No. 6434/080 issued 4 by the Regional Transport Authority, Karwar which was valid and effective on the date of accident.
6. The OP repudiated the claim by letter dated 12/3/13 (copy at page 46) stating that the complainant was unable to reply to their letter dated 4/10/12 and as such they had to assume that the driver was not having a valid licence at the time of accident.
7. The complaint was then filed by the complainant on 13/8/13 on the same grounds, as taken in letter dated 15/10/12. The first ground is covered by pleadings in para 3 and 7 of the complaint. The second ground is covered by para 15 and 16 of the complaint; and to support the first ground the complainant has filed the affidavit of Vivek G. Devidas, a mechanic by profession, to say that the complainant had inquired from the driver Sanjay C. Naik as to how the accident had taken place and he had informed the complainant, in his presence, that the steering of the truck suddenly got locked. Complainant also filed the affidavits of Sunil S. Wagurmekar and Chetan P. Shetkar to say that the said Sanjay C. Naik was employed by the former from 1/9/11 to 28/11/11, and by the latter from 1/6/11 to 15/8/11 and also to say that as per records maintained by both of them the said driver, Sanjay C. Naik was having licence No. 6439/080. Both say, that the driver was competent; but both do not say, if he was competent, why they dispensed with his services within short periods.
8. We are inclined to believe that the first ground was taken by the complainant to take shelter of Jitendra Kumar vs. Oriental Insurance Company Ltd., and anr., 2003 (6) SCC 420 (para 9). The second ground was taken to take benefit of certain observations of the Apex Court in United India Insurance Company Ltd., vs. Lehru and ors., 2003 (3) ALL MR 708 (para 20), Lal Chand vs. Oriental Insurance 5 Company Ltd., 2006(7)SCC 318 (para 8) and Pepsu R.T.C. vs. National Insurance Company, 2013(5) ALL MR 924. The last two decisions follow Lehru (supra). Para 20 of Lehru reads as follows:
"20. When an owner is hiring a driver he will therefore have to check whether the driver has a driving licence. If the driver produces a driving licence which on the face of it looks genuine, the owner is not expected to find out whether the licence has in fact been issued by a competent authority or not. The owner would then take the test of the driver. If he finds that the driver is competent to drive the vehicle, he will hire the driver. Its rather strange that Insurance Companies expect owners to make enquiries with RTOs, which are spread all over the country, whether the driving licence shown to them is valid or not. Thus where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149(2)(a)(ii). The Insurance Company would not then be absolved of liability. If it ultimately turns out that the licence was fake the Insurance Company would continue to remain liable unless they prove that the owner/insured was aware or had noticed that the licence was fake and still permitted that person to drive.
9. The Lr. District Forum came to the conclusion that from the documents placed on record the verification which was done by the Regional Transport Officer, Karwar, was not that of the licence of Mr. Sanjay Naik who was having a driving licence bearing No. 6439-080 but of licence No. 6439/0304 and that from the letter issued by the Regional Transport Officer, Karwar, the OP had requested the Regional Transport Office, to provide information of driving licence No. 6439/0304 and not of 6439-080. Lr. District Forum also held that the lr. counsel appearing for the OP had no answer for the anomaly created by the officer of the OP while addressing the letter to the 6 Regional Transport Officer, Karwar, and, then once the mistake was brought to the notice of the OP by the complainant, it was the duty of the OP to address another letter to the Regional Transport Officer, Karwar, for correcting the mistake and thereafter should have come with proper justification as to whether the driving licence of the driver of the complainant was legal or illegally obtained. Lr. District Forum observed that the OP had taken the entire issue in a very casual manner and had failed to prove that the said driver Sanjay C. Naik was not holding effective driving licence on the date of accident.
It appears, as can be seen from letter dated 01/07/12, that the OP had asked for verification of licence in the name of Sanjay Naik under No. 6439-030 as given in the claim-form to which another digit "4" was added by typographical mistake. Since then, and after the disposal of the complaint, the OP has produced another letter dated 8/5/15 from the Regional Transport Officer, Karwar, stating that that licence No. 6439/080 issued on 17/5/10 is not issued to Sanjay C. Naik. In other words, the licence held by complainant's driver the said Sanjay C. Naik is a fake licence and he did not have, at the time of the accident, a valid licence.
10. Cross objections have been filed by the complainant to obtain a finding on the grounds taken by him to challenge the repudiation of the policy which according to the Lr. Adv. Shri. S.S. Kakodkar have not been dealt with by the Lr. District Forum. We find that the second ground taken by the complainant, as explained above, has been dealt with in paras 16 & 17 of the impugned order.
11. There can be no dispute that the onus of proof that there was a breach of the terms and conditions of the policy - in the driver of the insured vehicle not having a valid licence - is on the Insurance Company, as stated by the Apex Court in Narchinva V. Kamat & anr.
7vs. Alfredo Antonio Doe Martins & ors., AIR 1985 SC 1281. To the same effect, are the observations of the Apex Court in National Insurance Company Ltd., vs. Laxmi Narain Dhut, 2007 (3) SCC 706, wherein it is stated that the burden is on the insurer to prove that the licence was a fake one. The National Commission, too, has held in National Insurance Company Ltd. vs. Rajesh Ohri, 2012 (1) CPR 130 that the onus to prove that the original licence was fake, by credible evidence, is on the Insurance Company.
12. Objecting to the production of letter dated 8/5/15 from the Regional Transport Officer, Karwar, (which shows that licence No. 6439/080 was not issued to Sanjay C. Naik, and as such his licence was fake) lr. Adv. Shri. Kakodkar has relied upon Union of India vs. Ibrahim Uddin & ors., 2012(8) SCC 148 wherein the Apex Court, with reference to the provision of Order 41, Rule 27, CPC, has held that in the absence of satisfactory reasons for the non-production of the evidence in the trial Court, additional evidence should not be admitted in appeal as a party guilty of remissness in the trial court is not entitled to the indulgence of being allowed to give further evidence under the said provision. The Apex Court has also held that fresh evidence can be let in only for removing a lacuna in the evidence (para 38). In our view, the complainant can derive no benefit from the said decision. Firstly, because the provision of Order 41, Rule 27 have not been made applicable to the procedure to be followed under C.P. Act, 1986. Secondly, because even before the complaint was disposed off by the Lr. District Forum on 30/3/15, the OP had written a letter dated 25/3/15 to the Regional Transport Officer, Karwar, to verify the said licence of complainant's driver, the said Sanjay C. Naik. There appears to have been some communication gap between the OP and their advocate who appeared for the OP before the District 8 Forum in not informing the lr. Forum, that a reply was awaited to their letter dated 25/3/15. Thirdly, letter dated 8/5/15 is required to explain the lacuna in letter dated 1/7/12. Fourthly, the letter dated 1/7/12 issued by Regional Transport Officer, Karwar, could have been interpreted against the complainant inspite of the number of the licence being mentioned wrongly, for it appears that the licence of complainant's driver Sanjay C. Naik was verified not only with reference to the said No. 6439/03-04 but also with reference to the name of the said driver on the driving licence history book. Here it may be noted, as already stated, that the complainant himself was partly responsible in giving a wrong number of the said licence of his driver, the said Sanjay C. Naik, in the claim-form, wherein the complainant mentioned the number of licence as 6439-030 and the OP added another digit to it, namely, "4" due to typographical mistake. We, therefore, overrule the objection and in the interest of justice allow the OP to produce the said letter dated 8/5/15. This letter proves that the licence of complainant's driver, the said Sanjay C. Naik, is a fake licence, not issued by Regional Transport Officer, Karwar. In other words, complainants' driver did not have an effective driving licence at the time of accident. We are inclined to believe that the complainant knew about this position and for that reason did not produce an extract of the licence to the OP as recorded in letter dated 12/3/13. Complainant admits that he was orally requested to produce such extract but claims that he had given the same. There is nothing on record to substantiate such a statement.
13. The complainant has tried to give an impression that he had replied the show cause notice dated 4/10/12, by reply dated 15/10/12 (copy at page 44). However, a bare perusal of the said reply dated 15/10/12 does not show that it was received in the office of OP.
9On the contrary, the OP's Branch Manager, Shri. Anvekar, has categorically stated in his affidavit-in-evidence that he had not received the said letter dated 15/10/12. There is no statement in the evidence of the complainant that he had sent the said reply dated 15/10/12, to the OP. The complainant has also not filed a counter to the said statement of Shri. Anvekar, the Branch Manager, inspite of, he categorically stating that he had not received the said reply dated 15/10/12. We are therefore inclined to believe, that the complainant had not replied the said show cause notice, as he had no cause to be shown.
14. As regards the first ground taken by the complainant, that the accident took place because the steering got locked the same cannot be accepted at all. The complainant's driver was bound to give such a version as an afterthought to save his own skin or else he might have been booked for rash and negligent driving by the police. Reference to the item No. 28 of report dated 17/2/12 made by Shri. Kakodkar is of no assistance. If at all the steering got jammed, it must be post accident, due to impact of accident. This is also the opinion given by surveyor, Shri. Sukhthanker, under Sr. No. 1, page 2 of his report. The complainant himself told the surveyor Shri. R.S. Sukhthankar that the complainant's loaded truck met with an accident while trying to overtake a T.P. vehicle when the driver lost control and went to extreme right side hitting violently a road side "matti" tree and fell down to a depth of approximate 2 meters, etc. It is to be noted that this version has been given by the complainant himself on the very same day when the surveyor went to carry out a spot inspection at about 12.00 noon, and, therefore, should certainly carry more weight. The complainant in the claim-form also stated that the accident took place when his truck was over taking another vehicle when it lost 10 control and went to the extreme right side of the road, after hitting a tree. The complainant has tried to wriggle out of the said statement in the said claim form (copy at page 121) by stating that he had given it in blank. However, Shri. P.S. Anvekar, Branch Manager of the OP, has stated on affidavit, that the claim-form was received duly filled and signed. We are inclined to accept his version. The complainant himself had given a correct version of the accident, first to the surveyor Shri. Sukhthanker and then in the claim-form. The loss assessor Shri. Audhut B. Apte has picked up the said information from the claim-form and reproduced in his final report dated 17/2/12. We would prefer to go by the contents of Shri. Sukhthanker's report dated 19/1/12 and the claim-form submitted by the complainant, in preference to what has been stated by the complainant's witness Vivek G. Devidas. We also do not understand what was the need for the complainant to rush immediately with a mechanic to the site of accident, even before the truck was removed from the site of accident.
15. In our opinion, the accident took place, not because the steering got locked, but because the complainant's driver lost control whilst overtaking another vehicle and went to the right hand side and hit a tree. The case of Jitendra Kumar vs. Oriental Insurance Company Ltd., & anr., 2003(6)SCC 420 is of no assistance to the case of the complainant. It may be noted here that in the case of Jitendra Kumar the driver of the vehicle was not holding a valid driving licence at the time of the incident and the vehicle had caught fire during the drive due to mechanical reasons and not due to any fault of the driver, and, therefore it was held that the Insurance Company could not have repudiated the claim of the owner of the vehicle solely on the ground that the driver did not have a valid licence at the time of the incident.
11Shri. Timble, therefore, may not be entirely right in his submission that the cause of accident would be irrelevant as long as there was a breach of policy condition.
16. Coming to the second ground, at the outset, it must be stated that the case of United India Insurance Company Ltd., vs. Lehru and ors., 2003 (3) ALL MR 708, is a case of liability of the insurer as regards third party risks, and not a case of own damage. Shri. Kakodkar may not be entirely right in his submission that the case of United India Insurance Company Ltd., vs. Lehru & ors., (supra) was followed in National Insurance Company Ltd., vs. Swaran Singh & ors., 2004 (3) SCC 297, (a three Judge Bench decision). We need not refer to in detail to paras 84 and 92 of the case of Swaran Singh &ors., (supra) relied upon by Lr. Adv. Shri. Kakodkar. All that we need to say is that the case of Swaran Singh & ors., (supra) has subsequently been distinguished by two Judge decision of the Apex Court in National Insurance Company Ltd., vs. Laxmi Narain Dhut, 2007(3) SCC 706, relied upon by Lr. Adv. Shri. Timble. As regards United India Insurance Company Ltd., vs. Lehru & ors., (supra), the Apex Court in Swaran Singh & ors., (supra) has held as follows:
"99. So far as the purported conflict in the judgments of Kamla and Lehru is concerned, we may wish to point out that the defence to the effect that the licence held by the person driving the vehicle was a fake one, would be available to the insurance companies, but whether despite the same, the plea of default on the part of the owner has been established or not would be a question which will have to be determined in each case."
"100. This Court, however, in Lehru must not be read to mean that an owner of a vehicle can under no circumstances have any duty to make any enquiry in this respect. The same, however, would again be 12 a question which would arise for consideration in each individual case."
"101. The submission of Mr. Salve that in Lehru case, this Court has, for all intent and purport, taken away the right of an insurer to raise a defence that the licence is fake does not appear to be correct. Such defence can certainly be raised but it will be for the insurer to prove that the insured did not take adequate care and caution to verify the genuineness or otherwise of the licence held by the driver."
17. In the case of National Insurance Company Ltd., vs. Laxmi Narain Dhut, 2007 (3) SCC 706, the Apex Court has held that "the inevitable conclusion is that the decision in Swaran Singh's case (supra) has no application to own damage cases", and the effect "of fake licence has to be considered in the light of what has been stated by this Court in New India Assurance Company Ltd., vs. Kamla & ors., (2001) (4) SCC 342." It is further been held that once the licence is a fake one, the renewal cannot take away the effect of fake licence and "that "conceptual difference between the third party right and own damage cases had to be kept in view." In the final analysis, the court concluded as follows:
1. The decision in Swaran Singh's case (supra) has no application to cases other than third party risks.
2. Where originally the licence was a fake one, renewal cannot cure the inherent fatality.
3. In case of third party risks the insurer has to indemnify the amount and if so advised, to recover the same from the insured.
4. The concept of purposive interpretation has no application to cases relatable to Section 149 of the M.V. Act.
18. Again, in United India Insurance Company vs. Davinder Singh, 2007 (8) SCC 698, reference was made to Swaran Singh & ors. case 13 (supra) and it was noted that it was distinguished in National Insurance Company Ltd., vs. Laxmi Narain Dhut (supra) and it was further held that Laxmi Narain Dhut (supra) was followed in Oriental Insurance Company Ltd., vs. Meena Variyal & ors., 2007 (5) SCALE 269, and, it was again reiterated that the decision in Swaran Singh's case (supra) has no application to cases other than third party risks and then the Apex Court proceeded to hold that they were bound by the decisions in Laxmi Narain Dhut (supra) and Meena Variyal (supra), being directly on the point. The Hon. Court also reiterated that where originally the licence was a fake one, renewal cannot cure the inherent fatality.
19. Yet again, the Hon. Supreme Court in National Insurance Company Ltd., vs. Harbhajan Lal, IV 2008 CPJ 35, approved the view held in Laxmi Narain Dhut (supra) and further held that no sooner the insurer was able to prove that the licence was fake one, the insurer was absolved from its liability (emphasis supplied).
20. In Oriental Insurance Company Ltd., vs. Prithvi Raj, 2008 (2) SCC 338, it was observed by the Hon. Supreme Court, by referring to statutory provisions, that the Statute is beneficial one qua the third party. But that benefit cannot be extended to the owner of the offending vehicle. The logic of fake licence has to be considered differently in respect of third party and in respect of own damage claims. The view held in Kamla & ors. (supra) and Laxmi Narain Dhut was followed and it was again reiterated that the decision in Swaran Singh's case (supra) had no application to own damage cases and the effect of fake licence has to be considered in the light of what is stated in New India Assurance Company Ltd., vs. Kamla and ors., (supra).
1421. The case of Lal Chand vs. Oriental Insurance Company Ltd., 2006 (7) SCC 318, is again a case of third party risk decided on the basis of Swaran Singh and ors. (supra) and is of no assistance to the case of the complainant. Likewise, the case Pepsu Road Transport Corporation vs. National Insurance Company Ltd., 2013 (5) ALL MR 922 is again a case of third party risk, wherein it was held that the legislature, in its wisdom has made insurance, atleast third party insurance compulsory, the aim and purpose being that an Insurance Company would be available to pay so that innocent are not made to suffer for loss.
22. In National Insurance Company Ltd., vs. Rajesh Ohri, 2012 (1) CPR 130, what was held by the National Commission is that the Insurance Company had failed to prove that the licence of the driver was fake. In the case at hand the Insurance Company has succeeded in proving that the licence was fake. This case is of no help to the complainant.
23. The complainant has filed cross objections. As regards cross objections, Shri. Timble has submitted, and in our view rightly, that there is no provision made for filing of cross objections under the C.P. Act, 1986 and the provisions of O. 41, Rule 22 C.P.C are not applicable under C.P. Act, 1986. In the case of Mrs. Lenni S. P. Rodrigues (unreported order dated 02/01/15 in FA No. 22/14) this Commission has held as follows:
"8. The OP has filed cross objections on or about 8/4/14 but the same deserve to be dismissed as the C.P. Act, 1986 does not provide for filing of any cross objections and the provision of C.P.C providing for filing of the same are not followed by the Fora under the C.P. Act. The National Commission has taken the view, (see 1992 (2) CPR 132) that a counter claim is not maintainable as there is no provision under 15 the C.P. Act to file the same. By analogy the same principle can be followed in case of cross objections as well."
24. To sum up, the accident in this case took place because the complainant's driver lost control of complainant's tipper truck whilst overtaking another vehicle and hit a tree on the right side. The complainant's driver at the time of accident did not have an effective driving licence. The OP has proved that his licence was fake by producing letters dated 1/7/12 as well as dated 8/5/15 from the Regional Transport Officer, Karwar. The complainant did not produce an extract of the driving licence inspite of oral request made by the OP and this was presumably because the complainant knew that his driver did not have a valid driving licence. The complainant also gave a wrong number of the said licence in his claim-form, filed before the OP. Complainant committed breach of policy condition i.e. driver's clause. Since this is the case of own damage it had to be decided on the basis of Kamla and ors., Laxmi Narayan Dhut, Meena Variyal, Davinder Singh and ors., Harbhajan Lal and Prithvi Raj (supra). The case cannot be decided on the basis of other decisions referred to by Shri. S.S. Kakodkar beginning with United India Insurance Company Ltd., vs. Lehru & ors., (supra) and other decisions.
25. The case appears to have been decided on the basis of certain observation made by the Apex Court in deciding cases of third party rights - not own damage cases - particularly in Lehru and ors. (para 15 of impugned order) and Narchinva V. Kamat and ors. (supra, para 14 of the impugned order) wherein, on facts, the OP had failed to discharge the onus that there was a breach of the contract of insurance.
26. Disposal of cases by blindly placing reliance on a decision is not proper. It is well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a 16 decision. (see 2003 (2) SSC 111). A decision is only an authority for what it decides. What is the essence in a decision is its ratio and not every observation found therein nor what logically follows from various observations made in it (see Sumitbai and ors. vs. Paras Finance Co., AIR 2007 SC 3166. What is required to be followed in this case is the ratio of the decisions referred to para 17 to 20 hereinabove, relied upon by Lr. Adv. Shri. Timble in cases of own damage, and not observations made, even if by Larger Benches, in cases of third party risks.
27. For the above reasons, the appeal deserves to succeed. The cross objections are hereby dismissed. The impugned order is hereby set aside and the complaint is dismissed with costs of Rs. 2500/-.
[Shri. Jagdish Prabhudessai] [Justice Shri. N.A. Britto]
MEMBER PRESIDENT
sp/-