National Consumer Disputes Redressal
New India Assurance Co. Ltd. vs Surinder Singh Khurana on 10 November, 2005
Equivalent citations: I(2006)CPJ43(NC)
ORDER
B.K. Taimni, Presiding Member
1. The appellant was the opposite party before the State Commission where the respondent/ complainant filed a complaint alleging deficiency in service on the part of the appellant.
2. The brief facts of the case are that the respondent owned a truck which has insurance cover of Rs. 3,70,000. The truck caught fire coming into contact with the overhead high tension wires, while carrying goods, during the life of the policy. The matter was reported to the appellant and they appointed a Surveyor who recommended settlement of the claim at Rs. 3.32 lacs. Yet, the claim was not settled. It is in these circumstances that a complaint was filed before the State Commission, who after hearing the parties directed the appellant to pay Rs. 3,35,000 along with interest @ 18% from 15.9.1992 till the date of payment with a cost of Rs. 5,000. Aggrieved by this, the appeal has been filed before us. It is the case of the appellant that the vehicle caught fire as it was carrying goods over a height more than prescribed, under the Motor Vehicles Act and it was also a case of overloading. Since this was a case of violation of Motor Vehicles Act and rules made thereunder (Rule 93(4)(1) and Rule 93(7)(iv) of Central Motor Vehicle Rules, 1989), this amounted to violation of conditions of policy, making it fall outside the conditions of the policy. The appellants were right in repudiating the claim. The State Commission went into this argument very carefully and have observed that:
There may have been a violation of some provisions of the Motor Vehicles Act or rules made thereunder prescribing the maximum height. But, the height of loaded vehicle was not such as not to be able to pass underneath the normal height of high tension wires otherwise the vehicle would not have travelled that far. The complainant or its agent could have been liable for violation of the Motor Vehicles Rules or Traffic Rules if there be any. So far as the insurance cover is concerned, the loss is squarely covered under the insurance policy.
3. Learned Counsel for the appellant drew our attention to the policy in which it is stated "Use only for carriage of goods within the meaning of Motor Vehicles Act, 1988". We are of the view that even if it is accepted that there has been a violated of the provisions of the Motor Vehicles Act on the part of the height of the goods being carried by the truck, even that at best, it could be termed as breach of the warranty only and in these circumstances the case should have been strengthen on non-standard basis'.
4. It was argued by the learned Counsel for the appellant that since it is breach, Which resulted in the incidence of fire, as the guidelines issued by the GIC to settle the claim on non-stardard basis, will not be attracted and for this he wanted to cite some judgments, but he failed to show us if any of the judgment being relied upon by the appellant for settlement of claim on non-standard basis as per guidelines of GIC have been discussed in the cases on which he wanted to rely. He also failed to show us any judgment in which the order of the Hon'ble Supreme Court having discussed the guidelines issued by G.I.C. for settling the claims on 'non-standard basis'. As per the guidelines issued by the GIC and amended from time to time for settling the claim on non-standard basis in the chapter on 'Procedural Manual of Motor Claims' there are several contingencies under Item No. 10(ii)(4). The claim should be settled by the insurer with the insured amount on 75% of the admissible claim in case of "any other breach of warranty condition of policy including limitation as to use".
5. We have gone through the terms of the policy carefully and it only states "use only for carriage of goods within the meaning of Motor Vehicles Act, 1988". This could be said to be a violation of the Motor Vehicles Act and at best it could said to be a breach of warranty condition. In these circumstances the case should have been settled on 75% basis of the admissible claim. Not earing to settle the claim as per guidelines issued by G.I.C. itself shall amont to deficiency in services on the part of the appellant.
6. In the present instance, the first Surveyor appointed by the appellant had assessed the loss at Rs. 3,35,000. The appellant is directed to settle the claim on 75% of this amount which will come to Rs. 2,51,250 alongwith interest @ 10% from two months after from the report of the first Surveyor along with cost of Rs. 5,000 as directed to be paid by the State Commission within a period of 6 weeks from the date of this order.
The order of the State Commission shall stand modified in above terms and the appeal is also allowed in above terms.