National Consumer Disputes Redressal
National Insurance Co. Ltd. vs Kuldeep Singh on 12 April, 2019
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 2793 OF 2016 (Against the Order dated 03/06/2016 in Appeal No. 1015/2013 of the State Commission Delhi) 1. NATIONAL INSURANCE CO. LTD. NATIONAL LEGAL VERTICAL LEGAL CELL, 2E/9, JHANDEWALAN EXTENSION, 3RD FLOOR, NEW DELHI-110055 ...........Petitioner(s) Versus 1. KULDEEP SINGH S/O. LATE SH. VEER SINGH, R/O. HOUSE NO. A-33, OLD GOVIND PURA, NEW DELHI-110053 ...........Respondent(s)
BEFORE: HON'BLE MR. C. VISWANATH,PRESIDING MEMBER
For the Petitioner : For the Respondent :
Dated : 12 Apr 2019 ORDER
APPEARED AT THE TIME OF ARGUMENTS
For the Petitioner
:
Ms. Jyoti Nagpal, Advocate
For the Respondent
:
Mr. J.N. Taneja, Advocate
ORDER
C.VISWANATH The present Revision Petition is filed by the Petitioner under Section21(b) of the Consumer Protection Act, 1986 against Order passed by the State Consumer Disputes Redressal Commission, Delhi (hereinafter referred to as the "State Commission") in Appeal No. 1015/2013 dated 03.06.2016.
According to the Respondent/Complainant, he was living at Sundergarh, Orissa and was insured with National Insurance Co. Ltd./Petitioner under a Group Janta Personal Accident Insurance Policy, vide Policy No. 100300/47/01/9600022/03/96/30343 for Rs.4 Lakhs.The period covered under the policy was from 08.01.2004 to 07.01.2006. Unfortunately on 11.02.2005, while the Respondent was on duty, truck No. OG-04-G-6857, suddenly met with an accident due to which he sustained injuries.The Respondent was admitted in Cuttack, Orissa in the I.G.H. RourkelaHospital upto 14.02.2005.Thereafter, he was admitted in Government Hospital, S.C.B. Medical College Hospital, Cuttack from 15.02.2005 to 28.02.2005 and finally in General Nursing Home, Road No. 133/01, Manglabag, Cuttack from 01.03.2005 to 13.03.2005 wherein the left leg of the Respondent was amputated. He had spent Rs.1,25,000/- in total on his treatment. The Respondent has further deposited the necessary papers with the Petitioner for clearance of the insured amount of Rs.4 lakhs but the same was not paid to him. Thus, the Complaint was filed.
The Petitioner filed the Written Statement in which he did not dispute the fact that the Policy of Rs.4 lakhs was issued by the Petitioner but the only question raised was about the jurisdiction, though it has Head Office in Delhi. No other dispute was filed in the Written Statement. The Petitioner mentioned the claim in respect for injury within six months of the policy to be 50% of the sum insured.
District Forum, vide order dated 10.07.2013, allowed the Complaint on the ground that there was no merit in the preliminary objections regarding the territorial jurisdiction as the principal office of the Insurance Company was in Delhi and Respondent had also shifted to Delhi after the aforesaid event.The contention that the Respondent was only entitled to 50% of the claim was also not tenable in view of the clause (b) and (d) on cover-note which allowed full insured amount in case of permanent disability.In this case the leg was amputated.The District Forum, therefore, held that the Respondent was entitled to the full insured amount. The Petitioner was directed to pay Rs.4 lakhs i.e. full insured amount with interest @12% from the date of denial to till the payment. The Petitioner was further directed to pay Rs.1 lakhs as compensation for harassment and litigation expenses. It was made clear that the order had to be complied within 30 days of the receipt of the copy of the order; otherwise action could be taken under Section 25/27 of the Consumer Protection Act, 1986.
Being aggrieved by the order of the District Forum, the Petitioner filed an Appeal before the State Commission. The State Commission vide order dated 03.06.2016 dismissed the Appeal of the Petitioner. The State Commission further observed that they find no error in the order passed by the District Forum.
Being aggrieved by the order passed by the State Commission, the Petitioner filed the present Revision Petition before this Commission.
Heard the Learned Counsel for the Petitioner as well as the Respondent. They reiterated their respective contentions as stated above.Also carefully perused the record.
Both the parties filed certain judgements in support of their contentions which are stated as below:
The Petitioner placed the following judgements on record:-
In National Insurance Co. Ltd. Vs. A.S. Mooosani & Co., this Commission held that in General Assurance Society Ltd. (supra), a Constitution Bench of this Court has observed that :
"11.....In interpreting documents relating to a contract of insurance, the duty of the court is to interpret the words in which the contract is expressed by the parties, because it is not for the court to make a new contract, however, reasonable, if the parties have not made it themselves".
Similarly, in Harchand Rai Chandan Lal's case (supra), this Court held that:
"6.......the terms of the policy have to be construed as it is and we cannot add or subtract something. Howsoever liberally we may construe the policy but we cannot take liberalism to the extent of substituting the words which are not intended".
Thus, it needs little emphasis that in construing the terms of a contract of insurance, the words used therein must be given paramount importance, and it is not open for the Court to add, delete or substitute any words. It is also well settled that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer. Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed by the parties.
In A.V. Cottex Limited Vs. The Oriental Insurance Co. Ltd. And Ors., the NCDRC held that the insurance policy is a contract between the insured and the insurer and its terms and conditions are to be considered as such in the same spirit in which they are written and agreed upon by the parties. Form this point of view, parties are bound by the conditions No. 3(b) and 4(a) and (b) and it is difficult for us to grant any exemption or relaxation from those conditions. From the above examination, it is clear that the complainant has violated the conditions of the policy and therefore, the claim is not payable. We are also of the view that it is difficult to believe that the complainant did not receive the terms and conditions of the policy, Being an industrial enterprise, the complainant may have asked for the full policy alongwith terms and conditions if it did not receive the same within the period of validity of the cover note. Hence, the contention of the complainant that terms and conditions were not received by the complainant is not acceptable.
In M/s Industrial Promotion & Investment Corporation of Orrisa Ltd. Versus New India Assurance Company Ltd., the Supreme Court held that it is well-settled law there is no difference between a contract of insurance and any other contract, and that it should be construed strictly without adding or deleting anything from the terms thereof. On applying the said principle, we have no doubt that a forcible entry is required for a claim to be allowed under the policy for burglary/ house breaking.
In Suraj Mal Ram Niwas Oil Mills (P.) Ltd. Versus United India Insurance Co. Ltd. And Anr., the Supreme Court held that before embarking on an examination of the correctness of the grounds of repudiation of the policy, it would be apposite to examine the nature of a contract of insurance. It is trite that in a contract of Insurance, the rights and obligations are governed by the terms of the said contract. Therefore, the terms of a contract of insurance have to be strictly construed, and no exception can be made on the ground of equity. In General Assurance Society Ltd. (supra), a Constitution Bench of this Court has observed that :
"In interpreting documents relating to a contract of insurance, the duty of the court is to interpret the words in which the contract is expressed by the parties, because it is not for the court to make a new contract, however, reasonable, if the parties have not made it themselves".
Thus, it needs little emphasis that in construing the terms of a contract of insurance, the words used therein must be given paramount importance, and it is not open for the Court to add, delete or substitute any words. It is also well settled that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer. Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed by the parties.
In Atam Parkash Versus Reliance General Ins. Co. Ltd., the NCDRC held that Condition No.1 of the policy runs as under:
"Upon the happening of any event which may give rise to a claim under this policy, written notice will full particulars must be given to the Company immediately. Unless reasonable cause is shown, the Insured Person/Nominee should within one calendar month after the vent, which may give rise to a claim under the policy, give written notice to the Company with full particulars of the claim".
The judgements placed by the Respondent are as follows:-
In Oriental Insurance Company Limited Versus Ram Prasad Varma and Others, Supreme Court held that a Claimant who had suffered injuries in a motor vehicle accident resulting in amputation of both legs is entitled to 100% compensation in terms of the First Schedule appended to the Workmen's Compensation Act, 1923. The amount of compensation which represents the loss of income can be calculated either in terms of the structured formula as contained in the Second Schedule appended to the Motor Vehicles Act or on the basis of the other materials brought on record. It is not in dispute that in a case of this nature, the Tribunal cannot be said to have committed any illegality in applying the structured formula.
The second schedule as such may not have any application as the maximum annual income of a deceased or an injured which could be taken into consideration therefore is Rs.40,000/- per annum. However, keeping in view the peculiar factual circumstances of the case, the proper multiplier which, in our opinion, should be adopted is eight for the purpose of determining fair compensation. One third amount is deducted from computation of compensation from the total income on the premise that some expenses were necessary for one's own survival. Incidentally, we may notice that in the note appended to the Second Schedule, the amount of compensation arrived in the case of fatal accident claims is required to be reduced by one-third in consideration of the expenses which the victim would have incurred towards maintaining himself had he been alive. A person, although alive, but when he is not in a position to move and even for every small thing he has to depend upon the services of another, in our opinion, a direction to deduct 1/3rd of the amount form his total income need not always be insisted upon.
In New India Assurance CO. Ltd. Versus Balachandran, Kerala High Court held that it is fair to see that compensation in the case of permanent total disablement has to be higher as compared to partial disablement. In the event it is accepted that Explanation II is not applicable in the computation in clause (c), there may be a case where the amount for partial disablement may be more than that of permanent disablement which cannot be the intention of the Legislature. When reference is made to clause (b) for computing the compensation, the mechanism which has been provided in clause (b) shall ipso facto apply to clause (c). It was not necessary for Legislature to have expressly refer to in clause (c) since even in clause (c) there is no reference of clause (b) and only reference is of percentage of the compensation payable in the case of permanent total disablement which obviously refers to clause (b). can it be argued that non-reference of clause (b) does not entitle computation of clause (b)/ the answer shall obviously e "no". when clause (b) is applicable in computation. Explanation itself, which is part and parcel of clause (b) has to be made applicable.
In S. Suresh Vs. Oriental Insurance Co. Ltd. & Anr., the Supreme Court held that on account of amputation of his right leg below knee, he is rendered unfit for the work of a driver, which he was performing at the time of accident resulting in the said disablement. Therefore, he has lost 100% of his earning capacity as a lorry driver, more so, when he is disqualified from even getting a driving licence under the Motor Vehicles Act.
In Palraj Versus The Divisional Controller, Nekrtc, the Supreme Court agreed with the order passed by the High Court but held that the percentage of functional disablement has to be modified from 20% to at least 35%, having regard to the Appellant's mobility on account of the medical treatment received after the accident and also because of the Appellant's loss of future earnings and also promotion.
In Oriental Insurance Co. Ltd. Versus Mohd. Nasir & Anr., the Supreme Court held that the distinction between the "permanent total disablement" and "permanent partial disablement" is that whereas former it is 100% disablement, in the latter it is only the disablement to the extent specified in the Schedule. Similar terms have been used in clauses (a) and (b) of paragraph 5 of the Second Schedule of the Motor Vehicle Act. It, by reference, incorporates the provisions of the First Schedule of the 1923 Act. Indisputably, therefore, the Note appended thereto would not only be applicable to the cases failing under the 1923 Act but apply to the cases which fall under the 1988 Act as well.
On 11.02.2005, while the Respondent was driving a truck he met with an accident and sustained injuries.He was admitted to Hospital in Cuttack where the left leg of the Respondent was amputated.He spent Rs.1.25 lakh on his treatment and claimed insurance under the Janta Personal Accident Insurance Policy.There is no dispute that the Policy of Rs.4 lakh was issued by the Petitioner.The Petitioner did not pay the claim.However, before the State Commission, the Petitioner admitted that the Insurance Company was liable to pay Rs.2 lakh to the Respondent under the Policy, i.e., 50% of the sum assured. The certificate issued by the CMO, Government Hospital, Rourkela shows that it is a case of mid-thigh amputation of left leg.On account of the amputation of the left leg, the Petitioner was rendered unfit for the work of driving which was his main occupation and source of livelihood before the accident.Amputation of his left leg rendered him unfit for the work of a driver, which he was performing at the time of accident resulting in the said disablement.He lost 100% of his earning capacity as a lorry driver.The ratio of the judgment of Apex Court in "Pratap Narain Singh Deo vs. Srinivas Sabata & Anr. [AIR 1976 SC 222]" as well as "S. Suresh vs. Oriental Insurance Co. Ltd. & Anr. [Civil Appeal 7641 of 2009]" is squarely applicable to the facts of this case.
In view of the above, the present Revision Petition is dismissed and orders passed by the State Commission as well as the District Forum are confirmed.
...................... C. VISWANATH PRESIDING MEMBER