State Consumer Disputes Redressal Commission
Kulwinder Singh Chauhan vs United India Insurance Company Limited on 11 October, 2017
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
CHANDIGARH.
Consumer Complaint No.171 of 2015
Date of institution : 14.07.2015
Reserved on : 27.09.2017
Date of decision : 11.10.2017
Kulwinder Singh Chauhan s/o Jagdish Singh Chauhan, r/o H.No.86,
Dalowal, Tehsil Mukerian, District Hoshiarpur.
.......Complainant
Versus
1. United India Insurance Company Limited through its General
Manager, Head Office (Regd.), 24, Whites Road, Chennai.
2. Divisional Manager, United India Insurance Company Ltd.,
Divisional Office, Jalandhar Road, Hoshiarpur.
........Opposite Parties
Consumer Complaint under Section
17(1)(a)(i) of the Consumer Protection Act,
1986.
Quorum:-
Hon'ble Mr. Justice Paramjeet Singh Dhaliwal, President
Mrs. Kiran Sibal, Member
Present:-
For the complainant : Ms. Jagjit Grewal, Advocate. For the opposite parties: Shri D.P. Gupta, Advocate. JUSTICE PARAMJEET SINGH DHALIWAL, PRESIDENT:
The complainant, Kulwinder Singh Chauhan, has filed this complaint under Section 17(1)(a)(i) of the Consumer Protection Act, 1986 (in short, "the C.P. Act") for the issuance of following directions to the opposite parties:-
i) to immediately release the claim amount to the complainant;
Consumer Complaint No.171 of 2015 2
ii) to pay compensation to the tune of ₹30,00,000/- along
with interest at the rate of 9% per annum till its
realization; and
iii) to pay 3,00,000/- as litigation expenses.
Facts of the Complaint:
2. Brief facts, as stated in the complaint, are that the complainant had purchased a vehicle make Ashok Leyland (Truck) bearing Registration No.PB-07-AB-1141 on 24.2.2011 for a total sum of ₹19,20,000/-. The same was got financed from Kotak Mahindra Bank Limited for a sum of ₹18,66,000/-. The remaining amount was paid by the complainant from his own pocket. The complainant had to pay the loan amount by way of Equal Monthly Instalments of ₹50,450/-, each. The said vehicle was got insured initially from Reliance General Insurance Company Ltd. for the period from 24.2.2011 to 23.2.2012. Thereafter the vehicle was got insured from the opposite parties i.e. United India Insurance Company Ltd. for the period from 24.2.2012 to 23.2.2013. On 11.4.2012 the vehicle in question along with all the documents was stolen from Khalapur, District Raigarh, Maharashtra. The complaint regarding the same was made to the local Police Station. On 12.4.2012 the complainant submitted the other relevant documents to the Police Station and prayed for registration of the case but the same was not registered.
Then the complainant met Senior Police Inspector, PS-Khalapur and submitted an application on 23.4.2012 for registration of FIR regarding the theft of the vehicle in question. The intimation of theft was also given to the Financier-Kotak Mahindra Bank Ltd. as well as Consumer Complaint No.171 of 2015 3 to the Insurance Company. The complainant also filed insurance claim before the Insurance Company on 18.7.2012 along with requisite documents including FIR and R.C. of the vehicle etc. In- spite of lapse of long time the Insurance Company did not decide the claim of the complainant and continued to raise objections. On 27.5.2013 the complainant received a letter from the opposite parties-Insurance Company to supply NCB from the previous insurer and asked for fulfilling seven more documents but no action was taken. The complainant had been complying with all the formalities as required by the Insurance Company. Ultimately on 21.11.2013 the complainant received another letter asking for reasons for registration of FIR after the delay of 2 months and the untraceable report having been signed by SSP/ACP. The complainant had already submitted a copy of the FIR and thereafter submitted the untraced report dated 10.4.2014. In-spite of all this, the opposite parties-Insurance Company rejected the claim. The complainant wrote many letters. Not only this, in-spite of theft of the truck of the complainant the Kotak Mahindra Bank Ltd. started filing complaints under Section 138 of the Negotiable Instruments Act for dishonouring of the cheques which they had taken as surety. Even arbitration proceedings were initiated and arbitration award was passed. Finally the opposite parties-Insurance Company rejected the claim, vide letter dated 27.2.2015 on the ground that untraceable report was not submitted. Hence feeling aggrieved the present complaint was filed by the complainant for issuance of the above mentioned directions to the opposite parties.
Consumer Complaint No.171 of 2015 4Defence of the Opposite Parties:
3. Upon notice, the opposite parties-Insurance Company appeared and filed their joint reply taking preliminary objections that this Commission has no pecuniary jurisdiction. The value of the vehicle was ₹15,09,600/-. Excessive amount has been added to increase the value. This Commission has no pecuniary jurisdiction to try the complaint. The vehicle in question was stolen on 11.4.2012 and the FIR regarding the theft was registered on 9.7.2012. The delay in informing the police reduces the chances of catching of the thieves and recovery of the vehicle. The complainant did not provide untraceable report from the SSP/ACP. Thereafter the claim was declared as "No Claim", vide letter dated 27.2.2015. The complainant failed to provide the requisite information and, as such, it cannot be said to be a case of deficiency in service. On merits, it was denied that the total value of the truck was ₹19,20,000/-. It was also denied that it was got financed from the concerned Financier for a sum of ₹18,66,000/- and that the same was repayable in EMIs of ₹50,450/-. However, it is admitted that the policy of insurance was valid for the period from 24.2.2012 to 23.2.2013 and the IDV of the vehicle was ₹19.00 lakh. Some of the facts have been admitted with regard to the insurance policy, IDV of the vehicle and the documents submitted by the complainant. However, the main stress in the reply is with regard to the delay in lodging the FIR. As per intimation received from the complainant, the vehicle was stolen on 11.4.2012.
It is denied that intimation of theft was given to the police on 12.4.2012. According to the complainant himself he had written Consumer Complaint No.171 of 2015 5 letter dated 23.4.2012 to the Senior Police Inspector, Police Station- Khalapur regarding theft of the vehicle. Thus, there was delay of 12 days in giving the said information to the police, which has not been explained. Letters dated 27.5.2013, 29.8.2013 and 21.11.2013 written by the opposite parties to the complainant were also admitted. The complainant was asked to provide certain information which the complainant allegedly provided but it was incomplete. It is further averred that FIR was registered much after the alleged theft. FIR was registered on 9.7.2012 whereas the theft is of 11.4.2012. In the FIR date of theft has been mentioned as 9.6.2012. In view of these facts it is prayed that the complaint be dismissed. Evidence of the Parties:
4. In support of the averments made in the complaint, the complainant produced on record his affidavit as Ex.CA and documents Ex.C-1 to Ex.C-40. On the other hand, the opposite parties tendered in evidence affidavit of their Senior Divisional Manager, Ashok Kumar Trikha as Ex.R-A and the documents Ex.R1, Ex.R-1A and Ex.R-2. On 16.8.2017 the opposite parties filed translated copies of the documents but the same were not attested.
Thereafter the attested and translated copies of the same were placed on record by the opposite parties on 22.9.2017. Contentions of the Parties:
5. It was vehemently argued by the learned counsel for the complainant that the complainant purchased a brand new truck manufactured by Ashok Leyland. The value of the truck was ₹19,20,000/- and it was also got financed from the Kotak Mahindra Consumer Complaint No.171 of 2015 6 Bank Limited for a sum of ₹18,66,000/-. The said vehicle was also got registered from the Registering Authority and was assigned Registration No.PB-07-AB-1141. The vehicle was being used for carrying goods i.e. transportation and was also insured with the opposite parties from 24.2.2012 to 23.2.2013 for the IDV of ₹19,00,000/-. It was further argued that when the vehicle, carrying the goods, was being taken to Maharashtra, the same was parked in the area of Khalapur on 11.4.2012 from where the said vehicle was stolen. A complaint was lodged on the next day with the police of Police Station-Khalapur, District Raigarh, Maharashtra immediately.
The complainant was experiencing difficulty in understanding the local language i.e. Marathi and had conveyed to the police in Punjabi language but they were not understanding properly. The complainant remained there for many days for getting the FIR registered but the same was not registered. However, an application was again submitted on 23.4.2012, which is placed on record as Ex.C-6, which was written by a local person in Marathi and the same was got signed from the complainant. A copy of the said application was given after signing by the official of the concerned Police Station, which bears the stamp/seal of the Police Inspector of Police Station-Khalapur and the date. It was further argued that the complainant had informed the police immediately on 12.4.2012 and had also submitted another application on 23.4.2012 Ex.C-6 but it was not within the power of the complainant to get the FIR registered. He could only give intimation of theft of the vehicle to the police. There is no mala fide intention on the part of the complainant Consumer Complaint No.171 of 2015 7 that he will falsely claim for the vehicle which was a new one. In fact there is no delay on the part of the complainant in informing the police as well as the opposite parties and the financier. The delay is fully explained in view of the fact that the complainant remained in Khalapur area for tracing out the truck with the police but of no avail. It was also not in the control of the complainant to get the untraceable report from the concerned authority. The opposite parties have not got the claim investigated on their level. The complainant has no control over the police. Untraceable report can also be obtained by the opposite parties. It was lastly argued that the complainant had given legal notice for not deciding the insurance claim for three years, which is against the IRDA instructions as well as the general practice of deciding the claims by the Insurance Companies. The claim has been wrongly rejected, vide letter dated 27.2.2015, Ex.C-39, on the ground that the documents are not available and the complainant has not completed the formalities. This action of the opposite parties not only amounts to deficiency in service but also amounts to adoption of unfair trade practice on their part.
6. Per contra, it was vehemently argued by the learned counsel for the opposite parties that the FIR was registered on 9.7.2012, Ex.C-5 in which the date of theft is mentioned as 11.6.2012, though the theft is stated to have been taken place on 11.4.2012. It was further argued that there is considerable delay in giving intimation to the police authorities as well as to the Insurance Company. So, the complainant is not entitled to the insurance claim. It was further Consumer Complaint No.171 of 2015 8 argued that the complainant did not submit the relevant documents i.e. untraced report duly signed by the concerned SSP/ACP. On all these grounds the claim of the complainant has rightly been rejected as "No Claim", vide letter dated 27.2.2015 Ex.C-39. Hon'ble Supreme Court as well as Hon'ble National Commission repeatedly held the repudiation of the claim on the ground of late intimation of theft to the police as well as to the Insurance Company. He relied upon following judgments:-
i) 2010(4) C.P.J. 38 (M/s Suraj Mal Ram Niwas Oil Mills (P) Ltd. v. United India Insurance Co. Ltd. and another);
ii) IV(2012) CPJ 441 (NC) (NEW INDIA ASSURANCE
COMPANY LTD. v. TRILOCHAN JANE);
iii) I(2013) CPJ 71 (NC) (VIRENDER KUMAR v. NEW
INDIA ASSURANCE CO. LTD.);
iv) I(2016) CPJ 461 (NC) (UNITED INDIA INSURANCE CO.
LTD. v. NASIB SHAH BASHIR SHAH); and
v) I(2016) CPJ 205 (NC) (NATIONAL INSURANCE CO.
LTD. v. SURESH KUMAR).
He prayed that there is no merit in the present complaint and the same is liable to be dismissed with costs.
Consideration of Contentions:
7. We have given our thoughtful consideration to the arguments raised by the learned counsel for both the sides before us.
8. Admittedly the vehicle in question was purchased on 24.2.2011, vide Ex.C-1 and the same was registered, vide Ex.C-2 on Consumer Complaint No.171 of 2015 9 6.4.2011. The complainant had taken loan from Kotak Mahindra Bank Limited, vide Agreement dated 6.2.2011, Ex.C-3. The insurance policy was purchased on 24.2.2012, Ex.C-4 from the opposite parties, which was valid upto 23.2.2013. The complainant has orally submitted that he had given the intimation regarding the theft of the vehicle on 12.4.2012 to the police of PS-Khalapur and remained in the area of PS-Khalapur area for the purpose of registration of the FIR. It is also an admitted fact that the complainant belongs to the State of Punjab and the local language spoken in that area of Maharashtra is Marathi. A judicial notice can be taken of the fact that he must be experiencing difficulty in understanding and making the local police understand about the incident. After waiting for some days the complainant moved an application dated 23.4.2012 Ex.C-6, which was duly received by the police officials of Police Station-Khalapur and a copy duly signed and bearing official stamp/seal was given to the complainant. Meaning thereby that the complainant had informed the police authorities immediately but the FIR was registered by the police officials on 9.7.2012, Ex.C-5 and even in that FIR the date of theft has wrongly been mentioned as 11.6.2012, whereas in the application of the complainant it has been specifically mentioned that the theft had taken place on 11.4.2012 at around 9.00 P.M. near Hotel Priti Palace in the jurisdiction of Village Varose, PS-Khalapur, District Raigarh, Maharashtra. These facts have been admitted by the opposite parties in their reply also. In the light of these facts we deem it fit to examine the issue of delay in lodging the FIR, whether there is any Consumer Complaint No.171 of 2015 10 delay in lodging the FIR? The answer to the same is in the negative for the reason that it cannot be presumed that the complainant will not intimate to the police after the theft of the vehicle which he had purchased recently i.e. about one year ago and that too after getting it financed from the Bank. It is also an admitted fact that the complainant was not well conversant with the local language of the area i.e. Marathi. He must be experiencing some difficulty in communicating and narrating the incident to the police officials and local people. It is the specific case of the complainant that he remained there for registration of the FIR and also moved an application Ex.C-6 on 23.4.2012 to the Senior Police Inspector of PS-Khalapur, which was duly acknowledged by him and a copy duly signed and sealed was given to the complainant. It means that the complainant made every effort to inform the police authorities as early as possible. It is certainly beyond the control of the complainant to register the FIR. He could only give intimation to the police, which he did promptly and it is for the police authorities to register the FIR when intimation was given by him. We do not find that there was any delay on the part of the complainant in intimating the police about the theft of the vehicle in question for registration of the FIR. The authorities cited by the opposite parties are not applicable to the peculiar facts of the present case.
9. Another reason for rejecting the claim is non-submission of untraced report duly signed by the SSP/ACP of the concerned area. A copy of the Panchnama/Certificate dated 10.4.2014 regarding the theft of the vehicle issued by the Police Inspector of PS-Khalapur is Consumer Complaint No.171 of 2015 11 annexed as Ex.C-17 in which it has been stated that untraced report had been submitted by the police of PS-Khalapur to the Hon'ble Magistrate First Class, Khalapur to grant summary under class "A". It is also mentioned that FIR had been registered and till that date the accused had not been found. This Certificate has been duly issued by the Police Inspector, PS-Khalapur. Meaning thereby that till 10.4.2014 the vehicle was not traced. This information was supplied to the opposite parties-Insurance Company. Thereafter letter Ex.C-21 was received from the opposite parties-Insurance Company to supply cause and reason of lodging late FIR on 9.7.2012 while the theft had taken place on 11.4.2012 and untraceable report from the concerned SSP/ACP. So far as both the documents are concerned, the complainant had already submitted all the documents including application submitted by him to the Police of Police Station-Khalapur on 23.4.2012, Ex.C-6, which indicates that prompt action was taken by the complainant. Firstly oral complaint about the theft of the vehicle in question was made by the complainant to the police of PS-Khalapur on 12.4.2012. Thereafter another complaint was lodged on 23.4.2012, Ex.C-6, to the Police Inspector of PS-Khalapur, meaning thereby that there was no delay in informing the police. It is beyond the control of the complainant to submit all these documents. Some duty is also cast upon the opposite parties-Insurance Company. They were required to appoint their own Investigator as per the IRDA guidelines and as per the usual practice to investigate the matter but nothing of the sort has been done by the opposite parties-Insurance Company. Once Consumer Complaint No.171 of 2015 12 the complainant had already submitted all the relevant documents, then the concerned Hoshiarpur Branch of the opposite parties- Insurance Company should have contacted the officials of their Corporate Branch in Khalapur area of Maharashtra and could have asked for the documents from the concerned authorities. The complainant has no control over the action of the police authorities and the delay in investigation and tracing out of the vehicle. If the same was not available in the reasonable time, then the opposite parties must compensate the complainant once he fulfilled the required formalities. Admittedly the complainant had submitted the untraceable report from the Police Inspector of the concerned Police Station Ex.C-17 to the opposite parties. Therefore, the opposite parties-Insurance Company must have confirmed from the concerned Police Station, whether the report is correct or not but the same has also not been denied or rebutted by the Insurance Company. The ground for delay has already been explained. The lodging of the FIR was also beyond the control of the complainant. It is the act of the Police authorities. The complainant could only intimate about the theft and the intimation was given on 12.4.2012. The intimation was again given on 23.4.2012, vide application Ex.C6. The complainant has explained all efforts made by him in lodging the FIR and informing the Insurance Company and the Financier. Hence we find that there is no delay on the part of the complainant. The delay, if any, has been fully explained.
10. In a latest judgment dated 4.10.2017 passed in Civil Appeal No.15611 of 2017 (OM PRAKASH v. RELIANCE GENERAL Consumer Complaint No.171 of 2015 13 INSURANCE AND ANR.) in which the truck was stolen and there was delay in giving intimation to the Insurance Company, the Hon'ble Supreme Court while allowing the appeal in para no.11 has observed 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 Consumer Complaint No.171 of 2015 14 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."
11. In view of the above, we are of the view that the closing of the claim file as "No Claim", vide letter 27.2.2015, Ex.C-39, is without any justified reason and the action of the opposite parties in rejecting the same amounts to deficiency in service specifically when the theft had taken place during the subsistence of valid insurance policy and it is not the case of the opposite parties that the vehicle had been got stolen in connivance with the complainant. No such allegation has been alleged or proved on the record. It is a fact that the theft of the truck in question had taken place on 11.4.2012 and the claim was submitted with the opposite parties on 18.7.2012. However, the opposite parties have failed to bring on record what efforts they have made to trace out the vehicle and why they could not decide the claim for about three years since the claim was rejected, vide letter dated 27.2.2015, Ex.C-39.
12. It is common practice that the Insurance Companies being in dominant position create problems when their turn to pay claims comes. Moreover, in the case in hand, as discussed above, the complainant produced on record the attested copy of the Certificate Consumer Complaint No.171 of 2015 15 dated 10.4.2014, Ex.C-10 and a copy of the same was also given to the opposite parties, which clearly indicates that the untraced report has been forwarded to the Judicial Magistrate, A-Class, Khalapur. Thus, it does not lie in the mouth of the opposite parties to say that the complainant had not submitted the relevant document i.e. untraced report. The complainant cannot be held responsible for the delay if the police take time in investigation and untraced report is not accepted by the concerned competent Court.
13. In view of this, the evidence on record clearly reveals that the complainant has suffered loss on account of the non-payment of the claim within a reasonable period, which at the most can be 6 months. It is an admitted fact that the complainant had invested ₹19,00,000/- on the truck and had taken a loan of ₹18,66,000/- from the Kotak Mahindra Bank Ltd. He could not earn from the same for a period of at least two and a half years as the claim was not being settled in a reasonable time and till today more than 5 years have elapsed. The documents on record also reveal that the complainant had to face proceedings under Section 138 of the Negotiable Instruments Act and the Arbitration Proceedings because he was not a position to pay the instalments of the loan due to the fact that he could not purchase another vehicle and earn the amount for payment of instalments and his livelihood. Certainly the complainant is entitled to the IDV of the vehicle along with interest besides punitive damages under Section 14 of the C.P. Act, compensation for mental tension and harassment and litigation expenses. Consumer Complaint No.171 of 2015 16
14. In view of our above discussion, this complaint is allowed and the following directions are issued to the opposite parties:-
i) to pay ₹19,00,000/- to the complainant; being the IDV of the vehicle along with interest at the rate of 9% per annum from the date of lodging of the insurance claim i.e. 18.7.2012 till the date of payment;
ii) to pay ₹3,00,000/- as compensation for mental torture;
harassment and financial loss;
iii) to pay ₹2,00,000/- on account of punitive damages; and
iv) to pay ₹33,000/- as litigation costs.
15. Compliance of this order shall be made by the opposite parties within a period of two months from the date of receipt of certified copy of this order failing which the amount of compensation of ₹3,00,000/- shall also carry interest at the rate of 9% per annum from the date of this order till the date of actual payment.
16. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE PARAMJEET SINGH DHALIWAL) PRESIDENT (MRS. KIRAN SIBAL) MEMBER October 11, 2017 Bansal Consumer Complaint No.171 of 2015 17