National Consumer Disputes Redressal
New India Assurance Co. Ltd. vs Neerja Singh on 21 August, 2018
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 2164 OF 2018 (Against the Order dated 01/05/2018 in Appeal No. 454/2018 of the State Commission Uttar Pradesh) 1. NEW INDIA ASSURANCE CO. LTD. THROUGH ITS DULY CONSTITUTED ATTORNEY MANAGER, NEW INDIA ASSURANCE CO. LTD. DELHI LEGAL HUB RO-820000, CORE-3, FIRST FLOOR, SCOPE MINAR, LAXMI NAGAR, DISTRICT-CENTRE DELHI- 110092 ...........Petitioner(s) Versus 1. NEERJA SINGH W/O. SHRI TRIBHUVAN PRATAP SINGH, R/O. R.K.B.K. SAHABGANJ P.S. KOTWALI CITY, DISTRICT-GONDA UTTAR PRADESH ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE V.K. JAIN,PRESIDING MEMBER
For the Petitioner : Mr. C.K. Gola, Advocate
Mr. Abhishek Kumar, Advocate For the Respondent :
Dated : 21 Aug 2018 ORDER JUSTICE V.K.JAIN, PRESIDING MEMBER (ORAL)
The complainant/respondent owned a truck which he had got insured with the petitioner company for the period from 12.05.2014 to 11.05.2015. The aforesaid truck, loaded with goods, was taken from Bahraich on 17.07.2014. Thereafter, the complainant got no information about the truck and could not contact the driver. An FIR against the truck driver was therefore, lodged with the police. The complainant/respondent thereafter, lodged a claim with the insurance company which was rejected by the insurer.
Being aggrieved from the rejection of the claim, the complainant approached the concerned District Forum by way of a consumer complaint. The complaint was resisted by the insurer pleading inter-alia that no intimation of the loss was given to them by the insured. The District Forum vide its order dated 16.02.2016, allowed the complaint by directing the complainant to present the claim afresh with all necessary documents and directing the insurer to decide the claim within two months thereafter. The aforesaid order of the District Forum, having not been challenged by the insurer, became final and binding upon the parties.
2. After the aforesaid order of the District Forum, the insurer again rejected the claim vide letter dated 10.03.2016 which, to the extent it is relevant, reads as under:
We are in receipt of your letter dt. 22.02.2016 alongwith court order in regard to theft of your truck No. UP-42-AT-0757 in this connection we hereby reproduce the policy clause as below:
Notice shall be given in writing to the company immediately upon the occurrence of any accidental loss of damage and in the event of any claim and thereafter insured shall give all such information and assistance as the company shall require. Every letter claim writ summons and or process or copy whereof shall be forwarded to the company immediately on receipt by the insured shall have knowledge of any impending prosecution inquest of fatal injury in respect of any occurrences which may give rise to claim under this policy. In case of theft of criminal act which may be subject of a claim under this policy the insured shall give immediately notice to the police and co-operative with company in securing the convictism of the offender.
In view of the above, since you have not intimated the loss at branch office as such claim not tenable and we are closing the file treating as no claim.
3. Being aggrieved from the second rejection of the claim, the complainant again approached the concerned District Forum by way of a consumer complaint. The complaint was resisted by the insurer on several grounds including that the driver of the truck having committed criminal breach of trust, the loss was not covered under the insurance policy.
4. The District Forum having again allowed the complaint vide its order dated 09.01.2018 and having directed the petitioner to pay a sum of Rs.15 lacs to the complainant alongwith interest @ 9% per annum and cost of litigation quantified at Rs.5,000/-, the petitioner approached the concerned State Commission by way of an appeal. The said appeal having been dismissed, the petitioner is before this Commission by way of this revision petition.
5. As noted by the State Commission, the Hon'ble Supreme Court clearly held in Galada Power and Telecommunication Limited Vs. United India Insurance Company Ltd. & Anr. (2016) 14 SCC 161, that the insurer cannot be allowed to travel beyond the repudiation letter issued by it and cannot be allowed to contest the claim on a ground which was not the ground of repudiation. Therefore, the petitioner cannot be allowed to urge a ground other than the ground that the loss was not intimated to it by the insured. Since the aforesaid ground had already been rejected by the District Forum by allowing the consumer complaint vide its first order dated 16.02.2016, the insurer could not have rejected the claim on that ground, it having accepted the order of the District Forum dated 16.02.2016 by not challenging the same before the concerned State Commission. Therefore, the petitioner could not have resisted the second consumer complaint on the ground that the loss of the truck had not been intimated to it by the insured.
6. As far as the plea that the driver having committed criminal breach of trust in respect of the insured vehicle, the loss was not covered under the insurance policy, the plea cannot be accepted for two reasons: Firstly, the aforesaid was not the ground for rejection of the claim vide repudiation letter dated 10.03.2016. Therefore, in view of the decision of the Hon'ble Supreme Court in Galada Power and Telecommunication Limited (supra), the said plea cannot be allowed to be taken. Even on merits, the plea taken by the insurer has no substance. A reference in this regard may be made to the decision of this Commission in Jagrut Nagrik & Anr. Vs. Oriental Insurance Company Limited decided on 09.02.2018, which to the extent it is relevant, reads as under:
6. As far as the second plea taken by the insurer is concerned, it has repeatedly been held by this Commission, that such a case would constitute theft in terms of the definition given in Section 378 of the Indian Penal Code though it may also constitute a criminal breach of trust. Reliance in this regard is placed upon the decision of this Commission in Revision Petition No.2601 of 2017 - Oriental Insurance Co. Ltd. Vs. Dhanraj Surana, decided on 31.10.2017.
8. The decision of this Commission in Dhanraj Surana (supra), to the extent it is relevant reads as under:-
"4. The only question which arises for consideration in this case is as to whether this was a case of theft of the vehicle or not. If it was a case of theft, the claim in terms of the insurance policy was payable to the complainant. An identical issue came up for consideration of this Commission in The Oriental Insurance Company Ltd. Vs. Ms. Paramjit Kaur, Revision Petition No.2159 of 2015, decided on 15.12.2015 and the following view was taken :-
"Admittedly, the vehicle was insured inter-alia against loss on account of (i) burglary, housebreaking or theft, (ii) by malicious act. Therefore, the question which arises for consideration is as to whether the loss of truck in the fact and circumstances of the case, can be construed to be covered by theft or by malicious act or not? An identical issue came for consideration before this Commission in S. Bhagat Singh vs. The Oriental Insurance Co. Ltd., R.P. No.7 of 1991 decided by Bench of four Members on 03.10.1991. In the above referred case, the taxi owned by the complainant which used to be driven by the driver employed by him left with some passengers in it, but thereafter the whereabouts of the taxi and the driver could not be known. Intimation having been given to the insurance company, the matter was investigated by the insurer. No claim however was being paid. Being aggrieved, the complainant approached the concerned District Forum by way of a complaint. The complaint was resisted on the ground that it was a case of criminal misappropriation or breach of trust and not a case of theft. Rejecting the contention of the insurance company, this Commission inter-alia held as under:-
"After considering the arguments of the learned counsel for the parties we have come to the conclusion that the present case is one of theft. Criminal breach of trust is defined in sec.405 of the Indian penal code. There is nothing on the record to show that the driver had any dishonest intention to misappropriate or convert to his own use the taxi-car when he left Taxi stand Kamla Nagar Market on the night in question with passengers in it. It is possible that the driver might have been murdered or relieved of the taxi by the passengers. It was for the respondent company to allege and prove that the case falls under sec.405, Indian Penal Code. There is the bare allegation of the respondent company that the case is of criminal misappropriation or breach of trust. The case had been investigated by an officer of the respondent company. It has not been stated by the company that said investigation revealed facts contrary to the facts alleged by the complainant.
Even if it is assumed that the driver dishonestly took away the taxi-car, even then the case would fall under sec.378, Indian Penal Code wherein 'theft' has been defined. The present case is fully covered by illustration (d) appended to that section. The said illustration reads as follows:
d) A, being Z's servant, and entrusted by Z with the care of Z's plate, dishonestly runs away with the plate, without Z's consent. A has committed theft. In the present case the driver was entrusted with the taxi-car. He did not take it back to Dehradun but has gone away somewhere either with the passengers or after they had alighted from it on way to Dehradun. As noticed earlier, the taxi-car was to ply only between Dehradun and Delhi. Thus the driver in the present case will be deemed to have committed theft of the tax-car."
"7. This question again came up for consideration of this Commission in United India Insurance Co. Ltd. vs. Ravi Kant Gopalka, R.P. No.1958 of 2004 decided on 13.09.2007 by a Bench of three Members. In the above referred case, the insured vehicle was taken away by the driver for servicing but the driver neither turned up nor did he bring back the vehicle. An FIR against the driver for committing theft of the vehicle was lodged and the insurance company was also informed. No claim having been paid, a complaint was filed. The State Commission ruled in favour of the complainant. Being aggrieved the insurance company approached this Commission and contended that since the police had registered a case under Section 406 of the Indian Penal Code (I.P.C.), the act of taking away of the vehicle by the driver would not amount to theft. Rejecting the contention and holding the order of the State Commission, this Commission held as under:-
"In our view, this submission is without any justification because of the definition of theft under Section 378 of the I.P.C. Illustration (d) to Section 378 specifically provides that-
A, being Z's servant, and entrusted by Z with the care of Z's plate, dishonestly runs away with the plate, without Z's consent. A has committed theft.
In any case, this would be a malicious act and the policy covers such peril. Further, the exclusion clauses also nowhere provide that an offence under Section 406 of I.P.C. is excluded.
Further, in our view, this loss of the car could also be construed to be covered by the general category of malicious acts, a set of grounds used in the policy. It is a malicious act of a person who was an employee of the insured at the relevant time."
8. The learned counsel for the petitioner has referred to the decision of the Hon'ble Supreme Court in National Insurance Co. Ltd. Vs. Ishar Das Madan Lal, (2007) 4 Supreme Court Cases 105. In the case before the Hon'ble Supreme court, the respondent, which was a Jeweller had lodged a claim alleging theft of jewellery by a customer to whom the jewellery was temporarily handed over by the complainant. The question before the Hon'ble Court was as to whether the handed over the jewellery to a customer amount to entrustment. Ruling in favour of the complainant and against the insurance company, the Hon'ble Supreme Court inter-alia held as under:-
"12. The word 'entrust' would imply giving responsibility to a person upon whom the owner has confidence. It envisages establishment of a relationship. When a customer enters into a jewellery shop, as of necessity, the owner or his agent must allow him to inspect the merchandise, the customer intends to purchase. For the said purpose possession in the legal sense is not handed over. The owner or his agent does not loose complete control thereover.
14. Mr. Vishnu Mehra, the learned counsel appearing for the appellant has relied upon the meaning of the word 'entrust' as contained in Black's Law Dictionary, 8th Edn. and Webster's Universal Dictionary.
15. In Black's Law Dictionary, the word 'entrust' has been defined as under :
"To give (a person) the responsibility for something after establishing a confidential relationship."
16. In Webster's Universal Dictionary meaning of the word 'entrust' reads as under :
"To confer as a responsibility, duty etc. to place, something in another's care."
17. Apart from the fact that the said meaning of the term "entrustment" goes against the submission Mr. Mehra, we may notice that in Black's Law Dictionary the word "entrusting" in commercial law has been described as:
"The transfer of possession of goods to a merchant who deals in goods of that type and who may in turn transfer the goods and all rights to them to a purchaser in the ordinary course of business." Transfer of possession of goods, therefore, is a sine qua non for entrustment. The person must be handed over the possession of the property. Illustration (d) appended to Section 378 IPC envisages a situation of this nature. It by no stretch of imagination would have contemplated a situation where an unknown customer would have committed theft."
9. In the case relied by the learned counsel for the petitioner, the Hon'ble Supreme Court was not concerned with the question as to whether a case of the driver of a vehicle found missing along with vehicle would constitute theft or criminal breach of trust. On the other hand, the above referred decisions of this Commission directly cover a case where the driver takes a vehicle and then does not return. Moreover, this Commission has also taken the view that such a case will also amount to a malicious act and therefore the loss would be covered under the insurance policy taken by the owner of the vehicle. Since I am bound by the previous decisions of this Commission rendered by a Larger Bench, it is not open to me to take a contrary view unless the aforesaid decisions are shown to be per incuriam. The petitioner however has failed to show that the aforesaid decisions rendered by the Larger Bench of this Commission are per incuriam."
7. For the reasons stated hereinabove, I find no merit in the revision petition, which is accordingly dismissed with no order as to costs.
......................J V.K. JAIN PRESIDING MEMBER