National Consumer Disputes Redressal
Divisional Manager, National ... vs M/S. Bharat Construction on 29 June, 2018
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 423 OF 2010 (Against the Order dated 15/11/2010 in Complaint No. 8/2010 of the State Commission Chandigarh) 1. M/S. BHARAT CONSTRUCTION 9 PPCL COLONY OPPOSITE RADHA SWAMI SATSANG UDAY VIHAR ,HARIDWAR BY PASS , DHERADUN UTTARAKHAND ...........Appellant(s) Versus 1. DIVISIONAL MANAGER, NATIONAL INSURANCE CO. LTD. NATIONAL INSURANCE CO,LTD ,DIVISION 1,2ND FLOOR ,SCO 133-35 SECTOR 17-C CHANDIGARH CHANDIGARH ...........Respondent(s) FIRST APPEAL NO. 26 OF 2011 (Against the Order dated 15/11/2010 in Complaint No. 8/2010 of the State Commission Chandigarh) 1. DIVISIONAL MANAGER, NATIONAL INSURANCE CO. LTD. Divsion.1.2nd floor ,
Sco No.1 ,133-135, Sector 17-c , Chandigarh chandigarh ...........Appellant(s) Versus 1. M/S. BHARAT CONSTRUCTION 9 PPcl Colony , Opposite Radha Swamy Satsang , Uday vihar , Hardwar Bye Pass , Dheradun Uttrakhand ...........Respondent(s) BEFORE: HON'BLE MR. PREM NARAIN,PRESIDING MEMBER For the Appellant : For Bharat Construction : Ms. Charanjeet Bhatia, Proxy for Ms. Aditi Deshpande, Advocate For the Respondent : For National Insurance Co. : Mr. Yogesh Malhotra, Advocate Mr. Rajnesh Kumar, Advocate Dated : 29 Jun 2018 ORDER These two appeals have been filed by M/s. Bharat Construction and Divisional Manager, National Insurance Co. Ltd. against the order dated 15.11.2010 of the State Consumer Disputes Redressal Commission, UT Chandigarh, (in short 'the State Commission') passed in Complaint No.08/2010.
2. Brief facts of the case are that on 31.03.2007, complainant M/s. Bharat Construction purchased a package policy of insurance from opposite party National Insurance Company Ltd. in respect of newly purchased construction equipment vehicle (Dumper) from Tata Motors Ltd. Jamshedpur. On 28.05.2007 while working at the work site near Bayal Distt. Kullu, the insured vehicle met with an accident and went downhill deeply which resulted in total loss of the vehicle. On 30.05.2007, proper claim was lodged with opposite party. FIR was lodged with police. Opposite party arranged spot survey. After the machine was retrieved, the Insurance Company appointed the final surveyor and loss assessor to assess the loss. The surveyor assessed the net loss of Rs.24,98,000/-. However, no payment was made by the Insurance Company. However, the Insurance Company repudiated the claim on 22.02.2010 on the ground that inspite of several reminders, the complainant did not deposit the copy of the RC, route permit and fitness certificate. It was further mentioned that the temporary registration had expired on 28.04.2007 and the accident took place on 28.05.2007. Thus, the vehicle was without registration on the date of accident. The complainant then filed consumer complaint No.08 of 2010 before the State Commission. The complaint was resisted by the opposite party on the ground mentioned in the repudiation letter as well as on the additional ground that the driver was not having requisite driving licence to drive the vehicle. His driving licence had also expired before the date of accident.
3. The State Commission vide its order dated 15.11.2010 partly allowed the complaint and ordered that the opposite party/Insurance Company shall settle the insurance claim for Rs.16,02,920/- along with interest @9% p.a. since 01.12.2007.
4. Aggrieved with the order dated 15.11.2010 of the State Commission, the opposite party/ Insurance Company as well as the complainant both have preferred appeals bearing No.26 of 2011 and 423 of 2010 respectively.
5. Learned counsel for the complainant/appellant did not appear for two consecutive dates to argue the matter. Hence, on third date when the learned counsel for the complainant did not appear again, the learned counsel for the opposite party was heard. It is to be noted that on all the three dates learned counsel for the complainant was represented by different proxy counsel and the proxy counsel appearing on the third date of hearing did not have the authority letter to argue the matter nor he was ready with the matter.
6. The learned counsel for the opposite party argued that the vehicle in question was a dumper and it is supposed to be a transport vehicle, however, the State Commission has not treated this as transport vehicle and has stated that the complainant does not require the route permit. Moreover, the temporary registration number given to the complainant was valid only for 30 days and the same expired on 28.04.2007. It is not the case of the complainant that the complainant applied for permanent registration number or for any extension of temporary registration number. Thus, the vehicle was without any registration on the date of accident which happened on 28.05.2007. As per Section 39 of the Motor Vehicles Act, 1988, no vehicle can be taken on road without registration number from the Transport Authority. Therefore, the dumper in question was not authorised to work on the field, after its temporary registration expired. The State Commission has also agreed with this point of view, however, the State Commission has still allowed the insurance claim on non-standard basis, whereas the claim should have been totally rejected. To support his contention, the learned counsel for the opposite party/Insurance Company has relied on the following judgment:-
"Narinder Singh Vs. New India Assurance Company Limited and others, (2014) 9 SCC 324. It has been held that:-
11. A bare perusal of Section 39 shows that no person shall drive the motor vehicle in any public place without any valid registration granted by the registering authority in accordance with the provisions of the Act. However, according to Section 43, the owner of the vehicle may apply to the registering authority for temporary registration and a temporary registration mark. If such temporary registration is granted by the authority, the same shall be valid only for a period not exceeding one month. The proviso to Section 43 clarified that the period of one month may be extended for such a further period by the registering authority only in a case where a temporary registration is granted in respect of chassis to which body has not been attached and the same is detained in a workshop beyond the said period of one month for being fitted with a body or unforeseen circumstances beyond the control of the owner.
12. Indisputably, a temporary registration was granted in respect of the vehicle in question, which had expired on 11.1.2006 and the alleged accident took place on 2.2.2006 when the vehicle was without any registration. Nothing has been brought on record by the appellant to show that before or after 11.1.2006, when the period of temporary registration expired, the appellant, owner of the vehicle either applied for permanent registration as contemplated under Section 39 of the Act or made any application for extension of period as temporary registration on the ground of some special reasons. In our view, therefore, using a vehicle on the public road without any registration is not only an offence punishable under Section 192 of the Motor Vehicles Act but also a fundamental breach of the terms and conditions of policy contract."
7. Learned counsel for the opposite party/Insurance Company submitted that the verification of the licence of the driver who was driving the vehicle in question shows that the driver held licence to drive Motorcycle, Light Motor Vehicle and Heavy Goods Vehicle only and was valid only from 30.01.1998 to 29.01.2007. It is clear that the driver did not have a valid driving licence and more so with regard to the endorsement which was required for driving on hill roads.
8. Learned counsel for the opposite party/Insurance Company further stated that there existed grave discrepancy in the temporary registration number of the vehicle in question. The temporary registration number as mentioned in the letter dated 01.05.2008 was JH 05E-5565, whereas previously all though, it was mentioned as JH-05-A-3515 of 2007 as per the Claim Form and Temporary Tax token receipt issued by Tata Motors Limited.
9. The complainant has filed appeal No.423 of 2010 mainly on the ground that State Commission has allowed the insurance claim only on non- standard basis and has also accepted Rs.12,00,000/- as the value of salvage on the basis of the report of the surveyor, whereas the actual salvage value is not more than Rs.1,50,000/-. Another ground for the appeal has been that the complainant has spent Rs.75,000/- in retrieving the vehicle, however, the State Commission has allowed only Rs.20,000/- for the same. It has been prayed that the order of the State Commission be modified and total IDV of Rs.33,10,560/- should be allowed.
10. I have considered the arguments advanced by the learned counsel for the opposite party/Insurance company and have carefully gone through the grounds and memo of appeal filed by the complainant. The State Commission has agreed with the fact that the vehicle was not having valid registration on the date of accident and therefore, it has violated the provisions of the Motor Vehicle Act, 1988 and consequently the policy conditions. The State Commission has allowed the claim on the basis of its following observation:-
"11. The OP had appointed surveyors who submitted their reports (Annexures R-4 and R-5) showing that the salvage value of the vehicle was Rs.12 Lac approximately. There is no evidence to rebut the same. When we deduct Rs.12 Lac out of the IDV of Rs.33,10,560/-, the complainant would be entitled to Rs.21,10,560/-. Since, he is entitled to 75% of the said amount, the compensation payable to the complainant comes out to be Rs.15,82,920/-. The complainant would retain the salvage."
11. The surveyor has assessed the net loss as Rs.24,98,000/-. The complainant has objected to the salvage value of Rs.12,00,000/- as taken by the State Commission on the basis of the report of the surveyor, but the complainant has not objected to the report of the surveyor as such. Otherwise also the surveyors are appointed under the provisions of Insurance Act, 1938 and their report cannot be brushed aside without any cogent reasons. The State Commission has not considered the report of the surveyor in totality and has only accepted the value of salvage on the basis of this report.
12. The Insurance Company has raised various other issues like difference in temporary registration numbers mentioned in the claim form and supplied to the Insurance Company separately by the complainant, the issue of driving licence that the driver did not have the valid driving licence on the date of accident as the driving licence expired before the date of accident as well as the issue of permit. The issue of driving licence was not raised in the repudiation letter hence the same cannot be accepted as ground for dismissing the claim. Even if one leaves the issue of permit, it is true that the vehicle was not registered on the date of accident and the State Commission has observed that it is not the case of the complainant that he had applied for permanent registration or for extension of temporary registration before the date of accident. Hence, in these circumstances, clearly the vehicle was being run without any registration in contravention of Section 39 of the Motor Vehicle Act, 1988. This is a fundamental violation of the Motor Vehicle Act and also a fundamental breach of the terms and conditions of the policy because the policy contract cannot be sustained if the provisions of any other relevant law have been violated because no contract would be valid if it contravenes any law of the land.
13. The State Commission has ordered the insurance claim to be settled on non-standard basis without considering the implication of fundamental violation of the Motor Vehicle Act. If the vehicle was not having valid registration number, it should not have been taken out for work on the site and the accident could not have happened. In that situation there could not have been any insurance claim. Apart from this, the driver of the vehicle was not having valid driving licence on the date of accident. The learned counsel for the complainant has also not rebutted these charges. In the light of the judgment of the Hon'ble Supreme Court in Narinder Singh Vs. New India Assurance Company Limited and others (supra), I am of the view that the two violations of the Motor Vehicle Act in respect of non-registration of the vehicle and the driver not having the valid driving licence on the date of accident constitute the fundamental breach of the terms and conditions of the policy and the Insurance Company would not be liable to pay the insurance claim under these circumstances.
14. Based on the above discussion, the First Appeal No.26 of 2011 is allowed and order dated 15.11.2010 passed by the State Commission is set aside. However, National Insurance Company shall pay Rs.1,00,000/- (rupees one lakhs only) to the complainant as cost for condoning the delay in filing the appeal. This cost be paid within a period of 45 days from the date of this order, failing which, this amount shall carry an interest @ 9% p.a. from the date of this order till actual payment.
15. As a sequel to First Appeal No.26 of 2011 having been allowed, First Appeal no.423 of 2010 filed by the complainant stands dismissed.
...................... PREM NARAIN PRESIDING MEMBER