State Consumer Disputes Redressal Commission
The Oriental Insu. Co. Ltd. vs Gajanan Mangulkar on 21 August, 2023
Daily Order M. P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BHOPAL PLOT NO.76, ARERA HILLS, BHOPAL FIRST APPEAL NO. 438 OF 2019 (Arising out of order dated 04.02.2019 passed in C. C. No.714/2013 by District Commission, Bhopal-1) GAJANAND MANGULKAR, S/O SHRI KISHAN MANGULKAR, BM-2, NEHRU NAGAR, NEAR POLICE PETROL PUMP, BHOPAL (M.P.) .... APPELLANT. Versus 1. MANAGER, SANGHI AUTOMOBILES, KOH-E-FIZA, BHOPAL (M.P.) 2. THE ORIENTAL INSURANCE CO.LTD. THROUGH BRANCH MANAGER, BRANCH-KOH-E-FIZA, BHOPAL (M.P.) HEAD OFFICE- THE ORIENTAL INSURANCE CO.LTD. CLAIM SERVICE CENTRE, CHITTOD COMPLEX, ZONE-I, M.P.NAGAR, BHOPAL (M.P.) .... RESPONDENTS. FIRST APPEAL NO. 1099 OF 2019 (Arising out of order dated 04.02.2019 passed in C. C. No.714/2013 by District Commission, Bhopal-1) THE ORIENTAL INSURANCE CO.LTD. THROUGH BRANCH MANAGER, BRANCH OFFICE- KOH-E-FIZA, BHOPAL (M.P.) .... APPELLANT. Versus 1. GAJANAND MANGULKAR, S/O SHRI KISHAN MANGULKAR, BM-2, NEHRU NAGAR, NEAR POLICE PETROL PUMP, BHOPAL (M.P.) 2. MANAGER, SANGHI AUTOMOBILES, KOH-E-FIZA, BHOPAL (M.P.) .... RESPONDENTS. BEFORE: HON'BLE SHRI A. K. TIWARI : PRESIDING MEMBER
HON'BLE DR. SRIKANT PANDEY : MEMBER COUNSEL FOR PARTIES : Shri M. K. Pandagare, learned counsel for the complainant.
Shri J. S. Parmar, learned counsel for the opposite party no.1-Sanghi Automobiles.
Shri Anurag Khaskalam, learned counsel for the opposite party no.2-insurance co.
-2-O R D E R (Passed on 21.08.2023) The following order of the Commission was delivered by A. K. Tiwari, Presiding Member:
Aforesaid appeals arise out of same order are taken up together and being disposed of by this common order. This order shall govern disposal of above mentioned appeals. The complainant has filed First Appeal No.438/2019 for enhancement of compensation awarded by the District Commission, whereas the opposite party no.2-insurance company has filed First Appeal No.1099/2019 for setting aside the impugned order.
2. The aforesaid appeals one by the complainant and the other by the opposite party no.2-insurance company arises out of order dated 04.02.2019 passed by the District Consumer Disputes Redressal Commission, Bhopal-1 (for short 'District Commission') in C.C.No.714/2013 whereby the complaint filed by the complainant has been allowed.
3. In nutshell, the facts of the case are that the complainant on 19.04.2013 had purchased a black coloured motor cycle 'Bajaj-Pulsar' from the opposite party no.1-Sanghi Automobiles having chassis number MD-2A-11-CZ-9DC-M81771 and engine number DHZCDM74116 for which he paid Rs.20,370/- in cash and rest amount of Rs.56,630/- was financed from Bajaj Finance Company. It is submitted that he paid Rs.5,923/- fee towards RTO and Rs.1,770/- towards insurance was deposited with the opposite party -3- no.1-dealer. The complainant got the subject vehicle insured with the opposite party no.2-Oriental Insurance Company Limited (hereinafter referred to as 'insurance company'). The insurance cover was valid w.e.f. 20.04.2013 to 19.04.2014, the policy of which was provided by the insurance company on 22.04.2013 having number 152109/31/2014/853. It is submitted that on 13.05.2013 between 12.30 pm to 2.30 pm when the subject vehicle was parked before the complainant's house, it was stolen. FIR was lodged with Kamla Nagar Police Station on the same day and the insurance company was duly informed. The claim preferred by the complainant was repudiated by the insurance company. Being aggrieved, the complainant filed a complaint before the District Commission.
4. The opposite no.1-dealer denying the allegations made in the complaint submitted that it sold the subject vehicle to the complainant and had provided the cover note of insurance and rest amount was deposited in RTO. The complainant did not inform the dealer about theft of vehicle. There has been no deficiency in service on its part and therefore the complaint be dismissed against it with costs of Rs.5,000/-.
5. The opposite party no.2-insurance company by filing reply to the complaint denied the allegations and has submitted that the complainant left his vehicle negligently and due to which theft took place. Along with claim, the complainant did not file the registration of the vehicle and document -4- regarding road tax with the insurance company. On investigation being carried out by the insurance company, it was found that at the time of theft the subject vehicle was neither registered with the RTO nor road tax was deposited, which is violation of Section 39 of Motor Vehicles Act, 1898 (hereinafter referred to as 'MV Act') and the policy terms and conditions. The complainant deposited the road tax with the RTO on the very next day of theft i.e. on 14.05.2013. The complainant is not entitled to get any relief and it is prayed that the complaint be dismissed with costs.
6. The District Commission on consideration of pleadings and evidence allowed the complaint and directed the insurance company to pay Insured Declared Value (IDV) of the subject vehicle to the complainant within a period of three months from the date of order. Aggrieved by the said order, the complainant as also the insurance company have filed appeals.
7. Heard. Perused the record.
8. Learned counsel for the complainant argued that the District Commission did not consider this important aspect that the insurance company kept pending the claim for a period of one year which ought to have been decided within one month. Though the District Commission has allowed the complaint and directed the insurance company to pay IDV of the vehicle but has committed grave error in not directing the insurance company to pay interest and compensation. The District Commission should -5- have awarded Rs.5,000/- towards compensation for mental agony and Rs.2,000/- towards costs. He therefore argued that the impugned order deserves to be modified.
9. Learned counsel for the opposite party no.1-dealer argued that the complainant has unnecessarily impleaded it as it has nothing to do with the complaint. The dispute is between the complainant and the insurance company and it is only the insurance company, which has to settle the claim of the complainant.
10. Learned counsel for the opposite party no.2-insurance company argued that the District Commission has failed to appreciate that the subject vehicle at the time of theft was unregistered and it was used in violation of Section 39 of the MV Act which amounts an offence under Section 192 of MV Act. Also, there is violation of policy terms and conditions. The District Commission has also not considered this important fact that the complainant did not deposit both keys of the subject vehicle, Form 28,29,30 & 35 of RTO, letter of subrogation, letter of undertaking and NOC from the financer which were required for deciding the claim. The District Commission has erroneously held the insurance company deficient in service and allowed the complaint. He therefore, argued that the impugned order deserves to be set-aside.
-6-11. The complainant has filed his affidavit, counter affidavit along with documents C-1 to C-6. On behalf of opposite party no.1-dealer, an affidavit of Bhupendra Singh, Manager has been filed. On behalf of opposite party no.2-insurance company, an affidavit of Madhu Bisoi, Divisional Manager along with documents R-1 to R-8 has been filed.
12. The facts of the case more or less admitted. It is undisputed that the subject vehicle was insured with the insurance company and it was stolen on 13.05.2013. It is also not in dispute that at the time of theft, the subject vehicle was unregistered. The contention of the insurance company is that since the complainant failed to get the subject vehicle registered, there is violation of Section 39 of the MV Act and which is an offence under Section 192 of the MV Act and therefore the insurance company was justified in repudiating the claim.
13. In order to appreciate the contention of learned counsel for the insurance company, it is necessary, to have a look on Section 39 of the Motor Vehicles Act, 1988 which deals with necessity for registration which provides thus:
39. Necessity for registration--No person shall drive any motor vehicle and no owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place unless the vehicle is registered in accordance with this Chapter and the certificate of registration of the vehicle has not been suspended or cancelled and the vehicle carries a registration mark displayed in the prescribed manner:-7-
Provided that nothing in this section shall apply to a motor vehicle in possession of a dealer subject to such conditions as may be prescribed by the Central Government.
Section 192 of MVAct deals with use of vehicle without registration and provisions for Offence, Penalties & Procedure under MVAct which reads thus:
192. Using vehicle without registration--(1) Whoever drives a motor vehicle or causes or allows a motor vehicle to be used in contravention of the provisions of section 39 shall be punishable for the first offence with a fine which may extend to five thousand rupees but shall not be less than two thousand rupees for a second or subsequent offence with imprisonment which may extend to one year or with fine which may extend to ten thousand rupees but shall not be less than five thousand rupees or with both:
Provided that the court may, for reasons to be recorded, impose a lesser punishment.
(2).....
(3)....
[Explanation--Use of a motor vehicle in contravention of the provisions of section 56 shall be deemed to be a contravention of the provisions of section 39 and shall be punishable in the same manner as provided in sub-section (1)]
14. Bare reading of the aforesaid sections suggests that driving of unregistered motor vehicle by any person in any public place or any other place is prohibited. Section 39 casts an obligation on the owner of the motor vehicle not to permit the vehicle to be driven in any public place or any other place and violation of this provision is an offence under Section 192.
15. C-6 is the repudiation letter dated 04.10.2014 addressed to the complainant, wherein the sole ground for repudiation is as follows:
-8-"The above vehicle was stolen on 13.05.2013 but at the time of loss vehicle was not registered. You have deposited the RTO Tax after accident i.e. on 14.05.2013 whereas accident was occurred on 13.05.2013. This is violation of Section 39 of the Motor Vehicles Act and terms of the insurance policy."
"However you are being given one more opportunity to substantiate your claim in view of the rounds of repudiation mentioned above before a final decision is taken at our end. Your representation/clarification must reach us within 7 days from the date of receipt of this letter. Please note that in case we have no response from you within 7 days from the date of receipt of this letter, the claim shall stand repudiated for the reasons indicated above without further advices from us."
Above letter of the insurance company clearly demonstrates that before taking final decision with regard to repudiation of claim of the complainant, the insurance company had given one more opportunity to the complainant to give representation/clarification with regard to your claim within 7 days from the date of receipt of this letter, failing which the claim shall stand repudiated for the reasons indicated above.
16. C-5 is FIR dated 13.05.2013 lodged by the complainant at 19.40 hrs (7.30pm). From the said FIR, it is clear that the complainant parked the vehicle before his house at 12.30 pm and slept, when he woke up at 2.30 pm, he found that the subject vehicle was not there. Thus, it is clear from the FIR that the vehicle was parked before the complainant's house, when it was stolen. Section 39 of the MV Act provides driving of unregistered motor vehicle by any person in any public place or any other place is prohibited. Here in the instant matter, the subject vehicle was stolen when -9- it was parked before the complainant's house/premises.
17. In the aforesaid circumstances, now it has to be considered whether the insurance company was justified in repudiating the claim on the basis of violation of Section 39 of the MV Act? When the theft had taken place, the unregistered subject vehicle was parked in complainant's premises and it was not being driven by any person in any public place or any other place, thus there was no violation of Section 39 of the MV Act and it cannot be said that the insurance company was justified in repudiating the claim. It is also true that violation of Section 39 of MV Act is a punishable offence but for the purpose of the insurance claim, the insurance company has no authority to decide the punishable offence. Under Cr. P. C. it is the police or Magistrate or competent court has power to decide the penalty and it is not within the power of the insurance company.
18. The fact that the subject vehicle was stolen when it was parked in complainant's residence is also confirmed further from the R-1, the survey report, dated 03.07.2013 of Arun Kr. Bhuraria, who opined that the claim is genuine. The vehicle was stolen on 13.05.2013 in between 12.30 pm to 2.30 pm while it was parked duly locked in compound of the insured's residence. Thus it is an admitted fact that when the vehicle was stolen it was parked and not being driven by any person -10- in any public place or any other place in contravention to Section 39 of the MV Act.
19. So far as the contention of the insurance company that since the vehicle was unregistered, there is violation of terms and conditions of the policy is concerned, we find that nowhere in the policy it has been mentioned that in case of insurance there is necessity of registration of the vehicle. It is an admitted fact that the vehicle was unregistered. It is also admitted that the insurance company provided the insurance cover to the subject vehicle without registration, before accepting the proposal for insurance. We cannot help mentioning here that no endorsement on the policy has been made specifying that if the insured failed to get the vehicle registered within a month from the date of purchase, the insurance cover would stand withdrawn.
20. It is also pertinent to mention here that Section 43 of the MV Act suggests that even in case of a vehicle having temporary registration, such a registration is valid for a period not exceeding one month. Despite that the insurance company instead of providing insurance cover for one month issued the policy for a period of one year and had charged premium for one year without endorsing it that in case the owner of the subject vehicle failed to get the subject vehicle registered within one month from the date of purchase, the insurance cover would stand withdrawn. Even otherwise, in -11- the case in hand, the complainant had purchased the subject vehicle on 19.04.2013 and theft took place on 13.05.2013 i.e. within a period of one month. In such circumstances, the repudiation of the insurance claim of the complainant by the insurance company cannot be said to be justified. It is just a harassment to the complainant by denying the claim.
21. In view of the aforesaid, it is evident from the FIR (C-5) and the survey report (R-1) that at the time of theft, the subject motorcycle was parked in compound of the complainant and it was not being driven by anyone at any public place or any other place, thus at the time of theft, the complainant has not violated Section 39 of MV Act.
22. In this respect, Hon'ble National Commission in National Insurance Co. Ltd. Vs Shyam Indus II (2018) CPJ 46 (NC) in paragraph 11 has held that "No doubt Sandeep More violated Section 39 of the Motor Vehicles Act, 1988 when he drove the vehicle upto the parking of Maina Tourism Complex and while driving he violated Section 39 of the Motor Vehicles Act which is offence punishable under Section 192 of the Act. However, from the contents of the FIR it is also clear that the vehicle was stolen while parked in the parking of the above tourism complex. Thus, the question arises whether the commission of offence under Section 192 of the Motor Vehicles Act prior to the theft would justify repudiation of insurance claim?" Answer to the above question is in the negative. It is further held in -12- paragraph 13 "In the instant case, admittedly at the time of theft, subject vehicle was not being driven by anyone. Thus at the time of theft, respondent was not violating Section 39 of the Act."
23. In view of the aforesaid, we are of the considered view that the repudiation of insurance claim by the insurance company is unjustified and as such the District Commission has rightly allowed the complaint directing the insurance company to pay IDV of the subject vehicle. However, we find that in the facts and circumstances of the case, the District Commission ought to have also awarded compensation and costs.
24. We hereby direct the appellant insurance company to pay to the complainant IDV of the vehicle with interest @ 6% p.a. from the date of the order of the District Commission i.e. 04.02.2019 till payment. Compensation of Rs.5,000/- along with costs of Rs.2,000/- is also directed to be paid to the complainant. It is further directed that the aforesaid amount be paid to the complainant within a period of two months failing which the aforesaid amount shall carry interest @ 8% p.a. from the date of this order till payment.
25. Accordingly, the impugned order is modified to the extent indicated hereinabove.
26. In the result, First Appeal No.438/2019 filed by the complainant is partly allowed to the extent indicated hereinabove and the First Appeal -13- No.1099/2019 filed by the insurance company being devoid of any merits is hereby dismissed.
27. This order be placed in First Appeal No.438/2019 and a copy be also placed in First Appeal No.1099/2019.
(A. K. Tiwari) (Dr. Srikant Pandey) Presiding Member Member