State Consumer Disputes Redressal Commission
Icici vs Darcl on 30 July, 2013
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, STATE CONSUMER DISPUTES REDRESSAL COMMISSION, UNION TERRITORY, CHANDIGARH First Appeal No. 238 of 2013 Date of Institution 04.06.2013 Date of Decision 30.07.2013 1. ICICI Lombard GIC Ltd., 1st Floor, SCO 24-25, Sector 8C, Madhya Marg, Chandigarh, Pin 160017 through its Manager. 2. Mr. Arun Sharma, Zonal Sales Manager, ICICI Lombard General Insurance Company Ltd., KLJ Complex, 1st Floor, Block-2, Plot No.70/A-55, Main Najafgarh Road, Motinagar, Delhi 1100115. 3. ICICI Lombard General Insurance Company Ltd., through its authorized person, Interface Building No.11, 401/402, 4th Floor, New Link Road, Malad (W), Mumbai 400064. .Appellants/Opposite Parties. Versus DARCL Logistics Ltd, having its Office at SCO No.116, Sector 47-C, Chandigarh through its authorized representative Sh. Ashok Sharma s/o Lage Sh. Bodhraj Sharma, Manager, HR of the Company. .Respondent/Complainant. Appeal U/s 15 of the Consumer Protection Act, 1986. BEFORE: JUSTICE SHAM SUNDER (RETD.), PRESIDENT SH.DEV RAJ, MEMBER
Argued by:Sh.
Sandeep Suri, Advocate for the appellants.
Sh. Jainainder Saini, Advocate for the respondent.
PER DEV RAJ, MEMBER This appeal is directed against the order dated 15.04.2013, rendered by the District Consumer Disputes Redressal Forum-I, UT, Chandigarh (hereinafter to be called as the District Forum only) vide which it allowed the complaint filed by the complainant, against the Opposite Parties (now appellants) and directed them as under:-
15] Resultantly, in view of the foregoings and entirety of the case, as per the settled law as well, we are of the opinion that the present complaint deserves to be partly allowed. Accordingly, we allow the complaint partly. The OPs are directed to settle the claim case of the complainant company on non-standard basis upto 75% of the assessed value as assessed by the Surveyor. They are also directed to pay compensation of Rs.25,000/- as well as litigation cost of Rs.10,000/- to the complainant.
This order shall be complied with by the OPs within a period of 30 days from the date of receipt of copy of this order, failing which they shall be liable to pay penal amount of Rs.2,00,000/- in addition to the above amount/relief awarded/granted to the complainant.
2. The facts, in brief, are that the complainant being a Transport Company, was the registered owner of vehicle bearing registration No.CG-04-FB-8811 make Volvo. It was stated that the Opposite Parties approached the complainant and made a proposal for general insurance (Annexure C-1), in pursuance whereof, Package Policy No.3003/56377502/00/000 (Annexure C-18) valid up to 11.3.2010 was purchased by the complainant, after paying the premium. The Policy was extended upto 11.3.2011 (Annexure C-19). It was further stated that the vehicle, in question, met with an accident on 3.2.2011 at Surkhi near Sagar (Madhya Pradesh) and a claim was lodged with the respondents vide Claim No.MOT-0191082. It was further stated that all the requisite documents, were sent to the Surveyor, through email dated 23.03.2011 (Annexure C-2), for processing the claim. It was further stated that the Opposite Parties advised the complainant to get the vehicle repaired, after receiving the required documents. It was further stated that the vehicle was got repaired and the complainant submitted a bill of Rs.6.28,972/- to the Opposite Parties, with a request to deduct salvage @5% and to add value of two parts i.e. Wheel Stud and Nut Retainer in the Assessment Sheet. It was further stated that vide email dated 3.5.2011 (Annexure C-3), the Opposite Parties, requested the complainant to clarify the gap between the date of loss and the date of intimation. It was further stated that the complainant vide his email dated 11.5.2011 (Annexure C-4) clarified the said query of the Opposite Parties. It was further stated that copy of the RC of all the H. Axles joined with the vehicle at the time of accident was sent vide email dated 13.5.011 (Annexure C-5), as desired by the Opposite Parties. It was further stated that subsequently, the complainant also provided to the Opposite Parties, the Volvo Speciation Chart showing the pulling capacity of the vehicle vide email dated 20.5.2011 (Annexure C-6). It was further stated that National Permit of 4 H. Axles joined with the Volvo, at the time of accident was also sent to the Opposite Parties vide email dated 7.6.2011 (Annexure C-7).
3. It was further stated that, to the utter shock of the complainant, he received a letter dated 1.7.2011 (Annexure C-8) from the Opposite Parties, vide which his claim was denied on the ground that At the time of loss vehicle was overloaded, full load is 530% of actual registered/permitted load. It was further stated that the complainant also requested the Opposite Parties to consider the claim, as per the MOU dated 1.5.2008, but to no avail. It was further stated that vide email dated 8.8.2011 (Annexure C-9), the complainant asked the Opposite Parties, to provide the assessment sheet of the vehicle. It was further stated that as per the assessment sheet, salvage was deducted on Rear Axle casing costing Rs.4,95,944/- and Rs.1,75,000/- was deducted as salvage whereas the two parts i.e. Wheel Stud and Nut Retainer were not taken into account, in the same (assessment sheet). It was further stated that, in this regard, an email dated 26.8.2011 (Annexure C-1) was sent to the Opposite Parties, who in reply, sent an email dated 2.9.2011 (Annexure C-11). It was further stated that in reply to Annexure C-11, the complainant sent email dated 6.9.2011 (Annexure C-12) to the Opposite Parties. It was further stated that subsequently, the complainant sent email dated 3.9.2011 (Annexure C-13) to the Opposite Parties, clarifying that the salvage deduction was not applicable, in their case. It was further stated that the complainant also sent another email dated 18.11.2011 (Annexure C-14) to the Opposite Parties, to provide assessment sheet with correct salvage deduction and to arrange for clearance of claim immediately, followed by emails dated 27.12.2011, 17.1.2012, 9.2.2012, 10.3.2012 (Annexure C-15) and 20.3.2012 (Annexure C-16). It was further stated that the complainant served a legal notice dated 28.8.2012 (Annexure C-17) upon the Opposite Parties but to no avail. It was further stated that the Opposite Parties, were deficient, in rendering service, as also, indulged into unfair trade practice. When the grievance of the complainant was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), seeking directions to the Opposite Partiers, to honour the claim on non-standard basis not exceeding 75% of the admissible claim (after deducting correct salvage amount @5% and also including the amount of Wheel Stud and Nut Retainer in the Assessment Sheet; pay Rs.1,00,000/- as compensation for mental agony and harassment and Rs.11,000/- as costs of litigation, was filed.
4. The Opposite Parties, in the written version, took up a preliminary objection to the effect that since no cause of action arose at Chandigarh, therefore, the District Forum was not having the territorial jurisdiction to decide the complaint. On merits, it was stated that the complainant had relied on letter (Annexure C-1), which was not addressed to it. It was further stated that the reading of Annexure C-1 showed that the nature of documents that are required in a case of claim alone were mentioned. It was further stated that the same explained as to the nature of documentation required for processing of the claim. It was further stated that the complainant was wrongly relying on the said documents where the overloading was well up to 25%. It was further stated that the complainant had admitted that the vehicle was overloaded. It was further stated that against the sanctioned carrying capacity of 49 MT, the load was of 242 MT which was 530% more. It was further stated that such abnormal overloading contributed to the accident. It was further asserted that the settlement of claim on non-standard basis was the discretion of the Company and not a right of the insured. It was further stated that there was delay of 9 days in intimation of the accident to the Opposite Party - Company, which was not explained by the complainant. It was further stated that the claim already stood repudiated as there was violation of the terms and conditions of the policy. It was further stated that, the Opposite Parties, were neither deficient, in rendering service, nor did they indulge into unfair trade practice. The remaining averments, were denied, being wrong.
5. The complainant filed rejoinder wherein, all the averments, contained in the complaint, were reiterated and those, contained in the written version, were repudiated.
6. The Parties led evidence, in support of their case.
7. After hearing the Counsel for the parties, and, on going through the evidence and record of the case, the District Forum, allowed the complaint, as stated above.
8. Feeling aggrieved, the instant appeal, has been filed by the Opposite Parties.
9. We have heard the Counsel for the parties and have gone through the evidence and record of the case, carefully.
10. The Counsel for the appellants/Opposite Parties submitted that the District Forum did not have the territorial jurisdiction to entertain and try the complaint as no part of cause of action arose at Chandigarh. It was further submitted that the vehicle, in question was excessively overloaded to the extent of 530%, which contributed to the cause of accident. It was further submitted that against the sanctioned carrying capacity of 49 MT, the load was 242 MT. It was further submitted that such overloading was in gross violation of the terms and conditions of the Policy, for which the respondent/complainant was not entitled to the claim, which had been rightly repudiated. It was further submitted that the overloading of the vehicle was in violation of law and the District Forum erred in allowing part of the claim and in ordering for payment of 75% of the amount assessed by the surveyor. The Counsel for the appellants/Opposite Parties, also placed reliance on National Insurance Company Limited Vs. Ms. Usha Devi, Revision Petition No.2636 of 2010 decided by Honble National Consumer Disputes Redressal Commission, New Delhi (hereinafter to be referred as National Commission) on 13.07.2011. It was further submitted that the appeal be allowed and the impugned order, passed by the District Forum, be set aside.
11. On the other hand, the Counsel for the respondent/complainant, submitted that the order of the District Forum was just and appropriate. It was further submitted that the District Forum did have the territorial jurisdiction to entertain and decide the complaint, as Endorsement Schedule of Goods Carrying Package Policy, covering period from 12.3.2010 to 11.3.2011 (Annexure C-19), was issued from the Chandigarh office of the Opposite Parties and, thus, part of cause of action arose within the territorial jurisdiction of the District Forum. It was further submitted that as per the terms and conditions of the Policy, when overloading was more than 25%, the claim could be settled on non-standard basis i.e. up to 75% of the assessed value/admissible claim. In support of his contention, the Counsel placed reliance on Oriental Insurance Company Ltd. Vs. Ganpati Foods & Anr., II(2012) CPJ 24 (NC). It was further submitted that the appeal filed by the appellants/Opposite Parties be dismissed.
12. The issuance of Goods Carrying Vehicles Package Policy Certificate-cum-Policy Schedule (Annexure C-18 and Annexure-19), occurrence of accident, lodging of claim with the Opposite Parties (Insurance Company), appointment of surveyor for the assessment of loss and the repudiation of claim vide letter (Annexure C-8) on the ground of overloading of the vehicle, in question, are admitted facts.
13. The first question, which falls for our consideration, is, as to whether the District Forum had the territorial jurisdiction to entertain and decide the complaint. Annexure C-1 i.e. Proposal of vehicle insurance was issued by the Opposite Parties at Chandigarh. Goods carrying vehicles Package Policy Certificate cum Policy Schedule, was issued to the complainant at Chandigarh. Annexure C-19 Endorsement Schedule of Goods Carrying Policy, covering the period from 12.3.2010 to 11.3.2011 was also issued to the complainant by appellant No.1 at Chandigarh. Thus, a part of cause of action, arose to the respondent/complainant, at Chandigarh. The District Forum, was, thus, having the territorial jurisdiction to entertain and decide the complaint.
14. The second issue, which falls for our consideration, is, as to whether the act of the Opposite Parties, of repudiating the claim, on the ground of overloading of the vehicle, which met with an accident, can be termed as deficiency, in rendering service or indulgence into unfair trade practice on their part? No doubt, the carrying capacity/gross weight of the vehicle was 49 MT and pay load of the Trailers/H. Axles joined with subject vehicle CG-04FB-8811 (claim MOT No.-01910182) (Annexure C-5) was as under:-
Vehicle No. Gross Vehicle Height(Kgs) Tara Weight (Unladen Weight) (kg) Pay load (kg) HR55L5578 72000 17800 54200 HR55H1116 108000 27000 81000 HR55G9792 36000 8000 28000 HR55H8284 108000 27000 81000 Total 324000 79800 244200 (244.2 Tonnes)
15. These H. Axles were having valid Registration/permits (Annexure C-7). It was only after clubbing carrying capacity of these Axles, that full load was 530%. Annexure C-6, Volvo specification chart (Page 53 of the District Forum file), the pulling capacity of Volvo (vehicle in the instant case) has been produced. As per stipulation in this Chart, Gross combination weight (when coupled to a suitable drawbar Trailer) could be 2,00,000 Kgs. Viz.200 tonnes, subject to approval from the Ministry of Road Transport and Highways. In the absence of any evidence, to this effect, the excessive loading was in violation of the provisions of Rules/guidelines. Clearly the vehicle was not only overloaded, but such overloading was also without the approval of competent authority viz. Ministry of Road Transport and Highways.
16. As per the policy schedule for the period 12.3.2009 to 11.3.2010 relating to the vehicle, in question, gross weight of the same was 49MT (AnnexureC-18). The policy under LIMITATON AS TO USE, contained the following provision:-
Use only for carriage of goods within the meaning of the Motor Vehicles Act. The Policy does not cover:(1) Use for organized racing, pace making, reliability trials for speed testing. (2) Use whilst drawing a trailer except the towing(other than for reward) of any one disabled Mechanically propelled vehicle (3) Use for carrying passengers in the vehicles; except employees (other than the driver) not exceeding the number permitted in the registration document and coming under the purview of Workmens Compensation Act 1923.
17. In cases United India Insurance Co. Ltd. Vs. M/s. Harchand Rai Chandan Lal I (2003) CPJ 393 and Vikram Greentech (I) Ltd. Vs. New India Assurance Co. Ltd. II (2009) CPJ 34 (SC), the Honble Supreme Court, inter-alia, held that the terms of an Insurance Policy have to be strictly construed to determine the extent of liability of and insurer and the Court while construing the terms of Policy is not expected to venture into extra liberalism that may result in re-writing the contract or substituting the terms which were not intended by the parties.
18. The provisions of Sections 113(3)(a) and (b), 194 and 200 of the Motor Vehicles Act, 1988, being relevant, are extracted below:-
"113.
Limits of weight and limitations on use (1) xxxx (2) xxxx (3) No person shall drive or cause or allow to be driven in any public place any motor vehicle or trailer
(a) the unladen weight of which exceeds the unladen weight specified in the certificate of registration of the vehicle, or
(b) the laden weight of which exceeds the gross vehicle weight specified in the certificate of registration.
114.
Power to have vehicle weighed :
(1)Any officer of the Motor Vehicles Department authorized in this behalf by the State Government shall, if he has reasons to believe that a goods vehicle or trailer is being used in contravention of Section 113 require the driver to convey the vehicle to a weighing device, if any, within a distance of ten kilometers from any point on the forward route or within a distance of twenty kilometers from the destination of the vehicle for weighment; and if on such weighment the vehicle is found to contravene in any respect the provisions of Section 113 regarding weight, he may, by order in writing, direct the driver to off-load the excess weight at his own risk and not to remove the vehicle over trailer from that place until the laden weight has been reduced or the vehicle or trailer otherwise been dealt with so that it complies with Section 113 and on receipt of such notice, the driver shall comply with such directions.(2)
Where the person authorized under subsection (1) makes the said order in writing, he shall also endorse the relevant details of the overloading on the goods carriage permit and also intimate the fact of such endorsement to the authority which issued that permit.
194.
Driving vehicle exceeding permissible weight:
(1)Whoever drives a motor vehicle or causes or allows a motor vehicle to be driven in contravention of the provisions of Section 113 or Section 114 or Section 115 shall be punishable with minimum fine of two thousand rupees and an additional amount of one thousand rupees per tonne of excess load, together with the liability to pay charges for off-loading of the excess load.(2)
Any driver of vehicle who refuses to stop and submit his vehicle to weighing after being directed to do so by an officer authorized in this behalf under Section 114 or removes or cause to removal of the load or part of it prior to weighing shall be punishable with fine which may extend to three thousand rupees.
200.
Composition of certain offences:
(1)Any offence whether committed before or after the commencement of this Act punishable under Section 177, Section 178, Section 179, Section 180, Section 181, Section 182, subsection (1) or sub-section (2) of Section 183, Section 184, Section 186, Section 189, sub-section (2) of Section 190, Section 191, Section 191, Section 194, Section 196, or Section 198, may either before or after the institution of the prosecution, be compounded by such officers or authorities and for such amount as the State Government may, by notification in official gazette, specify in this behalf.(2)
Where an offence has been compounded under sub-section (1) the offender, if in custody, shall be discharged and no further proceedings shall be taken against him in respect of such offence."
19. Since the gross weight of the vehicle, in question, was 49000 Kgs. (49 Tonnes), the same (vehicle), at the time of accident, coupled with trailers, was overloaded to the extent of 530%, the load being 244 tonnes.
The load of the vehicle at the relevant time, being 530% of the actual registered/permitted load, was abnormally excessive, which was the main contributing factor for the accident. Thus, the abnormally excessive load of the vehicle, had direct nexus with the cause of accident. In National Insurance Company Limited Vs. Ms. Usha Devi, Revision Petition No.2636 of 2010 decided by Honble National Consumer Disputes Redressal Commission, New Delhi (hereinafter to be referred as National Commission) decided on 13.7.2011, relied upon by the Counsel for the appellants/Opposite Parties, it was held in Para No.5, as under: -
5. The rash and negligent act of the driver of the mini bus is thus detailed in the charge sheet. It cannot be overlooked that excessive over-loading by nearly 100% was one of the main contributing causes of the serious accident. It is an elementary scientific fact that the momentum of a moving object is the product of its mass and velocity. In other words, for a motor vehicle travelling at a given speed, the momentum would be twice if the total weight of the motor vehicle was increased two times and it is momentum which determines the severity of the effects of impact. In this case, overloading of the passengers by nearly 100% obviously led to correspondingly higher momentum of the mini bus which could not be controlled but the brakes and led to impacts that caused extreme damage, including deaths and physical injuries to 26 persons.
Thus, the appellant/Opposite Party legally and validly repudiated the claim of the complainant.
20. In Oriental Insurance Company Ltd. Vs. Ganpati Foods & Anr., II(2012) CPJ 24 (NC), relied upon by the Counsel for the respondent/complainant, the settlement of claim, on non-standard basis, was on account of the reason that the vehicle was containing rice bran oil weighing 29,000 Kgs, against the carrying capacity of 16,000 Kgs. The overloading was not so excessive. The District Forum, in the aforesaid case, had held that the overloading of the tanker had no nexus with the cause of accident and, therefore, the Insurance Company was not justified in reducing the amount of claim. In the instant case, the overloading, being excessively on the higher side, the facts of the case of Oriental Insurance Company Ltd. Vs. Ganpati Foods & Anr. (supra) are distinguishable.
22. The Honble Supreme Court of India in case Paramjit Bhasin and Ors. Vs. Union of India and Ors., Writ Petition (Civil) No.136 of 2003, decided on 09.11.2005, held as under: -
Section 200 does not in any way authorize the State Government to permit the excess weight to be carried when on various inspection/detection it is noticed that there is carriage of load beyond the permissible limit. It only gives an opportunity of compounding so that instead of the amounts fixed, lesser amounts can be accepted by the authorized officers. The intention of uploading the excess weight is apparent from a bare reading of the Section 194(1). The liability to pay charge for uploading of the excess load is fixed on one who drives a vehicle or causes a motor vehicle to be driven in contravention of the provisions of Sections 113, 114 and 115. It is to be noted that compounding can be done either before or after the institution of the prosecution in respect of the enumerated offences. Any notification which runs counter to the clear import of Section 194 has no validity. As rightly submitted by learned counsel for the petitioners after compounding the excess load, same cannot be permitted to be carried in the concerned vehicle. Such carriage would amount to infraction of Section 113 of the Act. The object for which the maximum permissible weights have been fixed is crystal clear. On a perusal of the provisions it is clear that the maximum gross weight (in short GVB) of the trucks is 16.2 tonnes which enables loading of about 9 tonnes. The load rating is primarily based on the road design, specifications of Indian roads. Rule 95(2) of the Central Motor Vehicles Rules, 1989 (in short the Central Rules) prescribes the principles which cover the fixation of GVB of the vehicles..
It is indisputable that the power of compounding vests with the State Government, but the notification issued in that regard cannot authorize continuation of the offence which is permitted to be compounded by payments of the amounts fixed. If permitted to be continued, it would amount to fresh commission of the offence for which the compounding was done. The State Governments which have not yet withdrawn the notifications shall do it forthwith. So far as the practical difficulties highlighted are concerned, it is for the State Governments concerned to make necessary arrangements to ensure that the difficulties highlighted can be suitably remedied by the State Government themselves without in any way overstepping statutory prescriptions.
23. The overloading being excessively on the higher side (530%), which was, in violation of not only the terms of the Insurance Policy but also the provisions of the Motor Vehicles Act, 1988. In view of the law laid down by the Honble Supreme Court, the claim of the complainant was rightly repudiated. Therefore, the argument of Counsel for the complainant/respondent, that the District Forum did not hold that accident was due to overloading and, therefore, the claim was tenable, does not hold water, on the face of reasons, indicated in the foregoing paras.
24. The next question, which falls for our consideration, is, as to whether the claim could be settled on non-standard basis, when, admittedly, the load was excessively beyond the permissible limits? It is clear from Annexure C-1, Sr. No.5 of the proposal of vehicle Insurance- overloading claim settlement up to 25% (of the mentioned capacity) was to be waived of. Apparently as per the proposal of policy, the overloading could be waived of upto 25%, whereas, in the instant case, overloading being 530%, the waiver was not permissible, and, consequently, the claim was not tenable.
25. Annexure A/Red Carpet (Page 47 of the District Forum file) is with regard to the documents required. The load (530%) being more than 25%, it could not be said that 75% claim was admissible.
26. In case Amalendu Sahoo Vs. Oriental Insurance Co. Ltd., 2010 AIR (SC) 2090, the Honble Apex Court set out guidelines about settling the claims on non-standard basis in cases of overloading of vehicles beyond licensed carrying capacity. It was held that in such cases, the claims were payable not exceeding 75% of the admissible claim. In the aforesaid case of Amalendu Sahoo, the claim pertained to a vehicle, which was given to an employee of the Bank, for urgent use, and the claim was dismissed by the District Forum holding that there was a clear condition, as to the mode of use of the insured vehicle. The policy was not applicable in case of use of the vehicle for hire, reward or organized racing speed testing and carriage of goods in connection with any trade or business by any third party. Apparently, the facts of the case Amalendu Sahoo Vs. Oriental Insurnace Co. Ltd.,s case (supra), are totally distinguishable, from the facts involved, in the instant case, where the overloading was to the extent of 530%. Apparently, such excessive overloading, to the extent of 530%, was the main cause of accident. Such overloading was also clearly in violation of the terms and conditions of the Insurance Policy, and the provisions of the Motor Vehicles Act. Thus, the appellants/Opposite Parties, correctly repudiated the claim and the District Forum did err in holding vide the impugned order, that the Opposite Parties (Insurance Company) was to settle the claim of the respondent/complainant Company on non-standard basis up-to 75% of the assessed value by the Surveyor. Since the claim was legally and validly repudiated, by the Opposite Parties, they were not deficient, in rendering service.
27. In view of the above discussion, it is held that the order, passed by the District Forum, suffers from illegality and perversity, warranting the interference of this Commission.
28. For the reasons recorded above, the appeal filed by the appellants/Opposite Parties, is accepted, with no order as to costs. The order, passed by the District Forum, is set aside. The complaint, filed by respondent/complainant, is dismissed.
29. Certified Copies of this order be sent to the parties, free of charge.
30. The file be consigned to Record Room, after completion.
Pronounced.
30th July, 2013.
[JUSTICE SHAM SUNDER (RETD.)] PRESIDENT [DEV RAJ] MEMBER Ad STATE COMMISSION (First Appeal No.238 of 2013) Argued by:Sh.
Sandeep Suri, Advocate for the appellants.
Sh. Jainainder Saini, Advocate for the respondent.
Dated the 30th day of July, 2013.
ORDER Vide our detailed order of the even date, recorded separately, the appeal has been accepted with no order as to costs. The impugned order, passed by the District Forum has been set aside, and the complaint has been dismissed.
(DEV RAJ) MEMBER (JUSTICE SHAM SUNDER) PRESIDENT Ad