State Consumer Disputes Redressal Commission
Subhadra B Gharal vs New India Assurance Co Ltd on 22 February, 2018
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
MAHARASHTRA, MUMBAI
Consumer Complaint No.CC/14/459
Smt.Shubhadra B.Gharal
Bhavani Complex
Shop no.6, Plot no.67-68
Sector -19A, Vashi 400703 .....Complainant
Versus
New India Assurance Co.Ltd.
Thane divisional office
(170100) B-201 Pinak Galaxy .........Opponent
Opp.Big Bazar, Kapur Bawadi Junction
Majiwada, Thane (W) 400607
BEFORE: Smt.Usha S.Thakare, Presiding Judicial Member
P.B.Joshi, Judicial Member
PRESENT: Mr.Uday B. Wavikar, Advocate alongwith Mr.Bhaskar Yogi,
Advocate for complainant.
Mr.D.S. Joshi, Advocate for opponent
ORDER
Per Hon'ble Smt.Usha S. Thakare, Presiding Judicial Member
1. Complainant Smt.Shubhadra B.Gharal has filed this consumer complaint under section 17 of Consumer Protection Act, 1986 against opponent -Insurance Company by alleging deficiency in service under the category of insurance. According to complainant, he is a consumer and there is relationship of 'consumer' and 'service provider' between the parties. The opponent is an Insurance company who is carrying out business of insurance. The complainant is self employed and for the sole purpose of livelihood and bread and butter, she had given the vehicle i.e. Tata motor truck to drive for carrying goods. The complainant had purchased truck having Chassis no.MAT 452020A7k39854/ 697TC68Kzy128724/ public carrier for goods carrying for the total consideration of Rs.13,45,215/- on 22/12/2010. The complainant had taken insurance policy from the opponent for the period commencing from 1 16/01/2013 till 15/01/2014 for the sum assured amount of Rs.12,27,388/- for the said truck. On 25/01/2013, the vehicle was carrying iron rods and was moving at Mumbai Naik highway near New Kasara Ghat. The vehicle was driven by driver Mr.Niwas Ishwar Ghadge and one helper was there with the driver. At that time, the vehicle met with an accident and banged the cemented wall. The accident was horrible. The police reached the spot and effected panchanama. FIR was lodged at Kasara police station. Driver Mr.Niwas Ghadge and cleaner/helper had sustained severe injuries and died on the spot. The bodies were sent to hospital and post mortem was done. The complainant informed opponent about the accident. Opponent appointed surveyor. Surveyor orally informed that it is a total loss to the vehicle. Accordingly, opponent was under obligation to settle the insurance claim for an amount of Rs.12,27,388/- i.e. the sum insured amount. Opponent was not ready to settle the claim. Opponent repudiated the claim finally on 17/02/2014. Opponent repudiated the claim by alleging that two additional persons were allowed in the vehicle. Carrying of the additional persons in goods vehicle amounts to breach of terms and conditions and on that ground claim was rejected. It is alleged by the complainant that the opponent is guilty of deficiency in service and unfair trade practice. Therefore, complainant has filed consumer complaint for claiming an amount of Rs.12,27,388/- being the claim under the policy. She has also claimed interest @ 21% p.a. on the sum of Rs.12,27,388/-, compensation of Rs.5 lakhs and Rs.1 lakh towards costs of litigation.
2. The opponent resisted the claim by filing written statement and denied all adverse allegations. It is specifically denied that the opponent is guilty of deficiency in service and unfair trade practice. It is submitted that the insurance policy availed by the complainant is a 'Commercial Vehicle Package Policy' insuring the truck which is admittedly a goods carrying vehicle. The goods carrying vehicle is not permitted to carry passengers in any case except the owner of the goods carried in the said vehicle. It is clear 2 from the police papers that the driver of the complainant permitted two more persons to travel in the insured vehicle at the time of an accident. Thus there were 4 persons in the cabin at that time. Insurance policy is subject to terms and conditions of the policy as well as provisions of Motor Vehicles Act, 1988. If there is breach of the provisions of Motor Vehicles Act, 1988 or the terms of the insurance policy, the opponent is not under any liability to indemnify the insured under the said policy. The opponent has rightly repudiated claim of the complainant vide its letter dated 17/02/2014. The complainant has not made out case for claiming damages. Claim of the complainant is exorbitant. Complainant has not come with clean hands before this Commission. The carrying capacity of the vehicle is that of only one person i.e. the driver of the vehicle. The driver of the complainant permitted other persons to be carried in the said vehicle in spite of having knowledge that the said vehicle, being a commercial vehicle, cannot be used to carry passengers. Due to breach of terms of policy conditions and provisions of Motor Vehicles Act, 1988, the consumer complaint is liable to be dismissed. Complicated questions of law and facts are involved in the complaint and hence it is not maintainable before Consumer Fora. Civil suit is the remedy and on all these grounds the consumer complaint is liable to be dismissed with costs.
3. On these pleadings of the parties following points arise for our determination and we record our findings for the reasons given below:-
Sr.No. Points Finding
1 Whether consumer complaint is Yes
maintainable before Consumer Fora?
2 Whether opponent is guilty of Yes
deficiency in service?
3 Whether complainant is entitled for As per final order
reliefs? If yes, to what extent?
4 What order? As per final order
3
4. As to point no.1:-
It is admitted fact that complainant is owner of Tata Motor HCV truck. Said truck is a goods vehicle. Complainant obtained insurance policy from the opponent for the truck. Said policy was for the period commencing from 16/01/2013 till 15/01/2014 for the sum assured amount of Rs.12,27,388/-. Insurance policy was obtained by paying required amount of premium to the opponent. After receipt of premium opponent issued insurance policy i.e. 'Commercial Vehicle Package Policy' for goods carrying vehicle. There is relationship of 'consumer' and 'service provider' between the parties. The complainant falls within the definition of 'consumer'. There was a contract of indemnity between the parties. The complainant has filed consumer complaint by alleging deficiency in service against the opponent and her complaint is tenable before this Commission. It is harped upon the fact that complicated questions of facts and law are involved in the case and therefore, consumer complaint is not maintainable before this Commission. The main defence of the opponent is that there is a breach of policy conditions so also breach of provisions of law and, therefore, consumer complaint is not maintainable. Complainant should have raised her grievance before the Civil Court, which is competent to decide all the issues.
5. We do not find substance in this argument. It is settled principle of law that Consumer Fora are competent to decide the complicated questions of law and facts in a summary procedure.
6. The Hon'ble Apex Court while deciding the case of CCI Chambers Co-op. Housing Society Ltd. held as under :-
"The Fora at various levels have been constituted under the Act with the avowed object of providing summary and speedy remedy in conformity with the principles of natural justice, taking care of such grievances as are amenable to the jurisdiction. The said fora have 4 been established and conferred with jurisdiction in addition to the conventional courts. The principal object sought to be achieved by establishing such fora is to relieve the conventional courts of their burden which is ever-increasing and whereat the disposal is delayed because of the complicated and detailed procedure which at times is accompanied by technicalities. Merely because recording of evidence is required, or some questions of fact and law arise which would need to be investigated and determined, cannot be a ground for shutting the doors of any forum under the Act to the person aggrieved."
7. Hon'ble Apex Court also observed that - "It cannot be denied that fora at the national level, the State level and at the district level have been constituted under the Act with the avowed object of providing summary and speedy remedy in conformity with the principles of natural justice, taking care of such grievances as are amenable to the jurisdiction of the fora established under the Act."
8. The view of the Learned advocate that complicated questions of facts cannot be decided in summary proceeding requires to be rejected because under the Act, for summary or speedy trial, exhaustive procedure in conformity with the principles of natural justice is provided. Therefore, merely because it is mentioned that the Commission or Forum is required to have summary trial would hardly be a ground for directing the consumer to approach the civil court. The Legislature has provided alternative, efficacious, simple, inexpensive and speedy remedy to the consumers. Rights of consumer cannot be curtained by saying that complicated question of fact and law cannot be decided in summary trial particularly when the Act provides sufficient safeguards.
9. In view of this discussion, we find no hesitation to hold that consumer complaint is maintainable before Consumer Fora and as a result, we answer point no.1 for determination in affirmative.
5As to point no.2:-
10. To substantiate the claim, complainant led her evidence by filing an affidavit. She had relied on insurance policy, police papers i.e. FIR, Panchanamas, Post Mortem Reports. She has filed on record repudiation letter dated17/02/2014. Per contra, opponent has filed affidavit of evidence of Ms.Neha P.Lokwane, Authorized signatory of the opponent to disprove the complaint. The opponent has also relied on the police papers to prove the breach of terms and conditions of the policy.
11. Heard learned counsel Mr.Uday B. Wavikar alongwith learned counsel Mr.Bhaskar Yogi, Advocate for complainant and learned counsel Mr.D.S. Joshi for opponent.
12. It is nowhere disputed that the insured goods vehicle met with an accident on 25/01/2013 on Nasik Mumbai Highway within the jurisdiction of Kasara police station. In said accident driver and cleaner of the vehicle died on the spot due to accidental injuries sustained by them. Police reached on spot and effected spot panchanama in presence of Panchas. Spot panchanama dated 26/01/2013 shows that the accident was taken place at Kasara Ghat at village Latifwadi. Iron rods which were loaded in the truck were lying on the spot. Dash was given to cemented wall. As per police panchnama truck was totally damaged.
13. Police Naik Mr.Anil Ranoji Shinde filed report in police station. On his report crime was registered under section 279 and 304 of I.P.C. During investigation it was found that three dead bodies were found in cabin of the truck. Two dead bodies were of male and one dead body was of female. In FIR it is alleged by Police Naik Shinde that the accident was occurred due to rash and negligent driving of driver Mr.Niwas Ishwar Ghadge (Deceased).
14. Driver Mr.Niwas Ishwar Ghadge was driving the truck and he was holding valid driving license. All three dead bodies were sent for post mortem. Post mortem report of Sanjay Laxman Joshi, Post mortem report 6 of Niwas Ishwar Ghadge are filed on record. During investigation three dead bodies were found in the insured truck.
15. On the basis of police papers, opponent harped upon the breach of terms and conditions of policy and breach of provisions of law. Admittedly, the truck owned by the complainant is a commercial vehicle. Policy obtained was 'Commercial Vehicle Package Policy'. The truck was goods carrying vehicle.
16. Learned counsel Mr.Joshi urged that the goods carrying vehicle is not permitted to carry passengers. At the time of accident four persons were carried in the cabin of the truck and due to breach of policy conditions and provisions of law, claim is rightly repudiated.
17. In reply, learned counsel Mr.Wavikar urged that opponent i.e. Insurance company is liable to indemnify the owner of the vehicle, when the owner of the insured has obtained comprehensive policy for the loss caused to the insured. It is submitted that even assuming that there was breach of conditions of the insurance policy, the opponent Insurance company ought to have settled the claim on non-standard basis.
18. Both the parties have placed reliance on several rulings during the course of their arguments. Learned counsel Mr.D.S.Joshi for the opponent has placed reliance on the following rulings:-
i) Ruling laid down by Hon'ble National Commission reported in the matter of Oriental Insurance Co.Ltd. v/s. Ashwani Kumar I(2013) CPJ 21B (NC)(CN).
ii) Ruling laid down by Hon'ble National Commission in the case of Manjeet Singh v/s. National Insurance Co.Ltd. & anr. in Revision Petition no.4419 of 2014 by order dated 03/06/2015.
iii) Ruling laid down by Hon'ble Apex Court in the matter of Oriental Insurance Co.Ltd. v/s. Devireddy Konda Reddy and others reported in (2003)2 Supreme Court Cases 339.7
19. In the case of Oriental Insurance Co.Ltd. v/s. Devireddy Konda Reddy and others, Hon'ble Apex Court was pleased to hold as under:-
"The difference in the language of "goods vehicle" as appearing in the old Act and "goods carriage" in the Act is of significance. A bare reading of the provisions makes it clear that the legislative intent was to prohibit goods vehicle from carrying any passenger. This is clear from the expression "in addition to passengers" as contained in definition of "goods vehicle" in the old Act. The position becomes further clear because the expression used is "goods carriage" is solely for the carriage of goods". Carrying of passengers in a goods carriage is not contemplated in the Act. There is no provision similar to clause (ii) of the proviso appended to Section 95 of the old Act prescribing requirement of insurance policy. Even Section 147 of the Act mandates compulsory coverage against death of or bodily injury to any passenger of "public service vehicle". The proviso makes it further clear that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in goods vehicle would be limited to liability under the Workmen's Compensation Act, 1923 (in short 'WC Act'). There is no reference to any passenger in "goods carriage'."
20. The complainant has placed reliance on ruling laid down by the Hon'ble Apex Court in the case of Amalendu Sahoo v/s. Oriental Insurance Co.Ltd. while deciding Civil Appeal no.2703 of 2010 on 25/03/2010. Learned counsel Mr.Wavikar urged that the ruling laid down by Hon'ble Apex Court in the matter of Amalendu Sahoo is applicable to the case in hand. Learned counsel Mr.Wavikar has pointed out that the complainant had taken comprehensive insurance policy. It is not in dispute that the accident took place during the subsistence of policy. The policy was valid 8 on the date of accident. Only grievance of the insurance company is that the goods vehicle was used for carrying passengers. It is alleged by the opponent that the vehicle might have been used on hire and violated terms and conditions of policy and therefore, Insurance company was within its right to repudiate the claim.
21. The Hon'ble Apex Court while deciding the case of Amalendu Sahoo in para 16 observed as under:-
"In the instant case entire stand of the insurance company is that claimant has used the vehicle for hire and in the course of that there has been an accident. Following the aforesaid guidelines, this Court is of the opinion that the insurance company cannot repudiate the claim in toto.
For the reasons stated, we cannot affirm the order of the Fora below. We direct the respondent insurance company to pay a consolidated sum of Rs.2,50,000/- even though compensation claimed is Rs.5,00,000/-."
22. Hon'ble National Commission in the case of Oriental Insurance Company v/s. GirbarSinh Nandwanshi & anr. Reported in 2015(2) CPR 299(NC) in para 6 held as under:-
"Having carefully gone through the said decision, we are unable to persuade ourselves to agree with the learned Counsel. In that case, while holding that in a case of overloading, the claim had to be processed on non-standard basis, the Hon'ble court has relied on the instructions/guidelines issued by the Insurance Company itself. The instructions clarify that in a case of overloading of a vehicle, beyond licensed carrying capacity, the claim preferred by the Insured should be paid @ 75% of the admissible claim. Admittedly, the said guidelines/instructions are still in vogue. Insofar as the plea that overloading could 9 be the cause of accident, we find that the Insurance Company did not lead any evidence in that behalf. It is also pertinent to note that an FIR relating the accident was registered against the driver of the other vehicle."
23. Hon'ble National Commission while deciding the case of Oriental Insurance Co. v/s. GirbarSinh Nandwanshi & anr has placed reliance on the ruling laid down by the Hon'ble Apex Court in the case of Amalendu Sahoo v/s. Oriental Insurance Co.Ltd.
24. The ruling laid down by Hon'ble Apex Court in the case of Amalendu Sahoo acted as a guideline for us. The breach of condition as alleged by the opponent cannot be said to be fundamental breach of conditions of policy. We are of the opinion that the claim of the complainant should have been processed by the Insurance company on the basis of non standard basis. The Insurance company totally repudiated the claim of the complainant and, as such, guilty of deficiency in service. Learned counsel Mr.Joshi has argued that there is not only breach of terms and conditions of policy but also breach of provisions of law. As per provisions of Motor Vehicles Act 1988, passengers cannot be carried in the goods vehicle. Every citizen is duty bound to follow the law. The breach of law disentitles the complainant from claiming any relief. We are of the view that terms and conditions incorporated in the insurance policy are generated from law. Conditions are based on law. It is clear from police papers that apart from driver two persons were there in the vehicle but during investigation it was revealed that the accident was occurred due to rash and negligent driving of the deceased driver. It cannot be ascertained for want of evidence whether remaining two persons were fare paying passengers or gratuitous passengers. It is not the case of the opponent that due to their presence in the cabin the accident was occurred. We are guided by the Doctrine of Proximate Cause. 'Causa proxima' means 'the immediate cause'. In insurance law 'causa proxima et Non Remota 10 Spectatum' means the immediate and not the remote cause is to be considered. The maxim 'in jure non remota causa, set proxima, spectatur' means 'in law the proximate, and not the remote, cause is to be regarded. The object of the doctrine of 'cause proxima' is to decide, whether the loss or damage was caused by the peril insured against or not.
24. The proximate cause of the accident as revealed from the police papers is the rash and negligent driving. In view of above discussion, we find no hesitation to hold that breach of conditions in the case in hand is not a fundamental breach of policy terms and conditions. The claim of the complainant should have been allowed by the opponent on non standard basis. It was not done and claim of the complainant was totally rejected by the Insurance company. The contract of indemnity was in force and the opponent was liable to indemnify the insured/complainant, particularly, when huge premium was accepted from the complainant. The Insurance company is guilty of deficiency in service. As a result, we answer point no.2 for determination in affirmative.
25. As to point no.3:
The complainant has duly proved that opponent is guilty of deficiency in service. In view of deficiency in service, the complainant is entitled to claim damages. The complainant is entitled to get the damages on non standard basis. The complainant has claimed total amount of Rs.22,78,453/-. She has claimed amount of Rs.12,27,388/- towards damages. Amount of Rs.4,51,065/- towards interest, amount of Rs.5 lakhs towards compensation for mental pain and agony and Rs.1 lakh towards damages. The complainant is entitled for 50% of claim on non standard basis. The complainant is entitled to get Rs.6,15,000/- towards loss under contract of indemnity. The opponent is liable to pay interest @ 9% p.a. on said amount from the date of repudiation of claim i.e. 17/02/2014 till realization of amount. The complainant is entitled for an amount of Rs.1 lakh towards compensation for mental pain and agony and amount of 11 Rs.25,000/- towards costs of litigation. With this view we pass the following order:-
ORDER
1. Consumer complaint is partly allowed.
2. The opponent do pay an amount of Rs.6,15,000/- to the complainant under contract of indemnity with interest @ 9% p.a. from the date of repudiation of claim i.e. since 17/02/2014 till realization of amount.
3. The opponent do pay an amount of Rs.1,00,000/- to the complainant as compensation for mental pain and agony and amount of Rs.25,000/- towards costs of litigation.
4. The opponent to comply the order within a period of 45 days from the date of this order, otherwise, amount of Rs.6,15,000/- will carry interest @ 12% p.a. from the date of repudiation of claim i.e.17/02/2014.
5. Copies of the order be furnished to the parties free of costs.
Pronounced on 22nd February, 2018.
[USHA S.THAKARE] PRESIDING JUDICIAL MEMBER [P.B.JOSHI] JUDICIAL MEMBER Ms 12