Delhi District Court
M/S Amarjit Singh Bagga vs Iffco Tokio General Insurance Co. Ltd on 29 July, 2022
IN THE COURT OF SH. SYED ZISHAN ALI WARSI:
ADDITIONAL DISTRICT JUDGE-05: WEST DISTRICT:
TIS HAZARI COURTS: DELHI
Civ DJ No. 613868/16
CNR No. DLWT01-009779-2016
In the matter of :
1. M/S AMARJIT SINGH BAGGA
S/O SH. RAJINDER SINGH BAGGA
R/O C-10, SECOND FLOOR,
RAM PURA, HARI NAGAR,
NEW DELHI-110064.
THROUGH GPA HOLDER
SMT. MANJU
2. SMT. MANJU LUTHRA
W/O SH. SANDEEP LUTHRA
R/O 12/20, UPPER GROUND FLOOR,
WEST PATEL NAGAR,
NEW DELHI-110008.
.......... Plaintiffs
Vs.
IFFCO TOKIO GENERAL INSURANCE CO. LTD.
REGD. OFFICE AT IFFCO SADAN, DISTRICT CENTRE,
SAKET, NEW DELHI-110017.
.......... Defendant
SUIT FOR RECOVERYOF Rs.4,00,000/- (Rupees Four Lacs only)
WITH PENDENTELITE AND FUTURE INTEREST AT THE
RATE OF 18% P.A.
Date of institution : 19.12.2016
Judgement Reserved on : 13.07.2022
Date of Decision : 29.07.2022
CIV DJ 613868 /16
M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 1 / 24
JUDGEMENT
1. Plaintiffs i.e. Plaintiff no.1 namely Sh. Amarjit Singh Bagga and plaintiff no.2 namely Smt. Manju Luthra filed the present suit for recovery of Rs.4,00,000/- alongwith interest against defendant namely Iffco Tokio General Insurance Co. Ltd.
2. The plaintiffs have filed the present suit alleging following facts :-
"The plaintiff no.1 purchased the vehicle bearing no.DL-12CH-3064 Maruti Swift VDI BS4 Chassis No.MA3FHEB1S00650215,EngineNo.D13A0479478 from Rana Motors and got the said vehicle insured from the defendant company. In May, 2016, plaintiff no.2 purchased the said car from the plaintiff no.1 and in the first week of June, 2016 got the same transferred by the transport authority in the name of plaintiff no.2. It is the case of the plaintiffs that at the time of purchase by the plaintiff no.2, the insurance was in continuance and it was from 09.04.2016 upto 08.04.2017 , but due to some personal reason, the plaintiff no.2 could not transfer the said policy in her name and on 23.08.2016, the vehicle was theft and an FIR bearing 024727 dated 24.08.2016 was registered u/s 379 IPC at PS e-Police Station - M.V. theft District Crime Branch. It is further the case of the plaintiff that later on plaintiff no.2 had also got the insurance policy from the defendant w.e.f. 10.09.2016 CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.Page No. 2 / 24
to 09.09.2017. That the police filed an untraceable report and the same was accepted vide order dated 17.10.2016 by the concerned ACMM, West District.
Thereafter, the plaintiff no.1 applied for the losses qua to the said vehicle in question demanding the claim of an amount of Rs.4,00,000/- which was already covered under the insurance policy and the plaintiff no.1 had also given the affidavit by annexing the documents of insurance claim but the insurance company/ defendant straightway rejected the claim vide letter dated 08.11.2016. That an email in the form of complaint was also sent on 26.11.2016 through plaintiff no.2 before the Chief Grievances Officer as well as one complaint to the Ombudsman dated 26.11.2016 but the grievances of the plaintiffs have not been sort out and the plaintiff no.1 has not yet received the compensation /losses of the theft vehicle. It is further the case of the plaintiff that the plaintiff no.1 had duly paid the insurance premium of the said vehicle to the defendant and therefore, the said policy has never terminated or expired but the defendant had rejected the claim of the plaintiff on the basis of false plea. It is further the case of the plaintiffs that there is privity of the contract between the plaintiff no.1 and the defendant as the plaintiff no.1 had paid the premium upto 08.04.2017 and that the contract was CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.Page No. 3 / 24
not terminated when the theft of the said vehicle was taken place. As the plaintiffs are residing in Delhi and all the causes of actions arose within the jurisdiction of this Court and as such this Court had got jurisdiction to try, entertain and decide the present suit. Thus, the present suit has been filed seeking following prayer from the Court :-
i) A decree of Rs.4,00,000/- only (Rupees Four Lacs only) alongwith pendent-elite and future interest @18% p.a. against the defendant from the date of filing of the suit to till the date of realization of the said amount to the plaintiffs.
ii) Cost of the suit and the counsel fees may also be awarded to the plaintiffs.
iii) any other relief/relief(s) which this Hon'ble Court may deem fit and proper, in the interest of justice.
3. Defendant i.e. Iffco Tokio General Insurance Co. Ltd. had filed written statement in which they took the preliminary objection that the present suit is not only bereft of any substance but is also frivolous in as much as there is no cause of action in favour of the plaintiffs and / or against the defendant, that since there was no such agreement and since the insurer had not transferred the policy of insurance in relation thereto to the transferee, the insurer was not liable to make good the damage to the vehicle, as per Sec. 157(1) of the Motor Vehicle Act, 1988 deemed CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 4 / 24transfer of insurance can be assumed after compliance of the condition of 14 days as given under Sec. 157(2) of the Act. The provisions of Sec. 157 of the said Act is not applicable to the present case as they are a part of chapter-11 of the said Act and which does not have any application to the facts of the present case and under the provisions of GR-17 of the India Motor Tariff Regulations, it was the duty of the plaintiff no2 to make an application to the insurer within 14 days of acquiring the ownership of the vehicle, failing which, she can not be held eligible to get the claim for the theft of the vehicle, the present suit besides being devoid of any cause of action either in favour of the plaintiffs or against the defendant is also barred by law and is not maintainable and the plaintiff is liable to be rejected in terms of Order VII Rule 11 (a) & (d), that the plaintiffs have not come with clean hands as there is no privity of contract between the plaintiff and defendant and they have tried to indulge in fraudulent acts to cheat the defendant. It is further averred that the plaintiff has now filed the present suit in order to harass the answering defendant.
4. On merits, defendants refuted the version of the plaintiff by referring to aforesaid preliminary objections. Same are not repeated here for the sake of brevity.
5. Plaintiff did not file any replication to written statements of defendant despite sufficient opportunity being given and therefore, the right of the plaintiff to file the same was closed vide order dated 20.09.2017.
CIV DJ 613868 /16M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 5 / 246. After completion of pleadings, following issues were settled on 20.09.2017:-
(1) Whether the suit of the plaintiff is not maintainable as the plaintiffs failed to inform the defendant regarding the transfer of the vehicle within the stipulated period of 14 days?OPD (2) Whether the plaintiffs are entitled for recovery of Rs.4 lacs as prayed for?OPP (3) Whether the plaintiffs are entitled for interest on the aforesaid amount, if so, at what rate and for which period? OPP (4) Relief.
7. In order to prove their case, plaintiffs I.e, plaintiff no.1 & plaintiff no.2 examined themselves as :- Smt. Manju Luthra (GPA Holder of plaintiff no.1) i.e. plaintiff no.2 as PW1 and Sh. Amarjit Singh Bagga i.e. plaintiff no.1 as PW-2.
PW1 /Plaintiff no.2 Smt. Manju Luthra tendered her evidence by way of affidavit as Ex.PW1/A in which she reiterated the contents of plaint which are not repeated here for the sake of brevity. PW-1 relied upon following documents:-
S.No Exhibits Nature of documents
1. Ex Copy of attorney.
PW1/1(OSR)
2. Ex Copies of the invoice, receipt dated 26.04.2014
PW1/2(Colly.) issued by Rana Motors .
(OSR)
3. Mark Y Insurance policy in the name of plaintiff no.1
w.e.f. 09.04.2016 to 08.04.2017.
CIV DJ 613868 /16
M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 6 / 244. Mark X Copy of RC in the name of plaintiff no.1.
5. Mark X1 Copy of DL in the name of plaintiff no.1
6. Mark X2 Copy of FIR dated 24.08.2016
7. Ex.PW1/5 Copy of RC and insurance policy in the name of (Colly.)(OSR) plaintiff no.2
8. Mark X3 Copy of untraceable report dated 17.10.2016
9. Mark Y1 Rejection letter dated 08.11.2016
10. MarkX4 & Copy of e-mails Mark X5( Colly.)
11. Ex.PW1/7 Certificate under Sec. 65B PW1 was cross-examined at length by ld. Counsel for the defendant.
8. PW2 /Plaintiff no.1 Sh. Amarjit Singh Bagga tendered his evidence by way of affidavit as Ex.PW2/A in which he reiterated the contents of plaint which are not repeated here for the sake of brevity. PW2 relied upon the documents already exhibited as Ex.PW1/1, Ex.PW1/2 and the documents already Marked as Mark X, Y, X-1 and Y-1 during the testimony of PW1.
PW2 was cross-examined at length by ld. Counsel for the defendant.
9. Summoned witness HC Sombir Singh was examined as PW3. He had brought the certified copy of FIR bearing no.024727 dated 24.08.2016 under Sec. 379 IPC which was exhibited as Ex.PW3/A. He had also brought the copy of untraceable report dated 17.10.2016 which was exhibited as Ex.PW3/B. Opportunity was given to cross-examine the witness. Cross Nil.
CIV DJ 613868 /16M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 7 / 2410. No other witness was examined on behalf of the plaintiff and vide separate statement dated 27.11.2018 plaintiff no.2 / authorized GPA of plaintiff no.1 closed PE and rebuttal plaintiff's evidence was closed on 30.03.2022. Accordingly, matter was fixed for defendant's evidence.
11. In his defence, defendant has examined only one witness.
12. Defendant examined Sh. Amit Kumar i.e. AR of the defendant company as DW1 and tendered his evidence by way of affidavit as Ex.DW1/A in which he reiterated the contents of written statement which are not repeated here for the sake of brevity. DW-1 relied upon following documents:-
S. No. Exhibits Nature of documents
1. Ex DW1/1 Authority Letter
2. Mark A Copy of Power of Attorney of Sh. Alok
Gupta
3. Ex.DW1/3 Print out GR-17 of Indian Motor Tariff
(Objected as to mode of proof)
4. Ex.DW1/4 The certificate under Sec. 65B of the Indian
Evidence Act , 1872 (Objected as to mode of
proof)
Note : The objections on Ex.DW1/3 and Ex.DW1/4 were dealt at length in separate ordersheet of even date and the same are not sustainable.
DW2 was cross-examined at length by ld. Counsel for the plaintiff.
13. After examining the said witness, defendant closed his evidence on CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 8 / 2416.03.2022. Matter was then fixed for final arguments.
14. During the course of final arguments, ld. Counsel for the plaintiff submits that the vehicle was insured with the defendant and the insurance was valid upto 08.04.2017 and the fact is also admitted by the defendant in the written statement. He also submits that whenever a vehicle is transferred, the benefits of the insurance policy also deemed to be transferred to the new owner. It is also submitted by him that in the present matter the ownership of the vehicle and its transfer to the new owner is not disputed thus, the existing insurance policy shall also deemed to be transferred to the new owner and lapse of the intimation will not fail the cause of plaintiff. Ld. counsel for the plaintiff also submitted that it is an admitted fact that the insurance was paid for the period from 09.04.2016 to 08.04.2017 and the insurance company had not discontinued the insurance of the vehicle in question and the insurance company as well as the investigator was fully aware with regard to the theft of the vehicle. Then also, the insurance cover of the vehicle had not been cancelled. It is an admitted fact that insurance cover to any vehicle can be issued only after the depositing of the premium amount and for second policy the receipt of premium was made on 10.09.2016 when the earlier policy was still in existence and thus, the new policy was in continuation of the earlier policy. He further submits that clause mentioned as GR17 of Indian Motor Tariff Regulation Act were neither shown nor any signatures of the insurer were taken on any agreement regarding the said clause thus, that clause is not binding upon the plaintiff. It is further submitted that a comprehensive policy was issued and the CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 9 / 24policy was issued in the name of plaintiff no.2 on 10.09.2016 and it was in continuation of earlier policy issued in favour of plaintiff no.1 on 09.04.2016 till 08.04.2017.
Per contra, ld. Counsel for the defendant submits that the policy under issue / consideration has not been transferred as per law given under Sec. 157 (2) of the Motor Vehicles Act, 1988. He further submits that plaintiff /PW1 Ms. Manju Luthra had admitted that she had not informed the the insurance company about his the purchase of the vehicle in question from the plaintiff no.1 and the policy Ex.PW1/5 was procured by her through online declaration.
15. To further strengthen their arguments, ld. Counsel for the plaintiff has relied on :-
- Mallama v. National Insurance Co. Ltd. (2014) 14 Supreme Court Cases 137 On the other hand, ld. Counsel for the defendant has relied on :-
- Oriental Insurance Company Versus Enamul Haque passed by National Consumer Disputes Redressal Forum ;
- IFFCO Tokio General Insurance Company Versus Ashok Laxman Mane IV (2020) CPJ 248 (NC) passed by National Consumer Disputes Redressal Forum;
- M/S Complete Insulations (P) Ltd. versus New India Assurance Company Ltd. versus New India Assurance Company Ltd. (1996) 1 SCC 221 passed by Hon'ble Supreme Court of India.
16. Final arguments were heard on behalf of both the parties and after CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 10 / 24hearing final arguments, matter was fixed for judgment.
17. Written synopsis on behalf of the plaintiffs and Written Submissions on behalf of the defendant were filed and same are perused.
18. Before proceeding further, it is relevant to mention the position of law , that, the onus of proof in civil trial is the obligation on the plaintiff that the plaintiff would adduce evidence that proves his claims on preponderance of probability against the defendant. As per the principles of Indian law, until and unless an exception is created by law, the burden of proof lies on the person making any claim or asserting any fact. A person who asserts a particular fact is required to affirmatively establish it. The Supreme Court in R.V.E. Venkatachala Gounder V Arulmigu Viswesaraswami & V.P. Temple & another, VI (2003) SLT 307 observed that whether a civil or a criminal case, the anvil for testing of 'proved', 'disproved' and 'not proved', as defined in Section 3 of the Indian Evidence Act, 1872 is one and the same. A fact is said to be 'proved' when, if considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of a particular case, to act upon the supposition that it exists. It was observed in A. Raghavamma & another V Chenchamma & another, AIR 1964 SC 136, there is an essential distinction between burden of proof and onus of proof: burden of proof lies upon a person who has to prove the fact and which never shifts. Onus of proof shifts. Such a shifting of onus is a continuous process in the evaluation of evidence. It was observed in Rangammal V Kuppuswami CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 11 / 24and others, Civil Appeal No 562 of 2003 observed that burden of proof lies on the person who first asserts the fact and not on the one who denies that fact to be true. The responsibility of the defendant to prove a fact to be true would start only when the authenticity of the fact is proved by the plaintiff. In Anil Rishi V Gurbaksh Singh, (2006) 5 SCC 558 it has been held that the burden of proving the facts rests on the party who substantially asserts the affirmative issues.
19. In subsequent paragraphs, the Court shall decide issues.
As the issues from (i) to (iii) are interconnected they are hereby tried together :-
ISSUE No. (i) to (iii)
(i) Whether the suit of the plaintiff is not maintainable as the plaintiffs failed to inform the defendant regarding the transfer of the vehicle within the stipulated period of 14 days?OPD
(ii) Whether the plaintiffs are entitled for recovery of Rs.4 lacs as prayed for?OPP
(iii) Whether the plaintiffs are entitled for interest on the aforesaid amount, if so, at what rate and for which period? OPP
20. The onus to prove issue no.(i) is on defendant while issue no.(ii) &
(iii) upon plaintiffs.
21. The onus to prove this issue no.(i) is on the defendant and to bring home his argument ld. Counsel for the defendant submits that Sec. 157(1) of the Motor Vehicle Act, 1988 provides for deemed transfer of certificate CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 12 / 24of insurance in the event of transfer of ownership of the Motor Vehicle Act. He further submits that under Sec.157 (2), a period of 14 days has been provided for making necessary changes in the certificate of insurance, and the policy can only be deemed to be transferred on the date of transfer of vehicle. He also submits that Sec. 157 of the Motor Vehicles Act, 1988 being a part of chapter-11 of the said Act is applicable only for third party risk and not to own damage/ theft of the vehicle and the said section in the present case shall not have any application. He further submits that as per GR-17 of the India Motor Traffic Regulation only the "liability only cover" is deemed to have been transferred from the date of such transfer to a transferee, whereas, transfer of "own damage" segment of an insurance policy can be enforced only when a specific request is made by the transferee along with consent of transfer and a fresh proposal for along with prescribed fee has to be submitted with the evidence of same and the condition is that a transferree has to apply to the insurance company within a period of 14 days of the transfer having been completed and non-compliance of which absolve the insurance company of its liability and in the present case, the vehicle in question was originally owned and insured in the name of plaintiff no.1 and the same being purchased by the plaintiff no.2 in the month of May, 2016 and after the change of the ownership in the records of the transport department there was no intimation done to the insurance company regarding transfer of the policy and on the date of alleged theft i.e. 23.08.2016, the insurance policy continued to be in the name of plaintiff no.1 while, the vehicle has already been sold in May, 2016 to plaintiff no.2 and under the provisions of GR-17 of the India Motor Tariff Regulations, it was the duty of the CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 13 / 24plaintiff no.2 to make an application to the insurer / insurance company within 14 days of acquiring the ownership of the vehicle and non- compliance of the same will absolve the insurance company of its liability. He further submits that as there was no privity of Contract between the plaintiff and the insurance company therefore, insurance company is not liable for any compensation / claim for or any recovery of money as claimed for. It is also submitted that the title of the vehicle having been passed to plaintiff no.2 thus, plaintiff no.1 also being seized to be owner of the vehicle therefore, he is also not entitled for any compensation / claim for or any recovery of money as claimed.
22. He further submits that in cross-examination, PW1 Ms. Manju Luthra had admitted that on 23.08.2016, she had not informed the insurance company about purchasing the vehicle from plaintiff no.1 and she has not got the insurance policy transferred in her name. He further submits that PW2 Amarjit Singh Bagga has in his cross-examination stated that at the time of the sale of the car bearing no.DL12CH3064 to the plaintiff no.2, he had not informed / intimate the insurer of the said car i.e. defendant. Thus, the insurance company i.e. defendant is not liable to pay for any compensation / claim for or any recovery of money as claimed for as due to non-compliance of Sec. 157(2) of the Motor Vehicles Act, 1988.
23. He further submits that, the policy Ex.PW1/5 was procured by plaintiff no.2 through online and he had not made any written declaration to the effect that the vehicle in question has already been stolen on CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 14 / 2423.08.2016. She had not got first insurance policy transferred in her name.
24. It is further submitted that PW2 Amarjit Singh Bagga admitted in his cross-examination that at the time of sale of the car bearing no.DL-12- CH-3064 to the plaintiff no.2, he did not intimate the insurer of the said car i.e. defendant herein. He is not aware as to when the aforesaid car was transferred in the name of plaintiff no.2.
That the plaintiff no.2 after purchasing the said vehicle got transferred in her name in the month of June, 2016 and thereafter she did not intimate the defendant's company to transfer the insurance policy of the said vehicle which was given by the plaintiff no.1 to plaintiff no.2 at the time of sale purchase of the said vehicle.
25. Before proceeding further, it is relevant to consider the provisions of Sec. 157 of Motors Vehicle Act, Sec. 157 (1) & (2) of the Motor Vehicles Act, 1988 are reproduced here as :-
...."Sec. 157(1) Where a person, in whose favour the certificate of insurance has been issued in accordance with the provisions of this Chapter, transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.
...."Sec. 157(2) The Transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the fact of transfer in the certificate of insurance and the policy described in the certificate in his favour and the insurer shall make the necessary changes in the certificate and the policy of insurance in regard to the transfer of insurance.".....CIV DJ 613868 /16
M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.Page No. 15 / 24
26. Thus, as per sec. 157(1) of Motor Vehicle Act there is a deemed transfer of ownership and by virtue of sub section-2, there is a condition that, the transferee shall apply within 14 days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the effect of transfer in the certificate of insurance and the policy described in the certificate and the policy of insurance in regard to the transfer of insurance.
27. It is also submitted by the counsel for the defendant that the plaintiff no.2 failed to comply with Section 157 of Motor Vehicle Act to get transfer the insurance policy in her name and on the other hand the plaintiff no.1 had no insurable interest as he had sold his vehicle to the plaintiff no.2 in the month of May, 2016. He further relied on the citation of :
i) Oriental Insurance Company Versus Enamul Haque passed by National Consumer Disputes Redressal Forum ;
ii) IFFCO Tokio General Insurance Company Versus Ashok Laxman Mane IV (2020) CPJ 248 (NC) passed by National Consumer Disputes Redressal Forum;
iii) M/S Complete Insulations (P) Ltd. versus New India Assurance Company Ltd. versus New India Assurance Company Ltd. (1996) 1 SCC 221 passed by Hon'ble Supreme Court of India.
28. On the other hand, ld. counsel for the plaintiff has drawn the attention of this Court to the cross-examination of DW1 wherein DW1 CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 16 / 24has admitted that the insurance was paid for the period from 09.04.2016 to 08.04.2017 and the insurance company had not discontinued the insurance of vehicle in question and the insurance company had got the information regarding the theft of vehicle and the investigator of the company and insurance company were aware of the theft.
29. On careful examination of the testimony of DW-1 Sh. Amit Kumar, in his deposition during the course of cross-examination, he has admitted that the insurance company had not refunded the premium paid by the insurer during the period 09.04.2016 to 08.04.2017. He has also admitted that the insurance company had not discontinued the insurance of the vehicle. He has further admitted that the insurance company had got the information regarding the theft of vehicle. It is also admitted by him that the investigator of the insurance company had visited the site and also met with Manju Luthra and the details were also provided by Manju Luthra to the investigator. He has specifically admitted that they had not sent or communicated with plaintiff no.1 that he will not be entitled to get the claim of the theft vehicle. He has specifically admitted that the company had not cancelled the insurance cover of the said vehicle. He has also admitted that at the time of making the contract by the company with the insurer, they do not show or got the signatures of the insurer on any agreement regarding the clause mentioned as GR-17 of Indian Motor Tariff Regulations.
30. It is relevant to mention here that both plaintiff and defendant during the course of arguments has relied on the Complete Insulations CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 17 / 24(P) Ltd. v. New India Assurance Co. Ltd., (1996) 1 SCC 221 and on careful perusal of Para no. 10 of it and the same is reproduced as follows :
........."10. There can be no doubt that the said chapter provides for compulsory insurance of vehicles to cover third-party risks. Section 146 forbids the use of a vehicle in a public place unless there is in force in relation to the use of that vehicle a policy of insurance complying with the requirements of that chapter. Any breach of this provision may attract penal action. In the case of property, the coverage extends to property of a third party i.e. a person other than the insured. This is clear from Section 147(1)(b)(i) which clearly refers to "damage to any property of a third party" and not damage to the property of the 'insured' himself. And the limit of liability fixed for damage to property of a third party is Rupees six thousand only as pointed out earlier. That is why even the Claims Tribunal constituted under Section 165 is invested with jurisdiction to adjudicate upon claims for compensation in respect of accidents involving death of or bodily injury to persons arising out of the use of motor vehicles, or damage to any property of a third party so arising, or both. Here also it is restricted to damage to third-party property and not the property of the insured. Thus, the entire Chapter XI of the new Act concerns third-party risks only. It is, therefore, obvious that insurance is compulsory only in respect of third-party risks since Section 146 prohibits the use of a motor vehicle in a public place unless there is in relation thereto a policy of insurance complying with the requirements of Chapter XI. Thus, the requirements of that chapter are in relation to third-party risks only and hence the fiction of Section 157 of the new Act must be limited thereto. The certificate of insurance to be issued in the prescribed form (See Form 51 prescribed under Rule 141 of the Central Motor Vehicles Rules, 1989) must, therefore, relate to third-party risks. Since the provisions under the new Act and the old Act in this behalf are substantially the same in relation to liability in regard to third parties, the National Consumer Disputes Redressal Commission was right in the view it took based on the decision in Kondaiah case [AIR 1986 AP 62 : (1985) 2 Andh LT 88 : (1986) 60 Com Cas 762] because the transferee-insured could not be said to be a third CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.Page No. 18 / 24
party qua the vehicle in question. It is only in respect of third-party risks that Section 157 of the new Act provides that the certificate of insurance together with the policy of insurance described therein "shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred". If the policy of insurance covers other risks as well, e.g., damage caused to the vehicle of the insured himself, that would be a matter falling outside Chapter XI of the new Act and in the realm of contract for which there must be an agreement between the insurer and the transferee, the former undertaking to cover the risk or damage to the vehicle. In the present case since there was no such agreement and since the insurer had not transferred the policy of insurance in relation thereto to the transferee, the insurer was not liable to make good the damage to the vehicle. The view taken by the National Commission is therefore correct".......
31. As from the aforesaid judgment of complete insulations, it can be seen that the requirements of chapter-11 of the Act are in relation to third party risks only and Sec. 157 of the Act is limited thereto and the transferree-insured could not be said to a third party qua the damage of the vehicle in question i.e. by theft and the damage caused to the vehicle of the insured himself, that would be a matter falling outside chapter-11 of the Act and in the realm of contract for which there must be an agreement between the insurer and the transferree. Now, as in the case in hand, the insured vehicle was stolen and chapter-11 Sec. 157 of the Act, if be considered as non-applicable then the case has to be considered in the realm of contract and the conduct and intentions of the parties has to be examined for the purpose of contract as well as privity of contract and the subsequent paras of this judgment deals with the same.
32. Now, on careful appreciation of the evidence of DW1 in foregoing para no.29 of present judgment, this Court is of the view that as the fact CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 19 / 24has been specifically admitted by the defendant that there was continuance of the policy and they are aware of the theft of the vehicle and then also they have not cancelled the earlier policy. On the other hand, a new policy has been issued thus, it amounts to creation of a new agreement between the parties. Thus, it gets precipitated that the material facts of the theft of the car was known to the defendant and the earlier policy was in continuance. Accordingly, it can be said insurable interest for the said vehicle was in continuance. Thus, there is a privity of contract as well as continuity of the privity of contract between the plaintiffs and the defendant. Now, as the fact has been admitted by DW1 that the defendant had not shown or got the signatures on any agreement regarding the clause mentioned as GR-17 of Indian Motor Tariff Regulations. Here, it is also relevant to mention here that the object of Motor Vehicle Act, 1988 is a socio beneficial legislation and liberal interpretation to the law has to be given instead of strict interpretation. Thus, in the present case, the provisions of GR-17 of Indian Motor Tariff Regulations. Are not attracted as the present case is not falling under chapter 11 of the act but it has to be seen and appreciated in the realm of contract laws.. Hence, issue no.1 is decided in negative i.e. against the defendant and in favour of the plaintiffs.
33. With regard to issue no.(ii) & (iii) are concerned, the onus of proof of these issues is on the plaintiffs and in order to discharge that onus the plaintiffs relied on plaint, examined himself as PW1, produced documents i.e. copy of attorney as Ex.PW1/1, copies of the invoice, receipt dated 26.04.2014 issued by Rana Motors as Ex.PW1/2, insurance policy in the CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 20 / 24name of plaintiff no.1 w.e.f. 09.04.2016 to 08.04.2017 as Mark Y, copy of RC in the name of plaintiff no.1 as Mark X, Copy of DL in the name of plaintiff no.1 as Mark X1, Copy of FIR dated 24.08.2016 as Mark X2, Copy of RC and insurance policy in the name of plaintiff no.2 as Ex.PW1/5, Copy of untraceable report dated 17.10.2016 as Mark X3, Rejection letter dated 08.11.2016 as Mark Y1, Copy of e-mails as MarkX4 & Mark X5( Colly.). The contents of the plaint are corroborated by the testimony of PW1 & PW2, the same being corroborated by the documents exhibited by the plaintiff as the same has been admitted by the defendant.
34. Further, on careful examination of the evidence, the pleading of the plaintiffs that vehicle was insured from the defendant and the insurance was valid upto 08.04.2017 is corroborated in the cross-examination of DW1 Amit Kumar as it is admitted by him that the insurance was for the period of 09.04.2016 to 08.04.2017.
35. Ld. Counsel for the plaintiff has relied on the following portions of the judgment of - Mallamma v. National Insurance Co. Ltd. (2014) 14 Supreme Court Cases 137, (2014) 14 SCC 137 : (2015) 1 SCC (Civ) 246 : (2015) 1 SCC (Cri) 300 : 2014 SCC OnLine SC 307 at page 139 the same are reproduced as follows :
....."4. ..........as per Section 157(1) of the Motor Vehicles Act, 1988 whenever a vehicle is transferred from one person to another, the benefits of the insurance policy shall also be transferred to the new owner; accordingly instant policy benefits will also be automatically transferred from Gangadhara to Jeevaratna Setty".......CIV DJ 613868 /16
M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.Page No. 21 / 24
......"8. ..........Once the ownership of the vehicle is admittedly proved to have been transferred to Jeeva Rathna Setty, the existing insurance policy in respect of the same vehicle will also be deemed to have been transferred to the new owner and the policy will not lapse even if the intimation as required under Section 103 of the MV Act is not given to the insurer, hence the impugned order [National Insurance Co. Ltd. v. Mallamma, MFA No. 3842 of 2003, decided on 10-8-2005 (KAR)] passed by the High Court is contrary to law."......
........"13.In view of the above discussion we are of the considered view that as on the date of accident, the deceased workman was in the course of employment of Jeeva Rathna Setty in whose name the ownership of the vehicle stood transferred and the said vehicle was covered under a valid insurance policy, the High Court ought not have simply brushed aside the decision of the Commissioner fastening joint liability on the Insurance Company in the light of the deeming provision contained in Section 157(1) of the MV Act."........
36. As already discussed in foregoing paras of this judgment that DW1 Sh. Amit Kumar has admitted that the insurance policy was in force/ continuation and the same was not cancelled. Further, the theft of vehicle was in the knowledge of the defendant company. In his cross- examination, it is also admitted by him that the insurance company does not give insurance cover to any vehicle without depositing of premium amount. He has further admitted that even before receiving of premium and after receiving of premium they did not communicated with plaintiff no.2 that insurance company does not give the insurance cover to the vehicle in question. He further admitted that till that day, the insurance company had not cancelled the insurance policy of plaintiff no.2 after the receipt of premium on 10.09.2016 and it is still in existence. He has also CIV DJ 613868 /16 M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 22 / 24admitted that they had received the premium from plaintiff even before theft and thereafter also and insured the vehicle in question. Thus, on the basis of the conduct of defendant and in view of continuance of policy, the defendant can not absolve out of their liability by denying the benefit of that policy to the plaintiffs. It is also relevant to mention here that as in the testimony of DW1, the fact has come that the first policy was never cancelled and it was in continuation, further, the defendant was aware of the theft of the vehicle and then also, a new policy was given. Thus, the defendant can not be permitted to take benefit of his wrong. Specially, when they have taken premium i.e. consideration for the same and thus, they can not turn out from their insurable liability. The defendant has to be "estoped" by the principle of Estoppel as they can not blow hot and cold at the same time as in the present case while, accepting the premium, they have created insurable interest while, on the other hand, they are denying their liability which is not permissible and the defendant has to be bound by their insurable interest and accordingly, privity of contract is in favour of the plaintiffs. Accordingly, issue no.(ii) is proved in affirmative i.e. in favour of the plaintiffs and against the defendant.
37. With regard to issue no.(iii) , the onus to prove this issue is upon the plaintiff. Considering the fact that no evidence has been lead by either of the parties regarding the amount of interest. Considering the normal rate of interest, plaintiff is entitled to interest @ 6% p.a. from the date of filing of the present suit till realization of the amount from the defendant.
CIV DJ 613868 /16M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
Page No. 23 / 2438. Issue no. (iv) Relief :-
In the light of the aforesaid discussion, the suit of the plaintiffs is decreed for a sum of Rs.4 lacs along with interest @ 6% p.a. from the date of the filing of the suit till the date of realization from the defendant.
39. Cost of the suit is also awarded in favour of the plaintiff.
40. Decree sheet be prepared accordingly subject to payment of deficient court fees, if any.
41. File be consigned to the record room after due compliance.
Digitally signed by SYED SYED ZISHAN ALI
ZISHAN WARSI
Date: 2022.07.29
Announced in the open Court ALI WARSI 15:06:41 +0530
[SYED ZISHAN ALI WARSI]
Dated : 29.07.2022 ADJ-05, WEST DISTRICT
TIS HAZARI COURT, DELHI
CIV DJ 613868 /16
M/S AMARJIT SINGH BAGGA & ANR. vs. IFFCO TOKIO GENERAL INSURANCE CO. LTD.
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