National Consumer Disputes Redressal
Sundar Singh vs New India Assurance Company Limited on 26 May, 2023
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 1576 OF 2019 (Against the Order dated 26/02/2019 in Complaint No. 20/2017 of the State Commission Himachal Pradesh) 1. SUNDAR SINGH S/O. SHRI. NORBU CHHRING. R/O. VILLAGE CHACHOGA, P.O. MANALI, TEHSIL-MANALI. KULLU. H.P. ...........Appellant(s) Versus 1. NEW INDIA ASSURANCE COMPANY LIMITED THROUGH ITS BRANCH MANAGER. BRANCH OFFICE-352401, GAUR COMPLEX, DHALPUR. KULLU-175101. H.P. ...........Respondent(s)
BEFORE: HON'BLE MR. DINESH SINGH,PRESIDING MEMBER HON'BLE MR. JUSTICE KARUNA NAND BAJPAYEE,MEMBER FOR THE APPELLANT : MR. JIYA LAL BHARDWAJ, SENIOR ADVOCATE WITH MR. SANJAY BHARDWAJ, ADVOCATE COMPLAINANT IN PERSON FOR THE RESPONDENT : MR. RAVI BAKSHI, ADVOCATE Dated : 26 May 2023 ORDER HON'BLE MR. JUSTICE KARUNA NAND BAJPAYEE, MEMBER
1. This appeal under section 19 of The Consumer Protection Act, 1986 is in challenge to the Order dated 26.02.2019 of the State Commission in complaint no. 20 of 2017.
2. We have heard the learned senior counsel for the appellant (the 'complainant') and the learned counsel for the respondent (the 'insurance co.'). We have also perused the record, including inter alia the State Commission's impugned Order dated 26.02.2019 and the memorandum of appeal.
3. Briefly, the complainant had insured the subject vehicle with the insurance co. for the period from 04.06.2016 to 03.06.2017 for an insured declared value of Rs. 22,20,625/-. The premium was paid, the policy was valid. During the subsistence of the policy on 29.08.2016 the vehicle met with an accident falling into a river when the bridge over the river collapsed while the vehicle was crossing it. First information report was lodged with the police. The insurance co. was intimated. The complainant claimed that the vehicle was a total loss and asked for the insured declared value i.e. Rs. 22,20,625/- to be settled. The insurance co. did not settle the claim on ground that the complainant did not retrieve and shift the vehicle to a workshop to enable complete inspection of the vehicle after dismantling its parts.
The State Commission vide its impugned Order directed the insurance co. to pay Rs. 9,51,338.60p. to the complainant as per the loss assessed by its surveyor with interest at the rate of 9% per annum from the date of institution of the complaint along with Rs. 25,000/- as compensation for mental agony and harassment and Rs. 10,000/- as cost of litigation.
The complainant filed the present appeal seeking payment of the insured declared value of Rs. 22,20,625/- with interest at the rate of 12% per annum from the date of expiry of two months of the accident i.e. from 29.10.2016 along with enhanced compensation for mental agony and harassment and cost of litigation.
4. The insurance co.'s case is that the complainant did not take the insured vehicle to a workshop for enabling comprehensive inspection after dismantling its parts so as to make a genuine assessment of the loss. As such it had not settled his claim. However, so as to close the matter, it has not agitated the State Commission's Order which has allowed the claim at par with the surveyor's assessment.
5. The complainant's case is that the vehicle had fallen in a river in a remote district i.e. Lahaul & Spiti of Himachal Pradesh in hilly terrain and it was not feasible to cart the vehicle to a workshop. The complainant also requested the Border Roads Organisation (BRO) to retrieve the vehicle. On 31.08.2016 the BRO deployed a recovery vehicle and a dozer to recover the vehicle but its efforts failed. The BRO issued a certificate to this effect. The complainant also intimated the insurance co. that it was not possible for a recovery van to cross the bridge at Koksar. Even the complainant requested the insurance co. to bring the vehicle from Lahaul to a workshop on its own offering and assuring that the complainant will bear the expenses for the same. But the insurance co. did nothing to transport the vehicle to a workshop even at the complainant's expense. The surveyor made a perfunctory visual inspection at the spot to assess the loss. In fact the vehicle could not be put to any use after the accident and its estimate of repair from an authorized dealer was much higher than the insured declared value and it was as such a total loss and therefore the complainant was legitimately entitled to the insured declared value.
6. Learned counsel for the insurance co. would argue that it was the responsibility of the complainant to make available the vehicle for proper inspection at a workshop which duty he did not perform. Even then its surveyor made the best out of the situation and made his assessment of the loss based on visual inspection on the spot. Submission is that the surveyor's report has been accepted by the State Commission and there is no need or justification to in any manner enhance the compensation.
7. Learned senior counsel for the complainant would argue that in ordinary circumstances no doubt the complainant would have been responsible to retrieve the vehicle and transport it for inspection at a workshop. However in the present case the vehicle had fallen into a deep river when the bridge over it collapsed while the vehicle was crossing it. The terrain was hilly. The area was remote. A recovery van could not cross a bridge enroute. Even the BRO failed in its attempt to recover the vehicle. It was not feasible for the complainant to transport the vehicle anywhere including to a workshop. The complainant had written to the insurance co. to itself transport the vehicle to whichever place or workshop it wanted to at the complainant's expense. The complainant did not have the necessary wherewithal. The insurance co. did not or could not transport the vehicle to a workshop even when the complainant was prepared to meet the expenses. The surveyor in making an assessment on the spot has made estimate in respect of electronic, electrical and mechanical parts by visual inspection without putting it to requisite in-depth inspection. As such the assessment of the surveyor in respect of the various electronic, electrical and mechanical parts is in the nature of a coarse guesstimate. It is grossly on the lower side. The fact of the matter is that the vehicle was not of any use whatsoever and the estimate of repair obtained by the complainant from an authorized dealer was for an amount of Rs. 26,10,447/- which was much higher than the insured declared value of Rs. 22,20,625/-. In fact the vehicle was a total loss and as such the case necessitated to be settled at the insured declared value. The complainant had taken finance for the vehicle and was burdened with repaying the loan with interest even after the vehicle met with the accident and became a total loss. Learned senior counsel also draws attention to the photographs of the site which show the heavily damaged vehicle lying in a river in hilly terrain. Submission is that in the facts and circumstances if the claim is not settled at the insured declared value it will be something less than justice.
8. We may observe that in ordinary circumstances it is the duty of the owner of the insured vehicle to make the damaged vehicle available at a designated workshop for the insurance co.'s surveyor to make a meaningful inspection and correctly assess the actual loss. However in the peculiar facts and circumstances of the present case, when the vehicle had fallen into a river in hilly terrain in a remote area, even the BRO failed in its attempt to retrieve the vehicle, the terrain and topography did not allow access of a recovery van, and the insurance co. on its own also did not or could not transport the vehicle to a workshop at the complainant's expense, it is reasonable and apt to conclude that it was not at all feasible for the complainant to ferry the vehicle to a workshop. Pertinently, the complainant had written to the insurance co. to cart the vehicle on its own at the complainant's expense. But even the insurance co. did not or could not muster the necessary wherewithal to transport the vehicle. We also find merit in the submissions of the learned senior counsel that without a proper inspection in a garage it was not feasible for a surveyor to make a genuine assessment of the loss in respect of the various electronic, electrical and mechanical parts of the vehicle. We have browsed through the surveyor's report and have no hesitation in agreeing that the assessment made is essentially in the nature of a guestimate, removed from the actual loss. Having regard to the overall facts and circumstances, and also having seen the photographs depicting the heavily damaged vehicle lying in the river in hilly terrain, considering the area and topography, considering that the vehicle could not be put to use after the accident, we find it reasonable and apt to conclude that, one, it was not at all possible for the complainant to transport the vehicle to a workshop on his own, and, two, the vehicle was a total loss. As such we feel that the insurance co. ought to have settled the claim at total loss at par with the insured declared value with the insurance co. being the owner of the salvage.
9. Learned senior counsel for the complainant submits that he has been recently told by the complainant that during the pendency of the litigation the complainant has anyhow been able to remove the vehicle from the river but not being able to do anything with it he has sold its salvage as scrap for an amount of Rs. 1.50 lakh on 04.07.2020 i.e. after the State Commission had passed its Order and during the pendency of the present appeal before this Commission. The amount was received electronically in the complainant's bank account.
10. Learned counsel for the insurance co. submits that this is a grave irregularity on the part of the complainant who ought not to have disposed of the damaged vehicle without informing the insurance co. He also submits that if the complainant's case is that the vehicle was a total loss and he is claiming the insured declared value the ownership of the salvage would be of the insurance co. and as such the complainant ought not to have sold it like this.
11. The complainant in person would submit that seeing that the matter was not reaching any end and since the local authorities were pressuring him to remove the debris, being driven to the wall he had no other alternative but to sell the salvage as scrap.
12. We may observe that the insurance co. was totally unaware of the sale of salvage. For that matter even learned senior counsel for the complainant was unaware till recently. The complainant on his part has truthfully with genuine honesty given forth the information of selling the salvage at Rs. 1.50 lakh. The surveyor in his report had assessed the value of the salvage at Rs. 48,615/-. Though the two values i.e. the value of the salvage on total loss and the value of the salvage on making an estimate of repair are different from each other and the former will necessarily be higher than the latter, but a broad comparison would show that it cannot be said that the complainant has sold the salvage at any unreasonable or unfair or grossly undervalued amount.
13. We may reiterate that it is the duty of the owner of an insured vehicle to make it available for inspection to the insurance co. and its surveyor. Also, survey and investigation are one of the fundamentals in settling a claim and cannot and should not be disregarded or dismissed without cogent reasons. But it also goes concomitantly that in a particular case in its peculiar facts and circumstances it might just not be feasible for the owner of an insured vehicle to retrieve and cart the vehicle to a workshop and also that the survey or investigation should be convincing and pass the test of credence in scrutiny. Here in this particular case it is very well evident that it was not feasible for the complainant to transport the insured vehicle for inspection, considering the terrain and topography. The insurance co. also did not or could not transport the vehicle to a garage at the complainant's expense. It is also very well evident that the surveyor's assessment was only a guesstimate based on visual inspection on the spot. The surveyor has only made a rough estimate of the loss since it has referred to 'n' number of electronic, electrical and mechanical parts and made an estimate in their regard without a thorough inspection in a workshop. We note inconsistency in the insurance co.'s approach. On the one hand it initially discounted its own surveyor's visual inspection on ground that it did not substitute for a proper inspection after dismantling of parts in a workshop, but now it wants the same surveyor's report to be accepted as such at its face value without questions. The fact remains that the vehicle was heavily damaged, having gone down and remained submerged under running water, it was not in a position to be put to any use after the accident, the estimate of repair from an authorized dealer was higher than the insured declared value. All this inevitably leads to nothing but to the presumption of total loss.
14. We may also observe that in a case of such nature closing the matter as 'no claim' was not the solution. The fact remained that the insured vehicle had met with an accident and had been damaged. The complainant had put forth his genuine helplessness to transport the vehicle to a workshop. The insurance co. could not have remained content and cannot be allowed to shrug its shoulders completely disowning its responsibility and throw the blame on the complainant squarely in the manner in which it had done. Being an organisation with wherewithal it ought to have found a rational solution to meet its liability in a logical and sound manner rather than to brush it aside callously. The approach of the insurance co. ought to have been more sensitive and sensible in the circumstances of the case.
15. As such in the facts of the present case we feel that the ends of justice will be met and it will be fair and equitable to both sides if the insured declared value i.e. Rs. 22,20,625/- minus the amount for which the salvage was sold by the complainant i.e. Rs. 1,50,000/- is settled. We also feel that the rate of interest of 9% per annum awarded by the State Commission is fair and reasonable but the same should be with effect from six months of the date of the accident i.e. 01.03.2017, the same being a reasonable period for the insurance co. to have examined and settled the claim in the normal course. The compensation for mental agony and harassment and cost of litigation awarded by the State Commission do not require to be disturbed.
16. We make it explicit that we are in no manner rewriting the terms and conditions of insurance. We agree that in ordinary circumstances the owner of an insured vehicle has to duly make available the vehicle for inspection. We also agree that the owner of the vehicle ought not to and should not dispose of the salvage without informing the insurance co. moreso in a case of total loss where the insurance co. is the owner of the salvage. But in the present case, as already said above, in the peculiar terrain and topography and the conspicuous facts and circumstances it was just not feasible for the complainant to cart the vehicle to a workshop and the belated selling of the salvage was in good faith as a last measure and at a not unreasonable amount.
17. Sequel to the above, the appeal is partly allowed with the direction that the insurance co. shall pay an amount of Rs. 22,20,625/- (insured declared value) minus Rs. 1,50,000/- (amount at which salvage sold) equalling Rs. 20,70,625/- with interest at the rate of 9% per annum with effect from 01.03.2017 along with Rs. 25,000/- as compensation for mental agony and harassment and Rs. 10,000/- as cost of litigation. The amount if and as any paid in compliance of the State Commission's Order of 26.02.2019 shall be duly adjusted therein. The balance awarded amount shall be made good within six weeks of the pronouncement of this Order, failing which the State Commission shall undertake execution, for 'enforcement' and for 'penalty', as per the law.
18. The Registry is requested to send a copy each of this Order to the parties in the appeal and to their learned counsel as well as to the State Commission immediately. The stenographer is requested to upload this Order on the website of this Commission immediately.
.............................. DINESH SINGH PRESIDING MEMBER ..................................................J KARUNA NAND BAJPAYEE MEMBER