State Consumer Disputes Redressal Commission
United India Insurance Company Ltd. vs Iccha Singh & Anr. on 1 November, 2022
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
PUNJAB, DAKSHIN MARG, SECTOR -37 A, CHANDIGARH
First Appeal No.165 of 2022
Date of Institution : 02.03.2022
Reserved on : 27.09.2022
Date of Decision : 01.11.2022
United India Insurance Company Limited, Branch The Mall,
Kapurthala, The Manager, now represented through the duly
authorized signatory of Regional Office at 136, Feroze Gandhi
Market, Ludhiana, Punjab.
........Appellant/Opposite Party
Versus
1. Iccha Singh S/o Surjan Singh, R/o Village Brindpur, District
Kapurthala.
2. Gurpreet Singh S/o Paramjit Singh, R/o H.No.4, Guru Nanak
Avenue, Circular Road, Kapurthala.
.....Respondents/Complainants
First Appeal under Section 41 of
Consumer Protection Act, 2019 against
orders dated 14.12.2021 passed by the
District Consumer Disputes Redressal
Commission, Kapurthala.
Quorum:-
Hon'ble Mrs. Justice Daya Chaudhary, President
Mrs. Urvashi Agnihotri, Member
Present:-
For the appellant : Sh. Nitin Gupta, Advocate
For the respondents : None
1) Whether Reporters of the Newspapers
may be allowed to see the Judgment? Yes/No
2) To be referred to the Reporters or not? Yes/No
3) Whether judgment should be reported
in the Digest? Yes/No
2
First Appeal No.165 of 2022
JUSTICE DAYA CHAUDHARY, PRESIDENT:-
The appellant/opposite party i.e. United India Insurance Co. Limited through its Manager has approached this Commission by way filing the present appeal under Section 41 of the Consumer Protection Act, 2019 as amended upto date (in short the 'Act') to challenge the impugned order dated 14.12.2021 passed in Consumer Complaint No.101 of 2019 by the District Consumer Disputes Redressal Commission, Kapurthala (hereinafter referred as the "District Commission") whereby the complaint filed by respondents-complainants was partly allowed in favour of complainant No.1. The relevant para 11 of the impugned order passed by the District Commission is reproduced as under:-
"11. In view of the above detailed discussion, the present complaint qua complainant No.2 is dismissed and complaint is partly allowed in favour of complainant No.1 and OP is further directed to settle the claim of Rs.52,800/-. Further OP is directed to pay the amount of Rs.10,000/- on account of mental agony and harassment to the complainant No.1 and Rs.5000/- as cost of litigation expenses. Compliance of the order be made within one month from the date of receipt of copy of the order failing which complainant would be entitled to the interest @8% on the awarded amount from the date of filing of complaint i.e. 14/10/2019 till realization."
2. As per averment made in the complaint, the complainant No.1 (Iccha Singh) was the registered owner of the vehicle Toyota Innova (Model 2010) bearing Registration No.PB 09 L 0220. Said vehicle was insured with the appellant-Insurance Company vide 3 First Appeal No.165 of 2022 policy No.2005043117- P115827730 which was valid for the period from 07.02.2018 to 06.02.2019. During the period of said Insurance Policy, the vehicle was sold by complainant No.1 to one Gurpreet Singh (complainant No.2). However, the vehicle was not transferred in his name. The vehicle met with an accident on 02.10.2018. FIR No.465 dated 02.10.2018 was registered under Sections 279/337/187 IPC at Police Station Una Sadar. Complainant No.1 being the registered owner of the said vehicle lodged the claim with the Insurance Company. The claim was repudiated vide letter dated 13.02.2019 on the ground that complainant No.1 was not having any insurable interest in the vehicle on the date of accident i.e. 02.10.2018. Being aggrieved by the action of OP/Insurance Company the complaint was filed by both the complainants stating to be a case of 'deficiency in service' and 'negligence' on the part of OP and also allegations of 'unfair trade practice' were made as the claim was not accepted which had resulted into harassment, mental tension and agony.
3. The prayer was made in the complaint for issuance of directions to the OPs to settle the claim and to pay interest on the claim amount @12% per annum from the date of lodging the complaint till actual payment and also to pay an amount of Rs.50,000/- as compensation on account of harassment suffered due to action and in action on the part of the OP. An amount of Rs.11,000/- was claimed as litigation expenses. 4 First Appeal No.165 of 2022
4. Said complaint was contested by the OP by way of filing written statement wherein certain preliminary objections were raised stating therein that the complainants were stopped by their own act and conduct from filing the complaint and also raised certain other objections that complainant No.2 (Gurpreet Singh) was not consumer of OP and had no right to file the complaint before the District Commission. It was also mentioned in the reply that complainant No.1 was not having any insurable interest in the vehicle and had no right to claim any amount from OP with regard to vehicle. The policy of insurance was issued in the name of Iccha Singh (complainant No.1) and accident occurred on 02.10.2018 whereas the vehicle was delivered to complainant No.2 on 09.08.2018. Other averments made in the complaint were also denied.
5. After considering the averments made in the complaint, reply thereof filed by OP and on hearing the arguments raised by the counsel representing both the parties, the complaint filed by the complainant was partly allowed in favour of complainant No.1 but dismissed qua complainant No.2, as referred above.
6. Aggrieved by said order dated 14.12.2021 passed by the District Commission, OP-Insurance Company has filed the present appeal alongwith M.A. No.290 of 2022 for condonation of delay of 31 days in filing the appeal which was supported by an affidavit. Delay was condoned vide order dated 04.03.2022 and said M.A. was disposed of.
5First Appeal No.165 of 2022
7. Mr. Nitin Gupta, Advocate learned counsel for the appellant submits that the vehicle in dispute was sold to respondent No.2/complainant No.2 and possession thereof was also delivered to him. Both the complainants filed their affidavits in support of this fact and said affidavits were duly attested by the Executive Magistrate Jalandhar. However, the Insurance Policy was not transferred in the name of complainant No.2. The appellant Insurance Company has rightly repudiated the claim on the ground that complainant No.1 was not having any insurable interest but this fact has not been appreciated by the District Commission while partly allowing the complaint without dealing with the said argument. Learned counsel further submits that the District Commission has awarded a claim of Rs.52,000/- without admission of any liability and no reason whatsoever has been mentioned while awarding the amount of claim whereas as per Surveyor report the loss was assessed of Rs.23,700/- only. The District Commission has overlooked the Surveyor's report and assessment and by passing totally a non-speaking order has awarded Rs.52,800/- and as such the impugned order passed by the District Commission is liable to be set aside. Learned counsel has also relied upon judgments i.e. (1) V.A. Sreekumar Vs. Senior Divisional Manager, RP No.3732 of 2017, decided on 30.01.2018 (NC) and (2) Oriental Insurance Company Vs. Arvinder Singh, FA No.311 of 2018, decided on 28.09.2018 (State Commission Punjab) in support of his contentions.
6First Appeal No.165 of 2022
8. Neither the respondents/complainants were present themselves nor any counsel on their behalf despite service.
9. Heard the learned counsel for the appellant. We have also carefully perused the averments made in the complaint as well as reply thereof and order passed by the District Commission and also the relevant documents available on the record.
10. Admitted case of both the parties are that the vehicle in dispute was purchased by complainant No.1 (Iccha Singh) and it was registered in his name and was insured from the appellant-Insurance Company. The insurance policy was valid with effect from 07.02.2018 to 06.02.2019. The copies of Registration Certificate and Insurance Policy were attached by the complainants with the complaint. It is also not disputed that the original purchaser of the vehicle (Toyota Innova) sold it to complainant No.2 (Gurpreet Singh) and affidavits dated 31.08.2018 regarding sale were executed by complainant No.1 and 2 which was duly attested by the Executive Magistrate, Jalandhar. The insured car met with an accident on 02.10.2018 and intimation in this regard was sent to the Insurance Company. However, the vehicle was not registered in the name of subsequent purchaser till the date of lodging the claim with the Insurance Company. However, the claim of claimant was repudiated vide letter dated 13.02.2019 on the ground that complainant No.1 was not having any insurance interest as vehicle had already been sold to complainant No.2 (Gurpreet Singh) and possession thereof was also 7 First Appeal No.165 of 2022 handed over to him. It is also not in dispute that both the complainants filed joint complaint before the District Commission and facts as mentioned in the complaint are not in dispute on the basis of documents available on the record. The District Commission has partly allowed the complaint vide order dated 04.12.2021. However, the complaint qua complainant No.2 was dismissed and it was allowed in favour of complainant No.1 (Iccha Singh). It is also admitted fact that no appeal has been filed by complainant No.2 (Gupreet Singh).
11. The word 'owner' has been defined under Section 2(30) of the Motor Vehicles Act, 1988 which is reproduced as under:-
(30) "owner' means a person in whose name a motor vehicle stands registered and where such person is a minor, the guardian of such minor, and in relation to a motor vehicle which is the subject of a hire-purchase, agreement, or an agreement of lease or an agreement of hypothecation, the person in possession of the vehicle under that agreement."
12. The same issue was there before the Hon'ble Supreme Court in judgment of case "Surendra Kumar Bhilawe Vs. The New India Assurance Company Limited" Civil Appeal No.2632 of 2020, decided on 18.06.2020. The relevant paras of the said judgment are reproduced as under:-
"36. It would also be pertinent to note the difference between the definition of owner in Section 2(30) of the Motor Vehicles Act, 1988 and the definition of owner in Section 2(19) of the Motor Vehicles Act, 1939 which has been 8 First Appeal No.165 of 2022 repealed and replaced by the Motor Vehicles Act, 1988. Under the old Act the owner meant the person in possession of a motor vehicle. The definition has undergone a change. Legislature has consciously changed the definition of owner to mean the person in whose name the motor vehicle stands.
XXXX
37. Some of the relevant provisions of the Motor Vehicles Act are set out herein below:- 50. Transfer of ownership1) Where the ownership of any motor vehicle registered under this Chapter is transferred- (a) the transferor shall,-
(i) in the case of a vehicle registered within the same State, within fourteen days of the transfer, report the fact of transfer, in such form with such documents and in such manner, as may be prescribed by the Central Government to the registering authority within whose jurisdiction the transfer is to be effected and shall simultaneously send a copy of the said report to the transferee; and (ii) (b) the transferee shall, within thirty days of the transfer, report the transfer to the registering authority within whose jurisdiction he has the residence or place of business where the vehicle is normally kept, as the case may be, and shall forward the certificate of registration to that registering authority together with the prescribed fee and a copy of the report received by him from the transfer of ownership may be entered in the certificate of registration. (3) If the transferor of the transferee fails to report to the registering authority the fact of transfer within the period specified in clause (a) or clause (b) of sub-section (1), as the case may be, or if the person who is required to make an application under sub-
section (2) (hereafter in this section referred to as the other person) fails to make such application within the 9 First Appeal No.165 of 2022 period the period prescribed, the registering authority may, having regard to the circumstances of the case, required the transferor or the transferee, or the other person, as the case may be, to pay, in lieu of any action that may be taken against him under section 177 such amount not exceeding one hundred rupees as may be prescribed under sub-section (5). Provided that action under section 177 shall be taken against the transferor or the transferee or the other person, as the case may be, where he fails to pay the said amount.
XXXXX
40. The finding of the National Commission that the fact of registration of the said truck in the name of the Appellant was inconsequential is also not sustainable in law. Section 2(30) of the Motor Vehicles Act, 1988 defines owner to mean the person in whose name the motor vehicle stands registered. The definition of owner has been overlooked and ignored by the National Commission. Had ownership of the said truck intended to be transferred forthwith, the registration would have been transferred in the name of the transferee, as also the permit to operate the said truck for carriage of goods. XXXXXX
44. The explanation to Section 157 clarifies, for the removal of all doubts, that such deemed transfer would include transfer of rights and liabilities of the said certificate of insurance and policy of insurance. The transferee might, within 14 days from the date of transfer, apply to the Insurer in the prescribed form, for making requisite changes in the certificate of insurance and the policy of insurance with regard to the factum of transfer of insurance. There could be no reason for a transferee of 10 First Appeal No.165 of 2022 an insured motor vehicle, to refrain from applying for endorsement of the transfer in the Insurance Policy Certificate when insurance covering third party risk is mandatory for using a vehicle.
13. In another judgment of case "Complete Insulations Private Limited Vs. New Indian Assurance Company Limited"
1996(1)SCC-221 the Hon'ble Supreme Court has held as under:-
"Under Section 103-A of the old Act, the Insurer had the right to refuse to transfer the certificate of insurance and/or the Insurance Policy. However, Section 157 of the Motor Vehicles Act, 1988 introduces a deeming provision whereby the transfer of the certificate of Insurance and the policy of Insurance are deemed to have been made, where the vehicle along with the Insurance policy is transferred by the owner to another person. This provision has taken away the Insurers right of refusal to transfer the Policy Certificate of Insurance which was there under the old Act."
14. Judgment of another case titled "Pushpa @ Leela & others Vs. Shakuntala & others" 2011(2)SCC-240, is also relevant wherein the Hon'ble Supreme Court has held as under:-
"the question before this Court was, whether liability to pay compensation to third parties as determined by the Motor Vehicles Accidents Claims Tribunal in case of an accident, was that of the purchaser of the vehicle alone, or whether the liability of the recorded owner of the vehicle was coextensive, and from the recorded owner it would pass on to the Insurer of the vehicle. This Court found that the person whose name continued in the 2 (2001) 8 SCC 748 3 (2011) 2 SCC 240 records of the registering authority as the owner of the truck was equally liable for payment of the compensation, having 11 First Appeal No.165 of 2022 regard to the provisions of Section 2(30) read with Section 50 of the Motor Vehicles Act, 1988 and since an insurance policy had been taken out in the name of the recorded owner, he was indemnified and the Insurer would be liable to satisfy the third party claims."
15. In another judgment of case "Naveen Kumar Vs. Viajy Kumar & others" 2018(3)SCC-1 a three-Judge Bench of the Hon'ble Supreme Court has held as under:-
"in view of the definition of the expression owner in Section 2(30) of the Motor Vehicles Act, 1988, it is the person in whose name the motor vehicle stands registered, who, for the purposes of the said Act, would be treated as the owner of the vehicle. Where the registered owner purports to transfer the vehicle, but continues to be reflected in the records of the Registering Authority as the owner of the vehicle, he would not stand absolved of his liability as owner."
16. Para 40 of the judgment of case Surendra Kumar Bhilawe (Supra) of Hon'ble Supreme Court is also relevant which is reproduced as under:-
"49. The Judgment of this Court in Pushpa @ Leela & Ors. vs. Shakuntala (supra) and Naveen Kumar vs. Vijay Kumar (supra) were rendered in the context of liability to satisfy third party claims and as such distinguishable factually. However, the dictum of this Court that the registered owner continues to remain owner and when the vehicle is Insured in the name of the registered owner, the Insurer would remain liable notwithstanding any transfer, would apply equally in the case of claims made by the insured himself in case of an accident. If the insured continues to remain the owner in 12 First Appeal No.165 of 2022 law in view of the statutory provisions of the Motor Vehicles Act, 1988 and in particular Section 2(30) thereof, the Insurer cannot evade its liability in case of an accident."
17. However, learned counsel for the appellant-Insurance Company has neither shown any such provision nor any case law in support of his arguments or pointed out any such condition as mentioned in the terms and conditions of the policy that in case of non-transfer of the policy in the name of subsequent purchaser the terms and conditions of the policy would be lapsed.
18. The appellant has relied upon judgment of Hon'ble National Commission of case V.A. Sreekumar (Supra), wherein it has been held as under:-
"Once it is proved that the ownership of the vehicle had transferred from the insured to another person before the theft or accident of the vehicle, as the case may be, the transferee of the vehicle, having no insurable interest in the vehicle at the time of theft/accident, will not be entitled to any reimbursement from the insurer. He having already sold the ownership of the vehicle, if the insurer is made to pay to him, it will not be a reimbursement but will become a bounty for the person who has already sold the vehicle.
19. The appellant has further relied upon judgment of this Commission of case Arvinder Singh (Supra), wherein it has been held as under:-
13First Appeal No.165 of 2022
"We find that complainant has no insurable interest in the insured vehicle after sale to Gulshan Kumar, as evidence by documents Ex.OP-6 and Ex.OP-7 on the record."
20. It is also the argument of the appellant that complainant No.2 is not the consumer of the Insurance Company. The appellant has failed to bring to the notice of the District Commission as well as this Commission any provision that in case the complainant No.1 has no insurable interest then who will have the insurable interest whereas the insurance policy was in existence at the time of accident and the Insurance Company had received premium to indemnify the loss.
21. Now the issue for consideration before us is as to whether the ownership would be transferred automatically in case of sale of vehicle without change in the RC and Insurance Policy.
22. Admittedly the RC of the vehicle was not transferred in favour of respondent No.2/complainant No.2. Meaning thereby complainant No.1 was the owner of the vehicle. Only on the basis of agreement or execution of the affidavit between both the complainants, it cannot be said to be a case of transfer of ownership. The transferee is required to apply for transfer of insurance policy within 14 days for the transfer of the vehicle. The buyer of the insured vehicle is required to transfer the vehicle under Section 157 of the Motor Vehicle Act but in the present case it was not done. Admittedly, the insurer had not transferred the policy of insurance to the transferee. Admittedly, the vehicle was not transferred in favour of the 14 First Appeal No.165 of 2022 subsequent purchaser till lodging the claim with the appellant/Insurance Company. Thus, the compliance of Sections 147 and 157 of the Motor Vehicles Act, 1988 could not be done. The Insurance Company was not justified to repudiate the claim. The District Commission has rightly dismissed the complaint qua to complainant No.2 (Gurpreet Singh) and partly allowed in favour of complainant No.1 (Iccha Singh).
23. The Hon'ble Supreme Court of India in the case as referred above has held as under:-
"the registered owner continues to remain owner and when the vehicle is Insured in the name of the registered owner, the Insurer would remain liable notwithstanding any transfer, would apply equally in the case of claims made by the insured himself in case of an accident. If the insured continues to remain the owner in law in view of the statutory provisions of the Motor Vehicles Act, 1988 and in particular Section 2(30) thereof, the Insurer cannot evade its liability in case of an accident."
24. In the present case the Insurance Policy and the Registration Certificate were still in the name of complainant No.1 at the time of said accident and he, being the registered owner of the vehicle, filed the complaint before the District Commission alongwith subsequent purchaser i.e. complainant No.2 (Gurpreet Singh). Complainant No.2 (Gurpreet Singh) has not filed any appeal against the impugned order passed by the District Commission, whereby the complaint was dismissed qua to him and the claim was allowed qua 15 First Appeal No.165 of 2022 to complainant No.1 only. Meaning thereby the complainant No.2 (Gurpreet Singh) was not having any objection in paying the claim amount to complainant No.1 (Iccha Singh). As such the judgments relied upon by the appellant/Insurance Company are not applicable to the facts and circumstances of the case.
25. In view of above cited judgments of Hon'ble Supreme Court, complainant No.1 has righty been held entitled to the claim, being the registered owner of the vehicle as the Registration Certificate and Insurance Policy were still in his name at the time of accident and he had paid the premium of the said Insurance Policy to the appellant/OP for indemnification of loss and the appellant/Insurance Company cannot evade its liability in case of an accident.
26. It is also the argument of learned counsel for the appellant that the District Commission has overlooked the Surveyor's assessment and awarded an amount of Rs.52,800/- in arbitrary manner.
27. In the case in hand the vehicle's model was of 2009 and alleged accident took place on 02.10.2018 wherein the vehicle suffered partial loss. As such the age-wise depreciation would be applicable by considering the age of the vehicle as per GR-9. The complainants had prayed/claimed damages to the tune of Rs.52,800/- and they had relied upon the estimate of loss dated 19.10.2018 (Ex.C-11) issued by Agam Motors, Kapurthala. The appellant/OP has 16 First Appeal No.165 of 2022 relied upon the Final Survey Report (Ex.O-3) wherein the Surveyor has assessed the loss to the tune of Rs.23,700/- by considering the vehicle model, repairer standard, nature of loss, etc. and has also filed his affidavit in support of the report. This fact has not been rebutted by the complainants. The District Commission has totally ignored the Final Survey Report available on the record and has assessed loss to the tune of Rs.23,700/- only. Accordingly, the impugned order passed by the District Commission is required to be modified.
28. We are of the considered opinion that the appellant- Insurance Company is liable to pay claim an amount to the tune of Rs.23,700/-, as assessed by the Surveyor, to complainant No.1 (Iccha Singh) instead of Rs.52,800/-. In view of above detailed discussion, we partly allow the appeal and the appellant/Insurance Company is directed to pay the claim amount to the tune of Rs.23,700/- to complainant No.1 (Iccha Singh) on account of loss suffered by the insured vehicle. The remaining order passed by the District Commission qua amount of compensation of Rs.10,000/- on account of mental agony and harassment and Rs.5000/- as cost of litigation expenses is upheld. The impugned order passed by the District Commission stands modified to the extent as referred above.
29. Since the main case is decided, the pending applications, if any, are also disposed of.
17First Appeal No.165 of 2022
30. The appellant had deposited an amount of Rs.25,000/- at the time of filing of the appeal with this Commission and further deposited an amount of Rs.59,997/- in compliance with order dated 04.03.2022 passed by this Commission. Said amounts, alongwith interest which has accrued thereon, if any, shall be remitted by the Registry to the District Commission forthwith. Parties may approach the District Commission for the release of the same and the District Commission may pass appropriate order in this regard in accordance with law.
31. The appeal could not be decided within the stipulated period due to heavy pendency of Court cases and due to pandemic of Covid-19. The order could not be pronounced within stipulated/prescribed time frame due to non-sitting of the Bench w.e.f. 26.10.2022 to 28.10.2022.
(JUSTICE DAYA CHAUDHARY) PRESIDENT (URVASHI AGNIHOTRI) MEMBER November 01, 2022 (MM)