State Consumer Disputes Redressal Commission
The Branch Manager,National Insurance ... vs Thiru Amanullah,Tanjore District. on 12 August, 2022
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IN THE CIRCUIT BENCH OF THE TAMILNADU STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, MADURAI.
Present: THIRU.N. RAJASEKAR, PRESIDING JUDICIAL MEMBER
F.A.No.74/2016
(Against the order made in C.C.No.25/2015 dated 01.07.2016 on the file of
the District Commission, Thanjavur.)
FRIDAY, THE 12th DAY OF AUGUST 2022
The Branch Manager,
National Insurance Company Limited.,
25 - Whites Road,
Chennai-600 014. Appellant/2nd opposite party
Vs
1. Thiru. Amanullah,
S/o. Sulaiman,
No.3/114, Muslim Street,
Patteswaram,
Kumbakonam Taluk,
Thanjavur District. 1st Respondent/Complainant
2. Tmt. Thavamani,
W/o. Sankaran,
13 - Bungalow Street,
Manampunchavadi,
Thanjavur.
Now at;-
Arunthavapuram,
Papanasam Taluk,
Tanjavur District. 2nd Respondent/1st Opposite Party
Counsel for Appellant/2nd Opposite Party : Mr. K. Chandrasekaran, Advocate.
Counsel for 1st Respondent/Complainant : Mr. A. Rajamohammed, Advocate.
Counsel for 2nd Respondent/1st opposite party: Served & Called absent.
This appeal is coming before me for final hearing on 08.09.2021 and on
hearing the arguments of both sides and on perusing the material records, this
Commission made the following;
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ORDER
THIRU.N. RAJASEKAR, PRESIDING JUDICIAL MEMBER.
1. This appeal has been filed by the appellant/2nd opposite party under section 15 read with section 17(1) (a) (ii) of the Consumer Protection Act, 1986 against the order of the District Commission, Thanjavur made in C.C.No.25/2015, dated 01.07.2016, allowing the complaint.
2. For the sake of convenience and brevity, the parties are referred to here as they had ranked in the District Consumer Disputes Redresssal Commission, Thanjavur.
3. The factual matrix giving rise to the present appeal is as follows:-
The complainant is a bus operator and he is having his office at Kumbakonam Town. The 1st opposite party had filed a petition claiming compensation for alleged injuries sustained by her in motor accident caused to the complainant and the vehicle was insured with 2nd opposite party. In M.C.O.P.No.1167/2015, before the Motor Accident Claims Tribunal-Cum-District Court, Thanjavur, subsequently it was transferred to the First Additional District Judge - Fast Track Court, Thanjavur for trial. The passenger bus bearing registration No.49-T-8869- involved in the said motor accident was insured with the 2nd opposite party and it had valid until the period of accident. After the filing of MCOP case against the complainant, he approached the 2nd opposite party, insurance company at Chennai where he was informed by them that the Company would take care of the case on behalf of the complainant at Thanjavur after getting a vakalath from him to appear for the above said M.C.O.P. case. Hence, the complainant did not attend the case under the 3 bonafide impression that the 2nd opposite party would conduct the case properly. The 2nd opposite party being the 2nd respondent in the above MCOP case engaged its Panel Advocate and filed its counter. But, no mention was made about the "factum insurance" of the complainant's said vehicle in the said counter. The 2nd opposite party had not produced any insurance policy and not properly contested the case. Hence, the complainant alone was unfortunately suffered by an Award and as per the order of the First Additional District Judge-Fast Track Court Cum Motor Accidents Claims Tribunal, Thanjavur on 11.02.2010, the complainant was directed to pay Rs.37,500/- as compensation to the 1st opposite party with interest at the rate of 7.5% and costs of Rs.1702/-. The 1st opposite party had filed an Execution Petition in E.P.No.14/2011 and obtained an ex-parte order of attachment against him and a notice was served from the Court only thereafter the complainant came to understand that the order was passed against him. Thereafter, the complainant filed a petition to set aside the ex-parte order and also after depositing 50% of the award amount preferred a CMA No.825/2012 before the Hon'ble High Court of Madras, Bench at Madurai.
4. After enlightening the facts of the case, the Hon'ble High Court has found that the vehicle involved in the accident had valid insurance with the 2 nd opposite party on the date of accident and held that the 2nd opposite party alone was statutorily liable to pay the entire compensation amount with interest and allowed the complainant's appeal as per its order dated 25.03.2013.
5. The complainant as a consumer has reposed the good faith with the 2nd opposite party as his insurer but it had not diligently conducted the case as assured to him and it had rather suppressed the factum of insurance obtained by the 4 complainant and thereby the 2nd opposite party has not only committed willful negligence but also committed deficiency in service that it had undertaken at the time of issuing the insurance policy for the said vehicle. The 2nd opposite party has also caused mental agony to the complainant in view of the fact that the 2nd opposite party had registered the case that the vehicle was not covered with valid insurance policy without verification of its records. Hence, the complainant issued pre-suit notice to the opposite parties and after receiving it they have not sent any reply to the complainant. The 1st opposite party is a necessary and proper party but no claim is made against her. Therefore, the complainant has approached the District Commission for a direction to the 2nd opposite party to pay a sum of Rs.1,00,000/- as compensation for having committed deficiency in service and also to pay Rs.50,000/- towards compensation for causing mental agony to the complainant with costs of Rs.5000/-.
6. The first opposite party filed a written version by contending inter alia that the 1st opposite party travelled on 22.05.2005 in the passenger bus bearing registration No.TN-49-T-8869 which belongs to the complainant. The driver of the bus drove the vehicle in rash and negligent manner at about 7.00 a.m. and due to which the bus met with an accident and as a result of which the 1st opposite party was thrown out of the bus and sustained grievous injuries and proper award was passed by the Tribunal and on enquiry it was found that the 2nd opposite party failed to prove that the vehicle was insured with the 2nd opposite party and the Tribunal has a award against the complainant and subsequently the complainant filed a C.M.A. No.825/2012 before the Madurai Bench of Madras High Court in which the 2nd opposite party was directed to deposit the claim amount. The 1 st opposite party is 5 an unnecessary party to the complaint and hence the complaint is to be dismissed as against the 1st opposite party.
7. The 2nd opposite party filed a written version by contending inter alia that it is admitted that the complainant's vehicle was fully insured with the Chennai Branch of the 2nd opposite party insurance company on the date of accident and that the 1 st opposite party filed a M.C.O.P.No.1167/2005 before the Motor Accident Claim Tribunal, Thanjavur, claiming compensation against the complainant and the 2 nd opposite party for the injuries sustained by her. The complainant has not produced any documents to substantiate the allegation of that he had approached the Chennai Branch of the 2nd opposite party insurance company after receiving the notice pertaining to MCOP. He gave vakalath to the branch to contest the case on his behalf which happens to be very foundation of his grievance against the 2nd opposite party. After receiving the notice issued by the Court, it is the duty of the complainant to have appeared before the Court on the relevant dates. But, for some reasons known to him, the complainant chose to be set ex-parte and did not contest the case. The complainant's failure to appear before the Court and produce the policy copy led to the court passing an award against him. A perusal of the counter copy filed by the insurance company and the judgment will clearly reveal that the 2nd opposite party nowhere denied the factum of the complainant's vehicle was insured with him. Besides, the insurance company did no adduce any oral evidence denying the fact of insurance as is the practice in case where the vehicle is not insured with it on the date of accident. The judgment does not state that the fact of insurance was denied by the advocate representing the company. The complainant insured his vehicle with the Chennai Branch and the Thanjavur Office did not have a copy of the 6 policy and hence failed to produce such document before the Court. If only the complainant had approached the Thanjavur Branch of the 2nd opposite party or appeared before the court and produced the policy copy, the award would not have been passed against him. The Court has recorded the following 4 reasons for passing the award against the complainant.
a) That the complainant failed to contest the case
b) That the Insurance Company failed to obtain an order under section 170 of the Motors Vehicle Act.
c) That the policy copy was not made available before the Court
d) That the Advocate appearing for the Insurance Company failed to submit in his argument that the complainant's vehicle was duly insured with the 2nd opposite party.
The complainant was called absent and set ex-parte by the Court and that the 2nd opposite party did nothing to prevent the complainant from appearing before the court and presenting his case. The complainant has got only himself to blame for being set ex-parte in the case. If the complainant had appeared and produced his documents, the court would not have had any doubts regarding the factum of insurance. The advocate appearing for the company was engaged by the Thanjavur Branch and not by the Chennai Branch which issued the policy and hence the copy of the policy was not available with the Thanjavur Branch or with the said advocate. Confirmation of the policy particulars was made only through phone by the Chennai Branch. If a direction to produce the policy copy had been given, the Thanjavur Branch would have contacted the Chennai office and made arrangements to produce the same before the Court. Further, a copy of M.V.I. report relating to the complainant's vehicle was marked as a document by the 1st opposite party and the said document clearly stated the vehicle to be duly insured with the 2 nd opposite 7 party on the date of accident. The said M.V.I. Report is a public document issued by the competent authority and the 2nd opposite party never challenged the contents of the said document before the Court. It is not clear as to why the court failed to rely on the contents of the MVI report regarding the factum of insurance. The failure of the complainant to contest the case and a misrepresentation of both law and fact led the court to pass an award against the complainant, while dismissing the case in favour of the 2nd opposite party. The High Court, in para 5 of its judgment states that the Advocate appearing for the 2nd opposite party in appeal proceedings fairly conceded after verification that the vehicle was duly insured with the 2nd opposite party insurance company and the company was under a statutory obligation to indemnify the complainant. But, the complainant neither approached the Chennai Branch which issued the policy nor the Thanjavur Branch which contested the case. Instead, he chose to prefer an appeal before the Hon'ble High Court. The 2nd opposite party had no intention to deny the factum of insurance or cause mental agony to the complainant at any stage. There is no deficiency in service on the part of the 2nd opposite party. Therefore, the complaint may be dismissed as against the 2nd opposite party.
8. After taking into account of the evidences adduced by both parties, the District Commission held that the 2nd opposite party, insurance company failed to file a counter in MCOP case even if it was knowing well that the said vehicle was insured with them and also failed to mention the factum of insurance in the counter and also failed to contest the case on merits which acts of the 2nd opposite party amounts to violation of natural justice and also filed counter statement suppressing the facts of insurance even after collecting premium for the policy which amounts to deficiency 8 in service on their part which also caused mental agony to the complainant and directed the 2nd opposite party to pay a sum of Rs.1,00,000/- as compensation for deficiency in service committed by them and also to pay Rs.50,000/- as compensation for mental agony and Rs.5000/- as costs and dismissed the complainant as against the 1st opposite party.
9. Being aggrieved against that award, the 2nd opposite party challenged it by filing this appeal stating that the District Commission failed to see that the appellant never raised a plea or adduced any evidence before the Tribunal that the vehicle of the complainant had no insurance at the time of accident. The Lower Court failed to observe that the complainant had not chosen to appear before the MCOP Tribunal after notices were served upon him for his appearance. The lower court failed to see that the MCOP Tribunal has passed an erroneous order that the appellant was not at all disputing the factum of insurance. The lower court ought to have considered that the Hon'ble High Court appreciated the fairness of the appellant as and when the policy copy was produced during the pendency of the appeal. The complainant had failed to intimate about the accident immediately after the accident took place and also failed to appreciate the appellant by furnishing all the required documents including the policy as required by the terms and conditions of the policy.
10. No additional evidence was adduced by both parties in this appeal before this Commission.
11. The points for consideration are;-
(1) Whether the 2nd opposite party has committed deficiency in service in contesting the case filed by the 1st opposite party before the Motor Accident Claims Tribunal?
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2) Whether the order passed by the District Consumer Commission is sustainable under law or not?
12. Point No. 1:- The complainant is a bus-operator and he had insured his vehicle bearing number TN-49-T-8869 with the 2nd opposite party insurance company. The passenger of the bus sustained some grievous injuries when the vehicle met with an accident. The 1st opposite party filed a claim petition before the Motor Accidents Claims Tribunal, Thanjavur in which the complainant is the 1st respondent and not appeared before the Tribunal and hence he was set ex-parte. The 2nd opposite party was impleaded as 2nd respondent in the claim application. The Motor Accidents Claims Tribunal after considering the evidences produced by the claimant/1st respondent passed an award directing the complainant to pay compensation to the claimants. Aggrieved against that order the complainant filed an appeal in C.M.P. No.825/2012 before the Hon'ble High Court of Madras at Madurai Bench and after knowing the ex-parte order passed against him and also in the Execution Petition No.14/2011 filed by the 1st opposite party, by depositing 50% of the award amount and after enlightening the facts of the case, the Hon'ble High Court found that the vehicle involved in the accident had valid insurance with the 2nd opposite party and held the insurance company alone was statutorily liable to pay the entire compensation amount with interest. Afterwards, the complainant filed a consumer complaint before the District Commission against the claimant and the insurance company in the complaint, he impleaded the claimant as only a formal party. The 2nd opposite party insurance company alone is the contesting party/appellant herein.
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13. The complainant alleged in his complaint that he is a consumer and has reposed good faith with the 2nd opposite party as his insurer but it had not diligently conducted the case as assured to him and it had rather suppressed the factum of insurance obtained by the complainant. Thereby the 2nd opposite party has not only committed willful negligence but also deficiency in service though it had undertaken to the insured to pay compensation for the injured when the vehicle met with the accident, at the time of issuance of insurance policy for the said vehicle.
14. The counsel for the appellant would contend that the complainant never approached the insurance company as and when he had received the court notice and requested the insurance company to enter appearance on his behalf. In order to shift the burden and just to suit his complaint, the complainant levelled the allegations against the insurance company. The learned District Commission has held that after discussing the order passed by the Motors Accident Claims Tribunal the 2nd opposite party committed deficiency in service and failed to contest the Motor Accident Claim in a proper manner even after knowing that the vehicle was insured with them. Whereas the counsel for the appellant contended that mere denial of insurance cover and question of driving licence will not entitle the insurance company to get exonerated and when the insurance company did not raise any defence or adduce any evidence before the Tribunal it is suffice to held that the insurance company is liable to pay compensation and it is a subject to the appreciation of the Tribunal. By raising the above contention, the appellant submitted that the Motor Accident Claims Tribunal can pass an order dismissing the claim application as against the insurance company. The insurance company is a beneficiary under the order passed by the Motor Accident Claims Tribunal. We have 11 to consider that how they can get beneficial order infavour of them after diligently contesting the claim application filed by the insured against the insurer. By insuring the vehicle the 2nd opposite party promised to save the complainant from loss caused to him by issuing insurance policy after collecting necessary premium for the policy. The contract of indemnity is a special kind of contract, section 170 sub- clause (b) of the Motor Vehicles Act reads as follows;
"A person against whom the claim is made has failed to adduce the claim it may for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim shall be impleaded as a party to the proceedings and the insurer so impleaded shall thereupon have, without prejudice to the provisions contained in sub- clause 2 of Section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made. Section 170 of Motor Vehicles Act, 1988 clearly shows that the Insurance Company when impleaded as a party by the Court can be permitted to contest the proceedings on merits only if the conditions precedents mentioned in section are found to be satisfied and for that purpose the Insurance Company has to obtain order in writing from the Tribunal and which should be a reasoned order by the Tribunal. Unless that procedure is followed, the Insurance Company cannot have a wider defence on merits than what is available to it by way of statutory defence"
15. The appellant raised a contention that the complainant had not informed the accident immediately to them. The policy for the vehicle was issued by their 12 Chennai Office whereas the claim petition was filed before the Motor Accidents Claims Tribunal at Thanjavur. When the complainant failed to give information about the accident and to provide relevant documents, the 2nd opposite party was unable to contest the claim on merits. The complainant has not filed any proof to show that he had approached the Chennai Office and furnished the insurance particulars and Motor Accident Claims petition. At the same time, the 2nd opposite party represented through an advocate before the Motor Accident Claims Tribunal at Thanjavur but he has not filed any application under section 170 of Motor Vehicles Act for contesting the claim application on merits. Even though no information was furnished by the complainant with regard to the policy particulars and other information of the accident, the 2nd opposite party appeared through advocate before the Accidents Claims Tribunal and they are very well known the documents marked by the claimant, among the documents the claimant marked, the Motor Vehicles Inspector Report which contains the information of the vehicle involved in the accident was insured with the appellant. The above report of Motor Vehicles Inspector was marked as Ex B2 in the claim application. When the complainant failed to contest the claim the Insurance Company ought to have filed an application under section 170 of the Motor Vehicles Act before the Tribunal for the purpose of contesting the claim on merits.
16. The counsel for the appellant raised their contention in their written version and written argument, the Motor Accident Claims Tribunal passed an award on the ground that the insurance company failed to obtain an order under section 170 of the Motor Vehicles Act. Even though the appellant raised a contention that the Motor Vehicles Inspector Report is a public document issued by the competent 13 authority and they have not enough challenged the contents of the said document before the Tribunal blamed the Tribunal for having passed the award and made the complainant liable to pay compensation. However, their allegation is deniable one they have not marked it in the counter statement or in the written argument filed by them before the Motor Accident Claims Tribunal. When they have admitted the counsel appeared for them failed to get an order from the Tribunal under section 170 of Motor Vehicles Act to contest the claim on merit. They allowed the enquiry before the Motor Accident Claims Tribunal after knowing the insured, the complainant remained ex-parte. They have simply allowed the Tribunal to pass order and now they are blaming the Tribunal by suppressing their responsibility to contest the claim on merits in the absence of policy holder. Interestingly, they have raised a plea in C.M.P. No.825/2012 filed by the complainant before the Hon'ble High Court of Madras at Madurai Bench that the vehicle was not covered by the valid insurance policy. Now, they have raised the contention that they have never denied the insurance before the Tribunal. But, the Tribunal in its order has observed that the complainant failed to prove the existence of insurance cover and therefore the complainant was held liable to pay compensation.
17. The appellant also raised the contention that merely denial of insurance cover and questioning the validity of driving licence will not entitle the insurance company to get exoneration and raising such contention would amount to deficiency in service on their part. The appellant/insurance company only after verifying the policy documents produced by the complainant before the Madurai Bench of the Hon'ble High Court of Madras, they have fairly conceded that there was a valid insurance policy for the said vehicle covering the period of accident. The failure on their part 14 of the Insurance Company who is indemnifier after collecting the premium amount by issuing the insurance policy had failed to contest the claim application filed by the 1st respondent herein on merit and thereby simply allowed to pass an awarding and now they are blaming the complainant, Motor Accidents Claims Tribunal and the District Consumer Commission. The Insurance Act is also a beneficiary legislation and also the Insurance Company shall suitably be liable to compensate the loss caused to the third party in road accident. The Insurance Company is having liability as well as a duty of conscious to the insured it means they are expected to be vigilant to contest the claim application filed by the third party against the insured. When they have failed to discharge their duty it amounts to deficiency in service under section 2(1) (g) of the Consumer Protection Act, 1986 which defines "the deficiency means failed imperfection or shortcoming, inadequacy in quality in nature and manner of performance which is required to be maintained by or under any law for the time being in force has been under section before performing by a person in consonance with the contract or otherwise any relation to any service". The 2nd opposite party is a service provider by issuing the insurance policy to the complainant and as such they are duty bound to contest the claim filed before the Motor Accident Claims Tribunal under the Motor Vehicles Act filed by a third party against the complainant.
18. From the above discussion, I find that the performance of the 2nd opposite party amounts to fault and imperfection in the quality, nature and manner of performance which is required to be maintained by or under law. The Motor Accident claim application was filed against this appellant which is having their office at Chennai. The application was not filed against their Thanjavur Office. Arrangement 15 of appointing an advocate representing on their side was made only through an administrative grounds. They have entered into appearance only after receiving notice from the Claims Tribunal. After knowing the absence of complainant, the insured, they are duty bound to file an application under section 170 of Motor Vehicles Act but they have failed to do so even after knowing the marking of Motor Vehicles Inspector's report on the side of the claimant which act of the appellant/insurance company amounts to imperfection and fault on their side in contesting the claim application on merits. Therefore, in my view, the complainant has proved his allegation set out against the 2nd opposite party in his complaint by marking the documents Exhibits A1 to A10 whereas, the 2nd opposite party has miserably failed to disprove the allegations by producing any evidence on their side. Thus, the 2nd opposite party has committed deficiency in service in contesting the case filed by the 1st opposite party before the Motor Accident Claims Tribunal and the point No.1 is answered accordingly.
19. Point No.2:- The District Commission after considering the evidences adduced by the complainant passed the impugned order directing the 2nd opposite party, appellant herein to pay a sum of Rs.1,00,000/- as compensation for deficiency in service and Rs.50,000/- for mental agony and Rs.5000/- towards costs. It was held in the judgment of the Hon'ble Supreme Court of India reported in 1994 AIR (Supreme Court) page 787 in the case of Lucknow Development Authority -Vs - M.K. Gupta it was held that "when the Commission has been vested with the jurisdiction to award the value of the goods or service and compensation it has to be construed widely enabling the Commission to determine the compensation for any loss or damages suffered by a consumer which any law 16 under otherwise included in wide meaning of compensation. The provision in my opinion enables the consumer to claim and monitor the Commission to redress injustice done to him in every action would definitely the very purpose of the Act. The State Commission or the District Commission can act as thus entitled to award not only value of the goods or service but also to compensate the consumer for the injustice suffered by him".
20. The failure and imperfection in performing the duty cast upon the insurance company enabling the complainant to get appropriate compensation for the sufferings undergone by him amounts to deficiency in service on the part of the 2 nd opposite party/insurance company and the fixation of Rs.1,00,000/- as compensation for deficiency in service and Rs.50,000/- for mental agony by the District Commission is justifiable and as such it does not require any interference by this Commission and the point No.2 is answered accordingly.
21. In the result, the appeal is dismissed by confirming the order of the District Commission, Thanjavur made in C.C.No.25/2015, dated 01.07.2016. There shall be no order as to costs in this appeal.
Sd/-xxxxxxxxxxx N. RAJASEKAR, PRESIDING JUDICIAL MEMBER.
Index: Yes/No TCM/SCDRC/Madurai Bench /Orders/Aug/2022