National Consumer Disputes Redressal
The Manager Icici Lombard General ... vs Shri Gafur Alamgeer Sayyad on 14 March, 2014
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 949 OF 2011 (Against the order dated 18.08.2010 in Appeal No.2455/2009 of the State Commission, Karnataka) 1. The Manager ICICI Lombard General Insurance Co. Ltd. 4th Floor, Shri Krishna Tower Khanapur Road, Tilakwadi Belgaum 2. The Regional Manager ICICI Lombard General Insurance Co. Ltd. 61/1, II Floor, Prestige Corniche Richmond Road Bangalore- 560 025 3. The Manager Legal Department ICICI Lombard General Insurance Co. Ltd. Regd. Off: ICICI Bank Towers Bandra Kurla Complex Mumbai-51 Now represented by Its Manager Legal ICICI Lombard General Insurance Co. Ltd. # 89, II Floor, S.V.R. Complex Hosur Main Road, Madivala Bangalore- 560 068 Through its Manager (Legal) ICICI Lombard General Insurance Co. Limited 3rd Floor, Narain Manzil 23, Barakhamba Road New Delhi- 110001 ..Petitioners Versus Shri Gafur Alamgeer Sayyad R/o CTS No.4822/70 Bansur Building, II Main, I Cross, Sadashiv Nagar Belgaum Karnataka ..Respondent BEFORE HONBLE MRS. VINEETA RAI, PRESIDING MEMBER HONBLE MR. VINAY KUMAR, MEMBER For the Petitioner : Mr. A.N. Krishna Swamy, Advocate For the Respondent: Mr. Prashant F. Goudar, Advocate PRONOUNCED ON: 14/3/2014 ORDER
PER MR. VINAY KUMAR, MEMBER Complainant Gafur Alamgeer Sayyad had insured his car with OPs/ICICI Lombard General Insurance Co. Ltd. During the period of insurance the car met with an accident.
The surveyor appointed by the insurance company made a detailed assessment and submitted his report.
However, the claim was repudiated on the ground that while it was insured for private use, the vehicle was used on hire basis at the time of the accident, which was in violation of the terms and conditions of the policy.
2. The District Forum considered the evidence in detail. It took note of the fact that the driver of the vehicle had made a deposition before Workman Compensation Commissioner Belgaum, which showed that the vehicle was being used for commercial purpose on the date of the accident. However, it held that even if it was a violation of terms and conditions, it did not constitute a fundamental breach of the policy conditions. Therefore, the claim could not have been repudiated in totality. The District Forum accordingly, held that the OPs should have settled the claim on non-standard basis. Therefore, it held the OPs responsible to pay Rs.4.5 lakhs to the complainant with 6 % interest, from the date of the repudiation. The vehicle was insured for Rs.6.72 lakhs.
3. The decision of the District Forum was challenged by both sides before the State Commission. In a common order, the State Commission has agreed with the District Forum and held that Even if there is a violation in terms & conditions of the Policy, the OPs are not justified in repudiating the entire claim of the complainant. In similar cases, this Commission has taken the view that if there is a violation in terms of the Policy, the OPs are liable to settle the claim on non-standard basis.
4. ICICI Lombard General Insurance Co. has filed this revision petition challenging the concurrent view taken by the fora below that it was a case for settlement on non-standard basis and not for outright repudiation of the claim in its entirety. The sole ground of challenge is that the liabilities of the insurance company cannot go beyond the terms and conditions of the insurance policy which is binding on the parties to the insurance contract.
5. The revision petition has been considered by the Circuit Bench of this Commission at Bangalore. Advocates Mr. A. N. Krishnaswamy for the Insurance Company and Mr. Prashant F. Goudar for the respondent/complainant have been heard. We have also carefully perused the records as submitted before us. The petition has been filed with delay of 123 days. A perusal of application seeking condonation of this delay shows that the copy of the impugned order was received on 7.10.2010. Thereafter, for the next four months the matter just kept moving from one office to another within the insurance company. Finally, papers were sent to their counsel on 2.2.2011 with decision to file the revision petition before this Commission. The explanation for such inordinate consumption of time is far from satisfactory. The revision petition is therefore liable to be dismissed on the ground of limitation alone.
6. Coming to merits, the pleadings of the OP/Insurance Co. before the District Forum show that the repudiation of the claim was on the solitary ground of the vehicle being used for commercial purpose i.e. for hire. Learned counsel for the revision petitioner emphasised that use of the vehicle for commercial purpose had been clearly established before the fora below. There is no dispute that the vehicle was insured for private use only.
For commercial use, the insured would have an obligation to pay premium at a higher rate. He therefore argued that there cannot be any justification for settlement at 75% of the assessed loss.
7. On the other hand, learned counsel for respondent/complainant has placed direct reliance on the decision of Honble Supreme Court in National Insurance Company Vs. Nitin Khandelwal, IV (2008) CPJ 1 (SC). This too was a case where the vehicle was found to be used for commercial purpose, in violation of the terms and conditions of the policy. The District Forum dismissed the complaint but the State Commission as well as the National Commission took a view that reimbursement on non-standard basis would be just and fair, in the facts and circumstances of the case. Hble Supreme Court of India has agreed with the National Commission, observing that
12. In the case in hand, the vehicle has been snatched or stolen. In the case of theft of vehicle, breach of condition is not germane. The appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy for the loss caused to the insurer. The respondent submitted that even assuming that there was a breach of condition of the insurance policy, the appellant Insurance Company ought to have settled the claim on non-standard basis. The Insurance Company cannot repudiate the claim in toto in case of loss of vehicle due to theft.
13. In the instant case, the State Commission allowed the claim only on non-standard basis, which has been upheld by the National Commission. On consideration of the totality of the facts and circumstance in the case, the law seems to be well settled that in case of theft of vehicle, nature of use of the vehicle cannot be looked into and the Insurance Company cannot repudiate the claim on that basis.
14. In the facts and circumstances of the case, the real question is whether, according to the contract between the respondent and the appellant, the respondent is required to be indemnified by the appellant. On the basis of the settled legal position, the view taken by the State Commission cannot be faulted and the National Commission has correctly upheld the said order of the State Commission.
8. The view taken in the decision above has been confirmed by the Supreme Court of India in Amalendu Sahoo Vs. Oriental Insurance Company Ltd., II (2010) CPJ (SC). In this case, too the claim for accident under the policy was repudiated by the insurer on the ground that vehicle was given on hire in violation of the terms of policy. The District Forum and the State Commission upheld repudiation on the ground of violation of the specific condition in the policy.
9. The National Commission refused to interfere with the concurrent findings of the fora below. However, the Apex Court held that repudiation of the claim in this case was not sustainable. The court confirmed the view taken in the Nitin Khandelwal case and allowed the complaint holding that-
15. The State Commission has allowed only 75% claim of the respondent on non-standard basis. We are not deciding whether the State Commission was justified in allowing the claim of the respondent on non-standard basis because the respondent has not filed any appeal against the said order. The said order of the State Commission was upheld by the National Commission.
16. In our considered view, no interference is called for.
This appeal is accordingly disposed of.
In the facts and circumstances of the case, the parties are directed to bear their own costs.
10. It needs to be pointed out that in the matter before us, it was not the case of the OP/Insurance Company that there was any vital nexus between the accident of the vehicle and the deviation of purpose in its use. The evidence of the driver before the District Forum shows that the car had collided with a tractor trolley while travelling on Pune- Bangalore National Highway. The tractor trolley was loaded with sugarcane and the accident had allegedly occurred due to the fault of the tractor trolley. As per the car driver, the car was being driven at 50-60 km per hour, at that time. Thus, while the use of the vehicle was irregular, it did not constitute any fundamental breach due to which the owner of the vehicle should be denied indemnification by the insurer. We therefore, find ourselves in full agreement with the view taken by the fora below.
11. In view of the details examined above, revision petition No.949 of 2011 is dismissed both on grounds of limitation and merit.
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(VINEETA RAI) PRESIDING MEMBER ....
(VINAY KUMAR) MEMBER S./-