State Consumer Disputes Redressal Commission
Rajesh Kumar vs National Insurance Company Ltd on 1 February, 2011
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
S.C.O. NO. 3009-10, SECTOR 22-D, CHANDIGARH.
First Appeal No.972 of 2005
Date of institution : 27.7.2005
Date of decision : 01.2.2011
Rajesh Kumar son of Vijay Kumar, resident of Ladowali Road, Jalandhar.
.......Appellant
Versus
1. National Insurance Company Ltd., (Subsidiary of General Insurance
Corporation of India), Regd. Office 3, Middleton Street, Calcutta-700 001.
2. National Insurance Company Ltd., Unit No.3, B.M.C. Chowk, Jalandhar-
144 001.
3. M/s Jyoti Enterprises, G.T. Road, Miller Ganj, Ludhiana through Mr.
Sanjay Pruthi.
......Respondents
First Appeal against the order dated 10.1.2005 of
the District Consumer Disputes Redressal Forum,
Jalandhar.
Before :-
Hon'ble Mr. Justice S.N. Aggarwal President.
Mrs. Amarpreet Sharma, Member.
Mr. B.S. Sekhon, Member.
Present :-
For the appellant : None.
For the respondents : Shri Sandeep Suri, Advocate. JUSTICE S.N. AGGARWAL, PRESIDENT:
Sanjay Pruthi of M/s Jyoti Enterprises, G.T. Road, Miller Ganj, Ludhiana respondent No.3 was the owner of maruti car bearing registration certificate No.PB-10-U-2505. It was purchased by the appellant on 24.6.1998 from respondent No.3 for a sum of Rs.1,50,000/-. However the ownership was not yet transferred in the name of the appellant. The appellant got the said car insured from National Insurance Company Ltd., respondents No.1 and 2 but the insurance policy was issued in the name of respondent No.3. First Appeal No.972 of 2005. 2
2. It was further pleaded that this car was stolen near Brindaban Hostel on the night intervening 23.5.1999 and 24.5.1999 for which the appellant got registered a criminal case under Section 379 IPC on 24.5.1999 in Police Station Division No.6, Jalandhar. The information was also given to the insurance company respondent No.1. The car was not traced nor the insurance claim was paid by respondent No.1. Hence the complaint.
3. Respondents No.1 and 2 filed the written reply. It was pleaded that the maruti car bearing registration certificate No.PB-10-U-2505 was owned by M/s Jyoti Enterprises and it was insured with respondents No.1 and 2 for the period from 20.8.1998 to 19.8.1999. Neither the car was owned by the appellant nor the insurance policy was in the name of the appellant. Therefore the appellant had no insurable interest in the car. It was also pleaded that the alleged theft had taken place on the night intervening 23.5.1999 and 24.5.1999 but the complaint was filed by the appellant in the District Consumer Disputes Redressal Forum, Jalandhar (in short "District Forum") on 23.9.2003 i.e. much after the expiry of the limitation period. Moreover the appellant had failed to supply the documents demanded from him vide letter dated 3.3.2000 and the last date for furnishing the documents by the appellant to respondents was 24.3.2000 which he had failed. From this angle also the complaint was barred by limitation. Hence, it was prayed that the complaint be dismissed.
4. The appellant filed his affidavit as Ex.AW-1 and also proved documents Ex.AW-1 (doubly marked) to Ex.AW-8. The appellant also filed his subsequent affidavit as Ex.AW-1/2.
5. On the other hand, respondents No.1 & 2 filed the affidavit of S.K. Passi, Divisional Manager as Ex.O-1. They also produced documents Ex.O-2 to Ex.O-4.
6. Learned District Forum considered the pleadings of the parties and dismissed the complaint vide impugned order dated 10.1.2005.
7. Hence the appeal.
First Appeal No.972 of 2005. 3
8. The submission of the learned counsel for respondents No.1 and 2 was that there was no merit in the present appeal and the same be dismissed. Reliance was placed on the judgment of the Hon'ble Supreme Court reported as "M/s Complete Insulations (P) Ltd. v. New India Assurance Company" I(1996) CPJ 1 (SC), judgment of Hon'ble National Commission reported as "MADAN SINGH v. UNITED INDIA INSURANCE CO. LTD. & ANR." I(2009) CPJ 158 (NC) and lastly the judgment of the Hon'ble U.P. State Consumer Disputes Redressal Commission, Lucknow reported as "National Insurance Co. Ltd. and others v. Haji Bashir Ahmad" 2002(2) CLT 534.
9. Record has been perused. Submissions have been considered.
10. The alleged theft had taken place in the night intervening 23.5.1999 and 24.5.1999. The matter was reported to the police. This theft of car was made a part of FIR No.85 dated 20.5.1999 (Ex.AW-5). Intimation was also given to respondents No.1 and 2. Respondents No.1 & 2 had written letter dated 3.3.2000 (Ex.AW-7) to the insured-cum-owner of the said car i.e. M/s Jyoti Enterprises respondent No.3 for furnishing certain documents. It was specifically mentioned in this letter that if the aforesaid documents were not supplied by the owner/insured, the case would be closed as 'no claim' on 24.3.2000. No documents were supplied to the insurance company either by the appellant or respondent No.3 and the case was closed as no claim on 24.3.2000. The present complaint was filed by the appellant on 23.9.2003 i.e. about four years after the alleged theft had taken place and more than three and a half years after the documents were demanded from the owner/insured and the owner/insured failed to furnish those documents and the claim was closed as no claim.
11. As per the provisions of Section 24-A of the Consumer Protection Act, 1986, complaint could be filed by a consumer within a period of two years after the cause of action had arisen to him. It reads as under:- First Appeal No.972 of 2005. 4
"[24-A. Limitation period.--(1) The District Forum, the State Commission or the National Commission shall not admit a complaint unless it is filed within two years from the date on which the cause of action has arisen.
(2) Notwithstanding anything contained in sub-
section (1), a complaint may be entertained after the period specified in sub-section (1), if the complainant satisfied the District Forum, the State Commission or the National Commission, as the case may be, that he had sufficient cause for not filing the complaint within such period:
Provided that no such complaint shall be entertained unless the National Commission, the State Commission or the District Forum, as the case may be, records its reasons for condoning such delay.]"
12. Therefore the appellant had the right to file the complaint within a period of two years after the cause of action had arisen to him. In this case, the cause of action had arisen to the appellant either on the date of theft on 24.5.1999 or on 24.3.2000 when the case was closed by respondents No.1 and 2 as 'no claim'. The complaint has been filed beyond the expiry of the period of two years and the delay in filing the complaint has neither been explained nor any separate application has been filed by the appellant for condonation of delay. The plea of limitation was taken by respondents No.1 and 2 in the written reply.
13. The provisions of Section 24-A of the Consumer Protection Act, 1986 have been interpreted by the Hon'ble Supreme Court in the judgment reported as "State Bankof India v. B.S. Agricultural Industries (I)" 2009 CTJ 481 (Supreme Court) (CP) in which it was held as under:-
First Appeal No.972 of 2005. 5
"8. It would be seen from the aforesaid provision that it is peremptory in nature and requires consumer forum to see before it admits the complaint that it has been filed within two years from the date of accrual of cause of action. The consumer forum, however, for the reasons to be recorded in writing may condone the delay in filing the complaint if sufficient cause is shown. The expression, 'shall not admit a complaint' occurring in Section 24A is sort of a legislative command to the consumer forum to examine on its own whether the complaint has been filed within limitation period prescribed thereunder. As a matter of law, the consumer forum must deal with the complaint on merits only if the complaint has been filed within two years from the date of accrual of cause of action and if beyond the said period, the sufficient cause has been shown and delay condoned for the reasons recorded in writing. In other words, it is the duty of the consumer forum to take notice of Section 24A and give effect to it. If the complaint is barred by time and yet, the consumer forum decides the complaint on merits, the forum would be committing an illegality and, therefore, the aggrieved party would be entitled to have such order set aside."
14. This view of law was reiterated by the Hon'ble Supreme Court in its latest judgment reported as "V.N. Shrikhande (Dr.) v. Anita Sena Fernandes" 2011 CTJ 1 (SUPREME COURT) (CP). It was held by the Hon'ble Supreme Court as under:-
First Appeal No.972 of 2005. 6
"Section 24A(1) contains a negative legislative mandate against admission of a complaint which has been filed after 2 years from the date of accrual of cause of action. In other words, the consumer forums do not have the jurisdiction to entertain a complaint if the same is not filed within 2 years from the date on which the cause of action has arisen. This power is required to be exercised after giving opportunity of hearing to the complainant, who can seek condonation of delay under Section 24A(2) by showing that there was sufficient cause for not filing the complaint within the period prescribed under Section 24A(1). If the complaint is per se barred by time and the complainant does not seek condonation of delay under Section 24A(2), the consumer forums will have no option but to dismiss the same. Reference in this connection can usefully be made to the recent judgments in State Bank of India v. B.S. Agricultural Industries (I), 2009 CTJ 481 (SC)(CP)=(2009) 5 SCC 121 and Kandimalla Raghavaiah and Company v. National Insurance Company and another, 2009 CTJ 951 (SC)(CP)=(2009) 7 SCC 768."
15. Keeping in view the discussion held above, it is clearly proved that the complaint was barred by limitation and no reason has been shown by the appellant for condonation of delay.
16. Although this Commission need not discuss the merits of the case but the fact remains that the car was owned by Sanjay Pruthi of M/s Jyoti Enterprises for which the appellant himself proved a copy of the registration certificate as Ex.AW-2. Similarly the insurance policy was also in favour of M/s Jyoti First Appeal No.972 of 2005. 7 Enterprises for which the insurance policy has been proved as Ex.O-2. The appellant has also filed the affidavit of Sanjay Pruthi of M/s Jyoti Enterprises as Ex.AW-6 to show that the appellant had purchased the vehicle from him. Since the appellant was not the insured, therefore, he has no right to claim compensation.
17. The basic law on the subject was laid in the judgment of the Hon'ble Supreme Court reported as "COMPLETE INSULATIONS (P) LTD. v. NEW INDIA ASSURANCE COMPANY LTD." I(1996) CPJ 1 (SC) in which it was held that there was nothing like automatic transfer of insurance policy in vehicle damage cases. The facts of that case were as under:-
"A Maruti Car with registration No.CHK-8253 was purchased in the name of Mrs. Archana Wadhwa for which the respondent, M/s New India Assurance Company Ltd., had issued a comprehensive insurance policy. The premium for the insurance was paid by the appellant-Company in whose favour the car was transferred. The registration of the car was transferred to the appellant on 15.6.89. On 26.6.89 the appellant intimated the transfer of registration and asked for transfer of the insurance policy. A reminder was sent on 24.7.89. The respondent did not reply to the two letters. On 17.9.89 the car met with a serious accident in which the Managing Director of the appellant suffered serious injuries and his sister died. On 11.10.89 the appellant asked for the assessment of the damage as the car was a total loss. The respondent did not respond. A reminder dated 26.12.89 met the same fate. The appellant got a notice issued to which the respondent replied that the appellant had no insurable First Appeal No.972 of 2005. 8 interest in the car. The appellant filed the complaint before the Consumer Disputes Redressal Commission, Chandigarh, which directed the respondent to pay Rs.83,000/- i.e., the insured value of the vehicle, as the vehicle was a total loss, along with costs and interest. The National Consumer Disputes Redressal Commission set aside the order of the Commission at Chandigarh, dismissed the complaint and granted cost of the appeal. Hence the appeal."
18. The whole law was discussed by the Hon'ble Supreme Court in the aforesaid judgment and it was observed as under:-
"The next important provision which we may notice of is Section 156 which sets out the effect of the certificate of insurance. It says that when the insurer issues the certificate of insurance, then even if the policy of insurance has not as yet been issued, the insurer shall, as between himself and any other person except the insured, be deemed to have issued to the insured a policy of insurance conforming in all respects with the description and particulars stated in the certificate. It is obvious on a plain reading of this provision that the Legislature was anxious to protect third party interest. Then comes Section 157 which we have extracted earlier. This provision lays down that when the owner of the vehicle in relation whereto a certificate of insurance is issued transfers to another person the ownership of the motor vehicle, the certificate of insurance together with the policy described therein shall be deemed to have been First Appeal No.972 of 2005. 9 transferred in favour of the new owner of the vehicle with effect from the date of transfer to the insurer for making necessary changes in the certificate of insurance and the policy described therein in his favour. These are the relevant provisions of Chapter XI, which have a bearing on the question of insurer's liability in the present case."
19. On the facts of that case and after holding detailed discussion, it was concluded by the Hon'ble Supreme Court in Complete Insulations (P) Ltd. case (supra) as under:-
"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 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."
20. The Hon'ble National Commission has followed the judgment of the Hon'ble Supreme Court in Complete Insulations Pvt. Ltd.'s case (supra) in the judgment reported as "MADAN SINGH v. UNITED INDIA INSURANCE CO. LTD. & ANR." (2009) CPJ 158 (NC). It was held as under:-
"13. Section 157(2) provides that transferee shall apply within 14 days from the date of transfer in the First Appeal No.972 of 2005. 10 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 insurer shall make the necessary changes in the certificate and the policy of insurance in regard to transfer of insurance. The vehicle, in question, was transferred in the name of the petitioner on 10.6.1993, but he did not get the change effected in the insurance policy in terms of Section 157(2) of the Act. However, the petitioner took policy in the name of the previous owners w.e.f. 22.3.1994 till 21.3.1995. The said policy is on record in which, the number of the vehicle is shown as RJ- 23/T-0030 and it is shown as insured in the name of the previous owners. The petitioner obtained the benefit of no claim bonus to the extent of 45% for the said policy, which he would not be otherwise entitled. The petitioner had thus suppressed material fact of transfer in his name from the Insurance Company. The contention of the petitioner that the Development Officer was duly informed about the change of ownership that the policy should be issued in the name of the petitioner has been denied by the insurance policy in the affidavit. In the case of Hazi Bashir Ahmad (supra), the transferee/new owner had obtained a fresh policy in his favour but the registration formalities had not yet been completed. It was in this context that the observations, upon which the petitioner has placed reliance, had been First Appeal No.972 of 2005. 11 made. There being no agreement of transfer of the insurance policy between the insurer and the transferee, the claim filed by the petitioner cannot be entertained."
21. Hon'ble National Commission in its latest judgment reported as "Mahesh Chand Ghiya v. New India Assurance Co. Ltd." 2011 CTJ 22 (CP) (NCDRC) has also held that the transferee without getting the insurance policy transferred in his favour does not have any insurable interest against the insurance company.
22. Keeping in view the discussion held above, the present appeal is dismissed as the complaint was barred by limitation.
23. The arguments in this case were heard on 18.1.2011 and the order was reserved. Now, the order be communicated to the parties.
24. The appeal could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE S.N. AGGARWAL)
PRESIDENT
(MRS. AMARPREET SHARMA)
MEMBER
February 01 , 2011 (BALDEV SINGH SEKHON)
Bansal MEMBER