State Consumer Disputes Redressal Commission
M/S Aviaxpert Pvt. Ltd. vs Bajaj Allianz Gen. Insurance Co. & Ors. on 8 August, 2023
CC. NO.371/2013 D.O.D.: 08.08.2023
M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
IN THE DELHI STATE CONSUMER DISPUTES
REDRESSAL COMMISSION
Date of Institution: 20.06.2013
Date of hearing: 21.04.2023
Date of Decision: 08.08.2023
COMPLAINT CASE NO.- 371/2013
IN THE MATTER OF
M/S AVIAXPERT PVT. LTD.,
E-178, EAST OF KAILASH,
NEW DELHI-110065.
(Through: Jeevesh Nagrath, Advocate)
...Complainant
VERSUS
1. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD.,
HAVING ITS REGISTERED OFFICE AT:
GE PLAZA, AIRPORT ROAD, YERWADA, PUNE-411006.
ALSO AT:
1 DLF INDUSTRIAL PLOT,
2ND FLOOR, MOTI NAGAR (NEAR METRO STATION)
NEW DELHI-110015.
AND ALSO AT:
201-201A, 2ND FLOOR, ITL TWIN TOWER,
NETAJI SUBHASH PLACE, PITAMPURA-NEW DELHI-
110088.
(Through: Navneet Kumar, Advocate)
...Opposite Party No.1
2. T&T MOTORS LIMITED,
212,OKHLA INDUSTRIAL ESTATE,
PHASE-III, NEW DELHI-110020.
(Through: Chandan Malik, Advocate)
...Opposite Party No.2
3. MERCEDEZ-BENZ INDIA PVT. LTD.,
E-3, MIDC, CHAKAN PHASE-III,
CHAKAN INDUSTRIAL AREA, KURULI &
NIGHOJE, TALUKA KHED, PUNE-410501.
(Through: Anurag Sharma, Advocate)
...Opposite Party No.3
CC. NO.371/2013 D.O.D.: 08.08.2023
M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
HON'BLE MR. J.P. AGRAWAL, MEMBER (GENERAL)
Present: Mr. B.L. Sanjit, Proxy Counsel for Complainant
Mr. Navneet Kumar, Advocate alongwith Mr. Saurabh,
Counsel for the Opposite Party No.1.
Mr. Vipul Vishwakarma, Proxy Counsel for the
Opposite Party No.2.
Mr. Anurag Sharma, Counsel for the Opposite Party
No.3.
PER: HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
JUDGEMENT
1. The present Complaint has been filed before this Commission by the Complainant alleging deficiency in service and Unfair Trade Practice on the part of Opposite Party and has prayed for the following reliefs:
a) "Cost of Repairs payable by Opposite Party No.1 Rs.
7,55,193.00 alongwith interest from 07.10.2011 and 07.12.2011, respectively and pendent lite interest thereto
b) Compensation payable by Opposite Party No.1 for agony and harassment suffered due to illegal repudiation of Insurance claim by the Opposite Party No.1 Rs.5,00,000.00
c) Compensation payable by Opposite Party No. 3 for deficiency in the Rs. 10,00,000.00 quality of vehicle manufactured by Opposite Party No. 3 and also for harassment and agony suffered due to false tall claims of Opposite Party No.3 about the vehicles and their parts manufactured by them, of true craftsmanship, standard to quality, state of art machinery and parts of the said vehicles as manufactured by Opposite Party No. 3.
Rs.10,00,000.00
CC. NO.371/2013 D.O.D.: 08.08.2023
M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
d) Compensation payable by Opposite Party Nos. 2 & 3 jointly and severally for loss caused due to false assurances of best quality services. Rs. 5,00,000.00
e) Compensation payable by Opposite Party No. 2 & 3 jointly and severally for harassment and agony suffered due to false assurances of best quality services. Rs. 10,00,000.00
f) Costs of the instant proceedings;
g) Any other and/or further relief which this Hon'ble State Commission may deem fit and proper under facts and circumstances of the present complaint."
2. Brief facts necessary for the adjudication of the present complaint are that the Complainant purchased a second hand Mercedez-Benz Car, model S320 CDI bearing registration no. DL2CQ3268 manufactured and sold by the Opposite Party No.3 from one M/S Automark, for a total sum of Rs. 46,88,118/- as against the showroom price of a similar car of Rs. 95 Lacs. The Complainant took a test drive of the car, got it inspected by the Opposite Party No.2 and thereby the said Opposite Party assured the Complainant that the car is in good condition, about its true craftsmenship, standard of quality, state of art machinery, and parts of the Car as manufactured by the Opposite Party no.3. Thereafter, the Complainant obtained a motor insurance policy on 13.05.2011 from the Opposite Party No.1 for the said car for a period from 13.05.2011 to 12.05.2012. On 16.09.2011, the said car got stuck in the heavy rainfall thereafter, the area got flooded with water and due to flooding, the engine of the car suddenly stopped. The Complainant immediately informed the Opposite Party No.2 and with the help of other people the said car was pushed to the side of the road. Further, the advisor from the Opposite Party No.2, reached the place where the car was stuck and towed it to the workshop of the Opposite Party No.2.
3. The driver of the Complainant then enquired about the car in the said workshop and there met Surveyor Mr. Dheeraj Sood, CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
appointed by the Opposite Party No.1 and filled up the motor insurance claim form on behalf of the Complainant.
4. On 20.09.2011, the Complainant received an email from the aforesaid Surveyor of the Opposite Party No.1 asking for the Complainant‟s consent for opening and refitting of the engine for cleaning and flushing out the water. On inspection of the car by the Opposite Party No.2, it was found „water inside the air filter housing‟, „air filter in wet condition‟, water has entered inside passenger cabin‟ and „engine not moving manually‟ moreover, they also suspected that water has entered in the combustion chamber and has damaged the engine which they informed the Complainant vide email dated 21.09.2011. The Complainant was provided with the preliminary estimate for the repairs of the said car that was of Rs. 8,37,575 vide email dated 27.09.2011 of the Opposite Party No.2. The Complainant then requested the Opposite Party No.1&3 to bear the expenses of repairs. However, the Opposite Party No.1 stated that due to the contact of water in the engine, it is not covered in the insurance policy and falls in the light of condition no.4 of the policy.
5. The Complainant then paid a sum of Rs. 3,50,000/- to the Opposite Party No.2 to carry out the repairs . The Opposite Party No.1 vide their letter dated 02.11.2011 said that their liability is reduced to the tune of Rs. 1,24,870 in light of the condition no.4 of the policy. The Complainant accepted the said amount as full and final settlement under protest on 03.12.2011.
6. The Complainant took the delivery of the car on 08.02.2011 after paying a balance sum of Rs. 4,05,193/-. The Complainant paid a total sum of Rs. 7,55,193/- to the Opposite Party No.2 till 07.12.2011 excluding Rs. 1,24,870/- as paid by the Opposite Party No.1. The Complainant thereby, submits that the Opposite Party No.1 wrongly refused to discharge its liability of payment of the amount due for repairs carried out in the car, which is duly insured CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
with the Opposite Party No.1 under the guise of the condition no.4 of the insurance policy. Moreover, the Complainant further submitted that the Opposite Party No.2&3 are liable for deficiency in service on part of them due to false and tall claims about the vehicle and its parts manufactured by them.
7. Aggrieved by this, Complainant sent various emails and letters to the Opposite Parties to pay for the damages suffered by the Complainant but of no avail.
8. The Opposite Party No.1, 2&3 have separately filed their written statement. The Opposite Party No.1 in its written statement contended that there is no cause of action against the Opposite Party No.1 as the liability assessed by the Surveyor was to the tune of Rs. 1,26,793/- and the Opposite Party No.1 has paid Rs. 1,24,870/- by the Opposite Party No.1 towards full and final settlement of the claim and the Complainant has signed the Discharge cum Satisfaction Voucher. Moreover, the liability of the insurer is restricted to the assessment done by the Surveyor. Pressing the aforesaid contention, the counsel appearing on behalf of the Opposite Party No.1 prayed that the present complaint should be dismissed.
9. The Opposite Party No.2 in its written statement contended that there is no consumer dispute made out from the Opposite Party No.2 as per the pleadings put forth by the Complainant, since the grievance for which the Redressal is sought for by the Complainant is arising out of the insurance claim of the Complainant by the Opposite Party No.1. Moreover, there is no privity of contract between the Opposite Party No.2 and the Complainant. Lastly, the Opposite Party No.2 contended that the Complainant is not a „consumer‟ as the car in question is used for commercial purpose. Pressing the aforesaid contention, the counsel appearing on behalf of the Opposite Party No.2 prayed that the present complaint should be dismissed.
CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
10. The Opposite Party No.3 in its written statement contended that the Complainant is not a „consumer‟ as the car in question is used for commercial purpose. The Opposite Party No.3 further contended that the liability of the manufacturer is limited to the warranty obligations alone and thus the warranty period was expired on 10.04.2010. Pressing the aforesaid contention, the counsel appearing on behalf of the Opposite Party No.3 prayed that the present complaint should be dismissed.
11. The Complainant has filed its Rejoinder rebutting the written statement filed by the Opposite Parties. Thereafter, all the contesting parties have filed their Evidence by way of Affidavit in order to prove their averments on record.
12. We have perused the material available on record and heard the counsel for all the contesting parties.
13. The first question for consideration before us is whether the Complainant - a Private Limited Company falls within the definition of consumer as defined under Section 2(1)(d) of the Act .To resolve this issue, we deem it appropriate to refer to Section 2 (1) (d) of Consumer Protection Act, 1986:
"Section 2(1)(d) Consumer" means any person who-
i. buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
ii. hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who [hires or avails of] the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person [but does not include a person who avails of such services for any commercial purpose] Explanation - For the purpose of this clause, "commercial purpose" does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment;
14. We also deem it appropriate to refer to Section 2(1)(m) of the Consumer Protection Act, 1986:
"person" includes:
(i) a firm whether registered or not
(ii) a Hindu undivided family
iii) a co-operative society;
(iv)every other association of persons whether registered under the societies Registration Act, 1860 (21 of 1860) or not.
15. In this regard we deem it appropriate to refer to the decision of the Hon‟ble Supreme Court in Karnataka Power Transmission Coproration & Ors vs Ashok Iron Works Pvt Ltd 2009 (3) SCC CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
240 wherein the issue before the Supreme Court pertained to whether a private company purchasing electricity for commercial purpose can be included within the ambit of term „consumer‟ under the Consumer Protection Act. The Apex Court while delivering the judgment in favour of Ashok Iron Works Limited held that company is a consumer within the definition of Section 2(1)(d)(i) of Consumer Protection Act 1986 as under -
"Section 2(1)(m) which enumerates four categories namely, (i) a firm whether registered or not; (ii) a Hindu undivided family; (iii) a co-operative society; and (iv) every other association of persons whether registered under the Societies Registration Act, 1860 (21 of 1860) or not while defining `person' cannot be held to be restrictive and confined to these four categories as it is not said in terms that `person' shall mean one or other of the things which are enumerated, but that it shall `include' them.
18. Section 2(1)(m), is beyond all questions, an interpretation clause, and must have been intended by the Legislature to be taken into account in construing the expression `person' as it occurs in Section 2(1)(d). While defining `person' in Section 2(1)(m), the Legislature never intended to exclude a juristic person like company. As a matter of fact, the four categories by way of enumeration mentioned therein is indicative, categories
(i), (ii) & (iv) being unincorporate and category (iii) corporate, of its intention to include body corporate as well as body un-
incorporate. The definition of `person' in Section 2(1)(m) is inclusive and not exhaustive. It does not appear to us to admit of CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
any doubt that company is a person within the meaning of Section 2(1)(d) read with Section 2(1)(m) and we hold accordingly"
16. Therefore, the Hon‟be Apex Court has not left any room for confusion by widening the definition of "consumer" and has included within its ambit corporate bodies. Thus, we are of the view that it is an established position of law that a company can be a consumer and we answer this point accordingly in favour of the Complainant.
17. Further, it is also appropriate to refer to "View Tech Imaging Equipment Private Limited Vs. CMC Limited" reported in 2008 (2) CPJ 240 (NC), wherein the Honble National Commission held that equipment/car even if purchased for commercial purpose, buyer would be a Consumer if defects noticed during warranty are not rectified, the buyer would continue to be Consumer and shall be entitled to relief for deficiency of service. In Super Computer Centre Vs. Globiz Investment Private Limited reported in 2006 (3) CPJ 256 (NC) and In Amtrex Ambience Limited Vs. M/s. Alpha Radios reported in (1996) CPJ 324 (NC), wherein the Honble National Commission held as follows :
"the purchaser of machinery will certainly be a Consumer in respect of defect in machinery during the period of warranty. Since defect in machine in question was brought to the notice of petitioner within three months period of purchase the respondent will be a Consumer even though the machine was purchased for commercial purpose."
18. Following the above decisions, we are of the opinion that as the defect was noticed during the warranty and not rectified, the buyer CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
would continue to be consumer and entitled for relief, even though the product in question was purchased for commercial purpose. In the present case, the Opposite Parties have not filed any evidence to show whether the car was being used for commercial activity or for the purposes of the company for meeting its daily requirements. As there is no any such evidence on record, inference can be drawn that the car was being used for dealing in Complainant‟s day to day affairs only. The Opposite Parties have merely made a statement that the Complainant purchased the said car for commercial gains and on perusal of the record before us; we fail to find any material which shows that the Complainant has purchased the said car for commercial purpose. Therefore, it is clear that the Complainant had bought the said car for the purposes of catering to the day to day affairs of the company. Mere allegation, that the purchase of the car is for commercial purpose, cannot be the ground to reject the present consumer complaint.
19. The second question for consideration before us is whether there was any manufacturing defect in the car in question.
20. On perusal of record, we find that the said vehicle was purchased by the original owner on 11.04.2008 alongwith warranty period of two years. Further, it is clear that the Complainant purchased a second hand vehicle and the said incident occurred on 16.09.2011. It is pertinent to mention here that the warranty period of the said vehicle expired on 10.04.2010.
21. The Complainant alleged that the engine was malfunctioning completely due to the manufacturing defect in the car. Therefore, the question before us is whether the said car suffered from any manufacturing defect at the time of purchase.
22. To resolve this issue, we deem it appropriate to refer to "Classic Automobiles Vs. Lila Nand Mishra" as reported in I [2010] CPJ CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
235 (NC), wherein, the Hon'ble National Commission while dealing with the similar case has hold as under:
"The onus to prove that there was manufacturing defect was on complainant/respondent No.1. We agree with the contentions raised by the learned counsel for the petitioner that complainant/respondent No. 1 failed to prove that there was any manufacturing defect by producing any cogent evidence. Complainant failed to produce expert evidence as provided under Section 13(1)(c) of the Consumer Protection Act, 1986."
23. Further, under catena of judgments namely "EID Parry Vs. Baby Benjamin-I [1992] CPJ 279, Tata Motors Vs. Sunil Bhasin - III [2008] CPJ 111, Chandreshwar Vs. Telco- I [2007] CPJ 2, Diamond Cement Vs. Rai Prexim India Pvt. Ltd. I [2003] CPJ 1 and Lovely Vs. Harmesh Lal - I [2007] CPJ 312." on similar issues, the Hon'ble National Commission has held that expert opinion is a condition precedent for establishing manufacturing defect.
24. From the aforesaid holdings of the Hon‟ble National Commission, it is clear that firstly the onus of proof is upon the Complainant/purchaser to prove that the purchased vehicle was suffered from manufacturing defect. However, in the present case, no expert opinion or evidence has been filed by the Complainant to prove that the said car broke down due to any manufacturing defect. Therefore, devoid of any evidence, we are not convinced with the fact that the said car suffered from any manufacturing defect. Consequently, the Opposite Party No.2&3 are not deficient in providing its services to the Complainant.
CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
25. The last question for consideration before us is whether the Opposite Party No.1 is deficient in providing its services by settling the claim to the tune of Rs. 1,26,793/- towards full and final settlement in the light of condition no.4 of the insurance policy.
26. Firstly, we deem it appropriate to refer to Condition no.4 of the insurance policy:
"The insured shall take all reasonable steps to safeguard the vehicle from loss or damage and to maintain it in efficient condition and the Company shall have at all the times free and full access to examine the vehicle or any part thereof or any driver or employee of the insured. In the event of any accident or breakdown the vehicle shall not be left unattended without proper precaution being taken to prevent further damage or loss and if the vehicle be driven before the necessary repairs are effected any extension of the damage or any further damage to the vehicle shall be entirely at the insured's own risk."
27. On perusal, we find that relying upon Clause 4 of the terms and conditions of the insurance policy, the learned counsel for the Opposite Party No.1 submits that the damage to the vehicle happened due to Complainant's own negligence on account of his having driven the vehicle through flood water and by doing so, the insured had failed to take reasonable steps to safeguard the vehicle from the damage thereby committing breach of condition No.4 of the insurance policy.
28. Further, the Surveyor appointed by the Opposite Party No.1 assessed the liability to the tune of Rs. 1,26,793/- towards full and CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
final settlement and which has been already paid by the Opposite Party No.1 to the Complainant. However, the Complainant has paid a sum of Rs. 7,55,193/- to the Opposite Party No.2 towards the repair charges of the engine of the car in question apart from Rs. 1,26,793/- which was paid by the Opposite Party No.1.
29. Since, it is pertinent to mention here that the Survey Report dated 19.11.2011 does not specifies the amount of water level on road and there is no such evidence on record which proves negligence on the part of the Complainant.
30. Further, when there is a heavy rain, big potholes takes place for which local authority spends crores of rupees. When the water is accumulated in a small patch of road, due to heavy traffic, the vehicle keeps passing in a hurry to reach the destination. Due to heavy rain and darkness the visibility on many road is poor, along with all other vehicle, you are forced to go through the above patch of water, as you have no choice to return, because of one way and flood of vehicle at the back. Due to heavy rain and darkness, you are not in a position to judge the water level in the centre and potholes which are covered with water. At times heavy vehicle passing from the side causes big water wave, which runs over the Bonnet level. Passing under above circumstances is NOT negligence, but a compulsion. This entire hazard may cause damage to engine etc. Car owner has bought the vehicle for his use. By not taking due care, he will be without car till it is repaired, and will have to share certain amount towards repairs.
31. In our opinion, the insurer has not been able to prove that the insured had failed to take reasonable steps to safeguard the vehicle against any damage. The policy taken by the insured was a CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
comprehensive policy insuring the vehicle against damages of all kinds and, therefore, irrespective of the cause of damage, the insurer has to reimburse the insured for the loss suffered by him unless the case is covered under any of the exceptions contained in the insurance policy or the insurer is able to prove breach of a mandatory term of the insurance policy. No such breach having been proved in this case.
32. In the given facts and circumstances, we hold that the Opposite Party No.1 was not justified in settling the claim to the tune of Rs.1,26,793/- towards full and final settlement in the light of condition no.4 of the insurance policy. Hence, the Opposite Party No.1 is liable for deficiency of service on its part.
33. Keeping in view the facts of the present case, we allow the following reliefs as prayed by the Complainant:
I. We direct the Opposite Party No.1 to pay an amount of Rs.7,55,193/- (as paid by the Complainant to the Opposite Party No.2 towards the repair of the engine) along with an interest as per the following arrangement:
A. An interest @ 6% p.a. be calculated from 03.12.2011 (being the date on which the claim was wrongly settled) till 08.08.2023 (being the date of the present judgment);
B. The rate of interest payable as per the aforesaid clause (A) is subject to the condition that the Opposite Party No.1 pays the entire amount on or before 08.10.2023;
C. In case the Opposite Party No.1 fails to refund the amount as per the aforesaid clause (A) on or before 08.10.2023, the entire amount is to be refunded with an CC. NO.371/2013 D.O.D.: 08.08.2023 M/S AVIAXPERT PVT. LTD. VS. BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD. & ORS.
interest @ 9% p.a. calculated from 03.12.2011 (being the date on which the claim was wrongly settled) till the actual realization of the amount.
II. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party No.1 is also directed to pay a sum of:
A. Rs. 1,00,000/- as cost for mental agony and harassment to the Complainant; and B. The litigation cost to the extent of Rs. 50,000/-.
34. Applications pending, if any, stand disposed of in terms of the aforesaid judgment.
35. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
36. File be consigned to record room along with a copy of this Judgment.
(JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (PINKI) MEMBER (JUDICIAL) (J.P. AGRAWAL) MEMBER (GENERAL) Pronounced On:
08.08.2023