National Consumer Disputes Redressal
Oriental Insurance Co. Ltd. vs Raj Kumar Gupta on 15 February, 2002
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO.1125 OF 1999 (From the order dated 16.4.1999 in Appeal No. 463/S.C./1999 of the State Commission Uttar Pradesh) Oriental Insurance Co. Ltd. Petitioner Vs. Raj Kumar Gupta Respondent BEFORE: HONBLE MR. JUSTICE D.P. WADHWA, PRESIDENT MRS. RAJYALAKSHMI RAO, MEMBER. MR. B.K. TAIMNI, MEMBER. Decision of two Judges Bench in B.V. Nagaraju Vs. Oriental Insurance Co. Ltd. [(1996) 4 SCC 647 ] if contrary to Constitution Bench judgment in General Assurance Society Ltd. Vs. Chandmull Jain and another [AIR 1966 SC 1644]?- since facts were simillar to that in B.V. Nagarajus case, held judgment in that case squarely cover the case in hand. For the petitioner : Mr. Vishnu Mehra, Advocate For the respondent : In Person O R D E R
DATED THE 15th February, 2002.
JUSTICE D.P. WADHWA, J.(PRESIDENT) Petitioner, insurer, was the opposite party before the District Forum. Complaint of the respondent-complainant was regarding insurance claim arising out of accident of his vehicle which the respondent had repudiated.
District Forum allowed the complaint relying on the two Judges Bench decision of the Supreme Court in the case of B.V. Nagaraju Vs. Oriental Insurance Co. Ltd. [1996 CCJ 743] .
Against the order of the District Forum, petitioner went in appeal before the State Commission which dismissed the appeal with costs and affirmed the order of the District Forum.
Still aggrieved, petitioner has challenged the order of the State Commission before us The vehicle, being a truck owned by the complainant was insured with the petitioner for Rs.2.00 lakhs. It was a goods carrying vehicle.
During the validity of the insurance policy the truck met with an accident. It was a total loss. At the time of the accident truck was found carrying 13 persons when the policy limited the travel in the truck to 5 persons.
District Forum on the basis of material on record came to the conclusion that the travelling of six more persons in the truck had no effect on the accident and the accident was not caused on account of truck carrying excess persons. District Forum, therefore, directed payment of Rs.2.00 lakhs as damages, Rs.20,000/- as compensation and Rs.5,000/- as costs payable to the complainant by the petitioner. It was contended by the petitioner before the District Forum as well as before the State Commission and now before us that finding that 13 persons were travelling in the truck was in violation of the terms of the policy and the petitioner was entitled to repudiate the claim. Mr. Vishnu Mehra, learned counsel for the petitioner had referred to the terms of insurance policy which limited the use of the vehicle for carriage of goods within the meaning of Motor Vehicles Act, 1988. It was contended that policy did not cover use of carrying passengers in the vehicle except employees (other than the driver) not exceeding six in number coming under the purview of Workmens Compensation Act, 1923. We may set out the relevant conditions of the policy as to limitation relating to the use of the vehicle as under:
Limitation as to use:
Only for the carriage of goods within the meaning of the Motor Vehicles Act, 1988.
The policy does not cover:
1. Use of organised racing pace making realiability trail or speed testing.
2. Use whilst drawing a trailer except the towing of any one disabled mechanically propelled vehicle.
3. USE FOR CARRYING PASSENGERS IN THE VEHICLE EXCEPT EMPLOYEE (OTHER THAN DRIVER) NOT EXCEEDING SIX IN NUMBERS COMING UNDER THE PURVIEW OF W.C. Act, 1923.
Mr. Mehra in all fairness did not dispute the finding that travelling of 13 persons in the vehicle did not contribute to the accident but his submission was based on law as required under clause (b) of Section 21 of the Consumer Protection for exercise of our jurisdiction.
Supreme Court in the case of B.V. Nagaraju vs. Oriental Insurance Co. Ltd. in somewhat similar circumstances had laid that terms of the policy of insurance need not be construed strictly but be read down to advance the main purpose of the contract. This, Mr. Mehra said, was contrary to a Constitution Bench decision of the Supreme Court in the case of General Assurance Society Ltd. Vs. Chandmull Jain and another [AIR 1966 SC 1644] . In this Constitution Bench it was pointed out that only in the case of ambiguity or doubt contract is to be construed contra proferentem that is against insurance company.
But if the words in the contract are clearly expressed by the parties it was not for the court to make a new contract, however, reasonable, if the parties have not made that themselves. Mr. Mehra would appear to be right in his submission but fact remains that judgment of the Supreme Court in the case of B.V. Nagaraju squarely covers the present case even to the extent of facts. This judgment of the Supreme Court in B.V. Nagaraju has been followed in number of cases and as noted above, relied upon by the District Forum. However, we are of the view in the case like this the claim under the policy should have been settled on the basis of non-standard claim i.e. complainant should have been entitled to 75% of the insured amount under the policy. We have been told that after the judgment of the State Commission the amount as awarded has since been paid to the complainant. It was strenuously argued by the complainant who appeared in person that he may not be made to refund even part of the amount of compensation which he had already received.
That argument in our view cannot stand. The accident took place on 2.12.1995 and repudiation under the policy by the petitioner was made on 17.5.1996.
It was only on 5.6.1999 that the amount of compensation was received by the Complainant. However, he had not been awarded interest which normally should have been allowed. The District Forum held that there was no clear evidence regarding damage to the vehicle and on that account direction was issued to the petitioner to make the payment of the amount of compensation on the basis of the survey report within one month of the date of the order which is 29.12.1998. District Forum awarded a sum of Rs.5,000/- as compensation which would appear to be on account of deficiency in service and Rs.2,000/- as costs. This order of the District Forum was affirmed by the State commission which further awarded Rs.1,000/- as costs while dismissing the appeal. In these circumstances it is not clear to us as to how much amount of award or compensation complainant has since received. Since there is no award of interest on whatever amount is found due and payable to the complainant, we will accept the submission of the complainant that he may not be asked to refund any amount to the petitioner, insurer. With these observations this petition stands disposed of. There shall be no order as to costs.
J JUSTICE D.P. WADHWA) PRESIDENT .
(RAJYALAKSHMI RAO) MEMBER (B.K. TAIMNI) MEMBER