State Consumer Disputes Redressal Commission
Sh. Atul Loomba vs M/S National Insurance Co. Ltd on 4 February, 2014
STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
Consumer
Complaint No.
:
78 of 2013
Date of Institution
:
07.11.2013
Date of Decision
:
04.02.2014
Sh. Atul Loomba s/o Late Sh. A. L. Loomba, House No.1204, Sector 43B,
Chandigarh.
2nd Address:
Krishna Colony, Sector 24, Faridabad, Haryana.
Complainant.
Versus
M/s National
Insurance Co. Ltd., SCO No.85-86, Sector 17-D, Chandigarh 160 017
through its Manager.
M/s National
Insurance Co. Ltd., Second Floor, SCO 133-135, Sector 17-C, Chandigarh
160 017 through Sr. Divisional Manager.
Mr. Shankar De,
Surveyor & Loss Assessor through M/s National Insurance Co. Ltd., SCO
No.85-86, Sector 17-D, Chandigarh 160 017.
Opposite Parties.
Complaint under Section 17 of the Consumer Protection
Act, 1986.
BEFORE: JUSTICE SHAM SUNDER (RETD.), PRESIDENT.
MR. DEV RAJ, MEMBER.
MRS. PADMA PANDEY, MEMBER Argued by: Sh. Pankaj Chandgothia, Advocate for the complainant.
Sh. J. P. Nahar, Advocate for the opposite parties.
PER DEV RAJ, MEMBER The facts, in brief, are that the the complainant got his heavy goods vehicle tanker (Volvo Prime Mover) bearing Registration No.HR-38-Q-8740 comprehensively insured from Opposite Party No.1, for the Insured Declared Value of Rs.22,00,000/- for the period from 23.3.2011 to 22.3.2012. It was stated that, as per the Insurance Certificate (Annexure C-1), the insurance covered third party liability, as well as legal liability to pay driver/conductor/cleaner also. The complainant has annexed copy of the Certificate of Registration and National Permit as Annexures C-2 and C-3. It was further stated that unfortunately, the said vehicle met with a serious accident on 19.12.2011, when all of a sudden the bridge collapsed and the entire vehicle plunged into the river bed from the height of 100 feet resulting into total loss. It was further stated that at the time of accident, two numbers of Three-Axle Line Hydraulic trailers attached to the Volvo Tractor, loaded with Transformer were crossing Rangchang Khola Bridge in East Sikkim, which collapsed. It was further stated that intimation regarding the accident was given to Opposite Party No.1 vide letter dated 21.12.2011 (Annexure C-4) and FIR No.51 dated 19.12.2011 was got registered at Police Station Singtam, DT East Sikkim, Sikkim. It was further stated that spot survey was conducted and report dated 25.1.2012 (Annexure C-5) was submitted. It was further stated that Opposite Parties No.1 and 2, delayed the appointment of final Surveyor, which inordinately delayed the assessment of loss. It was further stated that Opposite Parties No.1 and 2, did not appoint final. Surveyor till 28.05.2012, as was clear from the final survey report. It was further stated that Opposite Party No.3, was appointed as final surveyor by Opposite Parties No.1 and 2, in the month of May, 2012, who finally submitted his report on 30.3.2013 (Annexure C-6), which showed that it was a futile exercise, which only wasted further precious time. It was further that the Surveyor took more than 10 months, to submit his report, which itself amounted to deficiency in service on the part of the Insurance Company. It was further stated that as per the law of Insurance, if the estimated cost was more than 75% of the IDV, then the case has to be settled on total loss basis. It was further stated that, in the present case, the estimated repair value was more than the value of the vehicle and, as such, the insurance claim was bound to be settled on total loss basis. It was further stated that the Surveyor recommended the settlement of loss, on total loss basis for a sum of Rs.20,98,500/-, in which case, the salvage was to belong to the complainant. Therefore, the complainant was entitled to the assessed value, on the basis of total loss of the vehicle. It was further stated that even after the Surveyor had submitted his report recommending the claim, Opposite Parties No.1 and 2 continued to delay the settlement and raised irrelevant queries vide their letter dated 1.7.2013 (Annexure C-7). It was further stated that the complainant wrote letter dated 25.7.2013 (Annexure C-8) to the Opposite Parties replying all the queries, but even after almost two years of the accident and also seven months of the survey report, Opposite Parties No.1 and 2, have not offered the rightful claim settlement to the complainant. It was further stated that the complainant wrote letter dated 8.10.2013 to Opposite Party No.1, but to no avail. It was further stated that the complainant had paid up the vehicle loan, and now nothing was due to the financier. As such, the claim amount must be paid directly to the complainant. It was further stated that the complainant had to put two persons, on duty, to guard the wreckage at the spot, which cost him around Rs.20,000/- per month and till date, Rs.4,40,000/- stood incurred solely on this account. It was further stated that the Opposite Parties are adopting coercive methods to force the complainant to accept a much lower amount than that he is entitled to as per the law of Insurance. It was further stated that the aforesaid acts of the Opposite Parties, amounted not only to deficiency, in rendering service, but also indulgence into unfair trade practice. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 17 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), was filed, directing the Opposite Parties, to pay Rs.20,98,500/-being the total loss value on net of salvage basis alongwith interest @18% per annum w.e.f. 19.12.2011; Rs.2,50,000/- towards legal liability to driver and other employees; Rs.5,00,000/- towards reimbursement of other related expenses; Rs.5,00,000/- as compensation for mental agony and physical harassment; Rs.3,00,000/- as compensation for unfair trade practice, Rs.50,000/- as punitive damages and Rs.50,000/- as legal costs.
2. Opposite Parties, in their written version, took up a preliminary objection, that the complaint was premature as they had not yet taken a decision, on the claim and the same was in the process of settlement. On merits, it was admitted that the vehicle, in question, was insured with Opposite Party No.1 for the period from 23.3.2011 to 22.3.2012. It was stated that at the time of accident, the vehicle was used as a tractor to pull two trailers with load thereon. It was admitted that the Insurance Policy covered the legal liability towards the employees connected with the operation of the vehicle. It was further stated that the vehicle, in question, was insured as tanker but used as a tractor and, thus, there was violation as to the use of the vehicle. It was admitted that the vehicle, in question, met with an accident on 19.12.2011, while it was being used as a tractor pulling two trailers and intimation was given on 21.12.2011. It was further stated that, in the accident, ten persons were reported to have died, which fact was mentioned in the survey report (Annexure C-5). It was further stated that the final Surveyor could be deputed on submission of the estimates of repairs and receipt of the spot survey report. It was further stated that the Surveyor was deputed on 28.05.2012, who visited the spot on 29.05.2012, where the vehicle was lying in the damaged condition. It was further stated that the extent of damage could be intimated by the Surveyor only and the officials of the Opposite Parties had nothing to say about it. It was denied that the final survey by the Surveyor was a futile exercise and the case could have been treated as a total loss. It was further stated that for payment of any claim of Rs.20,000/-, it is mandatory under Section 64UM (2) of the Insurance Act, 1938 to depute a licensed Surveyor approved by the IRDA. It was admitted that the Surveyor submitted his report dated 30.3.2013 (Annexure R-2) recommending for payment of Rs.20,98,500/- on net of salvage basis. It was denied that the demand of documents and information by the Surveyor was unnecessary. It was further stated that since it was a complicated case, the information was required for arriving at a final conclusion. It was further stated that the settlement of claim was to be arrived at, on the basis of the final survey report, and as per the conditions of the Policy, which could be on repair basis, total loss basis, or cash loss/net of salvage basis subject to the terms and conditions of the Policy. It was denied that the claim was bound to be settled on total loss basis. As regards the payment of clam of the legal liability to the paid driver and other third party liability, it was stated that such claims had to be lodged before the Employees Compensation Commissioner and the MACT respectively. It was further stated that the vehicle was insured as heavy goods vehicle tanker under the Insurance Policy and the same vehicle was also a tanker as per the Registration Certificate. It was further stated that the vehicle was used as a tractor at the time of the accident, which was in violation of the terms and conditions of the Policy. It was further stated that as per the copy of GR, the consignment weighed 62 tonnes, but no authorized weigh bridge bill/receipt was found in support of the same. It was further stated that the claim involved complicated questions of overloading, driving licence and also the use of vehicle as a tractor whereas registered as a tanker and insured as a tanker due to which, the Opposite Parties could not decide the claim. It was further stated that the complainant was not entitled to loss on total loss basis and the payment of loss was subject to the terms and conditions of the Insurance Policy. It was further stated that neither there was any deficiency, in rendering service, on the part of the Opposite Parties, nor did they indulge into unfair trade practice. The remaining averments, were denied, being wrong.
3. The complainant, in support of his case, submitted his own affidavit, by way of evidence, alongwith which, a number of documents were attached.
4. The Opposite Parties, in support of their case, submitted the affidavit of Sh. K. G. Sharma, their Divisional Manager and Power of attorney holder, by way of evidence, alongwith which, a number of documents were attached.
5. The complainant filed replication, wherein he reiterated all the averments, contained in the complaint, and repudiated those, contained in the written version of the Opposite Parties.
6. We have heard the Counsel for the parties, and, have gone through the evidence, record of the case and written arguments submitted by the parties, carefully.
7. The Counsel for the complainant, submitted that the vehicle, in question, was Volvo Prime Mover with two trailers and was insured by Opposite Party No.2. It was further submitted that the Insurance Policy with IDV of Rs.22,00,000/- was valid from 23.3.2011 to 22.3.2012. It was further submitted that the vehicle was having proper registration and national permit, Annexures C-2 and C-3. It was further submitted that on 19.12.2011, the bridge collapsed and, consequently, the vehicle fell in the rivulet. It was further submitted that FIR was registered by the State as bridge collapsed due to the poor construction of the bridge and not due to the fault or negligence of the driver. It was further submitted that intimation was immediately given to the Opposite Parties vide letter dated 21.12.2011 (Annexure C-4). It was further submitted that the spot survey report dated 25.1.2012 was submitted and claim was still pending as the same was neither rejected nor allowed nor any deficiency attributable to the complainant was pointed out even in the final survey report dated 30.03.2013 (Annexure C-6). It was further submitted that it was a case of total loss and the salvage was not of any worth as the vehicle was a complete wreck. It was further submitted that the detailed survey report indicated that the Three-Axle Line Hydraulic trailers attached to the Volvo Tractor were not overloaded. It was further submitted that the complainant was entitled to full claim.
8. The Counsel for the Opposite Parties, admitted that it was a case of total loss. It was further submitted that the vehicle, in question, was insured as a tanker and used as a tractor. He also submitted that as per Insurance Regulatory and Development Authority (Protection of Policyholders Interests) Regulations, 2002), in special circumstances of the case, the Surveyor could take six months for submission of his report, from the date of his appointment. It was submtted that the competent authority approved the claim for Rs.15,73,500/- on non-standard basis to the extent of 75% of the assessed amount i.e. Rs.21,00,000/- less 25% less excess Rs.1500/-. It was submitted that claim was considered on non-standard basis as six persons were travelling in the insured vehicle, against the combined seating capacity of three of both the tractor and two trailers, in violation of the permitted capacity in Registration Certificate. It was further submitted that since the Insurance Policy was subject to Endorsement No.7, the claim was payable to the Bank, unless the complainant submitted cancellation of hypothecation in the R.C.
9. The insurance of Prime Mover, bearing Registration No.HR-38-Q-8740, by Opposite Parties No.1 and 2 for the period from 23.3.2011 to 22.3.2012, accident thereof on 19.12.2011 due to collapse of the bridge, on account of poor construction, lodging of the FIR, and intimation by the complainant to the Opposite Parties on 21.12.2011 are admitted by the parties. The seating capacity of the vehicle as per the Certificate of Registration was 03 and the vehicle was also having valid authorization for National Permit (Annexure C-3).
10. No doubt, the Surveyor was appointed, who submitted his motor spot survey report on 25.1.2012 (Annexure C-5), and, the final survey report was submitted on 30.3.2013. The conclusion drawn by the Surveyor, in his final survey report dated 30.3.2013 (Annexure C-6), is extracted below:-
Conclusion:
On the basis of the physical findings made local enquiries made, documents made available it can be concluded that:-
1.
The Prime Mover was empty at the time of accident.
2. The Prime Mover was pulling the modular hydraulic, trailers loaded with the transformer when it met with an accident.
3. The load being carried on the independent trailers was 62 MT.
4. The load bearing capacity of these trailers was 144 MT gross and 24 MT self weight.
5. These trailers being modular and articulated do not share any weight with the Prime Mover and operate independently. Thus the Prime mover was not overloaded.
6. This is the only way of transporting heavy lift jobs internationally (Ref. enclosed photographs).
7. A copy of the circular issued by the Joint Secretary Minister of Road Transport and Highway addressed to the Transport Commissioners of all States regarding the movement of Cargo on Hydraulic Axle, modular trailers is enclosed herewith. As per the said circular there is no provision in the Motor Vehicle Act, 1988 for the pulling power capacity of prime movers, hence this circular has been issued to clarify that there is no co-relation between the permitted axle load and pulling power capacity under draw bar arrangement.
8. The damaged caused by overloading is not applicable in this case for the Prime Mover because the puller has taken only the Puller weight and is not loaded with any material. The trailers were attached and were being drawn by a bar arrangement (Ref. Sketch enclosed).
9. The Prime Mover HR-38/Q 8740 was fitted with a 400 HP Engine. A Certificate issued by BHEL (A Govt. of India Enterprise) who manufacture heavy duty engines for the Indian Railways is enclosed, indicating that a 350 HP engine can pull a train load of more than 1263 MT. In the instant case, the Prime Mover was fitted with a 400 HP engine and was pulling a load of less than 100 MT including self weight and the weight of the trailers. The Prime Mover thus had sufficient power to pull the load.
10. To summarize it can be concluded that:
v The Prime mover HR-38/Q 8740 was not loaded at the time of accident.
v The trailers being pulled by the Prime Mover were independent modular hydraulic axle trailers having a carrying capacity of more than that required at the time of accident.
v The Prime Mover had sufficient power to pull the said trailers.
v The driver/Insured cannot be held responsible for the accident. There is no gross negligence/negligence on part of the driver/Insured.
The final Surveyor report dated 30.3.2013 (Annexure C-6) is very specific and no fault was attributable either to the driver or the complainant. The contention of the Opposite Parties, that the vehicle was insured as a tanker and not as a tractor is too technical an objection. The vehicle, in question, was insured by Opposite Parties No.1 and 2 and if the Policy was issued, as a tanker, instead of tractor, the deficiency for the same also lay with Opposite Parties No.1 and 2. The Surveyor has assessed the payable amount of claim to the tune of Rs.20,98,500/- against the IDV of Rs.22,00,000/-. While assessing the net loss, the Surveyor observed as under:-
Based on details provided above, the lowest liability under the subject Policy of Insurance works out to Rs.20,98,500/-.
The assessment of loss, as detailed above, is subject to the terms and conditions of the Policy of Insurance.
11. Opposite Parties No.1 and 2 have failed to lead any cogent evidence to rebut the authenticity of the report of the Surveyor. Opposite Parties No.1 and 2 have approved the claim for Rs.15,73,500/- on non-standard basis to the extent of 75% of the assessed amount i.e. Rs.21,00,000/- less 25% less excess Rs.1,500/-. Their contention that the claim was considered on non-standard basis as six persons were travelling in the insured vehicle against the combined seating capacity of three of both the tractor and two trailers in violation of the permitted capacity as mentioned in the Registration Certificate is without any cogent evidence. As per the Certificate of Registration and Surveyor Report, the seating capacity of the Prime Mover alone was 03. Even if, it is assumed, for the sake of arguments, that one or two persons were in excess of the seating capacity, the same could not be in any way attributable to the accident. The cause of accident was poor construction of the bridge and the vehicle fell in the river due to collapse of the same (bridge).
12. In our considered opinion, there was no justification for delaying the claim of the complainant for more than two years, and, to allow the same on non-standard basis. Thus the Opposite Parties were deficient in rendering service and indulged into unfair trade practice.
13. In Sikka Papers Limited Vs. National Insurance Company Limited, (2009) 7 Supreme Court Cases 777, it was held that, no doubt, the report of the Surveyor is not the last word, yet there must be legitimate reason, for departing from the same. In New India Assurance Company Ltd. Vs. Rabindra Narayan, I (2010) CPJ 80 (NC), it was held that the Surveyors report, being an important piece of evidence, was required to be given weight and relied upon, unless proved unreliable. In Dabirudin Cold Storage Vs. New India Assurance Company Ltd. & Ors., I (2010) CPJ 141 (NC), it was held that the Surveyors report, being an important document, cannot be easily brushed aside. Since the Opposite Parties did not adduce any cogent evidence to contradict the Surveyor Report, in our considered opinion, the complainant is entitled to a sum of Rs.20,98,500/-, as assessed by the Surveyor.
14. Not only this, the Opposite Parties failed to decide the claim within a reasonable time, and kept the same pending without any justified reason for more than two years. The complainant, thus, suffered immense physical harassment and mental agony, at the hands of Opposite Parties No.1 and 2, for which, he is entitled to compensation, and, in our considered opinion, compensation in the sum of Rs.70,000/- shall be reasonable, fair and adequate.
15. Since, the claim is to be paid by Opposite Parties No.1 and 2, being the Insurers, therefore, the complaint qua Opposite Party No.3, who is the Surveyor, deserves to be dismissed.
16. No other point, was urged by the Counsel for the Parties.
17. For the reasons recorded above, the complaint is partly accepted, with costs against Opposite Parties No.1 and 2, in the following manner:-
i. Opposite Parties No.1 and 2 are directed to pay an amount of Rs.20,98,500/-, as assessed by the Surveyor vide final survey report dated 30.03.2013 (Annexure C-6) to the complainant; alongwith interest @9% per annum from the date of filing the complaint, within two months of the date of receipt of a certified copy of this order.
ii. Since the vehicle was hypothecated with the ICICI Bank, the said Bank (ICICI Bank) shall have the first charge on the amount payable to the complainant, to the extent due against him, unless he (complainant) submitted cancellation of hypothecation. The complainant shall also complete all the formalities within a period of 30 days from the date of receipt of a certified copy of this order.
iii. Opposite Parties No.1 and 2 are further directed to pay compensation, in the sum of Rs.70,000/- for causing mental agony and physical harassment, to the complainant, within two months, from the date of receipt of a certified copy of this order.
iv. Opposite Parties No.1 and 2 are further directed to pay cost of litigation, to the tune of Rs.11,000/-, to the complainant.
v. In case the payment of amounts, mentioned in Clauses (i) and (iii), is not made, within the stipulated period, then Opposite Parties No.1 and 2 shall be liable to pay the amounts mentioned in those clauses with interest @12% per annum, instead of 9% per annum, from the date of default, till realization, besides payment of cost, to the tune of Rs. 11,000/-.
18. However, the complaint qua Opposite Party No.3 is dismissed with no order as to costs.
19. Certified Copies of this order be sent to the parties, free of charge.
20. The file be consigned to Record Room, after completion.
Pronounced.
February 04, 2014.
Sd/-
[JUSTICE SHAM SUNDER (RETD.)] PRESIDENT Sd/-
[DEV RAJ] MEMBER Sd/-
[PADMA PANDEY] MEMBER Ad STATE COMMISSION (Consumer Complaint No.78 of 2013) Argued by: Sh.
Pankaj Chandgothia, Advocate for the complainant.
Sh. J. P. Nahar, Advocate for the opposite parties.
Dated the 4th day of February, 2014 ORDER Vide our detailed order of the even date, recorded separately, this complaint has been partly accepted qua Opposite Parties No.1 and 2 with costs. However, it (complaint) has been dismissed qua Opposite Party No.3, with no order as to costs.
Sd/-
(DEV RAJ) MEMBER Sd/-
(JUSTICE SHAM SUNDER (RETD.)) PRESIDENT Sd/-
(PADMA PANDEY) MEMBER Ad