State Consumer Disputes Redressal Commission
National Insu.Co vs Upendra P.Singh on 11 January, 2024
Daily Order M. P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BHOPAL PLOT NO.76, ARERA HILLS, BHOPAL FIRST APPEAL NO. 1249 OF 2011 (Arising out of order dated 14.07.2011 passed in C.C.No.121/2009 by District Commission, Panna) UPENDRA PRATAP SINGH. ... APPELLANT. Versus BRANCH MANAGER, NATIONAL INSURANCE CO. LTD. ... RESPONDENT. FIRST APPEAL NO. 1339 OF 2011 (Arising out of order dated 14.07.2011 passed in C.C.No.121/2009 by District Commission, Panna) NATIONAL INSURANCE CO.LTD. ... APPELLANT. Versus UPENDRA PRATAP SINGH. ... RESPONDENT. BEFORE: HON'BLE SHRI A. K. TIWARI : ACTING PRESIDENT HON'BLE DR. SRIKANT PANDEY : MEMBER
O R D E R 11.01.2024 Shri Rajeev Acharya, learned counsel for the complainant.
Shri Deepesh Shukla, learned counsel for the opposite party-insurance company.
As per A. K. Tiwari :
Aforesaid appeals arise out of the order dated 14.07.2011 passed by the District Consumer Disputes Redressal Commission, Panna (for short 'District Commission') in C.C.No.121/2009 therefore they are taken up together and are being disposed of this common order. Facts are taken from First Appeal No.1249/2011 unless otherwise stated.
2. First Appeal No. 1249/2011 has been filed by the complainant for enhancement of compensation whereas First Appeal No.1339/2011 has -2- been filed by the opposite party-insurance company for setting aside the impunged order.
3. The facts of the case in short are that the complainant's Volvo Hydraulic Excavato was insured with the opposite party insurance company for the period w.e.f. 28.01.2009 to 27.01.2010. It is submitted that on 31.05.2009 while levelling the agricultural land suddenly went out of order of which intimation was given to the police, insurance company and the manufacturer Volvo company. The team of engineers of the manufacturer company and the surveyor of the insurance company inspected the vehicle and on their advice, the said excavator was sent to Naveen Infrasolutions Pvt. Ltd. Indore for repairs. It is submitted that Naveen Infrasolutions Pvt. Ltd told him repair charges Rs.13,30,465/- with labour charges and if the complainant wants to replace the engine, it will cost Rs.10,94,416/- with labour charges of which intimation was given to the surveyor and authorized officers of the insurance company who suggest him for replacement of engine. The complainant at his own expenses got the engine replaced and submitted the claim with the insurance company, however, the insurance company did not pay the claim. The complainant therefore approached the District Commission seeking relief.
4. The District Commission allowing the complaint directed the insurance company to pay Rs.75,000/- with interest @ 6% p.a. from the date -3- of filing of complaint i.e. 24.09.2009 along with compensation of Rs.2,000/- and costs Rs.1,000/-. Hence the aforesaid appeals by both parties.
5. Heard learned counsel for the parties. Perused the record.
6. Learned counsel for the complainant argued that the District Commission has committed material irregularity in not appreciating the fact that the cost of the excavator was Rs.37,50,000/- and therefore, the insurance company was liable to pay the aforesaid amount. Also the interest rate awarded by the District Commission is on lower side, at present prevailing rate of interest is 8.5% to 11%. It is therefore prayed the complainant be awarded a sum of Rs.37,50,000/- with interest, compensation and costs.
7. Learned counsel for the opposite party-insurance company argued that as per incident reported by the complainant, the insured vehicle suffered loss due to internal defect of mechanism of machine which is manufacturing defect and as per insurance policy there was coverage for the liability which arise due to accident but in the present case the machine suffered manufacturing defect, which cannot be considered as an accidental loss. The insurance company is only liable to indemnify the claim of accident only but the District Commission did not consider this aspect and erred in awarding Rs.75,000/- to the complainant against accidental loss. He therefore prayed that the impugned order be set-aside.-4-
8. After hearing learned counsel for the parties and on careful perusal of the record as also the impugned order we find that admittedly the machine suddenly stopped due to some mechanical defect in the engine and not met with any accident. From the record we find that there is a policy at page no 61 in the record of the District Commission wherein it is specifically mentioned under the heading Limits of Liability as under:
Limits of Liability:
Under Section 11(i) in respect of any one accident: As per Motor Vehicles Act, 1988.
Under Section 11(ii) in respect of any one claim or series of claims arising out of one event: Rs.7,50,000/-.
On bare perusal of Limits of liability it is crystal clear that in case of any claim arising out of one event, the insurance company is liable to pay to the extent of Rs.7,50,000/-.
9. However, the word 'event' has not been defined in the policy as to whether it relates to accident or impact or break down. The word 'event' in Oxford Concise Dictionary defines as:
Event- 1. A thing that happens or takes place
2. Each of several contests making up a sports competition
3. A single occurrence of a process e.g. the ionization of an atom.
10. Considering the aforesaid meaning that a thing that happens or takes place in the present facts and circumstances of the case break down of the vehicle can also comes under event or not as accident word has already been given under the Limits of Liability in clause 1 under Section 11(i). Learned counsel appearing on behalf of opposite party-insurance -5- company argued that risk covered in case of accident only but he failed to demonstrate that what does event mean by virtue of policy term and break down of questioned vehicle does not fall under event.
11. Thus we do not find any susbstance in the arguments advanced by learned counsel for the opposite party-insurance company that the insurance company is only liable to indemnify the claim in case of accident only.
12. We find that the District Commission has also misinterpreted the amount of Rs.7,50,000/- as Rs.75,000/- and awarded the same to the complainant. Thus we find that the District Commission failed to consider the letter and spirit of the policy.
13. In view of the above discrepancies with regard to Limits of Liability as event is also covered as also the amount , we are of a considered view that the matter deserves to be remanded back to the District Commission with a direction to the insurance company to demonstrate the policy terms and conditions in its correct perspective. The District Commission shall decide the matter afresh after considering the documents including the policy document in its correct spirit and perspective.
14. Accordingly, we set-aside the impugned order and remanded the case to the District Commission for decision afresh on merits after consideration of the documents as aforesaid, in accordance with law.-6-
15. All the questions involved in the matter are kept open and parties are at liberty to produce additional evidence, if any. It is made clear that observations made hereinabove shall not come in way of the District Commission, while deciding the complaint.
16. The District Commission shall decide the complaint in accordance with law as expeditiously as possible.
17. Parties are directed to appear before the District Commission on 05.03.2024.
18. With the aforesaid observations and directions, both appeals stand disposed of. No order as to costs.
19. This order be placed in First Appeal No.1249/2011 and a copy be placed in First Appeal No.1339/2011.
(A. K. Tiwari) (Dr. Srikant Pandey) Acting President Member