National Consumer Disputes Redressal
Bherajram vs United India Insurance Company Ltd. on 5 January, 2015
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO.2573 of 2008 (From the Order dated 27.02.2008 in Appeal No. 1105/2004 of State Consumer Disputes Redressal Commission, Rajasthan) Bherajram S/O Shri Ram Chandra Jat, Village Jasrasar, Tehsil Nokha, Distt. Bikaner, Rajasthan ... Petitioner Vs. United India Insurance Company Ltd. Commercial Complex, Sadulganj Circle, Bikaner, Rajasthan Respondent BEFORE: - HONBLE MR. JUSTICE D.K. JAIN, PRESIDENT HONBLE MR. VINAY KUMAR, MEMBER For the Petitioner : Mr. J.P. Sharma, Advocate For the Respondent : Ms. Sakshi Gupta, Advocate For Mr. Vishnu Mehra, Advocate O R D E R
(Pronounced on 5th day of January, 2015) D.K. JAIN, J. PRESIDENT The Complainant has preferred this Revision Petition under Section 21(b) of the Consumer Protection Act, 1986 (for short the Act), questioning the correctness and legality of order dated 27.02.2008 passed by the State Consumer Disputes Redressal Commission, Rajasthan at Jaipur (for short the State Commission) in Appeal No. 1105 of 2004. By the impugned order, the State Commission has affirmed the order dated 06.05.2004, passed by the District Consumer Disputes Redressal Forum, Bikaner (for short, the District Forum) whereby the Petitioners complaint was dismissed.
2. Briefly stated, the material facts giving rise to the present Revision Petition are that: the Petitioner had comprehensively insured his truck with the Insurance Company on 10.12.1999. On 07.08.2000, the insured truck met with an accident. Intimation about the accident was given to the Insurance Company, who in turn, appointed a Surveyor to inspect the damaged truck and assess the loss on account of the accident. The Petitioner submitted a claim with the Insurance Company for indemnification of loss to the tune of `3,87,306.17. The Surveyor assessed the loss at `3,80,000/-. However, the Insurance Company repudiated the claim on the ground that at the time of accident, the truck was carrying excess load. The plea of the Petitioner that since he had been issued a golden token by the State Government permitting carriage of extra load of the goods, the question of overloading of truck did not arise, did not find favour with the Insurance Company. Consequently, the Petitioner filed a complaint against the Insurance Company praying for indemnification of the said loss.
3. The complaint was contested by the Insurance Company on the self-same plea, viz., overloading of the vehicle beyond the licensed carrying capacity amounted to breach of the conditions of the policy and, therefore, the claim of the Petitioner could not be entertained.
4. Accepting the stand of the Insurance Company, the District Forum held that if there was excess load in the vehicle which was the cause of accident, the repudiation of claim could not be treated as deficiency in service. Resultantly, the District Forum dismissed the complaint. The appeal preferred by the Petitioner having been dismissed by the State Commission, the Complainant is before us in this Revision Petition.
5. We have heard Learned Counsel for the Parties.
6. Ld. Counsel appearing for the Petitioner, vehemently submitted that even if it was assumed that there was overloading of the vehicle, the Insurance Company ought to have settled the claim of the Petitioner on non-standard basis, as per the guidelines issued by the Insurance Company. To buttress the submission, reliance was placed on the decision of this Commission in National Insurance Co. Ltd. Vs. Munni Lal Yadav II (2001) CPJ
53.
7. Per contra, Ld. Counsel appearing for the Respondent urged that the cause of accident being deflation of one of the tyres because of overloading, there was direct nexus between the overloading and the accident which amounted to breach of conditions of the policy and, therefore, the Insurance Company was justified in repudiating the claim.
8. Having perused the material on record, including the guidelines issued by the Insurance Company, we are of the opinion, that the Revision Petition deserves to be accepted. It is not in dispute that the Petitioner had obtained a comprehensive insurance policy in respect of the truck; nor is it in dispute that the accident took place during the subsistence of the policy. The question at issue is whether the Insurance Company was justified in repudiating the claim in toto on the ground that at the time of accident, the weight of goods being transported was more than the licensed carrying capacity of the vehicle. In other words, whether overloading of the vehicle, at the time of accident, inasmuch as, against the licensed capacity of 16,200 kilograms it was carrying 18,700 kilograms of goods, was a fundamental breach of the terms and conditions of the Policy. We may note that the excess load of 2,500 kilograms works out to be 12% in excess of the licensed capacity.
09. The plea of the Petitioner/Insured is that even if the vehicle was carrying excess load, yet the Insurance Company ought to have settled the claim on non-standard basis in terms of the guidelines issued by the Insurance Company itself for settling such claims. These conditions are contained in the Procedural Manual of Motor Claims. Relevant clause of the said Manual is clause 10, which reads as under:--
10. Non-Standard claims:-
Following types of claims shall be considered as non- standard and shall be settled as indicated below after recording the reasons:-
Sl.
No. Description Percentage of Settlement
1.
Under declaration of licensed carrying capacity Deduct 3 years difference in premium from the amount of claim or deduct 25% of claim amount, whichever is higher
2. Overloading of vehicles beyond licensed carrying capacity Pay claims not exceeding 75% of admissible claim.
3. Any other breach of warranty/ condition of policy including limitation as to use Pay upto 75% of admissible claim.
10. A bare perusal of the aforesaid guidelines makes it clear that the claim preferred by the Petitioner had to be settled on non-standard basis i.e. at 75% of the admissible claim. There is no substance in the contention of Ld. Counsel for the Insurance Company that since the cause of accident was deflation of a tyre which could be on account of excessive weight, the said guidelines were not applicable. Apart from the fact that the letter of repudiation does not indicate any such ground for repudiation of the claim, the afore-extracted guidelines do not carve out any such exception. Besides, para
(a) of the instructions issued by the Insurance Company vide letter dated 06.03.1995 also squarely covers the case of the Petitioner. In the said letter, the Field Officers have been advised by the Insurance Company that if the overloading is more than 10% and less than 25% of the carrying capacity, the claim may be settled at 75% of the admissible claim.
Admittedly, in the present case, the overloading was only 12% of the carrying capacity.
11. Keeping in view the said guidelines/instructions, we are of the opinion, that the action of the Insurance Company in repudiating the claim preferred by the Petitioner, amounts to deficiency in service on its part and, therefore, it cannot be sustained. It is set aside accordingly. The Insurance Company is directed to settle the claim made by the Petitioner on non-standard basis, as stipulated in clause 10 of the Procedural Manual of Motor Claims, i.e. 75% of the admissible claim of the Petitioner, as quantified by its valuer along with interest @ 9% p.a. from the date of filing of complaint till the date of actual payment within a period of six weeks from the date of receipt of a copy of this order, failing which, the said amount shall carry interest @ 12% p.a. from the date of expiry of the period of six weeks till the date of actual payment.
12. The Revision Petition stands disposed of in the above terms, with no order as to costs.
..
(D.K. JAIN, J.) PRESIDENT ..
(VINAY KUMAR) MEMBER YD/*