National Consumer Disputes Redressal
Mohd. Unis vs United India Ins. Co. Ltd. on 3 February, 2014
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO.443 OF 2013 (From the order dated 22.10.2012 in F.A. No.1366/2010 of the Haryana State Consumer Disputes Redressal Commission, Panchkula) MOHD. UNIS, S/O SH. MEHMOOD KHAN, R/O VILLAGE TEEKRI BRAHMIN, DISTRICT PALWAL, HARYANA. ... PETITIONER Versus UNITED INDIA INSURANCE COMPANY LTD. (i) THROUGH ITS BRANCH MANAGER, CHAMPA BHAWAN, 1st FLOOR, OPP. SYNDICATE BANK, OLD G.T. ROAD, PALWAL, HARYANA (ii) THROUGH ITS DEPUTY MANAGER, SCO 123-124, SECTOR 17-B, CHANDIGARH. ....... RESPONDENT BEFORE: HON'BLE MR.JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER HONBLE MR.SURESH CHANDRA, MEMBER For the Petitioner : Mr. Gagan Gupta, Advocate For the Respondent : Mr.Rajesh K. Gupta, Advocate PRONOUNCED ON: 03rd February, 2014 ORDER
PER SURESH CHANDRA, MEMBER Challenge in this revision petition is to the impugned order dated 22.10.2012 passed by the State Consumer Disputes Redressal Commission, Haryana (the State Commission, for short) in First Appeal No.1366 of 2010 whereby the State Commission has upset the order dated 28.07.2010 passed by the District Forum, Faridabad in Consumer Complaint No.293 of 2006 and allowed the appeal filed by the OP insurance company, respondent herein.
The District Forum had earlier accepted the complaint of the petitioner herein vide its aforesaid order in terms of the following directions:-
7. Since the vehicle was insured for an amount of Rs.3,50,000/- and the complainant is entitled to compensation on non standard basis at Rs.75% of the insured amount, the compensation comes to Rs.2,62,500/-.
8. The respondent is, therefore, directed to pay Rs.2,62,500/- as compensation for loss of his vehicle to the complainant with interest @ 9% per annum from the date of complaint till the date of payment. The respondent is further directed to pay Rs.2200/- as litigation expenses to the complainant.
2. Briefly stated, the facts relevant for disposal of this revision petition are that the complainant/petitioner got his vehicle bearing registration no.HR63-6854 insured from the OP/respondent insurance company for the period 20.07.2005 to 19.07.2006. During the period of the policy, the vehicle met with an accident on 08.10.2005 for which FIR was registered with the concerned police station and necessary intimation was given to the insurance company. As per the version of the complainant, the vehicle was got repaired from Shree Balaji Motors Palwal which gave an estimate of Rs.3,85,158/- for its repairs. The complainant submitted his claim to the insurance company which appointed a surveyor to assess the damage and loss to the vehicle. The surveyor in his report assessed the loss to the tune of Rs.2,49,000/- on repair basis but the insurance company repudiated the claim on the ground that the vehicle was being used for hire and reward. Challenging the action of the OP insurance company, the complainant invoked the jurisdiction of the District Forum by filing the consumer complaint. The OP insurance company resisted the complaint by filing a written statement justifying the repudiation on the ground that during the investigation carried out by the surveyor it was revealed that the vehicle in question was being used as a commercial vehicle whereas the complainant had got the vehicle insured as a private car. Denying any deficiency in service or unfair trade practice on their part, the OP insurance company pleaded for dismissal of the complaint. Both the parties led evidence in support of their respective claims.
On appraisal of the pleadings and evidence adduced on record, the District Forum accepted the complaint on non-standard basis and granted relief as reproduced above to the complainant.
Aggrieved of the order of the District Forum, the OP insurance company challenged the same by filing an appeal before the State Commission, which came to be allowed by the State Commission by its impugned order. It is in these circumstances that the present revision petition has been filed by the complainant.
3. We have heard learned Sh. Gagan Gupta, Advocate for the petitioner and Sh. Rajesh K. Gupta, Advocate for the respondent and perused the record.
4. Learned counsel for the petitioner has submitted that even though there was violation of a condition of the policy regarding use of the vehicle in question for hire and reward as alleged by the respondent insurance company, keeping this aspect in view, the District Forum had rightly accepted the claim on non-standard basis since the decision of the District Forum is in line with the view taken by the Supreme Court in the case of Amalendu Sahoo vs. Oriental Insurance Co. Ltd. (2010 CTJ 485 SC). He submitted that the facts of this case are identical to those in Amalendu Sahoos case and so the ratio of that case will be squarely applicable to the present case also. He further submitted that the State Commission gravely erred in relying on the judgment of the Apex Court in the case of M/s Suraj Mal Ram Niwas Oil Mills (P) Ltd. vs. United India Insurance Co. Ltd. & Anr. (2011 CTJ 11 SC). He further submitted that the OP insurance company has not provided any proof regarding the allegation of overloading which could have triggered or contributed to the accident in question. In this context, he has also drawn our attention to the contents of the FIRs No.75 dated 09.10.2005 and No.74 dated 08.10.2005 filed with the police station which clearly indicate that the number of passengers in the vehicle in question was below 10 and not 28 as alleged by the OP insurance Company in its reply before the District Forum. Copies of the two FIRs have been placed on record by the petitioner. He, therefore, submitted that the impugned order of the State Commission which is based on wrong application of the ratio of the Apex Court in Suraj Mal Ram Niwas Oil Mills case cannot be sustained and is liable to be set aside keeping in view the judgment of the Apex Court in Amalendu Sahoos case.
5. On the other hand, learned counsel for the respondent insurance company has contended that the there were two violations in the present case inasmuch as the vehicle was used for hire and reward even though it was registered as a private vehicle and the vehicle carried more passengers than permissible thereby causing overloading. According to him, there were 11 passengers in the vehicle (10+1) including the driver which led to losing of control over the vehicle by the driver resulting in the accident in question on account of overloading. He, therefore, submitted that the State Commission has appropriately relied on the judgment of the Apex Court in the case of Suraj Mal Ram Niwas Oil Mills (P.) Ltd. while accepting the appeal and dismissing the complaint.
6. We have carefully considered the contentions of the learned counsel for the parties. The short question which has arisen before us is as to whether the District Forum was correct in applying the ratio laid down by the Apex Court in the case of Amalendu Sahoo while settling the claim of the petitioner on non-standard basis and granting him relief as per its order dated 28.07.2010. As stated above, the State Commission has reversed the order of the District Forum relying on the later judgment of the Apex Court in the case of Suraj Mal Ram Niwas Oil Mills (P.) Ltd. In our view, the facts of this case are identical to the case of Amalendu Sahoo where the private motor car was being driven on hire at the time of accident and based on surveyor report the claim was repudiated keeping in view the terms of the insurance policy according to which the use of the car for hire was not permitted. The District Forum dismissed the complaint and the appeal was dismissed by the State Commission. Orders of the fora below were upheld by the National Commission, which dismissed the revision petition of the complainant. However, the Honble Supreme Court allowed the appeal. In this context, we may refer to the following observations of their Lordships of the Apex Court:-
12. Reference in this case may be made to the decision of National Commission rendered in the case of United India Insurance Company Limited v. Gian Singh reported in 2006 CTJ 221 (CP) (NCDRC). In that decision of the National Consumer Disputes Redressal Commission (NCDRC) it has been held that in a case of violation of condition of the policy as to the nature of use of the vehicle, the claim ought to be settled on a non-standard basis. The said decision of the National Commission has been referred to by this Court in the case of National Insurance Company Limited v. Nitin Khandelwal reported in 2008 (7) SCALE 351. In paragraph 13 of the judgment, in the case of Nitin Khandelwal (supra) this Court held:-
..The appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy for the loss caused to the insurer. The respondent submitted that even assuming that there was a breach of condition of the insurance policy, the appellant Insurance Company ought to have settled the claim on non-standard basis.
13.
In the case of Nitin Khandelwal (supra) the State Commission allowed 75% of the claim of the claimant on non-standard basis. The said order was upheld by the National Commission and this Court refused to interfere with the decision of the National Commission.
7. On the other hand, in the case of Suraj Mal Ram Niwas Oil Mills (P.) Ltd. the Apex Court has laid emphasis on the need for the courts to strictly construe the terms of a contract of insurance in terms of the words used therein without adding, deleting or substituting any words. However, this observation was specifically with reference to the question of coverage of the risk under the policy so as to determine the extent of liability of the insurer. In other words, if a particular risk is not covered by the words of the policy, it would not be open to the courts to add, delete or substitute any of the words used in the contract and the terms of the insurance contract have to be strictly construed without any exception made on the ground of equity by the courts. This celebrated ruling holds good without any doubt but facts of this case and the issue involved therein are different and as such, in our view the State Commission wrongly relied on the judgment of the Suraj Mal Ram Niwas Oil Mills case while setting aside the order of the District forum. In this context, it would be fair and just to reproduce the following observations of the Apex Court in Para 24 of the judgment:-
24.Thus, it needs little emphasis that in construing the terms of a contract of insurance, the words used therein must be given paramount importance, and it is not open for the Court to add, delete or substitute any words. It is also well settled that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer. Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed by the parties.
[Emphasis provided by us]
8. It may not be out of place to mention that in the aforesaid case of Suraj Mal Ram Niwas Oil Mills the question before the Honble Supreme Court was regarding claim in respect of dispatch of goods which had not been declared so as to cover them in terms and conditions of the policy. Also, there was an allegation of insurance company regarding the complainant exceeding the limit of coverage. It was with reference to these two questions that the Apex Court in the case of Suraj Mal Ram Niwas Oil Mills had dismissed the appeal of the complainant, namely, M/s Suraj Mal Ram Niwas Oil Mills (P.) Ltd. by holding that the rights and obligations of the parties under an insurance contract are governed by the terms of the said contract which have to be strictly construed and no exception can be made on the ground of equity. In the present case admittedly the petitioner had taken a comprehensive policy for the vehicle in question and, as such, keeping in view the ratio in the case of National Insurance Company Limited v. Nitin Khandelwal (2008 (7) SCALE 351) reiterated in the case of Amalendu Sahoo, the District Forum rightly accepted the claim of the petitioner on non-standard basis. The State Commission failed to appreciate the fine distinction between the two judgments of the Honble Supreme Court and hence, the impugned order cannot be sustained in the eye of law and is liable to be set aside. Accordingly, we accept the revision petition, set aside the impugned order and confirm the order of the District Forum with the parties bearing their own costs.
sd/-..
(AJIT BHARIHOKE, J.) PRESIDING MEMBER sd/-.
(SURESH CHANDRA) bs MEMBER