State Consumer Disputes Redressal Commission
New India Assurance Co. Ltd vs Appliance Technologies India Limited, on 10 January, 2008
IN THE STATE COMMISSION: DELHI IN THE STATE COMMISSION: DELHI (Constituted under section 9 clause (b) of the Consumer Protection Act, 1986) Date of decision: 10.01.2008 First Appeal No.07/736 (Arising from the order dated 04.06.2007 passed by District Forum(Central) Kashmere Gate, Delhi in Complaint Case No.203/2005) New India Assurance Co. Ltd., . Appellant Gulab Bhawan, through Mr. R.K. Kohli, 6, Bahadur Shah Zafar Marg, advocate. New Delhi. Versus M/s. Appliance Technologies India Respondent Limited, NH- 8, Near Birla Kanan, Shiv Murti Rangpuri, New Delhi CORAM: Justice J.D. Kapoor, ... President Ms. Rumnita Mittal Member
1. Whether reporters of local newspapers be allowed to see the judgment?
2. To be referred to the Reporter or not?
Justice J.D. Kapoor, President(ORAL)
1. Admittedly the respondent obtained insurance policy from the appellant in respect of a vehicle covering risk of theft of damage and due to accident. The car was taken away by a person who intended to purchase the same and wanted test drive. Consequently he lodged a complaint with the police and claim with the appellant. The claim was repudiated on the ground that the insurable interest stood transferred as the car had already been sold to the person, who had taken it for test drive. Consequently the respondent filed the instant complaint before District Forum seeking indemnification of loss and compensation..
2. Vide impugned order dated 04.06.2007, the District Forum allowed the complaint with the following directions to the appellant:-
(i) OP will pay Rs.3,80,000/- to the complainant as insurance amount and the complainant will issue a letter of subrogation in favour of the OP and will inform RTO concerned to change the ownership in the name of OP.
(ii) The OP repudiated a genuine claim and caused mental agony and harassment and deficiency in service, the OP will pay a sum of Rs.20,000/- to the complainant.
(iii) OP will also pay Rs.2,000/- as cost of litigation to the complainant.
3. Case of the respondent before District Forum leading to the impugned order was that the respondent is an authorised dealer of car. A person who represented himself as a resaler desired to purchase a car and selected a fiat palio EL(PS) diesel colour royal gold which was parked in front of the showroom. Respondent wanted to test drive the car and Abhishek Jain escorted him. After half kilometre the car started giving some unusual noise from the front side and the person escorting him got of the car to see but Sh. Amrik Singh suddenly sped off with the car. The respondent verified at the address given by Mr. Amrik Singh but no such person was found there on 19.10.2004. FIR under section 379 IPC was registered at Vasant Kunj Police Station. Intimation for the theft was given to the appellant on 19.10.2004. The claim of the respondent was not honoured.
4. While justifying the repudiation of the claim, the appellant took the objection that the respondent did not lodge complaint on the same date so that the culprits could be arrested. Moreover, Mr. Amrik Singh obtained the insurance cover of the car on 20.10.2004 and issued a cheque for a sum of Rs.17,187/- in favour of the appellant drawn on Syndicate Bank for payment of insurance premium. The appellant took the plea that the entire transaction had already been completed with Amrik Singh and therefore the respondent has no insurable interest.
5. In our view the appellant has taken a very strange plea as to the transfer of insurable interest. The appellant insurance company did not verify at all the papers of the ownership of the vehicle. Merely because some prospective purchaser had intended to purchase the car and took it for test drive and that too alongwith the representative of the respondent sitting besides him and in the process committed theft, does not mean that the insurable interests stood transferred in the name of the prospective purchaser. The report was lodged with the police and the police could not trace the car and therefore filed untraced report. District Forum has rightly come to the conclusion that the formalities relating to the purchase were still to be completed when the car was taken for the test drive and moreover Amrik Singh who wanted a test drive did not take the vehicle all alone he was accompanied by one Abhishek Jain a relative of friend of the respondent and when the car started giving problem it was natural for Abhishek Jain to get down from the car but such circumstances were created by Amrik Singh that gave him an opportunity to take away the car and to succeed in his plan to commit theft of the car.
6. It is not understandable and beyond our comprehension as to how respondent was blamed for theft of the car or transferring insurable interest.
7. So far as the insurable interest is concerned the same continues to be in the name of the person in whose name the vehicle stands registered. Unless owner of a vehicle has sold the vehicle against receipt of consideration and execution of all the requisite documents as provided by Motor Vehicle Act, the insurable interests continues to be in the name of the registered owner.
8. It is pure and simple case of a theft of the vehicle. Theft has been defined by section 378 of the IPC punishable under section 379 IPC as under:
378. Theft.- Whoever, intending to take dishonestly any moveable property out of the possession of any person without that persons consent, moves that property in order to such taking, is said to commit theft.
9. In the instant case all the essential ingredient referred in the definition exist. Amrik Singh dishonestly took the vehicle out of possession of the registered owner without his consent. We have come across large number of cases where the claim of original owner as well as the owners who had purchased the vehicle have been repudiated. Such a practice and attitude is unfair, unethical. When original owner files the claim Insurance Company tells him that since he has already sold the vehicle he has no insurable interest. When the subsequent purchaser files the claim he is told that change of his name has not been affected in the Registration Certificate as well as in the Insurance policy therefore his insurable interests have not been transferred. It is like heads you lose tails I win. By adopting such an approach, Insurance Company has no other motive than to escape its liability and to become unjustly rich.
10. Contract of insurance is for the benefit of the consumer and no term of the contract can be read in isolation. These have to be read in context of other terms and conditions and as a whole. It is universal rule of interpretation that every term of every contract or any provision of any statute should be interpreted in a manner that it should be in consonance with the aims and objects of the contract and the statute and particularly in respect of the insurance contract if there are two interpretations, the interpretation which favours the consumer should be adopted. Otherwise the whole contract will become meaningless.
11. Foregoing reasons persuade us to dismiss the appeal being wholly devoid of merit. The payment shall be made within one month from the date of receipt of this order.
12. Bank Guarantee/FDR, if any, furnished by the appellant be returned forthwith.
13. A copy of this order as per the statutory requirements be forwarded to the parties free of charge and also to the concerned District Forum and thereafter the file be consigned to Record Room.
Announced today on 10th day of January 2008.
(Justice J.D. Kapoor) President (Rumnita Mittal) Member Tri