State Consumer Disputes Redressal Commission
United India Insurance Company Ltd. vs Jai Krishan on 6 September, 2013
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, DAKSHIN MARG, SECTOR 37-A, CHANDIGARH.
First Appeal No.865 of 2010
Date of institution : 18.05.2010
Date of decision : 06.09.2013
United India Insurance Company Ltd., Regional Office, 136, Feroze
Gandhi Market, Ludhiana through Shri O.P. Kanava being Deputy
Manager.
.......Appellant- Opposite Party
Versus
Jai Krishan s/o Shri Darshan Lal Gupta C/o Jai Agro Services Centre,
Surja Ram Market, Malout, District Muktsar.
......Respondent- Complainant
First Appeal against the order dated
16.04.2010 of the District Consumer
Disputes Redressal Forum, Muktsar.
Quorum:-
Hon'ble Mr. Justice Gurdev Singh, President.
Shri Baldev Singh Sekhon, Member.
Mrs. Surinder Pal Kaur, Member.
Present:-
For the appellant : Shri Munish Goel, Advocate. For the respondent : Shri Naresh Jain, Advocate. JUSTICE GURDEV SINGH, PRESIDENT :
Jai Krishan, respondent/complainant, purchased policy bearing No.200104/31/7/01 from the opposite parties regarding his car bearing registration No.DL-3CAD-3978 after paying the full consideration and that policy was valid from 2.6.2007 to 1.6.2008. The car met with a serious accident on 26.4.2008 at 7.30 A.M. near village Bucho, District Bathinda, information about which was given to the opposite First Appeal No.865 of 2010. 2 party. The car was badly damaged and two deaths took place. He himself and his wife suffered serious injuries. FIR was got registered in the concerned police station. The damaged car was taken into possession by the police. The surveyor of the opposite party confirmed in its report that the car was totally damaged and was unfit to be plied on the road. The complainant filed complaint under Section 12 of the Consumer Protection Act, 1986 (in short, "the Act") averring therein that he requested the opposite party to release that claim in respect of the insurance and to reimburse the carriage charges of Rs.2620/- but it preferred to sit over that claim, which caused lot of mental pain, harassment and agony to him. The said act of the opposite party amounts to deficiency in service on its part. It was only after his request that the opposite party, vide letter dated 27.5.2009 informed him that his claim had been approved for Rs.1,79,500/- on net salvage basis. As the car was totally damaged, so he was entitled to the claim of Rs.2,70,000/-, which was the declared value. He made a request to the opposite party to pay that amount along with Rs.2,620/- but all in vain. Even the service of the legal notice upon it did not serve any purpose. He prayed for the issuance of following directions to the opposite party:-
i) to reimburse the total claim of Rs.2,70,000/- and Rs.2600/-
along with interest at the rate of 24% per annum from the date of accident till actual realization;
First Appeal No.865 of 2010. 3
ii) to pay Rs.50,000/- as compensation for mental tension, harassment, agony and deficiency in service;
iii) to pay Rs.10,000/- as litigation expenses.
2. In the written reply filed by the opposite party, it admitted that the complainant got his car insured with it and that after intimation was given about the accident the surveyor was appointed by it and that the complainant was informed, vide letter dated 27.5.2009 regarding the approval of his claim to the tune of Rs.1,79,500/-. It denied the other averments made in the complaint and pleaded that after the complainant informed it regarding the accident, Shri Rajpaul Singhal, Surveyor was immediately deputed for spot survey and Chander Shekher was deputed to assess final assessment of loss. That surveyor, vide letters dated 8.7.2008 and 28.7.2008, requested the complainant to furnish the requisite documents but he never responded to those letters. The order of the release of the vehicle on sapurdari was received by the surveyor on 10.3.2009 and thereafter after conducting the final survey he released his independent report dated 27.5.2009 in which he recommended the settlement of the claim on the net of salvage basis for an amount of Rs.1,79,500/- after deduction of excess clause. The delay in release of vehicle on sapurdari resulted in the decrease of the value of the vehicle for which the surveyor recommended the deduction of Rs.25,000/- from the insured declared value. The value of the wreck to be retained by the complainant was Rs.65,000/- and after deducting both these amounts the First Appeal No.865 of 2010. 4 recommendation for the settlement of the claim at Rs.1,79,500/- was made. That recommendation was duly conveyed to the complainant and a settlement intimation voucher for signature was also sent to him and a reminder was also issued on 12.6.2009. Instead of approaching it for the payment of that amount, he filed the complaint for which he is liable to be penalized under Section 26 of the Act as the complaint filed by him is false and frivolous. It also pleaded that the complainant is not a consumer as defined in Section 2(1)(d) of the Act as he was using the vehicle for commercial purposes. He concealed the material facts from the District Forum. He has no locus-standi to file the complaint. Complicated questions of law and facts are involved and, as such, the matter should be tried by the Civil Court in accordance with law. The District Forum has no jurisdiction to entertain and try the complaint.
3. Both the sides produced their evidence in support of their respective averments before the District Consumer Disputes Redressal Forum, Muktsar (in short, "District Forum"), which after going through the same and hearing learned counsel on their behalf allowed the complaint, vide order dated 16.4.2010 and directed the opposite parties to pay Rs.2,70,000/- along with interest at the rate of 7.5% per annum from 05.02.2009. The District Forum also directed the opposite parties to pay Rs.2620/- spent on carriage and Rs.5,000/- as costs. Feeling aggrieved by that order, this appeal has been filed by the opposite parties.
First Appeal No.865 of 2010. 5
4. We have heard learned counsel for both the sides and have carefully gone through the records of the case.
5. It was submitted by the learned counsel for the opposite parties that Chander Shekher, Surveyor, vide his report Ex.R-9 correctly assessed the loss on the basis of net on salvage by taking into consideration the insured declared value in the insurance policy. He deducted a sum of Rs.90,000/- as the value of the salvage, which is with the complainant. The District Forum committed an illegality by passing the impugned order by ignoring the fact that the salvage of the car is lying with the complainant and the value thereof was to be deducted while making the assessment of the amount to be paid to the complainant by way of claim. He prayed that the insured amount so ordered to be paid to the complainant be reduced to Rs.1,79,500/-.
6. On the other hand, it was submitted by the learned counsel for the complainant that from the evidence produced on record, it stands proved that after the car was released on sapurdari by the Judicial Magistrate, the possession thereof was taken by the opposite party and it is still in possession thereof. Therefore, the surveyor while assessing the loss could not have deducted the value of the salvage. The District Forum correctly allowed the total declared insurance value without any such deduction and that finding of the District Forum stands supported by the judgment of the Hon'ble Supreme Court reported in AIR (SCW) 6394 [2009] (Dharmendra Goel vs. Oriental Insurance Co. Ltd.).
First Appeal No.865 of 2010. 6
7. The first question to be decided is as to who is keeping the wreck (salvage) of the car? The most material document for determining that question is the order dated 24.2.2009 passed by Judicial Magistrate, Bathinda Ex.C-12. By that order the application for releasing the car on sapurdari in favour of the opposite party was allowed. The car was ordered to be handed over to the Insurance Company. It is in the written reply of the opposite party itself that final report was submitted by the surveyor only after that order was passed. That itself shows that after the car was ordered to be released on sapurdari, the possession thereof was taken by the opposite party. There is no evidence on the record on the basis of which it may be concluded that the possession thereof was ever delivered to the complainant by the opposite party. Thus, the salvage/wreck of the car is with the opposite party and the surveyor was not justified in making any deduction on account thereof from the declared insured value. In Dharmendra Goel's case (supra) it was held by the Hon'ble Supreme Court that the Insurance Companies being in dominant position because of the stringent provisions of Section 146 of the Motor Vehicles Act, 1988 often act in an unreasonable manner and after having accepted the value of a particular insured good disown that very figure on one pretext or the other when they are called upon to pay compensation. This take it or leave it attitude is clearly unwarranted not only as being bad in law and ethically indefensible. It was also held that the Insurance Company was bound by the value First Appeal No.865 of 2010. 7 put on the vehicle while issuing the insurance policy. In that case the deduction made by the surveyor from the value so declared in the policy was not allowed and after applying a deduction of Rs.10,000/- on account of the passage of 7 months since the taking of the policy, the Insurance Company was ordered to pay the amount as mentioned in the insurance policy.
8. From the above discussion, we conclude that the surveyor was not justified in making any deduction from the declared insured value while assessing the loss. At the most, the opposite party can ask the complainant to get the registration certificate of the car transferred in its favour and to execute the letter of subrogation. The District Forum did not commit any illegality while allowing the prayer of the complainant and directing the opposite party to pay the amount of Rs.2,70,000/-, which was the declared insured value. It is to be noted that the said value of the car was declared on the day when the insurance policy was obtained. The same was obtained on 2.6.2007 whereas the accident had taken place on 26.4.2008 i.e. almost after more than 10 months. The value of the car was bound to depreciate during the said period. Keeping in view the observations made by the Hon'ble Supreme Court in the above referred judgment that amount of Rs.2,70,000/- is reduced by Rs.15,000/-. The order of the District Forum is modified to that effect. Otherwise, we do not find any merit in this appeal and the same is dismissed subject to the above said modification. However, no order is made as to costs. First Appeal No.865 of 2010. 8
9. The sum of Rs.25,000/- deposited at the time of filing of the appeal along with interest which has accrued thereon, if any, shall be remitted by the registry to the respondent/complainant by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the District Forum and the appellant/opposite party.
10. The arguments in this case were heard on 3.9.2013 and the order was reserved. Now, the order be communicated to the parties.
11. The appeal could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE GURDEV SINGH) PRESIDENT (BALDEV SINGH SEKHON) MEMBER (MRS. SURINDER PAL KAUR) September 06, 2013 MEMBER Bansal