State Consumer Disputes Redressal Commission
Narayan Dayanand Nayak vs Tata Motors Ltd. on 18 April, 2024
1 CC/517/2018
Date of Filing : 13.11.2018
Date of Disposal : 18.04.2024
BEFORE THE KARNATAKA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, BENGALURU (PRINCIPAL BENCH)
DATED THIS THE 18th DAY OF APRIL 2024
PRESENT
Mr. K.B.SANGANNANAVAR : JUDICIAL MEMBER
Mrs M.DIVYASHREE : LADY MEMBER
CC-NO.517/2018
Narayan Dayanand Nayak
S/o Dayanand Nayak,
Aged about 36 Years,
R/at Laxmeshwar, Ankola,
Uttara Kannada - 581314. . . ..Complainant/s
(By Adv.Sri.Nishanth.A.V.)
VS
1.
1. Tata Motors Ltd.
Regional Office At:
Fortune Summit Towers,
No.244, 2nd Floor,
Hosur Main Road,
Bengaluru-560068.
Rep. by its Regional Manager.
Regd. Office At: Bombay House,
No.24, Home Mody Street,
Mumbai-400001.
(By Adv.Sri.Rishab Raj Thakur)
2. Reliance General Insurance
Regional Office at:
Maximus Commercial Complex,
4th Floor, Light House Hill Road,
Hampankatte,
Mangaluru-575001.
Rep. by its Regional Manager
2 CC/517/2018
Registered Office at:
H Block, 1st Floor,
Dhirubhai Ambani Knowledge City,
Navi Mumbai-400710.
(By Adv.Sri.C.Lakshminarayan)
3. Arvind Motors Pvt. Ltd.
Corporate Office At:
Padukodi, Kuloor-Kavoor Road,
Kuloor, Mangaluru-575013
Rep. by its Regional Manager. ... Opposite party/s
(By Adv.Sri.Nanjundaradhya.B.G)
ORDER
BY Mr.K.B.SANGANNANAVAR : Pri.Dist & Session Judge (R) - JUDICIAL MEMBER.
1. This is a complaint filed U/s.17 of CPA 1986 to direct OPs to consider the damage to the vehicle as total loss and pay the Complainant a sum of Rs.50 lakhs with interest at 24% from the date of claim till realisation and award compensation in a sum of Rs.5,000/- per day from 05.01.2018 being the date of the claim till payment.
2. The Complainant has stated in his complaint that for the purpose of his business operations purchased a Tata Prima LX 2525.K model Dumper vehicle manufactured by OP.1 from the authorised dealer/OP.3 for a total value of Rs.32 lakhs under invoice dtd.30.12.2017. This vehicle was temporarily registered with the RTO, Mangaluru, with temporary registration 3 CC/517/2018 no.KA19/TR005715/2017-18. This vehicle was insured with OP.2 under the Reliance Commercial Vehicles Package Policy (GCV) for the period 30.12.2017 to 29.12.2018. This vehicle was purchased by the Complainant availing financial assistance from Syndicate Bank, Ankola branch. That was on 04.01.2018, in order to obtain necessary approvals by the RTO, Karwar, the said vehicle was taken to a garage near Ankola. After completing the work near the garage, around 2pm when the vehicle engine was started, within few minutes, smoke emerged from the engine, which resulted in fire. The Complainant on the same day, lodged complaint with jurisdictional police at Ankola with a request to conduct inquiry. The police concerned registered FIR no.01/2018 on 04.01.2018. On 05.01.2018 Ankola police visited the spot, drew up mahajar in the presence of two witnesses. The Karnataka state fire and emergency services department, Karwar prepared a report dtd.27.02.2018 regarding the fire accident which took place on 04.01.2018. On 05.01.2018 Complainant lodged claim with OP.2 for compensation. OP.2 issued a letter dtd.28.02.2018 with a request to submit report of Fire Brigade and OP.1 regarding the fire incident. On 12.02.2018, the Complainant got issued a legal notice through his advocate to the OP.1 and OP.3 to pay compensation for the defect in the manufacturing of the said 4 CC/517/2018 vehicle purchased by the Complainant which resulted in fire accident. On 22.02.2018, the OP.3 issued reply to the legal notice dtd.12.02.2018 by denying any deficiency with respect to the said vehicle and denied the payment of the compensation as claimed by the Complainant and denied to replace the said vehicle with new vehicle. OP.1 on 05.03.2018 issued a letter by giving their interim reply to the legal notice dtd.12.02.2018 requesting to submit all required documents with respect to the claims made by the Complainant. OP.1 issued a final reply on 28.03.2018 to the legal notice dtd.12.02.2018 by denying any deficiency with respect to the vehicle purchased by the Complainant. The Complainant is a consumer within the meaning of Sec.2(1)(d) of CPA 1986 and sought for direction against OPs to consider the damage to the vehicle as a total loss and pay the Complainant a sum of Rs.50 lakhs with interest at 24% from the date of claim till realisation and to pay compensation in a sum of Rs.5,000/- per day from 05.01.2018 being the date of the claim till payment.
3. OPs.1 to 3 put their appearance through learned counsels. OP.1 being the manufacturer submits, he is the renowned manufacturer of various types of commercial vehicles and passenger cars and is widely acclaimed for its class and quality. The cars and the vehicles manufactured are also thoroughly inspected for control 5 CC/517/2018 systems, quality checks and test drive before passing through factory works for dispatch to the authorised dealers appointed on a principal to principal basis for sale of the cars and vehicles. The Complainant has made misconceived and baseless allegations of manufacturing defects in the subject vehicle without relying on any expert report from a recognized and notified laboratory U/s.13(1) of CPA 1986. The complaint filed by the Complainant does not fall within the definition of a consumer dispute and not a consumer within the meaning of Sec.2(1)(d) of CPA. The Complainant being a person avails of service for commercial purpose is not fall within the definition of consumer since he runs as many as three, six SK1613 and tippers. The Complainant has raised issues which involve bundles of facts as well as law and it necessarily requires deposition of evidence and trials can were appropriately done by the civil court. The Complainant is not a consumer and he is using the vehicle to earn profits and not for earning his livelihood and there is no manufacturing defects nor any deficiency in service on the part of manufacturer/OP.1.
4. The OP.2/insurer of the vehicle bearing no.KA19/TR005715/2017-18 admits the issuance of policy for the period from 30.12.2017 to 29.12.2018. In terms of the policy of insurance issued which is in accordance with the provisions of the 6 CC/517/2018 MV Act and rules thereon. OP.2 admits for having received the information from the Complainant on 05.01.2018 regarding the fire incident that occurred on 04.01.2008 immediately appointed an investigator and surveyor for spot inspection of the burnt vehicle due to alleged fire incident and accordingly surveyor was visited the spot and after detailed preliminary survey submitted the report. The Complainant has submitted the claim form and estimation report issued by M/s.Tata Motors ltd., and on receipt of the estimation report from the Complainant, appointed the final surveyor and loss assessors to assess the loss and accordingly their surveyor has visited the garage on several visit and on verification of the burnt car due to fire incident and on detailed discussion had with the authorised repairer and the owner of the car, requested the Complainant to submit the manufacturer report regarding the fire incident and in spite of repeated request the same was not submitted by the Complainant. The Complainant was requested to produce the technical report from the manufacturer to ascertain reason for the fire. The insured vehicle was got fire due to technical defects, which is not covered under the policy and therefore the claim is not payable. As per the investigation report, the fire incident in the insured car was due to manufacturing defect and therefore the insurer is not liable to 7 CC/517/2018 indemnify the loss sustained due to fire incident. The Complainant altered the vehicle contrary to Sec.52(1) MV Act, as such claim is not payable as per the policy terms & conditions. If the fire due to mechanical defects, same is not covered under the policy and therefore OP.2/insurer sought opinion from the manufacturer to ruled out the same and hence the present complaint is not maintainable and the same is liable to be dismissed.
5. OP.3/authorised dealer of the vehicle manufactured by OP.1 company. It contended that fire incident was not due to manufacturing defects in the vehicle or due to deficiency or delay in service of OP.3. As per the knowledge of OP.3 the vehicle was burnt due to fire but not as narrated by the Complainant in his complaint. The engineers of OP.1 have inspected the spot and after due enquiry found that there was no manufacturing defect in the vehicle, but due to the negligent act of the Complainant, the vehicle was burnt. Yet, the Complainant filed the complaint impleading manufacturer and dealer as parties which are hit by mis-joinder of the parties. The Complainant is not entitling for the relief sought for is liable to be dismissed.
6. In view of rival contentions of the respective parties, Commission held an enquiry. Received affidavit evidence and documents and after closure of enquiry, heard the learned counsels on record for 8 CC/517/2018 the respective parties and now, the following points arise for consideration of this Commission:
(1) Do OPs prove that the Complainant does not fall within the definition of consumer and the dispute raised is not a consumer dispute as contended?
(2) Does Complainant prove the manufacturing defects in the vehicle purchased by him as alleged? (3) Does OP.2/insurer justify the repudiation of the claim submitted by the Complainant?
(4) Does the Complainant prove the alleged deficiency in service on the part of OPs?
(5) Does the Complainant entitle for compensation as prayed for?
(6) What order or award?
The findings on the above points are recorded as follows:
(1) In the Negative (2) In the Negative (3) Not justified (4) In the Affirmative in so far as OP.2/insurer is concerned (5) Partly in the affirmative (6) As per the final order for the following:
9 CC/517/2018 REASONS
7. Point Nos.1 to 6: As all these points are to be answered considering the materials on record are taken together for discussion and determination to avoid repetition of certain facts and circumstances found from the enquiry and also to make it convenient for the commission to record findings.
8. It is an undisputed fact that, OP.1 is manufacturer of the vehicle bearing temporary registration no.KA19/TR005715/2017-18 purchased by Complainant through its authorised dealer/OP.3. It is also not in dispute that, Complainant has obtained motor insurance policy from OP.2 under the Reliance Commercial Vehicles Package policy (GCV) for the period 30.12.2017 to 29.12.2018. According to the Complainant, this vehicle was purchased availing financial assistance from Syndicate bank, Ankola branch. The Complainant in his complaint has stated that, on 04.01.2018, in order to obtain necessary approvals by the Regional Transport Officer, Karwar, the said vehicle was taken to a garage situated near Ankola and after completing the work near the garage, around 2pm when the vehicle engine was started, within few minutes, smoke emerged from the engine, which resulted in fire.
10 CC/517/2018
9. The vehicle was purchased on 30.12.2017 and within 5 days from the said date namely 04.01.2018 around 2 pm when it was in the garage was burnt in fire. It is not in dispute that it was burnt while the insurance coverage was in force. In this regard, it would be proper to examine the materials placed on record by the parties to this complaint. In particular the Complainant, commencing from Tax Invoice, wherein it is found, vehicle was hypothecated to Syndicate bank, Ankola. It was purchased for Rs.32 lakhs. As per Sale Certificate Form 21, it was on 01.01.2018. This vehicle was manufactured in the month of December 2017 and it was temporarily registered as found from Form KMV 19, wherein date of purchase is mentioned as 01.01.2018, class of vehicle: HGV- Heavy Goods Vehicle, while OP.2/insurer issued the policy in the name of Complainant incorporating the particulars found in Form KMV 19, declared IDV at Rs.30,40,000/- and collected premium of Rs.67,882/-. Accordingly the policy was issued with Risk Assumption Letter. It is not in dispute that the Complainant had availed loan of Rs.29,80,000/- from Syndicate bank to purchase this vehicle, as such, it was hypothecated in favour of Syndicate bank. Ankola police registered FIR on 04.01.2018 by receiving information from Mr.Narayan Nayak, who is none other the Complainant. His statement was recorded by the police on 11 CC/517/2018 4.01.2018 as to the fire incident. On 05.01.2018, the said police drew up mahajar, noted down the fire incident that was took place at the spot and as to how truck was burnt. The Karnataka State Fire and Emergency services certified about the fire incident in their report bearing no.02/2018 dtd.04.01.2018. OP.2/insurer on 28.02.2018 without prejudice requested the Complainant to submit Fire brigade report and Manufacturer report regarding the fire incident. The rest of the documents are legal notice and reply thereon. Further placed few positive photographs to show, as to how, the vehicle was burnt in fire. On the contrary, nothing is placed on record either by OP.1 or OP.2 or OP.3 to rebut these materials on record.
10. It is an unfortunate fact to be noted herein that, OP.2/insurer having been issued Commercial Vehicles Package Policy/GCV for the period commencing from 12.13 hrs on 30.12.2017 to 23.59 hrs of 29.12.2018, declaring IDV of the vehicle at Rs.30,40,000/-, having been received premium amount of Rs.67,882/-, contended that, having received the information from the Complainant on 05.01.2018 regarding the fire incident that was occurred on 04.01.2018 immediately appointed the investigator and surveyor for spot inspection of the burnt vehicle and to submit survey report to their company, however failed to submit the detailed preliminary 12 CC/517/2018 survey said to have been conducted by their investigator and surveyor, and further OP.2 company/insurer has also failed to submit the final survey report, suffice to draw an inference for the reasons best known or if placed would go against the company. The contention of OP.2 that, Complainant has failed to obtain technical report from OP.1/manufacturer to ascertain reasons for the fire. In our view if complainant has not produced, OP.2/insurer could have obtained such report from their own surveyor/investigator, to show the fire incident was occurred was due to defects in the manufacture of the said vehicle or at least could have obtain report from technical expert. In other words considering the date of purchase and the date of fire incident, instead of asking the Complainant to obtain report from OP.1 could have obtain an expert report from a technical expert, if they are already in a position to obtain a detailed preliminary report on the fire incident from their own surveyor or a final report obtain from such of surveyor. In our view not producing these two reports for scrutiny before the commission give rise to draw an inference against the insurer.
11. OP.2 would contend, fire incident was taken place, while welding/altering the insured vehicle parts in private garage which itself demonstrate the reason for fire and the Complainant without 13 CC/517/2018 prior permission from RTO altered the vehicle in violation of Sec.52 of MV Act. If this could be acceptable, where is the question of manufacturing defects in the vehicle, or, where is the question to request the Complainant to produce the technical report from the manufacturer to ascertain the reason for the fire. It is therefore, pursuant to the version submitted by OP.2, Commission could safely conclude that the fire incident, which was occurred on 04.01.2018 as stated by the Complainant, while the vehicle was in the private garage was not due to any manufacturing defects and it was due to reasons recorded in the preliminary survey or in the final survey as the case may be which are not at all placed before the Commission for appreciation.
12. The contention of learned counsel for OP.2 that there is no rule that claim has to be settled if the policy was in force without ascertaining the cause of the fire and whether the claim made by the Complainant would come under the purview of the policy terms & conditions and there is no deficiency in service on the part of insurer could be hold unacceptable considering the conduct of OP.2/insurer for not placing material evidence on record before the Commission for appreciation of the case of the Complainant in right perception. The contention of OP.2 that, Complainant is not maintainable for want of participation of banker as necessary party 14 CC/517/2018 as there is hypothecation clause is again unacceptable, since even without impleading banker complaint as brought could be decide by the Commission, in accordance with law. If the vehicle was purchased availing loan from Syndicate bank and if the loan amount is not paid is nothing to do with settlement of insurance claim pursuant to the fire incident that was occurred on 04.01.2018. The insurer cannot take such defence under consumer law case. The dispute as to the loan is between the complainant and the banker which cannot be deciding by the consumer commissions.
13. As already stated above, OP.1 is a manufacturer, while OP.3 is their authorised dealer and their defence is almost similar and are contending Complainant is not a consumer within the meaning of Sec.2(1)(d) of CPA 1986 and to find support placed decision reported in (1997) 1 SCC 131 in the case between Cheema Engineering Services vs. Rajan Singh, wherein held "the explanation excludes from the ambit of commercial purpose in sub- clause (i) if section 2(1)(d), any goods purchased by a consumer and used by him exclusively for the purpose of earning his livelihood by means of self-employment. Such purchase of goods is not a commercial purpose. The word „self-employment‟ is not defined. Therefore, it is a matter of evidence. Unless there is evidence and on 15 CC/517/2018 consideration thereof it is included that the machine was used only for self-employment to earn his livelihood without a sense of commercial purpose by employing on regular basis the employee or workmen for trade in the manufacture." Further, he relied on (1995) 3 SCC 583 in the case between Laxmi Engineering works vs. PSG Industrial Institute, wherein held at 21(ii) Whether the purpose for which a person has bought goods is a „commercial purpose‟ within the meaning of the definition of expression „consumer‟ in Section 2(d) of the Act is always a question of fact to be decided in the facts and circumstances of each case. Further, it would be just and proper to extract para 22, wherein held "So far as the present case is concerned we must hold (in agreement with the National Commission), having regard to the nature and character of the machine and the material on record that it is not goods which the appellant purchased for use by himself exclusively for the purpose of earning his livelihood by means of self employment, as explained hereinabove. Further placed reliance on the decision reported in 2016 SCC online NCDRC 251 in the case between Sanjay Jain vs. Honda Cars (India) Ltd., and Anr, wherein held "merely because the car caught fire, it cannot be stated there was manufacturing defects in the vehicle". Learned counsel further placed reliance on the decision reported in II (2005) CPJ 72 (NC) 16 CC/517/2018 in the case between Swaraj Mazda ltd., vs. P.K.Chakkappore and Anr, wherein held in para 5 .........This all leaves us with a clear view that the complainant has not been able to prove any defect in the engine and State Commission‟s reliance on the inspection report in our view is misplaced for two reasons - one about the qualification of the local commission and secondly the assumptions on which this report is based, which in our view is not well founded, especially, when the vehicle had met with an accident; what damage was caused by that accident is not on record, nor has that been commented upon by the Surveyor / Local Commissioner."
14. On the contrary, learned counsel for the Complainant placed reliance reported in (2020) 2 SCC 265 in the case between Lilavati Kirtilal Mehta Medical trust vs. Unique Shanti Developers and others, wherein held "In the context of such transaction, a commercial entity may also be a „consumer‟ depending on the facts of the case. It is not the identity of the person, but the purpose of transaction which is relevant. Hence, provision of goods and services/perquisites by employer for benefit of employees as welfare measures and not linked to ordinary profit- generating activity of the employer, held, can qualify as consumer transactions." Thus, this preposition of law laid down by the Hon'ble Apex Court is directly applies to the facts found from 17 CC/517/2018 complaint and version submitted by OPs, since in the context of complaint raised by the Complainant although he owns as many as six SK1613 and tippers for his company, facts remain the vehicle involved in the complaint was insured with OP.2, as such, we have to consider the Complainant is a consumer depending on these facts. In other words, it is not the identity of the Complainant, but parties to the transaction which is relevant, since, the Complainant has raised dispute not against OP.1 & 3, but also raised against OP.2/insurer and in view of the facts, as we hold nothing is placed on record to establish manufacturing defects in the vehicle manufactured by the OP.1, which was sold to the Complainant through OP.3 their authorised dealer and in such circumstances, the dispute crux would be between the Complainant and OP.2. In other words, between insurer and insured of the vehicle, which was burnt in fire incident on 04.01.2018 within 5 days from the date of purchase after registering the vehicle from RTO, Karwar. Further, it would be appropriate to make mention of para 19.2 of the decision relied on by the Complainant, wherein held "The purchase of the good or service should have a close and direct nexus with a profit-generating activity". Further, learned counsel relied on the decision reported in 2004 SCC online NCDRC 11 in the case between Harsolia 18 CC/517/2018 Motors vs. National Insurance Co., Ltd., wherein held by the end of para 12 "Further, from the aforesaid discussion, it is apparent that even taking wide meaning of the words for any commercial purpose it would mean that goods purchased or services hired should be used in any activity directly intended to generate profit. Profit is the main aim of commercial purpose. But, in a case where goods purchased or services hired in an activity which is not directly intended to generate profit, it would not be commercial purpose. In this view of the matter, a person who takes insurance policy to cover the envisaged risk does not take the policy for commercial purpose. Policy is only for indemnification and actual loss. It is not intended to generate profit." Thus, these two ratios are answers to the contention of the counsel for OPs.1 & 3 on one part and OP.2 on the other part that dispute raised by Complainant having been obtained insurance policy from OP.2 is not entitled to generate profit and the risk does not take the policy for commercial purpose. In other words, Complainant has obtained policy from OP.2 is only for indemnification and actual loss.
15. In the above such circumstances, viewed from any angle, on facts, the Complainant cannot be said does not fall within the meaning of Sec.2(1)(d) of CPA 1986 and his complaint cannot be held does not fall within the definition of consumer dispute.
19 CC/517/2018
16. Admittedly, the vehicle was purchased on 30.12.2017 for Rs.32 lakhs was insured with OP.2 declaring IDV for Rs.30,40,000/- and this vehicle was registered with RTA, Karwar and while the said vehicle was in a private garage at Ankola was burnt in a fire incident. The police visited the spot pursuant to information of fire incident, recorded statement of Complainant and drew up mahajar. The fire brigadier/fire station also visited the spot and submitted the report about the burnt of the vehicle and nothing is placed on record by OP.2/insurer despite conducting investigation and obtaining survey reports of the burnt vehicle. OP.2/Insurer failed to place not only preliminary survey report but also final report. In such circumstances, considering positive photographs which could be seen and in consideration of IDV, in our view, the vehicle has to be held totally burnt which could not be repaired, as such the loss of the insured vehicle has to be considered on the basis of the value for which the insured had declared in the certificate of insurance. In such conclusion, question of replacement of the vehicle by OPs.1 & 3 do not survive for consideration and the claim of the Complainant that he is entitle for Rs.50 lakhs with interest at 24% p.a. from 05.01.2018 and Rs.5,000/- being loss per day from 05.01.2018 as prayed also cannot be considered in consideration of the tax invoice and the 20 CC/517/2018 certificate of insurance. Accordingly, we proceed to record negative findings on Points nos.1 & 2, and hold OP.2 is not justified to repudiate the claim submitted by the Complainant and his actions amounts to rendering deficiency of services, hence recorded findings on point nos.3 and 4 accordingly.
17. In view of the findings recorded on Points nos.1 to 4, the complaint filed by the Complainant deserves to be allowed as against OP.2 alone, as such findings on Point nos.5 & 6 are recorded accordingly and in the result proceed to allow the complaint in part.
And directed OP.2/insurer to indemnify/pay Rs.30,40,000/- along with interest at 6.5% p.a. from 04.01.2018 till realisation and do pay Rs.1,00,000/- as compensation and Rs.50,000/- towards litigation cost within 60 days from the date of receipt of this order and in default, to pay interest at 8% p.a. from such date till realisation.
The insurer is held entitle to collect the salvage and the complainant is entitle to claim for reimbursement of the vehicle registration fees etc; as provided under motor taxation rules.
The complaint as against OPs.1 & 3 stands dismissed.
18. Supply free copy of this order to both the parties.
Lady Member Judicial Member *NS*