Anil Girulkar vs National Insurance Co.Ltd

AGGRIEVED by the order dated 22.5.2007, passed by Chhattisgarh State Consumer Disputes Redressal Commission, Raipur (for short, ''State Commission '') in (FA No.177 of 2006) filed by the respondent/O.Ps against order dated 13.4.2012, passed by District Consumer Disputes Redressal Forum, Raipur in complaint no.144 of 2005, thereby accepting the complaint.

BRIEF facts are that petitioner/complainant purchased a Nokia cell phone for Rs.3,700/- on 3.7.2004, which was duly insured by the respondents. It has been alleged by the petitioner that said handset was stolen from his shirt pocket on 31.3.2005. Accordingly, he lodged police report of the incident on 1.4.2005. Petitioner put up a claim with the respondents on 2.4.2005, alongwith relevant documents. Respondents, repudiated the claim, vide their letter dated 30.4.2005. The complaint was opposed by the respondents. In its written statement, respondents took the plea that special contingency policy was issued covering the risk, under the terms specified therein. Risk of theft as alleged by the petitioner was not covered under the policy. Hence, petitioner was not entitled to any relief.

District Forum, vide its order dated 13.4.2006, allowed the complaint and directed the respondents to pay to the petitioner a sum of Rs.3,700/- with interest @ 9% payable from 2.4.2005. Besides, compensation of Rs.2,000/- and costs of Rs.500/- was also awarded. Aggrieved by the order of the District Forum, respondents filed appeal before the State Commission which vide its impugned order, allowed it and dismissed the complaint of the petitioner.

THIS is how the matter has reached this Commission. We have heard the learned counsel for the parties and gone through the record.

IT is contended by learned counsel for the petitioner that State Commission has misinterpreted the terms and conditions of the policy since exclusion clause was not part of the policy which was issued to the petitioner. Secondly, State Commission wrongly held that theft has to occur by force. In support of its case, learned counsel for petitioner relied upon following judgements; i) National Insurance Company Ltd. Vs D.P. Jain III (2007) CPJ 34 (NC) and ii) United India Insurance Company Ltd. Vs M/s. Pushpalaya Printers, 1986-2004 Consumer 8271 (NS).

On the other hand, it is contended by learned counsel for the respondents that the policy term ''1B (d) '' clearly exclude theft of the handset, unless it was taken away by use of actual or threatened force. As per petitioner ''s own case, somebody has picked his pocket and removed the handset. Thus, no force whether actual or threatened has been exercised in this case. Accordingly, the risk as stated above was not covered under the policy. In support, learned counsel has relied upon decision of Apex Court in United India Insurance Co.Ltd. Vs. M/s Harchand Rai Chandan Lal, 2004 CTJ 1018 SC (CP). Relevant term and condition of the insurance policy ''clause 1B (d) '' is reproduced as under ; "Theft of Handset from any public place/public conveyance except where the Handset is taken by actual or threatened fore. In all the above instances, a claim shall be entertained only if accompanied by a copy of a registered FIR duly numbered, signed and stamped (First Information Report) to the local Police Station pertaining to such theft of the Handset ".

IN Harchand Rai (supra) Apex Court has held that a burglary or theft has to be preceded with force or violence in order to be indemnified by the insurance company. The court observed; "9. It is possible that an insurer may sustain loss in technical terms of the criminal law, but no relief can be given to him unless his case is covered by the terms of the policy. It is not open to interpret the expression appearing in policy in terms of common law; but it has to give meaning to the expression as defined in the policy. The act that causes the loss must fall within the definition in the policy and it cannot take the cover and contents of the definition as laid down in the criminal law. Therefore, when the definition of the word ''burglary'' has been defined in the policy then the cause should fall within that definition. Once a party has agreed to a particular definition, he is bound by it and the definition of criminal law will be of no avail. In this connection, the decision of the National Consumer Disputes Redressal Commission in the case of National Insurance Company Ltd. v. Public Type College which has taken the colour and content of the definition given in the criminal law does not lay down the correct proposition of law. It is settled law that terms of the policy shall govern the contract between the parties, they have to abide by the definition given therein and all those expressions appearing in the policy should be interpreted with reference to the terms of policy and not with reference to the definition given in other laws. It is a matter of contract and in terms of the contract the relation of the parties shall abide and it is presumed that when the parties have entered into a contract of insurance with their eyes wide open, they cannot rely on definition given in other enactment. Thus, the decision of the National Consumer Disputes Redressal Commission in the case of National Insurance Company Ltd. v. Public Type College is not a good law and all the Tribunals i.e. National Consumer Disputes Redressal Commission, State Commission and District Forum having applied the ratio of that case; the impugned order cannot be sustained. "

APEX Court has further observed; "15. From the above discussion, we are of the opinion that theft should have preceded with force or violence as per the terms of insurance policy. In order to substantiate a claim an insurer has to establish that theft or burglary took place preceding with force or violence and if it is not, then the insurance company will be well within their right to repudiate the claim of the insurer ". 16. However, all the three forums have already awarded compensation and the amount has been paid to the respondent, therefore, on the point of equity we would not like to disturb the payment which has already been made. However, in view of legal position stated by us, the orders of the District Forum, State Commission and the National Commission cannot be upheld. "

In view of the above decision of the Apex Court and ratio laid down therein, it is manifestly clear that terms of the policy have to be considered strictly and applied to decide the claim of the complainant. The above noted terms of the policy clearly and without any ambiguity state that simple theft of the handset from the shirt pocket of the complainant was not covered under the terms of the policy. Accordingly, petitioner is not entitled to claim the amount in question from the respondents. 13, hoever.

However , we should not loose sight of the fact that Apex Court, as early as in the year 2004, in Harchand Rai (supra) has observed; "That the terms of the policy as laid down by the Insurance Company should be suitably amended by the Insurance Company so as to make it more viable and facilitate the claimants to make their claim. The definition is so stringent in the present case that it gives rise to difficult situation for the common man to understand that in order to maintain their claim they will have to necessarily show evidence of violence or force. The definition of the word burglary should be given meaning which is closer to the realities of life. The common man understands that he has taken out the Policy against theft. He hardly understands whether it should precede violence or force. Therefore, a policy should be a meaningful policy so that a common man can understand what is the meaning of burglary in common parlance. Though we have interpreted the present policy strictly in terms of the policy but we hope that the Insurance Companies will amend their policies so as to make them more meaningful to the public at large. It should have the meaning which a common man can easily understand rather than become more technical so as to defeat the cause of the public at large ".

WHILE dismissing the present revision petition, under peculiar circumstances of the present case we direct the respondents to pay the awarded amount to the petitioner, since it has not complied with the above quoted directions passed by the Apex Court, as far as back in the year 2004, so that common man before taking such type of policy should understand the intricacies of the same. No order as to costs.