FRANK BROTHERS And COMPANY (PUBLISHERS) LTD. vs NEW INDIA ASSURANCE CO. LTD.

THE present complaint has been filed by M/s. Frank Brothers and Company (Publishers) Ltd. against the New India Assurance Company Limited and Standard Chartered Bank alleging deficiency in service on the part of O.P. No. 1 and claiming a sum of Rs. 4,85,000/- along with interest and also compensation for mental agony and harassment amounting to Rs. 50,000/- and also Rs. 15,000/- towards cost of litigation. O.P. No. 2 has been impleaded as a proforma party since the policy was subject to financial interest of the Bank.

THE facts of the case in brief are as follows: THE complainant purchased one Tata Sumo DLX with financial assistance of O.P. No. 2/Standard Chartered Bank, New Delhi in October, 1998 for Rs. 4,94,337/-. THE registration number of the vehicle was UP-16-4919. O.P. No. 2 obtained comprehensive policy of the insurance in respect of the vehicle before the delivery was taken and the policy was valid for the period 28.9.1998 to 27.9.1999. THE sum insured under the policy was Rs. 4,85,000/-. It is stated that on 16.2.1999 at about 6.00 p.m. the vehicle was stolen from a place situated within the jurisdiction of Police Station Rajouri Garden, West District, New Delhi. At that time the vehicle was in the possession of the driver Shri Avadesh Prasad. A formal report about the theft was lodged by Shri S.K. Madan, Assistant Accounts Officer on 18.2.1999. It is alleged that the police detained the driver upto 20.2.1999 when a regular report about the theft was lodged under Section 379, I.P.C. THE complainant sent the claim intimation to O.P. No. 1 on 18.2.1999. THE complainant also provided to O.P. No. 1 the details about the theft, purchase of the vehicle vide its letter dated 4.3.1999 THE complainant also submitted the untraced report of the police vide letter dated 29.3.1999. It is stated that the complainant completed all the formalities and submitted all the papers required by O.P. No. 1 to finalise the claim. It is also stated that in July, 1999 O.P. No. 1 offered to settle the claim for Rs. 3,87,500/- and the complainant vide its letter dated 19.7.1999 gave its consent to accept the above sum in settlement of the claim. However, the claim was not settled by O.P. No. 1 and the complainant withdrew the consent given earlier for settlement of the claim at Rs. 3,87,500/- and asserted that the complainant is entitled to settlement of the claim for the sum assured under the policy. It is also stated that between 18.2.1999 and 15.9.1999 there was no communication from O.P. No. 1. However, vide its letter dated 16.9.1999 O.P. No. 1 demanded clarification regarding the version given by the driver to Punjabi Bagh Police Station on 17.2.1999 and the second version given to police officials of Police Station, Rajouri Garden, New Delhi on 20.2.1999 on the strength of which FIR was registered. However, by that time the driver had left the employment of the complainant. THE complainant by its letter dated 8.1.2000 replied to the queries raised by O.P. No. 1. It is further stated that O.P. No. 1 after receiving the claim also appointed Investigator and Surveyor and the Investigator submitted his report on 21.4.1999 and the Surveyor also submitted his report on 4.8.1999. Still O.P. No. 1 failed to settle the claim. It is also alleged that both the Investigator and the Surveyor reported that the complainant has lost the vehicle and the claim is payable. However, O.P. No. 1 insisted to record the statement of the driver who was not available. Unable to get the claim settled, the complainant filed the present complaint alleging deficiency in service on the part of O.P. No. 1 and claiming the amounts mentioned above, in support of its claim the complainant has filed affidavit of Mr. R.K. Govil, Managing Director of the complainant company along with copies of all the letters exchanged between the complainant and O.P. No. 1. THE complainant has also filed copy of the FIR lodged with the Police Station, Rajouri Garden and also copy of report lodged at Police Station, Punjabi Bagh. THE complainant has also filed a copy of the letter by which the offer was made by O.P. No. 1 to settle the claim at Rs. 3,87,500/- and the copy of the acceptance sent by the complainant on 19.7.1999. In reply O.P. No. 1 admitted that Insurance Policy No. 3131170104419 was issued in favour of the complainant in respect of Tata Sumo valid for the period 29.9.1998 to 27.9.1999 for a sum of Rs. 4,85,420/-. It is also admitted that on 22.2.1999 the complainant gave intimation that the vehicle was stolen on 16.2.1999. It is also admitted that the O.P. appointed M/s. G.L. Aggarwal and Company as Investigator who in their report stated that the loss was likely in the circumstances as alleged by the complainant. O.P. company also appointed Shri S.P. Mangla as Surveyor to assess the loss who vide his report dated 4.8.1999 assessed the value of the vehicle as Rs. 3,87,500/-. The Surveyor also obtained a consent letter from the complainant to settle the claim. It is stated by the O.P. that when the claim was being processed they have received a copy of the report dated 17.2.1999 lodged by the driver with Punjabi Bagh Police Station which was not in consonance with the FIR lodged by the same person at Police Station Rajouri Garden on 22.2.1999. Since the two reports were contradictory, O.P. No. 1 sought clarification from the complainant, who reported that the driver has left the service and is not available. It is stated by O.P. No. 1 that the complainant has concealed material facts regarding the circumstances in which the vehicle was stolen. Still O.P. No. 1 processed the claim and offered to settle the same for Rs. 3,87,500/- subject to completion of formalities. But the complainant failed to do so and thus the delay in settling the claim is on the part of the complainant. It is also stated that the complainant did not get the registration of the vehicle transferred in the name of the Insurance Company in the absence of which the claim could not be settled and the amount could not be paid to the complainant. It is further stated by O.P. No. 1 that as per terms of the policy, the Insurance Company is required to compensate the complainant for the loss at the market value of the vehicle on the date of loss and also that there is no provision for payment of interest. It is also stated that in any case the interest should not exceed 9% p.a. In support of its contention O.P. No. 1 has filed the affidavit of Ms. Anjali Bansal, Assistant Manager of the New India Assurance Company along with copies of two FIRs and the letters written by the O.P. to the complainant company including the offer of settlement of claim for Rs. 3,87,500/-.

We have heard both the parties at length and have carefully considered the various documents on record. Certain facts are not disputed that the complainant purchased one Tata Sumo and got it insured with O.P. No. 1. The vehicle was stolen on 16.2.1999. It is also not disputed that the Insurance Company offered to settle the claim for Rs. 3,87,500/- instead of the amount of insurance policy of Rs. 4,87,420/-. It has been argued on behalf of O.P. No. 1 that as per terms of the policy, they are liable to pay the market price of the vehicle as on the date of the loss. It has, however, been argued on behalf of O.P. No. 1 that as per report of the Investigator and the Surveyor the market value of the vehicle was assessed as Rs. 3,87,500/-. It was on this account that the offer was made to the complainant to settle the claim at this amount. However, during this period the complainant has preferred to file a complaint before the State Commission which was pending when the offer of settlement was made to the complainant. From a perusal of the letter dated 8.1.2001 it is apparent that the offer was subject to the withdrawal of the complaint from the State Commission and the amount offered was without any interest. It has been argued on behalf of O.P. No. 1 that the delay in settling the claim was mainly act of omission on the part of the complainant who concealed material facts and also did not complete the formalities before receiving the payment of the claim. On the other hand it has been argued on behalf of the complainant that the claim was not settled intentionally by O.P. No. 1 company on frivolous grounds and moreover the O.P. put a condition in the offer that the payment is subject to withdrawal of the complaint. It has also been argued that the complainant completed all the formalities and was also prepared to complete any other formality required but he was prepared to accept the settlement amount without withdrawal of the complaint as according to him he was entitled to the sum of Rs. 4,85,000/- along with interest.

WE have given carefully consideration to the arguments advanced from both the sides. It appears that there was no intentional delay on the part of the Insurance Company to settle the claim but the circumstances were such which required detailed investigation. There were two versions of theft. According to the first version stated in the report dated 17.2.1999 lodged at Police Station Punjabi Bagh some persons forcibly snatched the vehicle from the driver Shri Avdesh Prasad at the crossing of Punjabi Bagh and also snatched the key of the car. It is also mentioned in this report that those persons forced him to take some intoxicating material on account of which the driver became unconscious. Subsequently, another report was lodged on 22.2.1999 at Police Station Rajouri Garden in which it was stated by the driver that he parked the vehicle near Rajdhani College, Ring Road and went to take tea and when he returned he found the vehicle stolen. In view of these two contrary versions, the Insurance Company got the matter investigated through its Investigator and Surveyor. It should, however, been noted that even if there was variation in the version given by the driver at two police stations, there is no dispute regarding the fact that the vehicle was stolen and hence the complainant was entitled to get compensation for the loss of the vehicle as per insurance policy. It was on this account that the company requested the complainant to produce the driver for clarification but the complainant failed to do so as the driver had left the employment. Hence O.P. No. 1 offered to settle the claim at Rs. 3,87,000/- i.e., the market value of the vehicle. However, there was some delay on the part of the complainant in completing the formalities. There is no dispute regarding the fact of theft and the Insurance Company''s offer of settlement is still pending. There can be no dispute regarding the fact that the complainant is entitled to the market value of the vehicle on the date of loss which was assessed by the Surveyor at Rs. 3,87,500/-. The complainant has not produced any evidence to the contrary. Hence, in our view, the Insurance Company (O.P. No. 1) is liable to pay to the complainant the settled amount of Rs. 3,87,000/- along with 12% interest from 19.7.1999 when the complainant consented to accept this amount in settlement of his claim till payment. Since there have been laches from both sides, the complainant is not entitled to any further compensation for mental agony and harassment. However, O.P. No. 1 is directed to pay Rs. 5,000/- to the complainant as cost of litigation. Since O.P. No. 2 is a proforma party no order is being passed against O.P. No. 2. The above order should be complied with within 30 days from the date of the receipt of this order by O.P. No. 1. The complaint is disposed of in above terms. Complaint disposed of.