GUPTA And GUPTA vs NEW INDIA ASSURANCE CO.LTD

THE brief facts of the case are that M/s. Gupta & Gupta, Chartered Accountants purchased a Car No. DNH 6444 Contessa Classic Model (1989) on 29.11.89 for a sum of Rs. 2.5 lacs and got the same insured with the respondent Co. for a sum of Rs. 2.5 lacs by paying a premium of Rs. 3,331/- for the period 21.11.91 to 20.11.92.

THE above car met with an accident on 4.1.92 in which the car was completely damaged and the son of the complainant sustained serious head injury and finally succumbed in the hospital. THE complainant lodged an FIR on 5.1.92. He further submitted his claim with the respondent Co.''s Branch Office in Model Basti, Delhi on 27.1.92. It is stated by the complainant that in view of the delay on the part of the respondent Co. to settle the claim they wrote a letter on 5.6.92 requesting for an early settlement of the claim. That they again wrote to the Chairman of the respondent Co. at their HQ''s in Bombay on 30.6.92 seeking intervention in expediting his claim. That no satisfactory reply was received from the Head Quarter of the respondent Co. The only communication received was dated 8.7.92 which stated that we are enquiring from our concerned Deptt./Office and shall revert as soon as we hear from them. In pursuance of this communication from the respondent Co. HQ''s, their Branch Office conveyed to the Divisional Office vide letter dated 11.2.92 that the claim of the complainant could be settled on a "total loss claim basis" which was assessed by him at 1.25 lacs. Since the amount of Rs. 1.25 lacs was not acceptable to the complainant, the respondent Co. have taken the stand that the delay if any was not due to them.

The complainant in his complaint has claimed full value of the car amounting to Rs. 2.5 lacs together with 21% interest therein from 27.1.92 to 16.8.92. He has further claimed Rs. 200/- per day from the date of accident (4.1.92) till 16.8.92 amounting to Rs. 50,000/-. He has also sought compensation of Rs. 50,000/- towards pain, suffering and mental torture, besides the cost of litigation of Rs. 5,000/-.

IT has been contended by the complainant that the car was purchased on 2941-89 and the accident took place on 4.1.92 and as such the car was used for little over 2 years having covered only 16,000 Km. and as such was in good new condition. That the price of a new car at the time of accident was Rs. 3 lacs. IT is further contended that the car was fitted with accessories. As such its value could not be assessed at less than Rs. 2.5 lacs. The respondent Co. in their reply have not denied the value of the Insurance Cover (Rs. 2.5 lacs) and the period of Insurance Policy from 21.11.91 to 20.11.92. They have also not contested that the accident did not take place or the car was not damaged. It is also not contested that any of the documents filed by the complainant were found incomplete to process the claim of the complainant. In fact, it has been stated by the respondent that on receipt of the claim papers, they appointed the Surveyor Mr. Harbans Lal Arora who submitted his report to the Divisional Office on 11.2.92. In this report the Surveyor had stated that as per complainants assessment made from M/s. Krishna Automobiles Limited, Mathura Road, Nizamuddin, New Delhi, the value of the car was assessed at Rs. 2,53,400/-. It is further stated that the value after inspecting the vehicle damage worked out on repair basis could be approximated to Rs. 1.25 lacs. In his report the surveyor has further mentioned that some more damage may come to light after the vehicle is dismantled. As to the market value of the car the Surveyor from his sand point has only observed "Very much lesser than the sum insured".

WE have heard the learned Counsel of both sides and also perused the documents on record. The fact of accident and the amount of Insurance Policy at Rs. 2.5 lacs are not disputed. The only dispute relates to the question of claim amount. In our view therefore, the facts which have to be given due consideration are whether the price as mentioned by the complainant can be taken as the value of the car. In stating his claim at full value of 2.5 lacs he has stated that it was a new car and had done only 16,000 km. That the value of the Insurance Policy was Rs. 2.5 lacs and the market value of the car at the time of the accident was also more than 2.5. It is further stated that M/s. Krishna Automobiles Ltd., Nizamuddin had also assessed the value of the car at Rs. 2,53,400/- which was more than the sum for which the car was insured with the respondent. The respondent Insurance Company''s contention on the contrary is that the market value of the car at the time of accident was much less than the sum of Rs. 2.5 lacs for which the car was insured and that their surveyor had assessed the value at Rs. 1.75 lacs, which was finally assessed by the respondent at Rs. 1.25 lacs on a total loss basis. The respondent in arriving at this figure had taken into account the salvaged value of the car at Rs. 75,000/-. It is not disputed that the respondent Co. had taken a long time in dealing with the claim even though the claim papers were submitted on 27.1.92. The surveyor''s report was given on 6.2.92, a prompt report which kept pending with the respondent for a long time. It is further evident from the facts that the complainant had approached the Chairman of the respondent Co. at their Head Quarter''s in Bombay who also dealt with the matter in a routine matter and this caused further delay. Obviously it was due to the delay on the part of the respondent Co. that the claim kept pending.

AN important fact to be considered in the case is that there was a suggestion made by the surveyor in his report dated 22.9.92 that the complainant''s claim could be settled on ''total loss basis'' and it was the surveyor who was communicating with the complainant. There was no formal offer made by the respondent. This goes to prove that respondent did not convey any specific terms from his side. This establishes the element of deficiency in service on their part. The normal presumption therefore is that the respondent Co. did not settle the claim which they ought to have done in terms of the Insurance Policy as well as the complainant''s claim.

IN support of our contention we are fortified by the judgment of the National Commission I (1993) CPJ 469, they held "that two months time can be taken as reasonable time even for the scrutinising of the report of the surveyor. It is not the case of the INsurance Company that after the surveyor had submitted its report, any of the INsurance Companies required any further information from the insured." As to the value of the car at which the complainant''s claim has to be considered we are of the view that as there was considerable delay on the part of the respondent in processing the claim the salvage value of Rs. 75,000/- as assessed by the respondents surveyor cannot be considered. In so far as the value of depreciation of 15% as per policy conditions is concerned we cannot overlook the fact that the prices of each model of the car including Contessa were increasing and as per the quotation given by M/s. Krishna Automobiles dated 1.12.92 the prices of a new Contessa Car should have been Rs. 3,23,301/-. Allowing a depreciation of 15% at this amount the value of the car would work out to be Rs. 2,74,806/-. However, since the car was insured for a value of Rs. 2.5 lacs only, we fix the value of the car at 2.5 lacs and allow interest at 18% from 4.4.92 i.e. 3 months after the date of accident till the date of payment.

With regard to the other reliefs sought towards travelling-expenses amounting to Rs. 55,000/- at Rs. 200/- per day from the date of accident till 16.8.92 we are of the view that as no account of this was maintained and even otherwise expenses had to be incurred on petrol etc. we can not hold the respondent fully liable for the same. We, therefore, fix it at a lump sum of Rs. 10,000/-. In so far as the amount of Rs. 50,000/- claimed as damages for pain, suffering and mental torture is concerned we would like to observe that this was a case of a serious accident and some delay was unavoidable and for this again the respondent Co. could at best be held partly liable. We, therefore, award Rs. 5,000/- towards pain and suffering caused at the hands of the respondent Co. in delaying his claim.

IN view of the foregoing we allow the complaint and direct the Opposite Party to pay Rs. 2,50,000/- together with interest at 18% p.a. from 4.4.92 till the date of payment together with Rs. 10,000/- towards travelling expenses and Rs. 5,000/- as compensation within 90 days from the date of the order failing which action shall be taken under Section 27 of the Consumer Protection Act: Cost of litigation Rs. 2,000/-. Complaint allowed with costs.