JANKI DEVI vs NEW INDIA ASSURANCE CO. LTD.

THE complainant Smt. Janki Devi has filed this complaint before the State Commission on 3.3.90 praying that the opposite party may be directed to pay to the complainant Rs. 1,27,000/- as compensation. THE complainant was owner of car No. RNE 9292 in the year 1987. THE car was insured with opposite party on 11.9.87 through its Development Officer Shri B.D. Nagpal on comprehensive basis which implied that the car if destroyed/ damaged due to any reason the opposite party was to reimburse the expenses incurred due to loss. Policy issued to the complainant was No. 4531224845. It was alleged that complainant''s son took the car on 13.9.87 and while he was proceeding to Delhi, on Delhi-Jaipur main highway the driver of truck No. PCU 9715 rashly and negligently struck the car with great force. This caused serious injury to the complainant''s son and destroyed the car completely. It is said that the complainant''s son became unconscious and was brought to Jaipur by some persons. A doctor was immediately called and he was given treatment at his house. When he gained consciousness he filed a First Information Report in P.S. Shahpura on 17.9.87 by a letter which was registered by the Police Station on 25.9.87. THE opposite party appointed Shri Y.P. Tyagi as surveyor who estimated the loss of the car to its full value of Rs. 60,000/-. THE complainant has alleged that the opposite party formally agreed to pay the amount but later repudiated the claim for Rs. 1,27,000/- before the District Forum but as it has jurisdiction upto Rs. 1,00,000/- the complainant withdraw the claim for filing it in the proper Forum. THE complainant has stated that she has suffered the following loss on account of the negligence of the opposite party: 1. Loss equal to the cost of the car Rs. 60,000/ Loss of interest on the loss of cost of car Rs. 27,000/ 3. THE cost of new car on account of the increase of the price Rs. 20,000/ 4. Other loss Rs. 20,000/ Total Rs. 1,27,000/

IT was submitted that the opposite party negligently stated " that the vehicle was not insured at the time of their insuring the car or the accident did not occur on 13.9.87." She, therefore, filed the complaint as stated above. With the complaint the complainant submitted the certificate of insurance, motor vehicle cover note, certificate of insurance, copy of FIR, letter addressed by Remesh Malhotra dated 17.7.87, postal certificates, letters of Y.P. Tyagi and correspondence that was exchanged between the parties. The opposite party submitted a detailed version of the case strongly opposing the complaint. It was pleaded that the alleged contract of insurance was due to fraud, non-disclosure of material facts, active concealment of true facts and by misrepresentation of facts which were false in material particulars to the claimant''s own knowledge and that this was done with mala fide intention to make wrongful gain to herself and wrongful loss to the opposite party and so is bad in law, inoperative, ineffective, void ab initio and illegal. It was pleaded that car No. RNE 9292 was being plied/used without any insurance at the time earlier than the alleged accident on 13.9.87. The car had already met with an accident earlier ton 11.9.87. and it was damaged. The insurance cover note No. 076027 was obtained on 11.9.87 at 3.30 p.m. from the Development Officer Shri B.D. Nagpal of opposite party. The said Development Officer in good faith and relying upon the claimant''s husband Shri Krishan Lal Malhotra without examining and/or making physical inspection of the car in question issued the said insurance cover note. The affidavit of Shri B.D. Nagpal, Development Officer in support of above plea has been filed. It was submitted that the insurance cover note and policy are void as provided in Sec. 92(2)(c) of the Motor Vehicles Act, 1939 and under Sec, 149(2)(b) of the Motor Vehicles Act, 1988 as the same have been manipulated and obtained by the non-disclosure of the material facts and/or by misrepresentation of facts which were false in material particulars. It will be useful to quote the additional pleas taken by the opposite party in its version of the case: "1. On 13.9.89 no FIR/Police Report has been lodged with the concerned policy pertaining to the accident in question dated 13.9.87 despite the fact that the claimant is claiming that in the alleged accident car RNE 9292 has extensively been damaged. 2. The claimant alleges that car in question met with a major accident with truck No. PCU 9715 at Jaipur-Delhi Road near Shahpura, P.S. Shahpura, Jaipur, but neither the said truck nor the car in question were ever seized and/or taken into custody by the police as ''case Property". 3. Car No. RNE 9292 is alleged to have been removed from the site of accident without lodging any report and/or informing the concerned policy. So much so that the claimant informed the Ins. Co. about the alleged accident by filing claim form dt. 17.2.88.

From the above said alleged acts and deeds, the claimant has deprived the respondent Insurance Company from getting the spot survey of the alleged damaged car and verifying the genuineness of the accident in question and also damage said to have been caused to the car in question.

THE claimant''s son Shri Ramesh Malhotra is said to have written a letter dated 26.9.87 to the Dy. Superintendent P.S. Kotputli, Jaipur whereby informing that the alleged accident had taken place on 13.9.87 entirely due to the rash and negligent driving, misconduct and fault of the driver of truck No. PCU 9715, but despite it no criminal case has been initiate against the driver of truck No. PCU 9715. So much so he was neither arrested nor the said truck was seized and also no criminal prosecution was initiated against the truck driver. It is only upon receipt of letter dated 26.9.87 that a formal FIR No. 232/87 dated 26.9.87 under Section 279/ 337 IPC P.S. Shahpura, Jaipur, was registered, but no action has been taken so far. It is alleged that Shri Ramesh Malhotra s/o the claimant Smt. Janki Devi received very serious and grievous injuries i.e. fracture of neck bone and other injuries on his body, but the claimant failed to produce any medical record showing his treatment either from any Government hospital or from any recognised Nursing Home.

NO claim for compensation was lodged by said Shri Ramesh Malhotra against the driver, owner and the Insurance Company of the Truck NO. PCU 9715 under the Motor Vehicle Act. Whereas as per the claimant the accident dated 23.9.87 was caused entirely due to the fault, rash, negligence, misconduct carelessness and causing serious and grievous injuries to Shri Ramesh Malhotra. That an independent surveyor Shri Onkar Lal Vyas vide his Final Report dated 24.11.89 has reported that he has verified from all the five border check-posts, from which the truck can enter into Rajasthan and as per his verification, no truck No. PCU 9715 ever entered between 8th Sept., 1987 to 13th Sept. 1987: hence the question of alleged accident dated 13.9.87 between Car No. RNE 9292 with Truck No. PCU 9715 does not arise at all. On the above stated pleas, it can safely be stated that no such alleged motor vehicle accident dated 13.9.87 had taken place and car in question No. RNE 9292 was never involved in the said accident dated 13.9.87. As such, the claimant''s claim is false, fabricated and coined with the malicious and criminal design to cheat and defraud the Insurance Company." 4. The affidavit of Shri Bulaki Das Asstt. Manager was submitted alongwilh photo slat copies of the motor claim form, letters, survey report dated 18.2.91 of Y.P. Tyagi and survey report of Shri Onkar Lal Vyas. It was stated that the claim was repudiated by the Insurance Co. on 18.10.89. The opposite party submitted photo stat copy of the claim form dated 17.2.88 signed by the complainant, photo stat copy of repudiation letter dated 18.2.89 alongwith photo stat copy of A.D. card, photo stat copy of survey report of Y.P. Tyagi, Shri Onkarlal Vyas Investigator''s Interim report dated 24.11.89 and the affidavit of Shri Baldev Das Nagpal Development Officer. Both the parties submitted written arguments. We have carefully considered the pleadings of the parties, documents and affidavits. The affidavits of Shri Krishan Lal (complainant''s husband) Smt. Janki Devi (complainant) and Ramesh Chand (son of the complainant) were also submitted. On behalf of the opposite party affidavit of Shri Ashok Sharma and Shri Onkarlal Vyas were submitted. 5. On behalf of the opposite party reliance was placed on the judgment rendered in M/s. Janta Machine Tools v. Oriented Insurance Company Ltd. (Original Petition No. 12/1990 decided by the National Commission on Aug. 21, 1990) [I (1991) CPJ 234 (NC)]. It was pressed that the Insurance Company had investigated the claim put forward by the complainant and thereafter repudiated the claim. In these circumstances it will not be proper for the State Commission to make investigation in the complaint. Before we proceed further it will be pertinent to refer to the copy of the repudiation letter dated 18.10.98, which is as under: "Claim No: 87/514, Policy No. 4531224845 Vehicle No. RNE 9292. Madam, Reference your claim under the aforesaid policy it be stated that upon investigation it has been found that your claim is not genuine for the reason as under: a. That the premium of above Insured policy pertaining to car No. RNE 9292 was deposited with us on 14.9.87, resulting into the vehicle in question being not insured at the time of alleged accident dated 13.9.87. b. That no FIR was lodged at the date of alleged accident dated 13.09.87 at the relevant Police Station and thereby resulting into not apprehending the culprit and/or the offending vehicle. c. Non-supply of documents showing that the Car No. RNE 9292 which got involved in an alleged accident dated 13.09.87 was seized by the concerned police. d. Violation of terms and conditions of the insurance policy by not immediately informing giving notice of the accident in question to us. Please note that in the instant case a notice of accident had been given to us after approximately 76 days from the date of alleged accident i.e. 13.9.87. e. Being a major loss you have not afforded an opportunity to us to arrange spot survey of vehicle at the site of accident by an independent surveyor, hence violation of the terms and conditions of the policy. f. You have not extended desired cooperation to Mr. O.L. Vyas Independent Investigator, appointed by us for ascertaining the genuineness of the accident in question and the loss therein. g. Non-supply of authentic medical record duly supported by the record of any Government Medical Hospital to show that Shri Ramesh had received grievous injuries in the accident in question. In the aforesaid circumstances, we are constrained to repudiate your claim made under the aforesaid policy. Please take notice accordingly."

Six reasons have been given by the Insurance Company in rejecting the claim. It was observed by the National Commission Janta Machine Tools, case (supra) an under: "From the facts disclosed by the record and particularly the averments contained in the counter affidavit filed by the first respondent it is seen that the Insurance Company had fully investigated into the claim put forward by the complainant, got surveys conducted and had finally come to the conclusion that the claim put forward by the complainant was false and accordingly informed the complainant that his claim was rejected. Thus this is not take prompt and necessary steps for deciding the claim under the policies of insurance. It may be that the complainant is not satisfied with the said rejection of his claim by the Insurance Company. Having regard to the facts and circumstances of this case and the nature of the controversy between the parties we consider that this is a matter that should be adjudicated before a Civil Court where the complainant as well as the respondent will have ample opportunities to examine witnesses at length, take out Commission for local inspections etc. and have an elaborate trial of the case. Without prejudice to the right of the complainant to take resort to the remedy by way of civil suit before the proper Court. We dismiss this petition."

Janta Machine Tools'' case was considered by the National Commission in Divisional Manager, life Insurance Corporation of India, Andhra Pradesh v. Shri Bhawanam Shriniwas Reddy (First Appeal No. 79 of 1990 decided on June 5, 1991 and it was observed that the jurisdiction of the statutory Redressal Forum to conduct an investigation into the complaint is in no way affected by the unilaterial repudiation of the contract of insurance by the insurer. 8. The National Commission referred New India Assurance Co. Ltd. v. Vipro Electronics Pvt. Ltd. (Revision Petition No. 12 of (1990) I (1991) CPJ 335 (NC) wherein it was held that the mere fact that the insurer has repudiated his liability in respect of the claim put forward by the insured does not operate to take away the jurisdiction of the Redressal Forums constituted under the Act to investigate into the complaint filed by the insured. The National Commission observed:" " It was laid down that whenever there is default or negligence in regard to service that will constitute "deficiency in service" on the part of the insurer and it is perfectly open to the aggrieved party for seeking appropriate relief under the Act."

Janta Machine Tool''s (supra) was again explained in 5. Bhagal Singh v. Oriental Insurance Co. Ltd. (Revision Petition No. 7/91 decided on Oct. 3,1991). It was observed that Janta Machine Tool''s case has to be understood against the background of the special facts relating thereto and that it was now here laid down in that case that in all cases where examination and cross examination of witnesses is involved the proper Forum for adjudication of the dispute in the case is only the Civil Court. In M/s. Rajdeep Leasing and Finance Pvt. Ltd., New Delhi v. New India Insurance Co. and Others First Appeal No. 61/91 decided on Now. 14, (1991) I (1992) CPJ 36 (NC) it observed that that case was directly governed by the dictum laid down by the National Commission in M/s. Janta Machine Tool''s case (supra). 9. In that case the Insurance Company represented by opposite parties Nos. 1 and 2 submitted a detailed written statement stating that the claim . of the complainant had been carefully scrutinized and got fully investigated the claim and after considering survey reports etc. Claim was found to be false and fabricated. The Insurance Company had repudiated the claim after application of mind. It was held that in these circumstances it cannot be said that there was deficiency of service so as to give rise to a cause of action under the Act.

IN New Jaipur dyeing and Tents Works v. Oriental INsurance Co. Ltd. II (1991) CPJ 241 (NC) the National Commission has observed as under: "As the upshot of the facts recorded above is that the appellant has reasonable grounds to doubt the genuineness of the claim, as such the non-payment of the insurance amount under the policies cannot be deemed to be a deficiency in service arising from negligence. Under Sec. 14 of the Consumer Protection Act, 1986 compensation can be granted to a consumer for loss or injury arising from deficiency in goods supplied or services rendered provided the same is due lo negligence. Such a presumption or negligence cannot normally arise where the factum of deficiency is established on the basis of balance of evidence or preponderance of probabilities. Hence the order of the State Commission is set aside and the parties are left to pursue their claims through States INvestigating Agencies and the Courts of Law."

THE State Consumer Disputes Redressal, Commission, Delhi while following M/s. Janta Machine Tool''s case (supra) dismissed the complaint. It was observed in Continental Chemical Ltd. v. Oriental Insurance Co, Ltd., II (1991) CPJ 354 as under: "THE question that arises for determination is as to whether, the State Commission constituted under the Consumer Protection Act has got the jurisdiction to decide the present complaint. THE facts of the case as pleaded by the parties have been given in detail above. From the perusal of the pleas, it is evident that respondent No. 1 after making investigations through surveyor, rejected the claim of the complainant In order to determine as to whether in view of the aforesaid situation, the complainant still can recover the amount from respondent No. 1 it requires leading of detailed evidence and examination and cross-examination of the witnesses. In the circumstances it is appropriate that the matter should be decided by the Civil Court. In the said view, we are fortified by a decision of the National Commission in M/s. Janta Machine Tools v. Oriental Insurance Co. Ltd. (Original) Petition No. 12/1990-I (1991) CPJ 234 (NC) decided on Aug. 21, 1990)."

The same view was taken by the State Consumer Redressal Commission, Delhi in M/s. Krishan Chand v. Oriental Insurance Co. I (1991) CPJ 678.

The surveyor Shri Y.P. Tyagi in his survey report dated 18.2.88 has stated that the claim should be settled on total loss basis which is more economical and according to that loss was Rs. 57,000/- and its salvage value is approx. Rs. 25,000/- Shri Onkarlal Vyas submitted his survey report dated 7.9.88. He has examined all the aspects in detail and summed up the position as under: "But all instances are if taken together then there will be chain of circumstantial evidence which will connect one loom with another and ultimately afford definite result that this case was not occurred within jurisdiction of Shahpura Police Station, it occurred in between June''to Sept. 1987 somewhere else. And after accident insurance was obtained for award of compensation."

THERE is affidavit of Baldev Das Nagpal as to under what circumstances car RNE 9292 was insured. On behalf of the complainant, there are affidavits of Shri Krishan Lai, Smt. Janki Devi and Shri Ramesh Chand. After that affidavit of Shri Ashok Sharma, Admn. Officer has been filed and he has dealt with the case lodged by Smt. Janki Devi. The affidavit of Shri Onkarlal Vyas was also submitted. He has proved the two reports. It is clear that the opposite party had made investigation thoroughly and rejected the claim of the complainant. It is clear from the reports and the affidavits submitted on behalf of the opposite party that opposite party had reasonable grounds to doubt the genuiness of the claim and, therefore, non-settling of the claim under the policy cannot be deemed to be deficiency in service arising from negligence. From the foregoing discussion it follows that the affidavits submitted on behalf of the insurers and the two reports of Onkarlal Vyas show that the claim was properly investigated and after the investigation, the claim of the complainant was repudiated. In view of the principles laid down by the National Commission in the cases referred to hereinabove and having regard to the facts and circumstances of this case and the nature of the controversy between the parties, we are firmly of the opinion that this is a matter which should be agitated before a Civil Court where the complainant as well as the opposite parties will have ample opportunities to examine witnesses at length and have elaborate trial of the case. The complainant may seek redressal in a Civil Court. In view of this, it is not necessary to examine the other questions arising out of this complaint. The complaint is dismissed subject to observations that the complainant may file a civil suit for recovery of the disputed amount if so advised. No order as to costs. Complaint dismissed.