JYOTI DUTT PANDEY vs Oriental Insurance Co. Ltd.

THIS complaint under Section 17 r/w Section 12 of Consumer Protection Act, 1986, has been filed praying that compensation of Rs. 16,00,000/- be awarded against opposite party.

THE complainant averred that he is the owner of Bus No. MP 26 C-5795. He had purchased the bus chassis for a consideration of Rs. 4,83,526.59 p. and the complainant spent Rs. 4,15,000/- in the fabrication of bus body. It was further averred that the bus was purchased on finance from opposite party (for short O.P.) No. 2 for which complainant paid margin money of Rs. 1,00,426.59 p. to O.P. No. 2. THE said bus was insured with O.P. No. 1 on 1.7.1999 covering the risk for the period from 1.7.1999 to 30.6.2000. According to the averments of the complainant besides margin money as above, the complainant also paid monthly instalments towards money obtained on finance for the bus chassis, totalling Rs. 1,62,866/- till 27.4.2000. He however, due to personal difficulties could not pay the instalments for the months of May, 2000 to July, 2000. It was further averred by the complainant that the said bus met with an accident on 20.8.1999 which resulted in total body loss of the bus. The report of the accident was given by the complainant to the opposite parties. O.P. No. 1 appointed Surveyor who assessed the loss. It is further averred by the complainant that O.P. No. 1 did not pay any amount to the complainant. The averment of the complainant further was that reconstruction of the bus required Rs. 4,00,000/-. Therefore, the complainant requested respondent/O.P. No. 2 to refinance further amount of Rs. 1,50,000/- for the reconstruction of the body. However, the said finance was not made available by O.P. No. 2.

Since the cost of reconstruction of the bus body was high and beyond the capacity of the complainant, the complainant desired that instead of the bus the same be converted into a truck which would require lesser amount. However, as this could be done only with the consent of the O.P. He, therefore, sought their consent, which however was not accorded to the complainant. The averment of complainant further is that he has paid total amount of Rs. 2,63,392.59 p. to O.P. No. 2 as against the bus chassis finance of Rs. 3,83,000/-. It was further averred that the bus was insured with the insurer for Rs. 8,50,000/-, and according to the assessment of the Insurance Company, the cost of body is Rs. 3,66,573.41 p. and he should have been paid the above amount as compensation. The opposite party No. 1 insurer committed deficiency in service by not paying compensation. It was averred by the complainant that as opposite party No. 2, finance company did not refinance the complainant and also did not allow the complainant to convert the bus into truck and did not take steps to enable the complainant to carry out the business of transport, therefore, O.P. No. 2 also committed deficiency in service. The complainant claimed total compensation of Rs. 16,00,000/- as detailed by him in the complaint, from the opposite parties.

OPPOSITE parties resisted the complaint. It was averred by opposite party No. 1 that the Surveyor assessed the loss at Rs. 1,15,700/-. Further, since the complainant was not complying and was non-cooperative and did not assist the O.P. No. 1 insurer in settlement of his claim and in not submitting the relevant documents, therefore, his claim could not be settled. It was also averred that since the claim as assessed by the Surveyor amounted only to Rs. 1,15,700/-, the complaint was within the competence and jurisdiction of the Distt. Forum, and that the complaint could not be competently filed in the State Commission. It was averred that the Surveyor was appointed by insurer O.P. No. 1 on 22.8.1999. It was denied that there was total loss to the bus. It was averred by the insurer that it had permitted the complainant to get the vehicle repaired after receipt of the survey report, and accordingly the complainant should have got the vehicle repaired and should have produced the bills of repairs, etc. to the insurer, as was stipulated under the policy. However, the complainant failed to do so. They have denied that they did not cooperate with the complainant in settling the claim. It was also denied that the complainant suffered loss on account of any fault of O.P. No. 1 insurer. It was averred by the insurer that since necessary documents were not produced by the complainant despite request made by the insurer, hence, ultimately the claim was treated as ''No Claim''. However, the action as above by the insurer, does not amount to deficiency in service. Opposite party No. 2 also resisted the complaint. It was averred that complainant was guilty of violating the agreement entered into between the parties. It was further averred that O.P. No. 2 is the real owner of the vehicle as it had financed it, and the possession of the damaged vehicle was accordingly taken by O.P. No. 2, as there was failure on the part of the complainant in paying the instalments, as per agreement between the parties. It was also averred that some cheques issued by the complainant were dishonoured. It was averred that the complainant was not entitled to any relief.

A preliminary objection regarding pecuniary jurisdiction of the State Commission has been raised. It was submitted on behalf of the opposite parties that the claim as assessed by the Surveyor appointed by Insurance Company was only of Rs. 1,15,000/-. The complaint for the said amount was within the pecuniary jurisdiction of the District Forum. It may be noticed in the above context that averments in the complaint would form the basis for determining the pecuniary jurisdiction and that the same would not be determined on the basis of objections raised by O.Ps. or on the basis of report of the Surveyor. Since the complainant had claimed compensation of Rs. 16,00,000/-, this Commission has the pecuniary jurisdiction to entertain and decide the complaint. Preliminary objections as above cannot be accepted. The other preliminary objection is regarding the arbitration clause in the agreement. It is clear that the complainant had alleged deficiency in service on the part of the opposite parties. Such deficiency in service can be considered by the Consumer Fora, notwithstanding the arbitration clause in view of Section 3 of the Consumer Protection Act, 1986, which provides additional remedy to the consumer. Hence the said preliminary objection also does not deserve to be accepted. Now, the opinion that arises for consideration is: as to whether the complainant is entitled to compensation? and if so, from which of the O.Ps. and to what extent?

IT is not disputed that the bus was purchased by the complainant by paying margin money of Rs. 1,00,426.50 p. towards agreement of finance of the bus chassis with O.P. No. 2. IT is also not in dispute that the finance amount of Rs. 3,83,000/- was given to complainant by O.P. No. 2. The said amount of finance was to be repaid by the complainant in monthly instalments, as per terms which were agreed by the complainant and O.P. No. 2. IT is further not in dispute that the bus met with an accident on 20.8.1999. The complainant informed the O.Ps. about the accident. Shri C.M. Sharma was appointed as Surveyor by the insurer O.P. No. 1. The report dated 9.11.1999 of the said Surveyor is filed on record. From the said report it appears that Surveyor has inspected the damaged vehicle and has reported that damage to mechanical parts has not taken place and that only body of the bus was damaged in the accident. The Surveyor assessed the loss at Rs. 1,15,700/- and salvage value was estimated at Rs. 5,000/-.

IT would also appear from the letters dated 14.2.2000 and 13.3.2000 written by the insurer O.P. No. 1 to the complainant, that O.P. No. 1 was willing to pay to the complainant the above of Rs. 1,15,700/- subject to submission of the documents and salvage. IT further appears that in the meanwhile the possession of the damaged bus was taken by the Financier O.P. No. 2. Therefore, there was no occasion for the complainant to get it repaired and to produce the bills, etc. thereof to the O.P. No. 1 insurer, as was demanded by them. However, it is clear from the survey report that the damage to the bus was assessed to the extent of Rs. 1,15,700/-. The value of salvage was estimated at Rs. 5,000/- by the Surveyor. The complainant was thus entitled, even as per O.P. No. 1 insurer, to a sum of Rs. 1,10,700/-. Though it appears that O.P. No. 1 was willing to release and pay the said amount subject to the complainant submitting the documents as demanded by them but the complainant was helpless, as the possession of the bus was taken by the financier O.P. No. 2. It is, however, clear that the damage to the bus after deducting the salvage value as estimated by the Surveyor was to the extent of Rs. 1,10,700/-. O.P. No. 1, therefore, is liable to pay the said amount to the complainant.

In view of the above, we hold that the complainant is entitled to receive the said amount of Rs. 1,10,700/- from O.P. No. 1 insurer. Since it does not appear that O.P. No. 1 insurer denied its liability to pay the same and in fact called upon the complainant to expedite the settlement of the claim as above, hence we do not feel inclined to grant interest or compensation to the complaint.

ACCORDINGLY, this complaint is allowed as below: The O.P. No. insurer shall pay to the complainant a sum of Rs. 1,10,700/- within 2 months from today. If the opposite party No. 1 fails to pay the above amount within the above period, O.P. No. 1 insurer shall pay to the complainant interest @ 12% p.a. on the said amount from the date of default. In the circumstances of the case, the parties shall bear their own cost. Complaint allowed.