M.ABDUL LATHEEF vs United India Insurance Co. Ltd.

THIS is a complaint under Section 17 read with Section 12 of the Consumer Protection Act.

THE Complainant is the owner of the Public Carrier bearing registration No. TN-04-B-0091. It was insured with the Opposite Party under comprehensive insurance policy No. 011100/24/24/l/Pu/55541/92 for a sum of Rs. 5,00,000/- covering the period from 13.10.92 to 12.10.93. THE vehicle met with an accident on 13.5.93 at about 7 km. from Dharward on its way to Madras and suffered heavy damage. THE complaint was filed with the Rural Police at Dharward. THE insurer was informed. A survey was conducted and the Surveyor estimated the loss at Rs. 1,15,090/-. THE Complainant estimated the loss and damage at Rs. 3,16,000/-.THE Complainant however repudiated the claim on the ground that the vehicle carried passengers at the time of accident in violation of the terms and conditions of the policy. Hence this claim. The Opposite Party admitted the policy and the accident. It has repudiated on just and proper grounds and by a speaking letter of repudiation containing reasons which are not irrelevant or extraneous. The complaint is not entertainable before this Commission. The Opposite Party appointed an independent Surveyor who examined the vehicle and assessed the loss at Rs. 1,15,000/-. The estimated amount of Rs. 3,06,000/- claimed by the Complainant is unjust and unfair. At the time of the accident there were admittedly some passengers in the vehicle and this was in violation of the terms and conditions of the policy. It was precisely for this reason the claim was repudiated. The claims for interest and loss of earning and for mental pain and agony are untenable.

Exhs. A1 to A5 and B1 are marked by consent. Proof affidavits are filed. No oral evidence has been let in.

THE points that arise for consideration are: (1) Whether the complaint is not maintainable ? (2) Whether there has been any deficiency in service on the part of the Opposite Party ? (3) To what relief, if any, is the Complainant entitled ?

Point No. 1:- Exh. A2 is the policy of insurance in respect of the vehicle in question which belonged to the Complainant and which met with an accident on 13.5.93. The Opposite Party insurer has rejected the claim on the ground that at the time of the accident, the lorry was carrying passengers in violation of the terms and conditions of the policy.

IT is contended by the Opposite Party that the policy has been repudiated on the ground that the vehicle was carrying passengers at the time of occurrence and the remedy of the Complainant is not to file a complaint before this Commission but to file a suit. We have consistently taken the view that the mere repudiation of the claim is not a ground to reject the claim before this Commission. IT is open to the Forum constituted under the Consumer Protection Act to go into the question whether the rejection or repudiation of the claim is just, fair, reasonable and legal and if the Forums comes to the conclusion that it is not, it is entitled to award adequate compensation. The point is found against the Opposite Party. Point No. 2:-The question whether the fact that the driver of a lorry carries some passengers in the lorry at the time of the accident is a bar to claim compensation has been considered by this Commission in R. Anthonydoss v. Branch Manager, The New India Assurance Co. & Another, I (1993) CPJ 557 and again in A. Mohammed Yasin v. New India Assurance Co. Ltd., II (1993) CPJ 903. It has been held by this Commission that merely because some persons were taken by the driver and the cleaner without the knowledge of the owner who had not contributed to increase of risk, a contractual liability for which a very high premium has been paid by the insured cannot be repudiated by the Insurance Company. An irregularity which is not fundamental in nature cannot put an end to a contract. The fact therefore that the driver and the cleaner carried some passengers at the time of the accident is no bar to entertain the claim suffered by the vehicle. In Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan and Others, 1987 (1) TAC 471, the Supreme Court of India has pointed out that the very concept of infringement of the violation of promise that the expression ''breach'' carries within itself, induces an inference, that the violation or infringement on the part of the promisor must be a wilful infringement or violation. If the insured is not at all at fault and has not done anything he should not have done or is not amiss in any respect how can it be conscientiously foisted that he has committed a breach ? It follows that the insurer can escape liability under the policy of insurance only if the insured is proved guilty of wilful infringement of violation of the conditions of the policy. If the insured is not aware of the violation or infringement of the conditions of the policy by the driver or the conductor as in the aforesaid case before the Supreme Court, he cannot be saicrto have committed a breach of the condition of the policy. This decision has been followed by this Commission in K.J. Sriranga Perumal Raja v. The Divisional Manager, National Insurance Co. Ltd., (Original Petition No. 525/92) and in K. Ganesan v. United India Insurance Co. Ltd., (Original Petition No. 102/93). Following these decisions, we hold that the fact that the driver and the cleaner of this lorry have allowed some passengers to travel in this vehicle does not disentitle the Complainant to claim under the policy of insurance. Point No. 3: - The Complainant has estimated the loss at Rs. 3,06,000/-. There is no basis for this claim. The Surveyor appointed by the insurer has estimated the loss at Rs. 1,15,000/- The survey report gives the details of the damages on various parts, the cost of replacement and the labour charges etc. We have absolutely no reason to differ from the conclusion of the Surveyor. The Complainant is, therefore, entitled to damages in the sum of Rs. 1,15,000/-. The Complainant is also entitled to interest on this amount at 18% p.a. from the date of expiry of two months from the Surveyor''s report dated 1.9.93 i.e. from 1.11.93 till payment. We are not inclined to grant any compensation for loss of business and mental pain and agony.

IN the result, we order as follows: (i) The opposite party shall pay to the complainant damages in the sum of Rs. 1,15,000/- with interest thereon at 18% p.a. from 1.11.93 till payment. (ii) The opposite party shall also pay costs of Rs. 2,000/- to the complainant. Complaint allowed with costs.