MOTOR GENERAL FINANCE LIMITED vs New India Assurance Co. Ltd

BRIEFLY the facts are, that the complainant is the owner of the Maruti Van bearing registration No. DAE-4623 which was hired by Shri Rajbir Singh, S/o Shri Rattan Singh, R/o Vill. & P.O. Jaffarpur Kalaan, Delhi-73, (hereinafter referred to as ''the lessee'') from them.

AN agreement between the complainant and lessee was executed on 17th December, 1988. The vehicle was stolen and the report was made to the police under Section 364/34 IPC which was registered as FIR No. 96 of 1989 dated 23rd March, 1989. The police ultimately closed the case on the ground that the vehicle was not traceable. The complainant lodged a claim with the respondent but the same was repudiated by them on the ground that the vehicle was being used as a ''Taxi'' by them. The complainant filed a complaint against the respondent before the Commission for recovery of price of the vehicle and the damages. The complaint was contested by the respondent inter-alia on the ground that the complainant committed the breach of the condition of the policy as they were using the vehicle as a taxi, whereas it was registered as a private car

The only question that arises for determination is that if the vehicle is got registered and insured as a private vehicle and it is used as a taxi, whether the complainant is entitled to the insurance money in case it is stolen. The learned Counsel for the complainant has vehemently argued that the premium of the private car according to the tariff is the same as that of taxi and if the car is stolen, the Insurance Company in spite of breach of condition of the policy, does not suffer in any way.

WE have duly considered the arguments and find force therein. The complainant has filed a copy of the tariff which supports the contention of the Counsel. The premia of the private vehicles and taxis of the value between Rs. 90,000/- and one lakh, is the same. She has produced the Claims Procedure Manual of New India Assurance Company Limited in which clause 10 (iii) provides that in case of breach of warrantly/condition of a policy including limitation as to use, 75% of the admissible claim should be paid. She has also submitted that in the case of Oriental Insurance Company in similar circumstances a claim was accepted by the Insurance Company. This fact is mentioned in para (a)(i) of the rejoinder, which reads as follows:- "The complainant also submits, in the alternative, in a similar case, M/s Oriental Insurance Company has passed the claim on nonstandard basis i.e. 75% of the assessed amount against vehicle No. DL2CA-5299. The said claim also pertains to the complainant. The complainant has also furnished and placed on record a copy of the letter dated 3rd August, 1992, covering letter dated 31st August, 1992 and a copy of the cheque issued by M/s Oriental Insurance Co. Ltd. in favour of the complainant for a total sum of Rs. 1,26,000/-."

Mr. Tyagi learned Counsel for the respondent submits that clause 10(iii) has been amended by a letter of the insurance company dated Feb 1991 and consequently, the complainant cannot derive any benefit from the Manual. We have given thoughtful consideration to the arguments of the Counsel and find force in the contention of Mrs. Oberoi. The fact that the tariff for insurance of private vehicles and those of taxis is the same and that the general policy of the Insurance Companies to pay 75% of the admissible claim goes a long way to settle the issue. The payment of claim in similar circumstances by the Oriental Insurance Company is relevant for deciding the matter.

IT is common knowledge that the General Insurance has been nationalised and the Corporation is called as General Insurance Corporation. IT has got four subsidiary companies. The tariff of all the subsidiary companies is the same and they are governed by the same conditions. The case of the Oriental Insurance Company referred to by the Counsel for the complainant, relates to August, 92. In the said circumstances we are of the view that the complainant is entitled to the claim as ''nonstandard claim''. The next question that arises for determination is, to how much amount the complainant is entitled to get as compensation. The complainant has produced the invoices of the vehicle, wherein the price shown is Rs. 82,974.66 Ps. say Rs. 83,000/-. The complainant had used the vehicle for slightly more than 3 months as it was purchased on 7th December, 1988 and stolen on 18th March, 1989. It was being used as a taxi. Consequently, we allow 10% as depreciation of the vehicle. After deduction of the depreciation the value of the vehicle comes to Rs. 74,700/-. For nonstandard claim, the price is to be reduced by 25%. Thus, an amount of Rs. 18,675/- is to be deducted from Rs. 74,700/-. The balance comes to Rs. 56,025/- say Rs. 56,000/-, which the complainant is entitled to recover. They are further entitled the interest on the said amount. The complainant lodged the claim with the respondent on 6.6.89. The claim should have been settled by them within a period of three months Consequently, we grant interest to the complainant from 7th Sept., 89 till the date of payment @ 18% p.a. For the aforesaid reasons we accept the complaint with costs and direct the respondent to pay an amount of Rs. 56,000/- with interest @ 18% p.a. from 7th September, 1989 till the date of payment within 3 months, failing which action shall be taken against them under Section 27 of the Consumer Protection Act. Costs Rs. 2,000/-. Complaint allowed with costs.