NATIONAL INSURANCE CO LTD vs MOHINDER SINGH

THIS revision petition is filed against the order dated 01.04.2014 of the Punjab State Consumer Disputes Redressal Commission, Chandigarh (''the State Commission'') whereby the State Commission had dismissed the appeal preferred by the petitioner against the order of the District Consumer Disputes Redressal Forum, Mansa (''the District Forum'').

BRIEFLY stated facts relevant for the disposal of this revision petition are that respondent complainant being aggrieved of repudiation of his insurance claim relating to theft of the insured 10 tyre Tralla no. RJ 20 G 4540 filed the consumer complaint in District Forum Mansa. The opposite party resisted the complaint stating that as per the terms and conditions of the insurance policy, the respondent was required to report the theft immediately to the police and also give information of theft in writing to the insurance company. The complainant failed to comply with the said condition and reported the theft to the police 10 days later on 10.09.2010 and intimated the insurance company with delay of 4 months and 23 days. As such, the insurance claim was rightly repudiated.

THE District Forum, Mansa on consideration of pleadings of the parties and evidence on record allowed the complaint and directed as under: To pay full amount of Rs.5 lakh along with interest @ 9% per annum from 15.03.2011 onwards till the insurance amount is paid to the complainant; Complainant has been put to unnecessarily mental tension, agony, harassment and inconvenience by repudiating the insurance claim in an arbitrary manner and, therefore, complainant is entitled for a reasonable and adequate amount of compensation, which we in the facts and circumstances of the case assess to the tune of Rs.5,000/ - out of which Rs.3,000/ - be deposited in the Consumer Welfare Fund of this Forum; To pay Rs.2,000/ - as litigation costs. Being aggrieved by the order of the District Forum, the petitioner insurance company approached the State Commission in appeal and the State Commission vide its impugned order dated 01.04.2014 had concurred with the findings of the District Forum and dismissed the appeal.

LEARNED counsel for the petitioner has contended that orders of the foras below are not sustainable because the foras below have failed to appreciate that the insurance claim was rightly repudiated for violation of the condition of the insurance contract which requires him to report the theft immediately to the police and also to inform the insurance company in writing.

LEARNED counsel for the respondent on the contrary has argued in support of the impugned order. Learned counsel has submitted that there is no violation of the terms and conditions on the part of the insured. Actually the father of the insured had visited the police station to report theft on the very next day but the police refused to record the FIR. Because of this reason, the matter was reported to the newspaper and ultimately a letter was sent to the SSP Mansa through registered AD post. Thereafter, on intervention of SSP Mansa, an FIR was registered on 03.11.2010.

WE have perused the record and considered the submissions made on behalf of the parties. The question which requires determination in this revision is "Whether the petitioner insurance company was justified in repudiating the insurance claim on the ground of violation of condition of the contract?

IN order to find answer to the above question, it is necessary to have a look on the relevant condition of the insurance contract which is reproduced as under: "Notice shall be given in writing to the company immediately upon the occurrence of any accident or loss or damage and in the event of any claim and thereafter the insured shall give all such information and assistance as the Company shall require. Every letter claim writ summon and or process shall be forwarded to the Company immediately on receipt by the insured. Notice shall also be given in writing to the Company immediately the insured shall have knowledge of any impending prosecution, inquest, fatal inquiry in respect of any occurrence which may give rise to a claim under this policy. In case of theft or other criminal act which may be the subject of a claim under this policy the insured shall give immediate notice to the police and co -operate with the Company in securing the conviction of the offender".

ON reading of the above, it is clear that as per the insurance contract, in the event of the theft of the insured vehicle, the insured is under an obligation to give immediate notice to the police and cooperate with the company in securing the conviction of the offender. The State Commission in the impugned order has concluded that the intimation about the theft of the subject vehicle was given to the local police on the very next day. The relevant observations of the State Commission are as under: The question arises, whether from the other evidence produced by the complainant can it be held that the matter was reported to the police immediately? The said application dated 10.9.2010 was proved on the record as Ex.C -3. The same was addressed to SSP Mansa and was sent through registered post. The postal receipt has been proved on the record as Ex.C -2. No evidence was produced by the opposite party to rebut this evidence. It is mentioned in the application that the vehicle was stolen on 30.08.2010 and information about the same was given by the driver thereof to the applicant the next day and he had further given that information to the police orally and also to the Press. The applicant prayed that the proceedings be taken regarding the theft. It becomes clear from the contents of this application that information about the theft was given to the police immediately after the theft. Even after the receipt of this application, no action was taken by the police and it continued to maintain the apathetic attitude. Ultimately it was on 3.11.2010 that Amar Singh, father of the complainant, went to the Police Station Mansa and lodged the FIR which was proved on the record as Ex.C -5. This evidence of the complainant was not rebutted by the opposite party, who proved on record the affidavit of S.C.Goyal, Branch Manager as Ex. OP -1. He simply stated that the complainant did not inform about the theft to the police for 11 days. In view of the documentary evidence produced by the complainant no weight can be given to this oral evidence. From the evidence so produced on the record, we conclude that there was no delay on the part of the complainant to report the police about the theft of the vehicle.

ON reading of the above, it is clear that the basis of the above findings of the State Commission is letter Ex. C -3 dated 10.09.2010 addressed to the SSP Mansa. It is observed by the State Commission that in the said letter it is mentioned that the vehicle was stolen on 30.08.2010 and oral information about the same was given to the police by the driver of the insured on the next day. Aforesaid observation of the State Commission is against the facts recorded in the letter dated 10.09.2010 addressed to SSP Mansa. We have gone through the copy of the said letter placed on record wherein it is nowhere mentioned that the driver of the subject truck or anyone else reported the theft to the police on the next day. Instead, the father of the insured has mentioned in the application that the driver narrated the entire episode to him and he gave that information to the press. Thus, it is evident that finding of the State Commission to the effect that the theft was reported to the police on the next day is against the record and is based upon imaginary facts. Thus the finding of the State Commission cannot be sustained. The respondent has failed to show us any other cogent evidence which may establish that police was intimated about theft of the subject vehicle on the very next day. Further, from the record, it appears that information regarding theft of vehicle was given to the insurance company more than four months after the theft. From the above, it is clear that the insured did not comply with the condition no.1 of the insurance contract.

LEARNED counsel for the respondent complainant has contended that even if it is assumed that complainant had failed to immediately report the theft to the police and give information of theft to the petitioner insurance company as required by condition no.1 of the insurance contract, then also, the petitioner in view of the judgment of Apex Court in the matter of Amalendu Sahoo vs Oriental Insurance Co. Ltd., 2010 2 CPJ 9 was required to allow the claim on non -standard basis.

WE do not agree with the above contention for the reason that in terms of the policy issued by the petitioner, the respondent was under obligation to immediately report the theft to the police and also inform the petitioner about the theft. For account of delay in intimation to the police as well as the petitioner, the appellant was deprived of its legitimate right to get an inquiry conducted into the alleged theft of the vehicle and make an endeavour to recover the subject vehicle. This lapse on the part of the respondent is grave and goes to the root of the insurance claim.

HON ''ble Supreme Court in the matter of Oriental Insurance Co. Ltd. Vs. Parvesh Chander Chadha, Civil Appeal No. 6739 of 2010 decided on 17.08.2010 held thus: "Admittedly the respondent had not informed the appellant about the alleged theft of the insured vehicle till he sent letter dated 22.5.1995 to the Branch Manager. In the complaint filed by him, the respondent did not give any explanation for this unusual delay in informing the appellant about the incident which gave rise to cause for claiming compensation. Before the District Forum, the respondent did state that he had given copy of the first information report to Rajender Singh Pawar through whom he had insured the car and untraced report prepared by police on 19.9.1995 was given to the said Shri Rajender Singh Pawar, but his explanation was worthless because in terms of the policy, the respondent was required to inform the appellant about the theft of the insured vehicle. It is difficult, if not impossible, to fathom any reason why the respondent, who is said to have lodged First Information Report on 20.1.1995 about the theft of car did not inform the insurance company about the incident. In terms of the policy issued by the appellant, the respondent was duty bound to inform it about the theft of the vehicle immediately after the incident. On account of delayed intimation, the appellant was deprived of its legitimate right to get an inquiry conducted into the alleged theft of the vehicle and make an endeavour to recover the same. Unfortunately, all the consumer foras omitted to consider this grave lapse on the part of the respondent and directed the appellant to settle his claim on non -standard basis. In our view, the appellant cannot be saddled with the liability to pay compensation to the respondent despite the fact that he had not complied with the terms of the policy."

In view of the above stated position in law and the discussion above, the impugned order is not sustainable. We accordingly allow the revision petition; set aside the impugned order and dismiss the complaint.