NATIONAL INSURANCE CO. LTD THROUGH BRANCH MANAGER vs JOHNY MEHTA

This revision petition has been filed under section 21(b) of the Consumer Protection Act, 1986, against the impugned order dated 07.09.2007, passed by the Himachal Pradesh State Consumer Disputes Redressal Commission, Shimla (hereinafter referred to as "the State Commission") in two cross appeals, appeal no. 119/2005, Johny Mehta vs. National Insurance Co. Ltd. and appeal No. 183/2005, National Insurance Co. Ltd. vs. Johny Mehta, vide which, the appeal filed by the complainant was allowed and the award passed by the District Consumer Disputes Redressal Forum, Shimla in consumer complaint no. 85/2013, dated 02.04.2005, allowing the said complaint, was modified. The other appeal no. 183/2005 filed by the Insurance Company was rejected.

The facts of the case are that the respondent Johny Mehta stated in his consumer complaint filed before the District Forum that he purchased a 41-seater bus, bearing no. HP13 0334 in the year 1997 to earn his livelihood and the said bus was insured for a sum of Rs. 6,50,000/- with the petitioner/OP National Insurance Company for the period from 22.11.2000 to 21.11.2001. The said vehicle met with an accident on 27.10.2001 at Nagali Pool near Solan, Himachal Pradesh. An FIR with regard to the incident was lodged with the police and the Insurance Company was also intimated. The Insurance Company appointed a surveyor who asked the complainant on 14.12.2001 to submit the requisite documents. The complainant contacted M/s. Sutlej Motors Ltd., Jalandhar, who informed him that the vehicle was not in a repairable condition. It is stated in the consumer complaint that M/s. Sutlej Motors Ltd. issued an estimate of Rs. 3,50,920/-, excluding excise duty for the proposed fitting of the bus body. Another estimate of Rs. 2,60,520/- was also supplied for the repair of engine and the related mechanical jobs. The case of the complainant is that the Insurance Company should have paid the claim, treating it as a case of total loss. However, the surveyor appointed by the Company, Rajesh Kumar, stated in his report that the vehicle was repairable and that the complainant was entitled to a sum of Rs. 2,14,082/- on repair basis. The complainant filed the consumer complaint in question, seeking direction to the Insurance Company to pay the assured sum of Rs. 6.5. lakhs alongwith interest @ 10% per annum from the date of accident and also to compensate him with a sum of Rs. 7,65,000/- @ Rs. 45,000/- per month, since the date of incident.

The complaint was resisted by the Insurance Company by filing a reply before the District Forum, in which they stated that Kuljeet Singh Baweja conducted spot survey on 28.10.2001 and submitted his report on 20.11.2001. Thereafter, the Insurance Company asked the complainant to submit estimate of repair so that the survey of vehicle could be conducted. Rajesh Kumar, surveyor and loss assessor was then appointed to assess the loss, who submitted his report on 27.05.2002. The OP stated that despite repeated requests and letters written by the surveyor to the complainant, they did not cooperate with him. The Insurance Company stated that they found the complainant entitled to a sum of Rs. 2,14,082/-, based on the report of the surveyor and hence, there was no deficiency in service on their part.

The District Forum, after considering the averments made by the parties, directed the Insurance Company to pay a sum of Rs. 2,14,082/- to the complainant alongwith interest @ 12% per annum from the date of filing the complaint till realization, as well as litigation cost of Rs. 2,500/-. The District Forum, stated in their order that the complainant had placed on record an affidavit of Tarun Sahni, Proprietor of M/s. Tarun Automobiles, Deonghat, Solan in evidence, who had deposed that an amount of Rs. 2,60,328.60/- had to be spent on purchase of parts for the repair of the bus, which gave rise to the implication that the vehicle was in a repairable condition. Being aggrieved with the order passed by the District Forum, the complainant as well as the Insurance Company challenged the same by way of two cross appeals before the State Commission. In proceedings before the State Commission, the complainant filed an application for placing on record a letter dated 22.03.2005 written by the Motor Vehicle Inspector. The application for additional evidence was, however, opposed by the Insurance Company, saying that the complainant could not be allowed to fill up the lacunae in evidence at the stge of appellate jurisdiction. The State Commission, vide impugned order, dismissed the appeal filed by the Insurance Company, but allowed the appeal of the complainant, directing as follows:- "a) That so far mechanical repairs of the bus in question is concerned, those shall got to be carried out by the appellant on the basis of the estimates submitted by him to the Insurance Company. 25% depreciation in terms of the policy of insurance only on the parts is allowed and not of labour charges;

b) So far compensation on account of body building of the bus in question, it is ordered that the appellant Mr. Johny Mehta is entitled to get it done either from Satluj Motors Ltd. Jallandhar or anywhere else. Its total cost less 25% depreciation shall be borne by the Insurance Company;

c) On the total amount of compensation now payable in terms of this order, appellant is held entitled to interest at the rate and from the date as awarded by the District Forum below;

d) At the same time appellant is directed to hand over the salvage of the body forthwith, and the parts which are replaced after repairs at the Solan Office of the National Insurance Company Ltd., against receipt. On production of requisite bills, in terms of the aforesaid after deducting the sum as per (a) and (b) above, the balance amount will be paid by the Insurance Company to claimant Mr. Johny Mehta or to the party if any whose charge is noted in the policy as financier;

Being aggrieved against the said order, the Insurance Company is before this Commission by way of the present revision petition.

During hearing, the learned counsel for the petitioner Insurance Company stated that the amount allowed as per the order of the District Forum had already been reimbursed to the complainant. There were no reasons to disagree with the detailed report given by the surveyor. The State Commission had passed their order without proper appreciation of the report made by the surveyor. The learned counsel stated that the vehicle in question was repairable and it was not a case of total loss.

The learned counsel for the respondent, however, stated that the order passed by the State Commission was in accordance with law and should be upheld. The report made by the surveyor did not reflect a correct appreciation of the facts and circumstances on record.

I have examined the entire material on record and given a thoughtful consideration to the arguments advanced before me.

The first point that requires consideration in the matter is whether the damage to the vehicle during the accident in question is to be considered as ''total loss'', or the vehicle was in a repairable condition. Although, the complainant stated in his complaint that being a case of total loss, the entire sum insured under the insurance policy should have been paid by the OP Insurance Company in addition to the compensation for loss suffered by him, it is clear from the complaint itself that the complainant obtained quotations/estimates for the repair of the said vehicle from different sources and he has specifically mentioned that an estimate of Rs. 3,50,920/- was given by Sutlej Motors Ltd., Jalandhar for the fitting of the bus body and another estimate of Rs. 2,60,320.60/- was given for repair of engine and other mechanical jobs. The surveyor also stated in his report that the vehicle could be repaired and he made an assessment of the sum payable to the complainant as Rs. 2,14,082.45/- after allowing the necessary depreciation. The State Commission have also observed in the impugned order that the repairs of the bus should be carried out on the basis of the estimate given after allowing for 25% depreciation. It is clear from these facts that the case in question was not that of total loss and the bus was in a repairable condition.

The next issue that arises for our consideration is about the quantum of compensation payable by the Insurance Company to the complainant in accordance with the terms and conditions of the insurance policy in question. As stated above, the State Commission allowed mechanical repairs as well as body building works on the vehicle as per the estimates submitted by the complainant minus 25% as depreciation amount. Considering the facts and circumstances of the case, the direction passed by the State Commission regarding repair of the vehicle in such manner is upheld, subject to the condition that the total amount admissible to the complainant including that disbursed already, shall, in no way, exceed the sum insured under the policy in question. Further, the State commission also ordered that the complainant shall be entitled to interest as awarded by the District Forum from the date of order of the District Forum. The District Forum in their order had allowed payment of 12% interest on the amount admissible. However, considering the overall facts and circumstances of the case, it is considered, in the interest of justice, that interest shall be payable on the amount admissible to the complainant @ 9% per annum from the date of the order passed by the District Forum. This revision petition is disposed of in accordance with the directions as stated above.