NATIONAL INSURANCE COMPANY LIMITED vs HARI CHAND

OFFICE has reported delay of 71 days in filing this revision petition. The petitioner has filed an application for condonation of delay in which according to the petitioner, there is delay of only 53 days, which is sought to be condoned. Explaining reasons for the delay of 53 days, the petitioner has submitted that the case file was received late by the petitioner from its regional office and it took some further time to seek an approval from the superior authorities to present the revision petition and to get the pleadings from Shimla office of the petitioner. It is further submitted that some more time was taken in seeking legal advice because of which there has been delay of 53 days, which is claimed to be neither intentional nor deliberate but for the reasons mentioned in the application. The reasons given by the petitioner explaining the delay are highly general and vague and would hardly constitute sufficient cause which could justify our condoning the delay in question. We are, therefore, not inclined to condone the delay and the petition can be dismissed on this ground alone.

COMING to the merits of this case, son of the complainant, who is respondent No. 1 herein, had purchased Maruti Car on 8.9.1999 after getting it financed by respondent No. 2 (who was opposite party No. 3 before the District Forum) under lease agreement dated 8.9.1999. The said vehicle was insured with the petitioner-company, who were opposite parties 1 and 2 before the District Forum for Rs.1,80,000/- under insurance cover note No. 657873 dated 8.9.1999. The aforesaid vehicle met with an accident on 12.9.1999 resulting in the death of the son of the complainant and extensive damage to the vehicle. The complainant being the natural guardian of his son lodged a claim with the opposite party-company. A surveyor came to be appointed. The Surveyor submitted his report in which he assessed the damage to the vehicle on total loss basis. The Surveyor recommended settlement of the claim at Rs. 1 lakh net of salvage and the salvage was assessed by the Surveyor at Rs.70,000/-. The petitioner-company paid Rs. 1 lakh to the financer i.e. respondent No. 2/opposite party No. 3 through a cheque dated 28.08.2000 despite undertaking of the complainant not to take the salvage. Aggrieved by this response of the petitioner-company, the complainant filed a complaint before the District Forum praying for a direction to the petitioner-company to pay Rs. 1 lakh paid to opposite party No. 3/respondent No. 2, Rs.82,500/- spent to keep the salvage of the vehicle and compensation of Rs.10,000/- in addition to the litigation cost. The petitioner resisted the complaint and submitted that the damage to the car had been assessed at Rs.1 lakh and the same amount had already been paid by the petitioner-company to respondent No. 2-Financer as per IMT condition No. 55 of the policy in full and final satisfaction of the claim. It was denied that the complainant had spent any amount to keep the salvage and hence it was submitted that the complainant was not entitled to any other amount in this regard. After hearing the parties and appraisal of the issues and the evidence before it, the District Forum allowed the complaint and directed the petitioner-company to indemnify the complainant to the extent of Rs.70,000/- alongwith interest @9% per annum with effect from the date of filing of the complaint till realization in addition to Rs.1500/- by way of litigation expenses.

Both the insurance company and the complainant filed separate appeals against the aforesaid order of the District Forum. The complainant prayed for enhancement of the compensation/relief in his favour and the opposite party/insurance company prayed for setting aside the order of the District Forum and dismissal of the complaint. The State Commission vide its impugned order dated 22.7.2008 disposed of the appeals by a common impugned order and directed that after presenting proof of having delivered the salvage to the insurance company, the complainant/respondent No. 1 will be entitled to Rs.80,000/- payable by the petitioner/insurance company alongwith interest at Rs.1,80,000/- from 15.03.2000 and litigation expenses allowed by the District Forum. Besides this, the State Commission also directed the petitioner-insurance company to pay a sum of Rs.25,000/- towards compensation for harassment and mental torture to the complainant. Regarding the claim of the complainant for the rental of the storage of the salvage, the State Commission held the complainant/respondent No. 1 entitled to a rental for the storage of the salvage of the vehicle at Rs.500/- per month from 15.03.200 upto 31.8.2008.

AGGRIEVED by this order of the State Commission, the petitioner/insurance company has filed the present revision petition challenging the same. Mr. Rajan Kumar Pandey, Advocate appearing for the petitioner-insurance company contended that the settlement of the claim of the complainant had been rightly done by the insurance company based on the assessment carried out by the Surveyor and in accordance with the IMT regulation No. 55, a copy of which is placed at page 32 of the record. He submitted that since the total assessment of the claim recommended by the Surveyor was Rs.1,70,000/-, net of salvage and the salvage continued to be with the complainant, payment of Rs.1 lakh by the petitioner-company to the Financer/respondent No. 2 amounted to full and final settlement of the claim and nothing remained to be done further by the insurance company. The fora below, therefore, erred gravely in giving additional reliefs to the complainant which was modified and further enhanced in favour of the complainant by the State Commission through its impugned order. The same, therefore, cannot be sustained in the eye of law.

ON the other hand, Mr. Pradeep Singh, counsel for the respondent No. 1 pointed out that payment of Rs. 1 lakh to the financer-company without concurrence and consent of the complainant/respondent No. 1, cannot be regarded as full and final discharge of the claim by the petitioner-company. He submitted that the quantum of compensation payable with reference to the claim of the complainant was first required to be settled by the petitioner-company with the complainant and not with the financer and hence any payment made directly to the financer by the petitioner-company without the discharge voucher being endorsed by the complainant, cannot absolve the petitioner-company from his responsibility to settle the claim. In fact, he stated that no action to settle the claim was taken by the petitioner-company for almost two years and as per the admitted position, the same came to be re-opened after more than two years at the instance of the complainant. He also contended that both the fora below have already looked into all the aspects of this case in great detail and have returned their concurrent findings of facts in favour of the complainant and the modification done by the State Commission through its impugned order, was absolutely appropriate since it was the case of total loss. As per the Surveyor, the salvage belonged to the petitioner-company because the complainant did not want to retain it and it was also the responsibility of the petitioner-company to make arrangements for its proper custody and maintenance. He, therefore, pleaded that there is no merit in the revision petition and the same be dismissed with costs. We have carefully considered the submissions made by learned counsel for the petitioner and respondent No. 1. Respondent No. 2 has been proceeded ex parte. We find that while upholding the order of the District Forum in regard to the deficiency in service on the part of the petitioner-insurance company, the State Commission vide its impugned order has rightly modified the reliefs in favour of the complainant for the reasons recorded in the order. The impugned order is well reasoned order and does not call for any interference. The plea of IMT regulation No. 55 has been wrongly relied upon by the petitioner-company for claiming the payment to the financer to be in the nature of full and final satisfaction of the claim. Any payment made directly by the insurance company to the financer in terms of IMT Regulation No. 55 would constitute proof of discharge of the proportionate claim and nothing further. So far as quantum of claim is concerned, as rightly pointed out by counsel for the complainant, the same has to be settled with the complainant and hence whatever payment is made by the petitioner-company directly to the financer only shows that it is a good payment but the amount by itself cannot constitute to be in full and final satisfaction of the pending claim. In the circumstances, we agree with the view taken by the State Commission and uphold the impugned order. The revision petition devoid of any merit is liable for dismissal and the same is dismissed accordingly with no order as to costs.