Oriental Insurance Co. Ltd. vs BACHHU DEBNATH

THIS revision petition is directed against the order passed by the Consumer Disputes Redressal Commission, Tripura dated 18.4.1996 in Appeal No. 37/95. In order to appreciate the controversy involved in this case, the facts relevant for the purpose may be stated as under: The complainant, Mr. Bachhu Debnath purchased a truck bearing No. TRL 3981 on taking loan from the Indian Overseas Bank, Agartala Branch, Agartala. The vehicle was insured with the Insurance Company for a sum of Rs. 3,70,000/-. On 5.3.1995, the truck met with an accident. As a result of the accident, the vehicle was damaged to a great extent. As the vehicle was insured with the opposite party-Insurance Company they were informed about the accident. The opposite party appointed a Surveyor who after inspection of the vehicle submitted his report on 15.3.1995. The vehicle was, thereafter, brought to the garage and after estimation it was found that an amount of Rs. 3,10,031.50 would be required for rectifying the defects. The vehicle was dismantled in presence of another Surveyor and it was estimated that a sum Rs. 1,43,966.77 would be required in addition to the estimate, which was done earlier. The complainant demanded a sum of Rs. 4,53,988.27 from the opposite party for repairing the vehicle. When he did not get any favorable response from the opposite party, he approached the District Forum seeking redress by filing a complaint.

IN the written version filed on behalf of the INsurance Company, it was pleaded that the complainant was not entitled to claim Rs. 4,53,988.27 plus Rs. 15,000/- per month as dam- ages. It was also pleaded that the respondent was not entitled to get any relief as the policy was void for non-disclosure of some material facts. It was also contended that in no way the respondent would be entitled to get such an amount as according to the terms of the policy, the deduction rate for depreciation of a vehicle of 1990-95 model stood at 35%. The Surveyor, Mr. Gurcharan Singh who was engaged by the appellant estimated the loss and opined for a cash loss of Rs. 1,44,521.12. After hearing the Counsel for the parties and appreciating the documentary evidence produced on record, the District Forum came to the conclusion that there was deficiency in service on the part of the opposite party and awarded the complainant a sum of Rs. 3,70,000/- as value of the truck and Rs. 8.300/- per month as business loss from the date of accident till payment.

Aggrieved by the order of the District Forum, the Insurance Company approached the State Commission by way of an appeal. The State Commission made certain modifications in the award allowed by the District Forum and dismissed the appeal. The Insurance Company has assailed the order of the State Commission by filing this revision petition. We have heard the learned Counsel for the parties and perused the records carefully with their help.

MR. P.K. Seth, Advocate, appearing for the Insurance Company contended that the District Forum as well as the State Commission were wrong in holding that there was deficiency in service on the part of the Insurance Company. The State Commission while passing the impugned order has exercised its jurisdiction illegally and with material irregularities. The State Commission has completely failed to under- stand the relevant provisions of the insurance policy and the Act while coming to the finding that the vehicle was insured for a sum of Rs. 3,70,000/- and as such the loss suffered by the respondent was Rs. 3,70,000/-. The State Commission ought to have taken into consideration the assessment made by the Surveyor. But, without giving any cogent reason or justification for not agreeing with the loss assessed by Surveyor, MR. Gurcharan Singh, held in an arbitrary and illegal manner that the respondent was entitled for a sum of Rs. 3,70,000/- towards the loss of his vehicle. On the other hand, Mr. R.B. Dutta, Advocate for the respondent contended that the order of the State Commission is based on correct appreciation of the material placed on. Record and was justified in the facts and circumstances of the case.

WE have given our thoughtful consideration to the entire matter. The State Commission returned the finding that the Insurance Company was deficient in its service in not settling the claim and protracted process of settlement for extraneous consideration. There had been no genuine efforts on the part of the Insurance Company in settling the claim. WE find that the finding of the State Commission on this point is supported by evidence and calls for no interference. So, we confirm the finding of the State Commission that there was deficiency in service on the part of the Insurance Company. Regarding compensation, the State Com- mission relied upon the conditions of the Insurance Policy. According to the conditions of the policy, the Insurance Company was entitled to deduct 35% for depreciation if the age of the motor vehicle was between 4 to 5 years. Taking the insured amount of vehicle, Rs. 3,70,000/-, 35% was deducted as depreciation value of vehicle and compensation was assessed at Rs. 2,40,500/-. Besides this, the State Commission awarded Rs. 8,300/- per month as business loss from the date of accident till realisation. In our opinion, the approach of the State Commission in assessing the loss was not rational. The first Surveyor after extensive examination of the damaged vehicle opined that a sum of Rs. 1,93,891.50 towards cost of the parts and that a sum of Rs. 20.140/- towards labour charges would be required to repair the vehicle. The State Commission assigned no reason as to why the report of the first Surveyor was not acceptable. In our opinion, no material was placed on record to show that the report of the first Surveyor suffered from any infirmity and could not be relied upon. The State Commission could not ignore the re- port of the Surveyor and should have acted upon it. In the presence of the Surveyor''s report, the State Commission could not resort to other method of assessing the compensation on the basis of deduction of 35% as depreciation value of the vehicle. In our opinion, the State Commission acted in exercise of its power illegally and with material irregularity in assessing the loss by de- ducting 35% as depreciation. We set aside the finding of the State Commission on this aspect. We hold that the complainant is entitled for compensation on the basis of report of the first Surveyor where he had estimated that a sum of Rs. 1,93,891.50 towards the cost of the parts and a sum of Rs. 20.140/- towards labour charges would be required to repair the vehicle. The total of these two amounts comes to Rs. 2,14,031.50. Adding another margin of Rs. 11,000/-, we find that an amount of Rs. 2,25,000/- would fully justify towards award of compensation. The State Commission also awarded a sum of Rs. 8,300/- per month on account of loss of income from the vehicle from the date of accident till date of payment. We find that this amount of Rs. 8,300/- has been awarded without any material placed on record by the complainant. We feel that it will meet the ends of justice, if we award interest to the complainant at the rate of 18% on the amount of compensation awarded. Accordingly, the appeal is partly allowed. The order of the State Commission is modified to the extent that the complainant shall be entitled to Rs. 2.25.000/- with interest at the rate of 18% from 1.7.1995 till date of payment. In the circumstances of the case, we make no orders as to costs. Appeal partly allowed.