Ramesh Kumar Jain vs Oriental Insurance Co. Ltd.

SINCE both these appeals arise from the same order dated 8.4.2003 in Complaint No. 439/2002 by District Consumer Disputes Redressal Forum, Raipur (hereinafter called the ''District Forum'' for short) directing the insurer appellant (of appeal No. 1100/03) to pay to the complainant (respondent in Appeal No. 1100/03) compensation of Rs. 2,50,000/- with interest at the rate of 9% p.a. as also cost of the complaint. For the sake of convenience parties shall be referred to as the complainant and opposite parties.

UNDISPUTEDLY the complainant is the owner of goods vehicle bearing registration No. CG-17-H 0109. The said vehicle was purchased for Rs. 5,00,000/- under finance from B.K.G. Bank, Narayanpur. The vehicle was comprehensively insured with the opposite party Oriental Insurance Company covering the risk for the period from 1.11.2001 to 31.10.2002. It is also not in dispute that the said vehicle met with an accident on 12.3.2002 near village Kallemulle and got extensively damaged. The complainant intimated the opposite parties insurer about the accident in writing. A Surveyor was appointed by the insurer opposite parties. The Surveyor C.M. Sharma, appointed by the Insurance Company conducted survey and submitted his report dated 8.4.2002. Subsequently, another Surveyor Pukhraj Jain, appointed by the Insurance Company also conducted survey and submitted his survey report dated 7.8.2002. It was averred in the complaint that Surveyor C.M. Sharma assessed the damage at Rs. 4,41,000/- on total loss basis. Salvage value was assessed as Rs. 2,50,000/-, and thus net payment of Rs. 1,91,000/- was offered by the opposite parties to the complainant. It was further averred in para 7 of the complaint that the complainant agreed to keep the salvage in the hope that the balance amount of Rs. 1,91,000/- would be paid by the insurer to him within a reasonable time of about a month. However, the Insurance Company was un-cooperative and adopted negative attitude and did not make the payment of Rs. 1,91,000/- which was assessed by Surveyor C.M. Sharma. It was alleged in para 9 of the complaint that the complainant approached the insurer to take possession of the salvage and pay him Rs. 4,41,000/- but his request was not heeded to by the insurer.

The complainant by way of amendment in the complaint averred that the salvage was sold by him for Rs. 1,91,000/- and, therfore, he prayed that compensation of Rs. 2,50,000/- be awarded along with damages, etc.

THE complaint was resisted by the insurer opposite parties. According to them the second Surveyor assessed the loss at Rs. 1,13,000/- which was offered to the complainant but the said amount was not accepted by the complainant. According to the insurer, they also offered that complainant may return the salvage and take the amount of Rs. 4,41,000/- towards full and final settlement of his claim, but the complainant did not accept the offer. It was further averred that the insurers are still ready and willing to pay Rs. 4,41,000/- on total loss basis to the complainant, on his returning the salvage. It was, therefore, averred that they have not committed any deficiency in service. District Forum in its impugned order took note of the fact that the valuation of the vehicle on total loss basis was made at Rs. 4,41,000/-. It was further observed that the report of the Surveyor C.M. Sharma, deserved to be accepted who valued the salvage at Rs. 2,50,000/-. However, since the salvage was sold by the complainant for Rs. 1,91,000/- only the said amount deserves to be deducted from the amount of Rs. 4,41,000/- which was assessed by Surveyor C.M. Sharma on total loss basis. Accordingly, District Forum was of the opinion that Rs. 2,50,000/- deserves to be awarded in favour of the complainant. Accordingly, the District Forum directed that the amount as above with interest, etc. be paid by the opposite parties insurers to the complainant.

THE opposite parties insurers came up in Appeal No. 1100/2003 challenging the impugned order as above. According to them the salvage was allegedly sold by the complainant for Rs. 1,91,000/-, without their permission. It was submitted that the complainant could get the amount of loss on the basis of survey report of C.M. Sharma and the said compensation could not exceed Rs. 1,91,000/- as the complainant has not returned the salvage to the appellant insurers. The complainant preferred appeal No. 1102/2003 in which he has prayed that the amount of Rs. 37,640/- required to be paid to the Bank as interest, ought to have been awarded in his favour. It was, therefore, prayed that the amount of compensation be enhanced. The first question that arises for consideration is: as to whether the compensation of Rs. 2,50,000/- awarded by the District Forum is justified?

UNDISPUTABLY the first Surveyor C.M. Sharma, assessed the value of the vehicle on total loss basis at Rs. 4,41,000/-. Pukhraj Jain, the second Surveyor in his report dated 7.8.2002 also valued the vehicle almost as above. Normally report of the first Surveyor should be relied upon. First surveyor assessed the value of salvage at Rs. 2,50,000/- and recommended the net loss was of Rs. 1,91,000/-. It may be noticed that the averments of the complainant in his complaint indicate that the complainant was also agreeable to accept the said amount. However, his grievance was that the same was not paid to him within a reasonable period. The opposite parties/insurers in their written version have also stated that they were always ready and willing to pay compensation of Rs. 4,41,000/- on total loss basis, on return of salvage. Thus, the value of vehicle assessed by C.M. Sharma on total loss basis at Rs. 4,41,000/- is accepted by both the parties. The salvage value of the vehicle of Rs. 2,50,000/- is also implicitly admitted by the complainant. It is also not in dispute that the complainant has now sold the vehicle and has thus not returned the salvage to the insurer.

ACCORDING to the complainant, the vehicle was sold by him for Rs. 1,91,000/-. He has produced a notarised document dated 16.8.2002 to support his contention as above. ACCORDING to the said document, the vehicle was sold to the purchaser Ramesh Kumar Jain of Narayanpur. District Forum on scrutiny of documents and averments as above came to the conclusion that the vehicle was sold for Rs. 1,91,000/- only and accordingly directed that the said amount be deducted from the value of the vehicle on total loss basis i.e. Rs. 4,41,000/- as assessed by Surveyor C.M. Sharma. However, it is noticed on perusal of the said document dated 16.8.2002 that purchaser has not only agreed to pay Rs. 1,91,000/- but also had agreed to pay the remaining instalments of loan taken by the complainant for financing the vehicle. it is also clear from the document itself that instalments of Rs. 10,000/- each were to be paid towards repayment of loan to Bastar Kshetriya Gramin Bank, Branch Narayanpur. It is further clear from the said document that several monthly instalments were due and they were undertaken to be paid by the said purchaser Ramesh Kumar Jain. However, it is not specified as to how many instalments remained to be paid by the complainant. In any case, it appears from the said document that besides cash amount of Rs. 1,91,000/- paid by the purchaser Ramesh Kumar Jain, to the complainant the liability of the complainant for payment of the balance monthly instalments of Rs. 10,000/- was also undertaken by the said purchaser. Clearly, therefore, the vehicle was sold for much more than Rs. 1,91,000/- even as per the said document. In the foregoing circumstances, the conclusion of the District Forum that the vehicle was sold for Rs. 1,91,000/- does not appear to be well founded. It may further be noted that several instalments of Rs. 10,000/- even according to the said document were due. However, it is not clear how many instalments were remaining due. Moreover, it may be pointed out that the said document dated 16.8.2002 is not supported by affidavit or other material by the alleged purchaser to show that the vehicle was actually sold as per that agreement. There is no material to show that change of name of alleged purchaser was effected in the registration certificate of the vehicle. Thus, it is not established that the vehicle was actually sold by the complainant to the alleged purchaser Ramesh Kumar Jain. In any case, even if the averment of the complainant as above is believed, the document produced by him, itself indicated that the vehicle was sold for a larger sum, besides the cash payment of Rs. 1,91,000/- as noticed above. In the circumstances, assessment of the Surveyor C.M. Sharma of the salvage value of Rs. 2,50,000/- appears to be wholly justified and deserves to be accepted.

Since the complainant has undisputedly not returned the salvage to the insurer, the amount of Rs. 2,50,000/- towards salvage value deserves to be deducted from Rs. 4,41,000/- the market value of the vehicle assessed by Surveyor C.M. Sharma. Thus the complainant is entitled to get only Rs. 1,91,000/- as compensation. The direction of the District Forum to the insurer to pay compensation of Rs. 2,50,000/-, therefore, deserves to be modified to the above extent and instead of the above amount compensation of Rs. 1,91,000/- deserves to be awarded.

COMPLAINANT in his Appeal No. 1102/2003 has claimed that interest ought to have been awarded in his favour. However, he has not produced any document or material to show how much interest he was required to pay. As already noticed, even according to the complainant he had already sold the vehicle with the liability to pay the balance of the amount by the alleged purchaser. Moreover, the insurer in their written version stated that they were always ready and willing to pay the sum of Rs. 4,41,000/- to the complainant if he returned the salvage. However, even after the opposite parties filed their reply as above, the complainant did not accept the offer. In the circumstances, we do not consider it proper to grant any additional interest to the complainant than awarded by the District Forum to the complainant. Accordingly Appeal No. 1100/2003 preferred by the opposite parties insurers Oriental Insurance Company is partly allowed and the impugned order stands modified as below: Instead of amount of Rs. 2,50,000/- awarded by the District Forum, the insurers appellants of the appeal shall pay to the complainant an amount of Rs. 1,91,000/- along with interest @ 9% p.a. from 8.4.2002. Appeal No. 1102/2003 of the complainant however, deserves to be and is hereby dismissed. Ordered accordingly.