Shyamlal Agrawaln vs UNITED INDIA INSURANCE COMPANY LTD

THIS appeal arises out of the order dated 14.7.2004 passed by the District Consumer Disputes Redressal Forum, Raipur (hereinafter referred to as District Forum for short) in Complaint Case No. 209/2001 whereby the complaint was partly allowed.

BRIEF facts as narrated in the complaint are that the complainant had purchased a vehicle, Sumo, bearing number MP 23 GA -0877, for personal use and got the same insured with the opposite party and kept renewing the policy of Insurance. The vehicle was also insured for the period from 17.1.1999 to 16.1.2000. It is specifically averred in the complaint that the vehicle was for personal use of the complainant and his family members. For the sake of convenience, the complainant had appointed Tarun Kumar Pandey, holding valid driving licence, as driver for driving the aforesaid vehicle and directed that none else should be allowed to drive the vehicle. On 8.5.1999, the complainant returned from Bhatapara with the driver at about 8 p.m. and instructed him to come in the morning for going to Jagdalpur. As the driver did not turn up in the morning the complainant had sent a person to enquire about the matter and came to know that the driver had, without permission of the complainant, taken the vehicle to Bhilai in connection with death of his relative. Thereupon the complainant himself went to Bhilai and on inquiry from the driver came to know that some other person had taken the vehicle to some other place. The complainant lodged FIR with the Pandri Police Station, Raipur on 10.5.1999 and there he was told that Tarini Pandey had taken the vehicle to Orissa and had caused an accident and he himself has died in the accident. Pandri Police informed that the Pandri Police could not take cognizance of the offence. The complainant had intimated the insurer and Surveyor M.A. Ramani visited the spot on 14.5.1999 and subsequently filed his report. The complainant had submitted an estimate for Rs. 4,41,026 and repeatedly requested the insurer to disburse the amount. However, the insurer finally repudiated the claim on the ground that the vehicle was being driven as taxi and the driver did not have valid driving licence. According to the averments of the complaint, the insurer had committed deficiency in service by repudiating the claim, hence the complainant had to file complaint before the District Forum. The opposite party/insurer resisted the case mainly on the plea that were also mentioned in the letter of repudiation i.e., the vehicle was being plied as taxi and the driver Tarini Pandey did not have valid driving licence. It was also averred that the report regarding theft of vehicle was false. The complainant had violated terms of policy and as such was not entitled to any relief and prayed that the complaint be dismissed.

THE learned District Forum decided the complaint in favour of the complainant and directed the opposite party to pay a sum of Rs. 1,30,000 to the complainant together with interest and costs as detailed in the order. However, the complainant was not fully satisfied with the order of the District Forum and has filed the appeal under consideration.

THE respondent has filed an application for filing affidavit of Surveyor and Loss Assessor Sr. Purushottam Lal Verma and the application was marked as I.A. No. 1. Arguments on the said application as well as final arguments heard. Record perused. The appellant did not file written reply to the application of the respondent for filing affidavit of Sri Purushottam Lal Verma though orally opposed the application vehemently. It is noticed that though the application is in the nature of filing document to be considered as additional evidence, no reason has been assigned as to why the affidavit of the Loss Assessor and Surveyor could not be filed before the District Forum during pendency of complaint case, especially when the case was remanded back to the District Forum for affording an opportunity to the insurer to file written version and for supporting the same with documents. However, in the circumstances of the case we think it proper to allow the application and to take the affidavit on record.

DURING argument on merits learned Counsel for the appellant submitted that the learned District Forum has erred in appreciating the material on record and though has held that it was a case of total loss yet awarded only a sum of Rs. 1,30,000 after deducting salvage value of Rs. 70,000 where as the vehicle was insured for Rs. 3,00,000. The learned Counsel reiterated that the appellant is entitled to get a sum of Rs. 3,00,000 from the insurer and after deduction of the salvage value of Rs. 70,000 the amount comes to Rs. 2,30,000. Learned Counsel for the appellant further submitted that the Insurance Company has charged premium for the insured sum of Rs. 3,00,000 and hence is liable to pay the same amount in case of total loss. He prayed that the impugned order be quashed and the appeal be allowed.

LEARNED Counsel for the respondent reiterated the stand taken before the District Forum and submitted that the Surveyor had enquired about the market value of Tata Sumo vehicle of 97 model from various places and was informed that the price of vehicle was not more than Rs. 2,00,000. It is mentioned in Surveyors report that father of the complainant had told the Surveyor that prior to the accident in question they were offered a price of Rs. 1,70,000 for the vehicle, but they refused to sell the vehicle. He also submitted that the vehicle had met with accident earlier also, hence could not fetch higher price. He further submitted that the respondent has filed Surveyors affidavit in support of the submissions made by him. In this appeal we have to consider the limited question as to whether the sum awarded by the District Forum is sufficient?

ON perusal of Surveyors report, it is apparent that he has assessed the loss considering all the three methods i.e., Repair basis, Cash Loss basis and on Total Loss basis. Since the liability of the Insurance Company came to be minimum on total loss basis, the Surveyor had recommended settlement on total loss basis. It is undisputed that the vehicle was comprehensively insured for a sum of Rs. 3,00,000. On page 6 of the report of the Surveyor and Loss Assessor Sri P.L. Verma it has been mentioned that he had contacted the dealers who deal in sale and purchase of second hand vehicles at Kanpur, Indore, Jabalpur and Godra and according to them the price of 1997 model of Tata Sumo in good condition is available for Rs. 2,00,000. However, it is noticed that but for the affidavit of the Surveyor and Loss Assessor and that too being filed in appeal, the insurer has failed to lead any evidence in support of their contention that the market value of the vehicle Tata Sumo of 1997 model was Rs. 2,00,000. Further it has neither been mentioned in the report nor in the affidavit as to when and by what mode the dealers were contacted. Name and other particulars of any of the said dealers have not been provided. In view of the fact that the vehicle was insured for sum of Rs. 3,00,000 and the Insurance Company had charged premium at the aforesaid insured value it is difficult to accept the contention of the insurer that the market value of the vehicle was Rs. 2,00,000 only.

IT is further mentioned in the report -it is learnt that the subjected insured vehicle was previously met with an accident and its case the new chassis frame was replaced with new. Therefore, the value of the pre -accidented vehicle should be not more than 2,00,000. There is nothing on record to suggest as to when the alleged accident had taken place. In case it was prior to the insurance period it would in no way reduce the value of the vehicle as the insurer had accepted the value of the vehicle to be Rs. 3,00,000 and had insured it for the same value. If it was otherwise the burden lay on the insurer to prove that there was an accident during the same year of insurance and thereby though premium was charged on the insured value of Rs. 3,00,000 the market value of the vehicle had reduced due to such accident. However, nothing of the sort has been done. We are of the opinion that the plea of the learned Counsel for the respondent that the father of the complainant had told the Surveyor during course of discussion that prior to accident of the vehicle there was an offer for the purchase of the vehicle for Rs. 1,80,000 but they did not agree, would also not help the insurer in convincing us to determine the value at Rs. 2,00,000.

IN view of the above discussion we are of opinion that when the insurer has insured the vehicle for a sum of Rs. 3,00,000 and has received the premium accordingly it is liable to reimburse the loss upto that limit. A reference in this regard may be made to New India Assurance Company Ltd. v. G.P. Malhotra, III (2002) CPJ 264 (NC). In our opinion the liability of the Insurance Company will extend to the total sum of Rs. 3,00,000 for which the vehicle was assured. Of course the salvage value of Rs. 70,000 will be deducted from the sum of Rs. 3,00,000. Hence, the order of the learned District Forum is modified and it is directed that the insurer shall pay a sum of Rs. 2,30,000 (two lacs thirty thousand) to the complainant/appellant towards loss of vehicle and shall also pay simple interest @ 9% per annum on the aforesaid sum from the date of repudiation till the date of actual realization. The insurer shall also pay Rs. 2,000 (two thousand) towards cost of litigation. All the aforesaid amount shall be paid within a period of 45 days from the date of this order. Appeal allowed.