THE NEW INDIA INSURACE CO. LTD vs JAGJIT SINGH

Challenge in this Revision Petition, under Section 21 (b) of the Consumer Protection Act, 1986 (for short "the Act") is to the order dated 5.9.2008 in First Appeal No.2008/651 passed by State Consumer Disputes Redressal Commission, Delhi (in short, "the State Commission"). By the impugned order, the State Commission dismissed the appeal preferred by the Insurance Co. and confirmed the order of the District Forum.

The facts material to the complaint are that the complainant purchased a Tata Indica vehicle from the previous owner M/s K.S. Engineers on 13.3.2006 and the period of insurance for the said vehicle was valid upto 10.5.2006. The complainant averred that he had applied for renewal of the

insurance policy and submitted all the requisite papers relating to the insurance of his car to the opposite party and paid a premium of Rs.7116/- by cheque dated 10.5.2006. The insurance policy was renewed w.e.f. 11.5.2006 to 10.5.2007. Unfortunately, the complainant''s car was stolen on 1.6.2006 and the same was intimated to the opposite party on 2.6.2006. On 8.6.2006, the complainant was informed that the opposite party had wrongly issued the policy in the name of the previous owner in spite of furnishing all the requisite documents. Immediately, he had written to the OP on 9.6.2006 for effecting the necessary corrections. The complainant averred that he had applied for renewal of the insurance policy in good faith disclosing all the relevant information but the OP did not renew the policy in his name. The complainant had insurable interest at the time of taking up the policy on 11.6.2006 and, therefore, the repudiation of the opposite party on the ground that the policy is not in his name is unjustified. Hence the complainant approached the District Forum and sought direction to the opposite party to pay Rs.2,10,000/- with interest @ 18% p.a., compensation and costs. Direction was also sought to issue the corrected policy in the name of the complainant herein.

The Opposite party filed the written statement stating that M/s K.S. Engineers had taken the insurance policy for the period 11.5.2006 to 10.5.2007 whereas the vehicle covered under the policy had been sold on 13.3.2006 to complainant Shri Jagjit Singh and the said vehicle was stolen on 1.6.2006. The complainant made a claim on 2.6.2006 but the record shows that the insured M/s K.S. Engineers got the policy renewed in their name and even claimed 20% no claim bonus in the policy. At the time of renewal of the policy on 11.5.2006, the insured had no insurable interest in the subject car which has been in possession of Mr. Jagjit Singh, the complainant herein. The subject car has been transferred on 1.6.2006 and the complainant vide his letter dated 9.6.2006 had requested the opposite party to transfer the policy of insurance in his name whereas the theft of the vehicle took place on 1.6.2006.

The opposite party pleaded that at the time of taking up the policy on 11.5.2006 the vehicle was in the possession of complainant and M/s K.S. Engineers has no insurable interest and as on the date of loss, i.e., 1.6.2006 the complainant had no contract of insurance and, therefore, the complainant has no locus standi to lodge the claim with the Insurance Co. and hence the repudiation is justified.

The District Forum based on the evidence adduced allowed the complaint by directing the Insurance Co. to pay the IDV of the vehicle, i.e., Rs.2,10,000/- with interest @ 9% p.a. from 31.10.2006 till the date of realization. The District Forum observed that it was an admitted fact that the earlier owner was having the policy covering the period 11.5.2005 to 10.5.2006 and that the complainant had applied for renewal of the policy in his name and also paid a premium from his own account. It is the mistake of the Insurance Co. to have renewed the policy in the name of the previous owner for which the complainant cannot be made to suffer.

Aggrieved by this order, the Insurance Co. preferred an appeal before the State Commission and the Commission concurred with the finding of the District Forum and observed as follows:- "8. Since in the instant case only vehicle was stolen and there was no damage by way of accident, therefore the question of Section 157 of Motor Vehicle Act and for that purpose the concept of third party interest was not at all applicable or invokable.

On the concept of equity, it is the vehicle which is insured and not the person and the only safeguard in such cases where total loss is by way of theft is that if the

insurable interests have not been transferred in the name of the person who has purchased the vehicle inspite of being the actual owner, the "No Objection Certificate" from the original owner as well indemnity bond from the claimant should be obtained. But in no way the insurance company can escape from its liability against the policy. If such a benefit is given to the insurance companies then it will get unjustly enriched whereas the actual consumer would be at great jeopardy and his interest would suffer.

The brief fact for consideration herein is whether the respondent/complainant has insurable interest and has locus standi to prefer a claim. The facts not in dispute are that the complainant had purchased the subject car from M/s K.S. Engineers on 13.3.2006 and that M/s K.S. Engineers was having the insurance policy of the said car covering the period from 11.5.2005 to 10.5.2006, the IDV value of the car being Rs.2,10,000/-. It is also not in dispute that the respondent/complainant applied for transfer of insurance certificate and for renewal of the policy in his name and paid a sum of Rs.7116/- vide cheque No.590672 dated 10.5.2006 drawn on State Bank of India. The petitioner Insurance Co. had issued the renewed policy valid from 11.5.2006 to 10.5.2007 in the name of the earlier owner of the vehicle, i.e., M/s K.S. Engineers. On 1.6.2006, the vehicle was stolen and the claim was made by the respondent/complainant.

Learned counsel for the revision petitioner submitted that as per GR17 the transferee should have applied within 14 days from the date of transfer in writing under recorded delivery to the insurer who has insured the vehicle with the details of the registration of the vehicle, the date of transfer of the vehicle, the previous owner of the vehicle and the number and date of the insurance policy so that the insurer may make the necessary changes in his record and issue fresh Certificate Of Insurance.

Perusal of the record shows that the respondent/complainant had applied for transfer of the insurance policy and has even paid the premium but it was only mistakenly issued in the name of the earlier owner. The record also shows that there was an investigation conducted by M/s Ipso Facto who have filed a report stating that they found no reason to suspect any foul play or wrong doing on the part of the owner/user of the vehicle and that the theft had actually happened and the claim seemed to be genuine. They recommended that the claim may be settled as per the terms and conditions of the policy. The vehicle particulars of the State Transport Department issued by the Registering Authority also states that the Insurance Certificate/Cover Note No.0000723 valid from 11.5.2006 to 10.5.2007 issued by the New India Assurance Co. is verified and found to be in order.

Having regard to the fact that the respondent/complainant had applied for transfer of the policy and also paid the premium by cheque on 10.5.2006 from his own account, while the theft had taken place on 1.6.2006 and that the respondent had complied with the other terms with respect to the lodging of the FIR and also informing the Insurance Co. on time, I do not see any illegality or infirmity in the concurrent findings of both the Fora below.

For all the aforementioned reasons, this revision petition fails and is accordingly dismissed.