United India Insurance Company Ltd vs ESS ESS PHARMACEUTICALS

MAJ. Gen. S. P. Kapoor, Member-This is an appeal received by transfer from Punjab State Consumer Disputes Redressal Commission against order of District Consumer Disputes Redressal Forum (for short hereinafter to be referred as District Forum) dated 26. 3. 2001 in complaint case No. 346 of 2000, M/s. Ess Ess Pharmaceuticals v. United India Insurance Company Limited.

BRIEFLY the case of the complainant is that it is a firm involved in the business of whole sale medicines and Mr. Atul Sood and Smt. Sneh Lata Sood are partners of the firm and are, therefore, competent to file the present complaint. It is averred that the complainant firm purchased a Tata Siera Car No. Pb-10-R-9708 from one Davinder Singh Ghuman in May 1997 and submitted relevant papers to District Transport Officer (D. T. O.), Jalandhar for transferring the registration certificate of the above said vehicle in the name of their firm to D. T. O. , Jalandhar/registering authority, which made endorsement of transfer on the registration certificate (RC) of the said vehicle. The complainant firm got the vehicle insured from National Insurance Company Limited, 89, Bhagwan Mahavir Marg, Branch Office No. 2, Jalandhar vide Cover Note No. 00030065 dated 4. 12. 1998. However, for the period from 13. 1. 1999 to 12. 1. 2000, the complainant got the car insured from the OP vide policy No. 110500/31/02/3268/99 and paid a premium of Rs. 5,982/ -. OP issued a certificate of insurance in the name of the complainant firm and undertook to indemnify firm against all types of losses including own damage. On 31. 3. 1999, the said vehicle met with an accident near village Garna Sahib on Jalandhar-Pathankot road at about 10. 15 p. m. It was being driven by Rajesh Sood. F. I. R. No. 29 dated 5. 4. 1999 was registered at P. S. Dasua. The driver at the time of accident had the valid driving licence and the vehicle was badly damaged. The complainant firm preferred own damage claim with the OP who deputed M/s. Vij Engineers and Enterprises as surveyor to assess the loss. On inspection of the vehicle, the surveyor estimated the loss of Rs. 72,438/- and the OP got deposited the salvage of the damaged parts with their office at Jalandhar. However, the OP vide their letter dated 29. 6. 2000 repudiated the claim on the ground that the registration certificate had not been transferred in the name of the complainant in the records of D. T. O. , Jalandhar. As per the complainant firm, the vehicle in dispute was in its actual and factual control as owner for the last more than three years and the insurance cover note was issued by the OP after seeing the registration certificate of the vehicle. Thus, claiming that the complainant firm is a consumer of the OP, this complaint has been filed seeking directions to the OP to pay the complainant a sum of Rs. 72,438/- for the damage caused to the vehicle along with interest @ 18% per annum from the date of accident till payment. The case of the OP is that the claim has been rightly repudiated as the complainant firm is not the owner of the vehicle and has further alleged that the compensation demanded is highly exaggerated and bears no relevance to the facts of the complaint. On merit, it has also been stated by the OP that the alleged criminal case under the F. I. R was registered in connivance with the police of P. S. Dasua to get false compensation and the correct course for the complainant is to get compensation from the owner and insurer of the tractor trolley with which the vehicle had met with an accident. It is also the case of the OP that the complainant had never shown the registration certificate of the vehicle to the OP and the complainant is not a consumer qua the OP as ownership of the said vehicle has not been transferred in the name of the complainant firm and, therefore, the complainant firm is a "stranger insurer" and not the "owner insurer" of the vehicle. As per the OP, the complainant firm has not suffered any loss and is, therefore, not entitled to any compensation.

The learned District Forum, in their analysis of the complaint, has recorded that the D. T. O. , Jalandhar/registration authority had made endorsement on the registration certificate of the said vehicle in the name of the complainant firm showing the complainant firm as registered owner of the above mentioned vehicle and the same is apparent from Exhibit A-2 i. e. photocopy of the registration certificate. The learned District Forum has also recorded that a perusal of Exhibit A-2 further confirms that Sh. Davinder Singh Ghuman was the previous registered owner and the registration was transferred in the name of the complainant firm under the seal and signature of the registering authority, Jalandhar. Further after perusal of the certificate of insurance, the learned District Forum has recorded that it shows the OP had undertook to indemnify the complainant against all types of losses including own damage. The learned District Forum was of the view that the claim of the complainant should not have been repudiated by the OP due to the following reasons: (a) D. T. O. , Jalandhar/registering authority had made endorse-ment on the registration certificate of the said vehicle in the name of the complainant firm showing it to be the registered owner of the said vehicle. (b) RW-2 has admitted that the seal below the signature on Exhibit A-2 is that of the office of D. T. O. even though he does not admit the signatures of D. T. O. /registering authority. Since the seal of the office of D. T. O. /registering authority has been admitted to be authentic, onus lay on the OP to prove that the seal on Exhibit R-2 is not authentic. (c) Insurance Company cannot repudiate the claim because it has received the premium for the policy in question issued in the name of the complainant and thus it cannot get away from the agreement between the complainant and the OP. (d) Insurance policy was valid at the time of the accident. (e) The driver of the car was holding a valid driving licence. (f) Divisional office of the OP at Jalandhar had collected the salvage of the said vehicle based on the survey report vide which, the surveyor had recommended payment to the complainant.

IN view of the above discussion, the learned District Forum holding that the complainant is a consumer of the OP and the vehicle in question was insured by the OP after receipt on due premium as well as after seeing the registration certificate, held that there was deficiency on the part of the OP in repudiating the claim. It, therefore, directed the OP to pay the complainant a sum of Rs. 72,438/- along with interest @ 12% per annum from the date of lodging the claim till recovery along with costs quantified as Rs. 500/ -. Aggrieved by the said order, OP had filed this appeal before the Punjab State Commission, which has now been transferred to this Commission under the orders of Hon''ble National Consumer Disputes Redressal Commission, New Delhi. Sh. Paul S. Saini, Advocate along with Sh. Parminder Singh, Advocate appeared for the appellant whereas Mr. H. K. Arora, Advocate represented the respondents/complainants.

THE learned Counsel for the appellant submitted that from the cross-examination of the clerk of the office of D. T. O. , Jalandhar/registering authority, it becomes clear that the ownership of the car had not been transferred in the name of the complainants and, therefore, the complainants had no insurable interest in the car and, thus, the claim was rightly repudiated. It was further pleaded that since the claim had been rightly repudiated on valid grounds, there was no deficiency in service on the part of the OP. In response, Mr. H. K. Arora, Advocate, learned Counsel for the respondents complainants submitted that the car had been transferred in the name of the complainant as is evident from the recording made in the registration certificate itself, by D. T. O. , Jalandhar under its office seal. He further submitted that this registration certificate was shown to the insurer before purchase of the insurance policy and only, thereafter, the insurance policy was issued in the name of the complainant firm and, thus, the Insurance Company now cannot deny its liability to indemnify the loss. He further submitted that even if the contention of the Insurance Company that the vehicle was not transferred in the name of the complainant firm is accepted, the Insurance Company is still liable to indemnify the complainant firm as the insurance policy had been taken by the complainant firm and it is nowhere laid down that the insured must always be the owner of the vehicle. In this context, he also relied on the judgment of the Hon''ble National Commission in the case of Haji Bashir Ahmad v. National Insurance Company Ltd. , III (2003) CPJ 22 (NC)=2004 (1) CON. LT 510, wherein the Hon''ble National Commission has held that since the agent signs in the proposal form wherein there is an entry stating "i have seen the vehicle. Presumption drawn is he must have seen the documents including RC. . . . . . . . . . "and it had further held that "section 1 of the Terms dealing with ''loss or Damage'' starts with the wording ''the Company will indemnify the insured against loss'' whoever is the insured mentioned in the policy is thus covered as per terms of the policy. " Reiterating that the policy was in the name of the complainant firm, the registration certificate duly carried the endorsement that the complainant firm had purchased the car and the registration certificate had been seen by the insurance agent at the time of filling the proposal form, the learned Counsel submitted that the OP Insurance Company now cannot get away from its liability to indemnify the complainant firm for the loss suffered. We have gone through the record of the complaint case on file as well as the impugned order and also heard the learned Counsel for the parties.

THE main plank of the Insurance Company to repudiate the claim is that the vehicle had not been transferred in the name of the complainant firm and, therefore, the complainant firm held no insurable interest in the vehicle and was, therefore, not entitled to claim any compensation from the Insurance Company whereas the case of the complainants is that the vehicle had been duly purchased by the complainant firm way back in the year 1997 and the factum of its purchase had been recorded in the registration certificate of the car by D. T. O. , Jalandhar/registering authority under its seal and the insurance policy was a contract between the complainant firm and the Insurance Company and, therefore, the Insurance Company was liable to pay the complainant firm for the damage suffered by the vehicle in the accident. The moot point in this case is whether the complainant firm was the owner of the car or not?

IT is an admitted fact that the insurance was done in the name of the complainant firm. From the insurance cover, it is clear that the insured is M/s. Ess Ess Pharmaceuticals. A presumption can, therefore, be conclusively drawn that the agent of the Insurance Company would have seen the registration certificate of the car to come to this conclusion that M/s. Ess Ess Pharmaceuticals was the owner of the car and we find support in this context from the decision of Hon''ble National Commission in the case of Haji Bashir Ahmad (supra ). Further, a perusal of Exhibit R-2 i. e. Registration Certificate clearly indicates that in this document, M/s. Ess Ess Pharmaceuticals, E-9, Dilkusha Marg, Jalandhar have been shown as the registered owner after the sale of the car by its owner Sh. D. S. Ghuman. It is also on record that Sh. Vijay Kumar, Junior Assistant of the office of D. T. O. , Jalandhar has in his affidavit clearly stated that the seal fixed on the registration certificate of the car in question indicating transfer of the vehicle in the name of M/s. Ess Ess Pharmaceuticals is that of the office of D. T. O. , Jalandhar. It has further been stated by him that this seal is usually kept under lock and key. In view of this statement of Sh. Vijay Kumar, it can be safely concluded that the sale of the car to M/s. Ess Ess Pharmaceuticals did take place and was, accordingly, recorded on the registration certificate. However, if the same sale has not been recorded in the office record of the D. T. O. , Jalandhar, then the complainant cannot be penalized for the same. Since this entry in the official records had to be made by the officials of the D. T. O. , Jalandhar and the complainant had no hand in it. The complainant was not required to take any subsequent action after the transfer of the car in its name on the Registration Certificate. The Insurance Company has not brought any thing by way of evidence on record to prove that the sale of the car, as averred by the complainant, did not take place and somebody else is the owner of this car. In view of the circumstances of the case, as discussed above, it is neither a case where the insurance policy had not been transferred in the name of the new purchaser nor is it a case where the registration had not been transferred in the name of the new buyer. From the record and evidence placed before us, we are convinced that the sale of the car by Sh. D. S. Ghuman had been done in the year 1997 and the same has been duly recorded in the registration certificate of the car whereupon the authentic seal of D. T. O. , Jalandhar has been affixed. It is also an admitted fact that the insurance for the car had been done in the name of the complainant firm after seeing the Registration Certificate in full belief that the insured is the owner of the car. In this view of the matter, it now cannot lie in the mouth of the Insurance Company that the complainant firm has no insurable interest in the car and that there is no contract between the insurer and the insured.

In view of the foregoing discussion, we agree with the view held by the learned District Forum that the claim of the complainant firm has been wrongly repudiated by the Insurance Company, which is a deficiency in service. We also agree with the view of the learned District Forum that the Insurance Company is liable to pay the complainant the amount of loss assessed by the surveyor to the tune of Rs. 72,438/- and also to compensate the complainants for the loss of enjoyment or interest of this amount and as well as for mental agony and harassment. Thus, we find no illegality in the directions of the learned District Forum in the impugned order. Consequently, the appeal is dismissed as it lacks merit and the impugned order is upheld. The appellant/op is directed to comply with the order within 30 days from the receipt of certified copy of this order.

COPIES of this order be sent to the parties free of charge. Appeal dismissed.