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Judgment
Dr. Inder Jit Singh,Presiding Member
The present First Appeal (FA) has been filed by the Appellant against Respondent as detailed above, under section 19 of Consumer Protection Act 1986, against the order dated 24.10.2017 of the State Consumer Disputes Redressal Commission, Haryana, Panchkula, (hereinafter referred to as the ‘State Commission’), in Consumer Complaint (CC) no. 225/2016 inter alia praying to allow the present appeal and set aside the order passed by the State Commission. While the Appellant was the OP, and the respondent was Complainant in the said CC/199/2018 before the State Commission. Notice was issued to the Respondent. Parties filed Written Arguments/Synopsis on 11.07.2022, 18.07.23 (Appellant/OP) and 18.07.2023 (complainant/Respondent) respectively.
Brief facts of the case, as emerged from the FA, Order of the State Commission and other case records are that: -
The complainant is the registered owner of a Tata Tipper-2516 with registration No. HR-68A-9180. The vehicle was insured with the National Insurance Company Limited for the period from 04.04.2015, to 03.04.2016, under Insurance Policy No. 420205/31/15/6300000074. The Insured Declared Value (IDV) was mentioned as Rs.23,00,000/-, and the complainant paid a premium of Rs.34,000/-. On 01.10.2015, after unloading the vehicle at Chandimandir, complainant, who is both the owner and driver, returned to Guru Nanak Stone Crusher and the vehicle was parked around 10:00 P.M. The incident occurred when complainant parked the mentioned vehicle inside the boundary wall of Guru Nanak Stone Crusher, Mubarikpur, and went to a room within the premises to sleep. Upon waking up early the next morning, complainant discovered that the vehicle was missing from its parking spot, having been stolen by an unknown individual. Additionally, an amount of Rs. 10,000/- was left in the dashboard of the stolen vehicle. Complainant took immediate action, informing both the police and Kuldeep Sharma, an agent representing the National Insurance Company Limited, regarding the theft. FIR No. 236 was filed on 04.10.2015, under Section 379 of the Indian Penal Code at Police Station Dera Bassi. The complainant provided necessary documentation to the Insurance Company (OP), including a copy of the FIR, an untraced report accepted by the learned Sub Divisional Judicial Magistrate, Dera Bassi on 02.03.2016, and other requisite documents for an insurance claim. The vehicle's purchase was financed by Cholamandalam MS General Insurance Company Limited, and its acquisition was intended for the complainant's livelihood. Despite the submission of the claim, it was repudiated by the Insurance Company. The complaint was allowed in State Commission and an Appeal has been filed by OP in the National Commission.
Vide Order dated 24.10.2017, the State Commission has allowed the complaint and directed OP to pay the complainant an amount of Rs. 23,00,000/- along with 9%; to pay an amount of Rs. 25,000/- on account of unnecessary harassment.
Appellant has challenged the Order dated 24.10.2017 of the State Commission mainly on following grounds:
i. The order is wrong, illegal, unjust, unfair, and improper, contrary to the facts, laws, and records. Therefore, it should be set aside. The State Commission's order is perverse, contradicting the facts, case records, established legal principles, and hence should be overturned. The State Commission failed to acknowledge a significant violation of Policy Condition No. 5 and neglected to recognize the gross negligence of the insured/Respondent for leaving the vehicle's key on the dashboard, facilitating the theft.
ii. The State Commission overlooked the policy's Condition No. 5, emphasizing the insured's responsibility to take reasonable measures to protect the vehicle and maintain its efficiency. The State Commission neglected the respondent/insured's statement to the investigator, indicating that they kept one of the original keys in the dashboard. There's failure on the part of the State Commission to consider the delay in informing the insurance company about the incident, with the complainant/respondent not providing adequate or compelling reasons for the delay in intimation.
Heard counsels of both sides. Contentions/pleas of the parties, on various issues raised in the FA, based on their FA/Reply, Written Arguments, and Oral Arguments advanced during the hearing, are summed up below.
i. The counsel for Appellant/OP argues that the State Commission's order is not only perverse but also illogical. The contention is that the insured (Respondent/complainant) grossly neglected the safety of the vehicle, violating Condition No. 5 of the insurance policy. Leaving the key inside the vehicle is deemed as an open invitation to thieves, making it easier for them to steal the vehicle. The counsel emphasizes that the complainant's actions constitute "gross negligence," a violation of the insurance policy's terms. They cite a series of judgments by the National Commission and the Hon'ble Supreme Court that consistently held leaving the key inside the vehicle as 'gross negligence,' thereby absolving the insurer of liability for the loss.
ii. The counsel urges the Commission to adhere strictly to the terms outlined in the insurance policy, highlighting that any deviations based on equity are impermissible. They stress that, from all perspectives, the complainant's claim does not align with the policy's provisions. The counsel requests the Commission to overturn the State Commission's order dated 24.10.2017, grant the appeal, and subsequently dismiss the complaint. Additionally, they seek costs in favor of the Appellant/OP.
iii. It is been repetitively held that if driver leaves the key in the vehicle, he would be negligent and the theft taking place on account of his negligence, the insurer cannot be made liable to pay the claim. The counsel for Appellant/OP relied on following cases:-
Bajaj Allianz General Insurance Co. Ltd. Vs. Astha Cement Pvt. Ltd. [RP No. 2765/2015: Decided on 18.08.2020: 2020 SCC OnLine NCDRC 811]
New India Assurance Co. Ltd. Vs. Ashok Kumar [RP/3415/2016; Decided on 24.01.2018]
TATA AIG General Insurance Co. Ltd. Vs. Mahendra Singh [RP/1239/2018 decided on 21.05.2019].
Cholamandalam MS General Insurance Company Ltd. Vs. Ashish Kumar Walecha [RP No. 1893 of 2016 & RP No. 3198 of 2016: Decided on 20.04.2017]
Reliance General Insurance Company Limited Vs. Vinod Kumar [RP No.157 of 2016 decided on 20.07.2016].
Baldev Singh vs. ICICI Lombard General Insurance Co. Ltd. [RP No. 3484/2014 decided on 06.07.2015].
Oriental Insurance Co. Ltd. Vs. K.K.Valsalan [RP No. 4521/2013; Decided on 07.05.2015]
Tata AIG General Insurance Co. Ltd. Vs. Nikhil Seth [RP No. 1500 of 2009; Decided on 09.03.2015]
Arjun Lal Jat Vs. HDFC Irgo General Insurance Co. Ltd. [RP No. 3182 of 2014, decided on 28.08.2014]
Oriental Insurance Co. Ltd. Vs. Sham Sunder [RP No. 3251/2013; Decided on 05.05.2014].
Kamaljit Kaur vs. United India [RP No. 2444/2013: Decided on 28.10.2013].
New India Assurance Co. Ltd. vs. Ajit Kumar [RP No. 1896 of 2008; Decided on 04.09.2013].
Jagdish Parshad vs. ICICI Lombard General Insurance Co. Ltd.: [RP No. 1996 of 2012 decided on 14.05.2013].
Devinder Kumar vs. National Insurance Co. Ltd. [RP No. 3840 of 2011: Decided on 02.04.2012].
Kanwarjit Singh Kang vs. M/s ICICI Lombard General Insurance Co. Ltd. [SLP (C)/6518/2018: Decided on 29.03.2022]
Shree Ambica Medical Stores vs. The Surat People's Co-operative Bank Limited & Ors. [2020 SCC OnLine SC 92=C.A. No. 562/2020; decided on 28.01.2020]
General Assurance Society Ltd. v. Chandumull Jain [AIR 1996 SC 1644]
Oriental Insurance Co. Ltd. vs. Samaynallur Primary Agricultural Coop. Bank [(1999) 8 SCC 543]
Oriental Insurance Co. Ltd. vs. Sony Cheriyan (1999) 6 SCC 451]
Suraj Mal Ram Niwas oil Mills (P.) Ltd. vs. United India Insurance Co. Ltd. [(2010) 10 SCC 567]
Industrial Promotion & Investment Corporation of Orissa vs. New India Assurance Co. Ltd. [(2016) 15 SCC 315]
iv. The counsel for Respondent/Complainant argued that the State Commission, in its order dated 24.10.2017, directed the Appellant Company to pay the Respondent/Complainant an amount of Rs. 23,00,000/- as the Insured Declared Value (IDV) of the stolen vehicle. Additionally, they were directed to pay interest at 9% per annum from the date of filing the complaint, along with Rs. 25,000/- for harassment, mental agony, and Rs. 11,000/- for litigation expenses. However, the Appellant Company failed to comply with this order, causing ongoing financial liability and mental suffering for the Complainant.
v. The appeal filed by the Appellant Company focuses on the alleged violation of Clause 5 of the insurance policy, stating that the spare key was left in the dashboard of the locked vehicle, facilitating the theft. However, the State Commission rejected this contention in their order, stating that the complainant did not act carelessly or negligently, and even if the key was presumed to be in the dashboard, it did not constitute the sole reason for the theft. The Commission also mentioned that professional criminals do not necessarily need original ignition keys to commit theft.
vi. The counsel further asserts that regarding the supposed delay in intimating the police and the insurance company, the Commission found that the complainant did not cause any undue delay in lodging the FIR or informing the insurance company about the theft. The present appeal lacks merit as the contentions raised by the Appellant Company were adequately addressed and rejected by the State Commission in their order dated 24.10.2017. Additionally, recent decisions by the National Commission confirm that the reasons cited by the Appellant Company do not constitute a breach of policy conditions. The order dated 24.10.2017 stands in accordance with established law on the subject. The appeal lacks substantial new grounds and should be dismissed, affirming the Appellant Company's liability to pay the insurance claim and compensate the complainant for their suffering and losses.
vii. The counsel for complainant/Respondent relied on following judgements:-
a. Shriram General Insurance Co. ltd. Vs. Abdul Rehman Sahabuddin Siddique (RP/3876 of 2017)
b. Royal Sundaram General Insurance Co. Ltd. Vs. Ashok Kumar Somani & Ors. (RP/796/2017)
The claim of Respondent herein has been repudiated by the Appellant Insurance Company vide letter dated 12.08.2016 on the ground that respondent had left one original key of tipper in the dashboard, which according to appellant Insurance Company show gross negligence and has helped the culprits to steal the vehicle easily, and is violation of condition no. 5 of the policy, which states that “the insured shall take all reasonable steps to safeguard the insured vehicle from loss or damage and to maintain it in efficient condition.” In this case, the complainant, who is the owner of the vehicle in question and was also the driver on the date of incident i.e. 01.10.2015, after unloading the vehicle at Chandimandir, returned back to Guru Nanak Stone Crusher at about 10:00 PM and parked the said vehicle inside the boundary wall of said Guru Nanak Stone Crusher, Mubarikpur, and went to a room located within the premises of the Stone Crusher to sleep. When the complainant woke up early in the morning, the said vehicle was not found at the parking place and same was stolen by some unknown person. The complainant after making some efforts to search the vehicle informed the police as well as the agent of the Appellant Insurance company, FIR was lodged on 04.10.2015. Complainant submitted insurance claim along with copy of FIR, untraced report which was accepted by Sub Divisional Judicial Magistrate vide order dated 02.03.2016 and other documents. However, the claim was repudiated vide letter dated 12.08.2016. Complainant filed complaint before State Commission praying for directions to Appellant Insurance Company to pay an amount of Rs. 23 lakhs along with Interest and compensation. Before the State Commission, the Insurance Company, in addition to its pleading of negligence on the part of Respondent, contended that theft of vehicle took place on 02.10.2015 but police was informed on 04.10.2015 and Insurance Company was informed on 05.10.2015, hence Respondent has caused unnecessary delay in informing the police as well as Insurance Company regarding the theft of the vehicle. Further, as the vehicle in question was financed with Cholamandalam Ms General Insurance Co. Ltd., So financer should have been impleaded as a party to the complaint.
The fact of complainant being the owner and said vehicle being insured by Appellant Insurance Company for the period 04.04.2015 to 03.04.2016 with IDV of Rs. 23 lakhs is not in dispute. Further, date, time and place of theft also is not in dispute. The Complainant/Respondent has taken a plea before State Commission that he informed the police on the date of occurrence and also informed the Insurance Company on the same date i.e. 02.10.2015 through Ashok Kumar, agent of the Insurance Company. State Commission accepted this plea of Complainant, observing that Insurance Company preferred not to examine Ashok Kumar, agent, to say he did not receive any information from the complainant on 02.10.2015. The complainant had pleaded that although he informed the local police on the same day but the local police caused some delay in lodging the FIR. State Commission observing that ‘this fact also cannot be completely overlooked that police generally avoid lodging of FIR in such type of matters to avoid increased figure of untraced criminal cases’, findings can be safely given that Complainant did not cause any delay in lodging FIR and giving information to the Insurance Company regarding theft of the vehicle. We tend to agree with the findings of State Commission in this regard.
Moreover, delay in informing the police and Insurance Company have not been mentioned as one of the reasons in the repudiation letter dated 12.08.2016 which is reproduced below:-
“Kindly refer to our letter dt. 21/04/2016 vide which we have stated that as per statement given to investigator Royal Associates by you, you had left one original key of tipper in the dashboard which shows your gross negligence and this has helped the culprits to steal the vehicle easily. This is violation of condition no.5 of the policy which states that "The insured shall take all reasonable steps to safeguard the insured vehicle from loss or damage and to maintain it in efficient condition." And in this case, you have kept the one original key in the dashboard of the vehicle which is gross negligence on your part and this helped the culprit to steal the vehicle easily. The matter was put before the competent authority for decision and the competent authority have repudiated the theft claim due to above stated reason as there is violation of condition no. 5 of the policy and as such claim is not payable.”
Hence, we agree with the findings of State Commission that Insurance Company cannot decline the claim on this ground. In Saurashtra Chemicals Ltd. v. National Insurance Co. Ltd., (2019) 19 SCC 70, the Supreme Court held that:-
“23. ……It is a settled position that an insurance company cannot travel beyond the grounds mentioned in the letter of repudiation. If the insurer has not taken delay in intimation as a specific ground in letter of repudiation, they cannot do so at the stage of hearing of the consumer complaint before NCDRC.”
In New India Assurance Co. Ltd. Vs. M/s Mudit Roadways, Civil Appeal No. 339 of 2023, dated 24.11.2023, the Supreme Court held that:-
“32. Notably, in earlier cases like Galada Power and Telecommunication Ltd. vs. United India Insurance Co. Ltd. & Anr. (2016) 14 SCC 161 and Saurashtra Chemicals Ltd. vs. National Insurance Co. Ltd. (2019) 19 SCC 70 , it was declared that new grounds for repudiation cannot be introduced during the hearing if they were not included in the repudiation letter. This legal principle was reiterated in JSK Industries Pvt. Ltd. vs. Oriental Insurance Co. Ltd. 2022 SCC OnLine 1451
“10. Mr. Gopal Shankarnarayan, learned senior counsel for the appellants has argued both on substantive and procedural points to assail the aforesaid orders. His first submission is that the insurance company cannot resist a claim petition on grounds beyond those cited by them while repudiating a claim. In support of this argument, a decision of this Court in the case Saurashtra Chemicals Ltd. v. National Insurance Co. Ltd. [(2019) 19 SCC 70] has been cited. In this judgment, it has been held:—
“23. Hence, we are of the considered opinion that the law, as laid down in Galada [Galada Power & Telecommunication Ltd. v. United India Insurance Co. Ltd.,: (2017) 2 SCC (Civ) 765] on Issue (2), still holds the field. It is a settled position that an insurance company cannot travel beyond the grounds mentioned in the letter of repudiation. If the insurer has not taken delay in intimation as a specific ground in letter of repudiation, they cannot do so at the stage of hearing of the consumer complaint before NCDRC.” 33. Canvassing supplementary arguments during the hearing, (beyond those in the insurer's repudiation letter), is explicitly prohibited. Consequently, it is held that the insurer cannot introduce additional reasoning beyond those detailed in their letter, to justify the repudiation.”
As regards negligence on the part of Complainant/Respondent, the State Commission has observed “the vehicle was parked in the premises of Guru Nanak Stone Crusher and the complainant earlier also used to park the vehicle in the same premises. The Ignition key of the vehicle was with the complainant. The complainant has mentioned in his statement before the investigator also that the ignition key was with him and he will hand over the same to the Insurance Company. The complainant in his statement before the police or anywhere has not stated that ignition key was left in the dashboard of the vehicle during night hours…. In his cross examination, the complainant clarified that there was only a broken key in the dashboard of the vehicle”. Keeping in view the facts and circumstances of the case, the State Commission observed that Complainant had not done any act of carelessness and negligence to make it easy for the offender to commit theft of the vehicle, observing further that “even if it is presumed that ignition key was in the dashboard of the vehicle, in that eventuality also, findings cannot be given that this was the only reason to make it easy for the offender to commit the theft of the vehicle. Moreover, the insured is also requested to take reasonable precautions only and it is not possible for him to keep eyes on the parked vehicle throughout night”. We tend to agree with the observations and findings of the State Commission in this regard and are of the considered view that the Complainant/Respondent, himself being the owner of the vehicle and driving himself on the date of incident, has taken all reasonable precautions when the vehicle was parked within the premises of Guru Nanak Stone Crusher.
Appellant Insurance Company has relied upon various judgements of this Commission in support of its contentions that if the complainant is negligent, the Insurance Company is not liable to pay the claim. However, facts of this case are distinguishable from many of the cited cases in that in the present case the vehicle was parked inside a stone crusher, the ignition key was with the owner cum driver, and it was only the second key (which the complainant contends was a broken one), which was kept in the dashboard. E.g. in Bajaj Allianz General Insurance Co. Ltd. Vs. Astha Cement Pvt. Ltd.., the driver employed by the complainant left the truck unlocked and also left the keys inside the vehicle while going in a Dhaba/Restaurant for taking his dinner. In New India Assurance Co. Ltd. Vs. Ashok Kumar, both the complainant and the driver stated that driver of the truck left the truck/dumper unattended on the road side with keys in the ignition and went to find out the address of Mittal Farms. In Tata AIG General Insurance Co. Ltd. Vs. Nikhil Seth, the theft took place when its driver left the key in the dashboard to make a STD call. In Baldev Singh vs. ICICI Lombard General Insurance Co. Ltd., the ignition key of the vehicle was not removed. In Oriental Insurance Co. Ltd. Vs. K.K.Valsalan, driver left both the keys in the vehicle and went to a hotel in the midnight for taking tea and returned after half an hour. In Kanwarjit Singh Kang vs. M/s ICICI Lombard General Insurance Co. Ltd., there was a delay of 8 days in lodging the FIR and 16 days in informing the Insurance Company about the alleged theft, and secondly the vehicle was left unattended on a Highway with ignition keys.
In view of the Foregoing, we hold that in the present case, the complainant has taken reasonable care, was not negligent and hence there is no violation of Condition No. 5 of the policy. State Commission has given a well-reasoned order and we find no reasons to interfere with the same, hence the same is upheld. Accordingly the FA is dismissed.
The pending IAs in the case, if any, also stand disposed off.