New India Assurance Co. Ltd. vs RASUL MOHAMMADBHAI AKBARBHAI MIRZA

THIS appeal arises from order dated 15.7.2000 rendered by the learned Consumer Disputes Redressal Forum, Banaskantha at Palanpur in Complaint No. 16/97. Impugned order reads as under : "The Complaint No. 16/97 is hereby allowed. The opponent side directed to pay a sum of Rs. 22,000/- along with 15% interest per annum from date 10.5.1995 to till recovery, the future economic loss of Rs. 10,000/- since not proved is rejected, but as regards the mental harassment and agony is concerned, a sum of Rs. 5,000/- is allowed. The opponent side directed to deposit the said amount within 30 days from the date of knowledge of this order."

IT was the complainant''s case that his Auto-rickshaw bearing Registration No. GRO 9035 insured with the opponent Insurance Company was parked in the Civil Hospital compound at Palanpur as he had to take his wife for treatment in that hospital. When he went to take back the rickshaw on return from the hospital in the early morning on 10.5.1995, he found it missing. He lodged complaint with the police. Upon investigation held by the police, the said rickshaw could not be traced. The complainant lodged claim in respect of loss of rickshaw with the opponent Insurance Company. By letter dated 16.12.1996 opponent Insurance Company repudiated the claim as there was no Fitness Certificate for the rickshaw in question on the date of its loss. After hearing the parties and considering the pleadings and material placed on record, the learned Forum came to the conclusion that absence of Fitness Certificate cannot be made ground for repudiation as per the decision of the Gujarat High Court reported in 1992 ACJ 148. The learned Forum also observed that the case of Fitness Certificate was not connected with loss of Auto-rickshaw since the loss of rickshaw in question was on account of theft. The learned Forum, therefore, held that the ratio in II (1999) CPJ 416, and I (1998) CPJ 133, could not be extended to the facts of the present case. The opponent Insurance Company has challenged the said order before this Commission. We have heard the learned Advocates for the parties. It was submitted on behalf of the original complainant that by virtue of the decision of the Honourable Supreme Court in the case of B.V. Nagaraju v. Oriental Insurance Co. Ltd., reported in II (1996) CPJ 28 (SC)=I (1997) ACC 123 (SC)=1996 ACJ 1178, the exclusion clause of the policy of insurance will have to be read down to advance the main purpose of the contract of insurance and unless the breach of the relevant term is fundamental in nature, the Insurance Company cannot take benefit of exemption or exclusion clause. In reply, reference has been made to a decision in the case of Kesarben v. United India Insurance Co. Ltd., reported in III (2000) CPJ 36 (NC)=(2000) NCJ 632 (NC), where the driver of the car did not return it to the insured and after waiting for some time he filed complaint. Upon investigation it was found that the driver was murdered and car was stolen. Exclusion clause was canvassed and the National Commission had an occasion to consider guidelines for settlement of non-standard claims. After referring to the decisions of the Honourable Supreme Court, the National Commission has proceeded to direct award of non-standard claim at 75% of the eligible claim. Reference was also made to these decisions. In National Insurance Co. Ltd. v. Premchand, reported in II (2001) CPJ 60 (NC), the Maruti van in question was stolen when it was lying duly parked. The National Commission considered the policy of the Insurance Company based on the guidelines of settlement of certain claims not directly falling within the limitation as to use of clause in the policy and awarded maximum 75% of the claim considering the same as non-standard claim. In National Insurance Company Limited v. Munni Lal Yadav, reported in II (2001) CPJ 53 (NC), also the National Commission took the same view, however while explaining the decision of the Honourable Supreme Court in the case of B.V. Nagaraju (supra).

Having regard to the trend of decisions of the National Commission while explaining the decision in B.V. Nagaraju''s case (supra), we are of the opinion that where the Insurance Company invokes one or the other exclusion clause and where it does not go to the root of the contract of insurance viz. fundamental breach, the appropriate option for the Consumer Fora or the Commission would be to award non-standard claim at 75% of the admissible claim.

IN above view of the matter, this appeal is required to be partly allowed. We, therefore, pass following order : ORDER Impugned order dated 15.7.2000 rendered by the learned Consumer Disputes Redressal Forum, Banaskantha at Palanpur in Complaint No. 16/97 is hereby modified by altering the awarded sum of Rs. 22,000/- to Rs. 16,500/- payable with interest @ 12% instead of 15% awarded by the learned Forum and mental harassment and agony at Rs. 1,000/- instead of Rs. 5,000/- awarded by the learned Forum. Such modified amount shall be paid over by the opponent INsurance Company [appellant herein] to the original complainant [respondent herein] within thirty days from today. If any amount is deposited in this Commission, payment shall be made by account payee cheque after due verification as per this order. This appeal is accordingly partly allowed, with no further order as to costs. Appeal partly allowed.