OM PARKASH GROVER vs NEW INDIA ASSURANCE CO.LTD

THE important question relating to interpretation of insurance policy is involved in this appeal. THEre is not much dispute on facts. THE complainant had purchased an insurance policy from New India Insurance Company for bringing scooters by transport, which were insured under rail and road risk, policy-B. Three of the scooters were damaged during the transit from Zirakpur to Malot, that the claim was filed before the Insurance Company. THE claim was not settled and the Company was approached again and again and after lapse of about two years, ultimately the claim was repudiated on January 2,1993. THE goods were brought in September, 1990. THE complaint was filed, claiming a sum of Rs. 3,090.38 before the District Forum by O.P. Grover, Proprietor of M/s. Grover Motor, Malot alleging therein that the repudiation of the claim was arbitrary and illegal. Surveyor had assessed the loss for which claim was made. THE Insurance Company, the opposite party as already stated above in the written statement took up the stand that the repudiation was valid as the damage caused due to jerks and jolts was not covered under the insurance policy. THEy fall in the Exclusion Clause vide which damage on account of wear and tear was not covered. THE District Forum accepted the stand of the Insurance Company and dismissed the complaint after getting affidavits and documents from the parties. Copy of the insurance policy is Annexure ''A'' (Cover Note). THE matter pertained therein refers to "On consignment said to contain scooters (assembled) LML Vespa in the proper carrying lorries by road from Pribhat near Zirakpur to Malot covered against road risk only". In the affidavit filed by Shri P.S. Dhawan, Divisional Manager of the Insurance Company, the road risk for which policy was issued is as under: "This insurance covers the risk of physical loss or damage to the insured goods caused by: (a) (i) Fire (ii) Lightening (iii) Breakage of Bridges (b) (i) Collision with or by the carrying vehicle (ii) Overturning of the carrying vehicle (iii) Derailment or accidents of like nature to carrying railway wagon/ vehicle. (Copy of Conditions Attached)".

ANNEXURE A ''5'' also contains the road risk clause as published by the Insurance Company. It reads as under: "A. The insurance commences with the loading of each bale or package into the vehicle and covers the risk of loss or damage occasioned by fire, lighting; collision, overturning or accident of a like nature whilst being conveyed in the vehicle and during transhipment prior to reaching the destination town. Risk to cease three days after the first arrival of the vehicle at the destination town mentioned in the policy or on delivery whichever shall first occur".

There is no dispute that the damage caused to the scooters in transit would be covered under the clause referred to above, particularly damage caused by collision. Annexure ''B'' also reproduces the risk clause as referred to above. It also refers to the Exclusions. 2.2 of the Exclusions reads as under: 2. In no case shall this insurance cover: "2.1. xx xx xx xx 2.2. Ordinary leakage, ordinary loss in weight to volume or ordinary wear and tear of the subject matter insured".

Annexure ''C'' is letter of repudiation and ground given for repudiation is that the loss occurred due to jerks and jolts in transit. Thus, the question for consideration is as to whether the damage caused to the scooters in transit by jerks and jolts would be damage caused by wear and tear of the subject matter insured. The obvious answer is in the negative. The concept of wear and tear would be applicable where the goods insured are used as such and not carrying of the goods in transport vehicle. It cannot be by any stretch of imagination treated as a use of the vehicle, which would cause wear and tear. It may further be observed that damage to the scooters in a transport vehicle by jerks and jolts is nothing but caused by collision and collision is nothing but striking against any substance. Thus, in view of what has been stated above, the Insurance Company arbitrarily repudiated the claim, which amounts to deficiency in rendering service.

THE National Commission in New India Insurance Co. v. Adarsh Bazar Wholesale and Retail Co-operative and Consumer Store Ltd., I (1996) CPJ 286 (NC), has held that in the case of Semi- Government and Corporations, interest by way of damages should not be allowed more than 12% p.a. The Surveyor has reported loss of the scooters as per survey report Annexures 1 to 3. The amount also includes survey fee. Vide Annexure C-1, Rs. 1,114/- was found to be the damage, vide C-2, a sum of Rs. 926/- was found to be the damage and vide C-3, a sum of Rs. 1,050/- was found to be the damage, total Rs. 3,090/-. Accepting the report of the Surveyor, the complainant is held entitled to a sum of Rs. 3,090/-. He is also entitled to interest thereon @ 12% p.a. from February 28,1991, the date of the survey report till payment. The complainant will also be entitled to costs of litigation of the two Courts, which are assessed at Rs. 2,000/-. The aforesaid amounts are directed to be paid to the complainant by the Insurance Company within one month from receipt of copy of the order. Appeal disposed of.