R.C. Sharma vs New India Assurance Co. Ltd

This revision petition has been filed by the petitioner Shri R.C.Sharma, against the order dated 10.07.2014 of the State Consumer Disputes Redressal Commission, Delhi, (in short 'the State Commission') passed in FA No.479/2014.

Brief facts of the case are that on 08.10.2001, the respondent/opposite party accepted the proposal & declaration of appellant/complainant and as such the appellant/complainant become regular customer of the respondent/opposite party and got renewed and extended the policy as & when it became due. On 07.10.2009, the respondent/opposite party received the premium of Rs.1864/- and extended the policy for further period w.e.f. 08.10.2009 to 07.10.2010. On 30.01.2010, during the validity period of policy at Har Ki Pauri, Haridwar, the incident of theft of jewellery took place and the wife of the complainant immediately intimated to the police and police noted in the register and later on the police showed some purses for identification and out of them, she identified the purse, but the same was empty. Accordingly, after having failed to search out the items & accused, on 31.01.2010 the police lodged formal FIR No.44/10. On 26.02.2010, the complainant/petitioner submitted written letter to the policy issuing branch.

On 30.07.2010, the surveyor of respondent/opposite party submitted his final survey & assessment report. On 20.08.2010, the Magistrate at Haridwar accepted the final/untrace report, then the complainant submitted the final/ untrace report in terms of letter dated 03.08.2010 to the respondent. On 29.11.2010, the respondent/opposite party issued letter to the complainant/appellant stating therein that the loss is not payable as per terms & conditions of the policy. On 28.01.2011, the respondent/opposite party intimated to the complainant/appellant stating therein that the claim is not payable as per their letter dated 29.11.2010. Then the complainant/petitioner filed complaint case before the District Consumer Disputes Redressal Forum, (central), Delhi, (in short 'the District Forum'). On 02.04.2014, the District Forum dismissed the complaint on the ground of delay in reporting the matter to the insurance company and lodging the claim beyond the agreed period of 14 days from the date of incident, which was unlawful & illegal and hit by Section 28(b) of the Indian Contract Act, 1872.

The complainant preferred an appeal bearing No.479/2014 before the State Commission, which was also dismissed vide order dated 10.07.2014.

Hence, the present revision petition.

Heard the learned counsel for the parties. Learned counsel for the petitioner states that the incident of theft is real. However, due to certain family engagement, the intimation could not be given to the Insurance Company within a period of 14 days as mentioned in the policy. Learned counsel for the petitioner stated that in response to the queries raised by the Insurance Company, the complainant had informed the following to the Insurance Company:-

"1. Delay Intimation:

There was a religious programme at my in-law's home at Khadri Shyampur Rishikesh w.e.f. 01.02.2010 to 08.02.2010 i.e. Bhagwat Katha. After over this programme on 08.02.2010, there was also a Shai Asnan on 12.02.2010 & Shiv Ratri as well as Pooranmasi was fallen on 12.02.2010 then my in-laws advised me to take this opportunity and due to that I halted there and left for Delhi on 13.02.2010. On 15th Feb. I informed my Agent Sh. B.N. Noni over the phone about the stolen items then lateron he advised me to give in writing and since my wife was ill so due to that I give in writing on 26.02.2010. I therefore, regretted. Kindly condone delay."

The reasons indicated to the Insurance Company for delay are genuine. There was enough ground to condone the delay and accept the claim. Various claims of insurance are accepted by the consumer fora. Even the Hon'ble Supreme Court in Om Prakash Vs. Reliance General Insurance and another, Civil Appeal No.15611 of 2017, decided on October 4, 2017 has accepted the delay of about 8 days in giving intimation about the theft of the vehicle. The Hon'ble Supreme Court has observed the following:-

"11. It is common knowledge that a person who lost his vehicle may not straightaway go to the Insurance Company to claim compensation. At first, he will make efforts to trace the vehicle. It is true that the owner has to intimate the insurer immediately after the theft of the vehicle. However, this condition should not bar settlement of genuine claims particularly when the delay in intimation or submission of documents is due to unavoidable circumstances. The decision of the insurer to reject the claim has to be based on valid grounds. Rejection of the claims on purely technical grounds in a mechanical manner will result in loss of confidence of policy-holders in the insurance industry. If the reason for delay in making a claim is satisfactorily explained, such a claim cannot be rejected on the ground of delay."

It was further mentioned by the learned counsel for the petitioner that even the Circular No. IRDA/HLTH/MISC/CIR/216/09/2011 dated September 20, 2011of Insurance Regulatory Development Authority (IRDA) has allowed the Insurance Companies to accept the claims filed with delay if the claims are genuine. As the FIR was lodged in the matter immediately, therefore, the genuinity of the claim cannot be doubted. Even the purse of the complainant was recovered, but items were not there. As per IRDA Circular this genuine claim cannot be rejected only on the ground of delay in intimation. Moreover, the delay is only of 14 days beyond the permissible period of 14 days in intimation to the Insurance Company.

On the other hand, learned counsel for the respondent/Insurance Company stated that if no period is prescribed in the policy for giving intimation to the Insurance Company, then the IRDA circular will be applicable. However, in the present case, Clause 5 (b) of the policy prescribes a period of 14 days only for informing such claims and beyond this initial period of 14 days in giving intimation and filing the claim obviously, the same cannot be entertained.

Learned counsel for the respondent stated that the explanation given by the complainant for giving intimation with delay cannot be accepted as the complainant was busy in family functions and other engagements and did not pay much care to the claim. To support his argument learned counsel for the respondent referred to the case of this Commission in RP No.2519 of 2014, Manager, New India Assurance Co. Ltd. Vs. Yadram, dated 01.12.2014 (NC), wherein it has been held that explanation under unavoidable circumstances can only be considered for condoning the delay. No proper explanation has been given by the complainant for submission of late information and therefore, the explanation cannot be accepted in respect of this delay. Learned counsel relied upon the judgment of this Commission in RP No.2591 of 2016, Universal Sompo General Insurance Co. Ltd. Vs. Roop Lal Dangi, dated 24.03.2017 (NC), wherein the delay in intimation without proper explanation has not been accepted.

I have given a thoughtful consideration to the arguments advanced by the learned counsel for the parties and have examined the material on record. In the present case, the policy clearly stipulates under clause 5 (b) that intimation is to be given within a period of 14 days from the date of incident. The intimation has been given with a further delay of 14 days. The explanation submitted to the Insurance Company only relates to the engagement of the complainant in the family functions and other religious ceremonies and the same cannot be considered as exceptional and unavoidable circumstances, which constrained the complainant to give intimation and to file the claim. Policy is an insurance contract and both parties are bound by the same. When there is a specific clause relating to limitation on intimation of the claim, it is difficult to extend this time as the policy is to be interpreted in the same terms as are agreed in the policy contract. This view is supported by the following judgements:-

(a) In General Assurance Society Ltd. Vs.Chandmull Jain, [1966 ]3SCR 500, it was held as under:-

17." ...In interpreting documents relating to a contract of insurance, the duty of the court is to interpret the words in which the contract is expressed by the parties, because it is not for the court to make a new contract, however reasonable, if the parties have not made it themselves."

(b) In Oriental Insurance Co. Ltd. Vs. Sony Cherian II(1999 )CPJ 13 (SC ), it has been observed as follows:-

"16. The insurance policy between the insurer and the insured represents a contract between the parties. Since the insurer undertakes to compensate the loss suffered by the insured on account of risks covered by the insurance policy, the terms of the agreement have to be strictly construed to determine the extent of liability of the insurer. The insured cannot claim anything more than what is covered by the insurance policy. That being so, the insured has also to act strictly in accordance with the statutory limitations or terms of the policy expressly set out therein."

(c) United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal, (2004) 8 SCC 644, the Hon'ble Apex Court held as follows:-

"6. ....The terms of the policy have to be construed as it is and we cannot add or subtract something: Howsoever liberally we may construe the policy but we cannot take liberalism to the extent of substituting the words which are not intended.

...It is settled law that terms of the policy shall govern the contract between the parties, they have to abide by the definition given therein and all those expressions appearing in the policy should be interpreted with reference to the terms of policy and not with reference to the definition given in other laws. It is a matter of contract and in terms of the contract the relation of the parties shall abide and it is presumed that when the parties have entered into a contract of insurance with their eyes wide open, they cannot rely on definition given in other enactment.

Therefore, it is settled law that the terms of the contract has to be strictly read and natural meaning be given to it. No outside aid should be sought unless the meaning is ambiguous."

Learned counsel for the petitioner has relied upon recent judgment of Hon'ble Supreme Court in Om Prakash Vs. Reliance General Insurance and another, (supra) where the Apex Court has condoned the delay of 8 days in giving intimation about the theft of the vehicle. In this case, the Hon'ble Supreme Court has clearly observed that the delay should be properly explained. In the present matter, the delay has not been properly explained as mentioned above. Thus, the judgment of the Hon'ble Supreme Court in Om Prakash Vs. Reliance General Insurance & Anr. (supra) is not applicable in the present case.

Based on the above discussion, I do not find any Illegality material irregularity or jurisdictional error in the order dated 10.07.2014 of the State Commission, which calls for any interference from this Commission. Accordingly, the RP No.3197 of 2014 is dismissed.