Sanjay Kumar vs Reliance General Insurance & Ors.

The complainant, Sanjay Kumar, insured his Tavera Car from Reliance General Insurance Company, the OP1 on 18-03-2008 for the period of one year till 17-03-2009. The vehicle met with an accident on 29-03-2008 near village-Rai, District-Sonepat. On next day, FIR was registered in Police Station-Rai. The vehicle was badly damaged and the information of accident was also given to the opposite parties. Thereafter, the complainant got repaired the vehicle from M/s. Aryaman Automobile at Karnal (OP2) and paid a sum of Rs.1,82,165/-. The complainant submitted the claim forms with the OP-insurance company along with the documents but the claim was repudiated by OP after investigation vide letter dated 02-07-2008 without any reason. Therefore, the complainant filed a complaint before the District Consumer Disputes Redressal Forum, Karnal (for short, "the District Forum") seeking direction to pay Rs.1,82,165/- and Rs.50,000/- towards mental agony and litigation expenses along with interest.

The OPs appeared and filed their written statement and denied the deficiency in service. OP1 stated that, the complainant has violated terms & conditions of the policy as the vehicle was being used for commercial purpose. The driver was not holding a valid driving license. The OP Nos.2 to 4 have filed their separate written version and stated that the complaint was not legally maintainable against them. They are associates for issuance of new insurance cover and renewal. The vehicle was for personal use, but in the FIR it was clearly mentioned that, he was carrying a Barat from Gharonda to Palwal.

The District Forum on perusal of documents, the investigation report and the evidence partly allowed the complaint and directed the OP to settle the claim on non-standard basis i.e.75% of the value of the vehicle. Being aggrieved the complainant and the insurance company filed cross appeals before the State Consumer Disputes Redressal Commission, Haryana (for short, "the State Commission"). The State Commission held that the complainant was using vehicle for commercial purpose. Therefore, allowed the appeal filed by OP and dismissed the complaint. The appeal for enhancement of compensation filed by the complainant was dismissed. Being aggrieved by the impugned order the complainant filed this revision petition.

We have heard the learned counsel for both the parties. Both have made submissions as made in their pleadings and evidence before the lower fora. The main question merits for consideration is whether the vehicle was used for commercial purpose or not? As per the FIR and the survey report it was admitted fact that the vehicle was used for commercial purpose. In the surveyor's report it was disclosed by Chamel Singh and Santro Devi that vehicle in question was hired by Premchand Pal for going to Palwal to attend the marriage party. We have perused the insurance policy under clause "limitation as to use of the vehicle", it is mentioned as below:

"Limitations as to use:-

The policy covers use of the vehicle for any purpose other than:

(a) Hire or reward.

(b) Carriage of Goods (other than samples or personal luggage)

(c) Organized racing.

(d) Pace Making

(e) Speed Testing and Reliability Trials.

(f) Any purpose in connection with Motor Trade."

It is pertinent to note that, complainant has violated the conditions of the policy. He was plying the private vehicle on hire and reward basis. Thus, it was the breach of agreement. The OP relied upon the decision of Hon'ble Supreme Court in Suraj Mal Ram Niwas Oil Mills (P) Ltd. Versus United India Insurance Co. Ltd. and Anr., (2010) 10 SCC 567 wherein it was held as under:

"22. Before embarking on an examination of the correctness of the grounds of repudiation of the policy, it would be apposite to examine the nature of a contract of insurance. It is trite that in a contract of insurance, the rights and obligations are governed by the terms of the said contract. Therefore, the terms of a contract of insurance have to be strictly construed and no exception can be made on the ground of equity."

It is clear from the averments that, the vehicle in question was insured for a private use, but at the time of accident it was used for commercial use, it amounts to breach of terms & conditions of the insurance policy. Therefore, repudiation done by OP is justified. We do not find any merit in the instant revision petition. Accordingly, it is hereby dismissed.