United India Insurance Co. Ltd. vs Ajay Kumar Sharma

M.M. Kumar, C.J.â€"United India Insurance Company Limited is in appeal against the judgment and order dated 23.05.2014 rendered by J & K

State Consumer Disputes Redressal Commission at Jammu (far brevity 'Commission') wherein it has been held that the fire incident damaging the

vehicle No. JK12-2078 had occurred in the area which was admittedly beyond the permitted area of operation, It, thus, violates the provisions of

carriage contract. Accordingly, the claim has been settled on 'Nonstandard Basis'. It has also come on record that the accident had taken place on

14.03.2011 and the permit of the vehicle under reference had expired on 15.05.2010. However, the aforesaid fact has been mitigated by the

complainant when he showed that on 05.06.2010 itself, he deposited the renewal fee of Rs. 205A with the competent authority vide GR No.

1826764, although there was no endorsement made on the permit. The question which arose before the Commission was whether in these facts

and circumstances, the complainant was entitled to the benefit of insurance cover or not. The Commission has settled the claim on 'Nonstandard

Basis' and the final assessment made by the surveyor at Rs. 4.50 lacs has been reduced by 1/4th. Accordingly, a sum of Rs. 3,37,500/- along with

salvage in terms of surveyor's report has been awarded.

Mr. Gupta, learned counsel for the insurance company has argued that the complainant was not entitled to any benefit once the terms of the

permit have been deviated in so far as the vehicle was operating beyond the permitted area of operation. He has further argued that, in-fact, there

was no permit on the date of accident i.e. 14.03.2011.

Mr. Raina, learned counsel for the complainant has, however, submitted that the matter is covered in favour of the complainant by the judgment

of Hon'ble the Supreme Court of India rendered in the case of Amalendu Sahoo Vs. Oriental Insurance Co. Ltd., in so far as the question of

deviation is concerned. It is for that reason that the claim has been settled on 'Non-standard Basis'. In para 14 of the aforesaid judgment, it has

been held that insurance company cannot repudiate the claim in case the driver did not have a proper driving licence when it met with an accident.

A reference has been made to the view taken by the National Commission stipulating the guidelines issued by the insurance company about settling

of such non-standard claims. It would be useful to read para 14 of Judgment, which is set out below in extenso:

In this connection reference may be made to a decision of the National Commission in New India Assurance Co. Ltd. v. Narayan Prasad

Appaprasad Pathank. In that case also the question was whether the insurance company can repudiate the claims in a case where the vehicle

carrying passengers and the driver did not have a proper driving licence and met with an accident. While granting claim on non standard basis the

National Commission set out in its judgment the guidelines issued by the insurance company about settling all such non-standard claims. The said

guidelines are set out below:

The aforesaid para of the judgment has also been relied upon by a Division Bench of this Court in the case of Bajaj Allianz General Insurance

Co. Ltd. v. Narinder Singh (CIMA No. 162/2013) and the 1/4th deduction on 'Non-standard Basis' has been upheld.

Keeping in view the discussion in the preceding paras, we find that the matter is covered against the appellant and in favour of the complainant.

The Commission did not commit any error on facts or on law.

The appeal is without merit and is dismissed along with accompanying CMA. The Registrar (Judicial) is directed to release the entire amount

awarded by the Commission in favour of the complainant. Let the needful be done expeditiously preferably within two weeks from today.