United India Insurance Co. Ltd. vs HIMACHAL PRADESH STATE CIVIL SUPPLIES CORPORATION LTD.

BEING aggrieved and dissatisfied with by the order dated 24.6.2002 passed by the Himachal Pradesh State Consumer Disputes Redressal Commission in Complaint No. 21 of 1999, the United India Insurance Co. Ltd., has preferred this appeal. By the impugned judgment and order, the Insurance Company was directed to compensate for the damage caused to the truck belonging to the respondent Corporation which was insured with the appellant for a sum of Rs. 4 lakh. The State Commission directed the Insurance Company to pay Rs. 4 lakh with interest at the rate of 18% from the date of the complaint, i.e., 20.11.1999 till realisation.

AT the time of admission of the appeal the Commission issued notice to the respondent limited to the question of valuation of the vehicle in question. Stay of the execution of the impugned order was granted on the condition that Rs. 2 lakh be directly paid to the respondent. At the time of hearing of this appeal, learned Counsel for the appellant submitted that there was no justifiable reason for the State Commission in arriving at the conclusion that the value of the vehicle was Rs. 4 lakh. As against this, learned Counsel for the respondent submitted that the complainant has taken the insurance policy for a sum of Rs. 4 lakh. The vehicle was purchased in 1993 for a sum of Rs. 4,90,000 and from the terms of the policy, at the most, there can be 25% depreciation in the value of the vehicle. And, therefore, the order passed by the State Commission is justifiable, as the accident took place on 22.8.1997, i.e., within a period of 4 years.

In our view, it is not possible to accept the contention of the learned Counsel for the respondent that as the insurance policy was taken for a sum of Rs. 4 lakh, the order passed by the State Commission does not call for any interference. Under the Insurance Act, the insured is entitled to get the market value of the loss which he has suffered and not on the basis of premium paid for the Insurance coverage. It is equally clear that in case where the damage suffered by the insured is more than coverage. It is equally clear that in case where the damage suffered by the insured is more than coverage given by the policy, he is entitled to be reimbursed only to the extent insurance coverage or as per the terms and conditions of the policy.

FURTHER, the submission made by the learned Counsel for the appellant requires to be accepted because on the record, the Insurance Company has produced three surveyors reports estimating the value of the vehicle at Rs. 2,50,000. The first survey report dated 2th September, 1998 reveals that the market value of such type of ''December 1993 model'' was approximately Rs. 2,50,000 and expected salvage of the damaged vehicle was Rs. 50,000. The investigator Mr. V.K. Chhibber vide his report dated 27.12.1998 revealed that in all 19 persons boarded the truck in question which was a goods carrier, out of which 18 persons died and the driver escaped. The Investigator also noted that there was a certificate issued by Additional D.C., Spiti at Kaza, because of urgency and public interest Government allowed 19 persons to board the truck for various reasons in hilly area which was dislocated. The other Surveyor, Mr. Vijay Kumar Berry, has assessed the loss by his report dated 21.4.1999 at Rs. 2,50,000. To the same effect, there is a report dated 21.4.1999 of third Surveyor, Mr. Mukesh Kumar Bhatia, estimating the value of the vehicle on the date of the loss at Rs. 2,50,000.

THERE is no other evidence assessing the loss suffered by the complainant. Hence, considering the aforesaid three reports, we think that it would be just and reasonable to assess the loss suffered by the complainant - Himachal Pradesh State Civil Supplies Corporation Ltd. at Rs. 2,50,000. We also hold that the interest awarded at the rate of 18% by the State Commission is excessive and reduced the same to 10% p.a. In this view of the matter, we modify the impugned order passed by the State Commission and direct the appellant to pay Rs. 2,50,000 with interest at the rate of 10% p.a. from the date of the complaint. By this time, if any salvage is left out, it would be open to the Insurance Company to collect the same.

THE appeal is partly allowed accordingly. THEre is no order as to costs. Appeal partly allowed.