The State Commission has jurisdiction to adjudicate a claim even after the insurer has repudiated it, and the insured's consent to accept a reduced settlement amount is valid and enforceable if it is given after proper discussion and persuasion.

Mr. Justice S.K.M. Lodha, President—Being dissatisfied with the order dated 3.4.91 passed by the District Forum, Jaipur in Complaint Case No. 819/90, the opposite party (insurer) has filed this appeal under Sec. 15 of the Consumer Protection Act, 1986 (“the Act” herein). The District Forum by the impugned order directed the opposite party-insurer to make payment of Rs. 69,000/- together with interest from 2.2.90 @ 12% p.a. and incase the amount is not paid within one month the opposite party insurer was made liable to pay interest @ 18% p.a. A sum of Rs. 1,000/- was awarded as costs. Facts leading to this appeal are these :

2. The complainant-insured is a registered owner of vehicle No. RNG 2116. He got his vehicle insured under a comprehensive scheme and paid the premium under different heads. Policy No. 31/11/125589 which was valid froml3.10,89 to 12.10.90was issued. It is said that on 2.12.89 the vehicle after being filled with vegetables left Niwai for Delhi. When it reached 3 km. south of Shahpura, from the opposite side another truck PAC8975 which was coming from Delhi dashed against the complainant’s vehicle. As a result of which the complainant’s vehicle was completely damaged. The complainant informed the opposite party on 2.12.89 without delay about the accident and requested for spot survey. The insurer sent the Surveyor who saw the vehicle and the photogrphs were taken. Thereafter the damaged vehicle was brought from the place of accident to Jaipur Transport Nagar. The insured filled the claim form. Alongwith the claim form he submitted replacement, repair, destroyed and other articles estimate and in writing requested for the appointment of the final surveyor. The insurer sent the final surveyor. According to the complainant he suffered loss to the tune of Rs. 85,000/-. The insurer and its surveyor in Dec. 89 told him to pay Rs. 69,000/- in lumbsum. On account of financial stringency the complainant accepted to take Rs. 69,000/- instead of Rs. 85,000/-. He got the vehicle completely repaired and showed it to the insurer. The insurer through its surveyor got reinvestigation of the vehicle. The complainant has alleged that he borrowed money and he was required to pay interest @ 1.50% per month. The amount was not paid to the complainant despite several visits. He, therefore, filed the complaint dated 30.1.90 praying that a sum of Rs. 85,000/- and from the date of the accident i.e. 2.12.89 until realisation interest @ 18% may be awarded. A sum of Rs. 5,000/- was claimed as special compensation. Costs and expenses amounting to Rs. 2,500/- of the complaint were also claimed. Shri Vishnu Prasad partner of the insured submitted affidavit in support of the complaint. The complainant submitted private and confidential motor (spot/final) survey report dated 2.7.90.

3. The insurer contested the complaint on various grounds. Certain preliminary objections were raised. One of the objection that was taken was that the claim amount cannot be paid as the claim does not fall within the terms and conditions of the policy. It, therefore, informed vide letter dated 28.3.90 that claim has been repudiated. An objection was taken that at the relevant time the vehicle was driven by a person who did not possess driving license of medium transport vehicle. The truck RNG2116 is medium transport vehicle. There is a condition in the policy that vehicle should be driven by a person holding valid and legal licence. It was submitted that in such vehicles passengers are not permitted to sit. There is strict prohibition, however, at the time of the accident there were nine persons sitting in it. The policy was for goods vehicle in which only six labourers could sit and thus the complainant violated the terms of the policy. The gist of the preliminary objections is that detailed investigation of the claim filed by the complainant was done by the insurer and it was thereafter that the claim was repudiated. On merits it was pleaded that policy wa