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TAMIL NADU STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, CHENNAI
Hon’ble Thiru Justice A. Raman,
President & Tmt. R. Vanaroja, Member
NEW INDIA ASSURANCE CO. LTD. & ANR.—Appellants
versus
S.G. RAJENDRAN—Respondent
A.P. No. 198 of 1998—Decided on 27.2.2004
For the Appellants :Mr. K.S. Narasimhan and Mr. P.V. Raghavan, Advocates.
For the Respondent:Mr. S. Natarajan, Advocate.
The main legal point established in the judgment is that the termination of insurable interest in a vehicle leads to the dismissal of an insurance claim, as per the provisions of the Motor Vehicle Act, 1988.
Headnote:
Insurance Claim - Termination of Insurable Interest - Motor Vehicle Act, 1988 - Section 157, Section 158, Section 159 - The judgment discusses the termination of insurable interest in a vehicle and the implications on an insurance claim. It highlights the legal provisions of the Motor Vehicle Act, 1988, specifically Section 157, Section 158, and Section 159, and their interpretation in the context of the case. The court's decision is influenced by the understanding that the contract between the complainant and the Insurance Company terminates when the subject matter of the contract is involved in an accident, leading to a complete termination of insurable interest in the vehicle.
Fact of the Case:
The complainant's vehicle was involved in an accident after being driven by a potential buyer who later refused to purchase the vehicle. The Insurance Company repudiated the claim, stating that the complainant had no insurable interest in the vehicle at the time of the accident.
Finding of the Court:
The court found that there was a complete termination of insurable interest in the vehicle, leading to the dismissal of the claim by the Insurance Company.
Issues: The main issue was whether the complainant had insurable interest in the vehicle at the time of the accident.
Ratio Decidendi: The court held that the contract between the complainant and the Insurance Company terminated when the vehicle was involved in an accident, leading to a complete termination of insurable interest in the vehicle.
Final Decision: The appeal was allowed, the order of the District Forum was set aside, and the complaint was dismissed with costs.
Thiru Justice A. Raman, President—The complainant’s case is as follows:
The complainant is the owner of a Matador van bearing No. PY-01-1011 which was insured with the 1st opposite party on 21.9.1993. The complainant has paid a sum of Rs. 3,422/- towards premium on the said insurance. On 14.7.1994 one Chellappan of Perundurai, with the intention of buying the vehicle, made an advance of Rs. 5,000/-, took the vehicle and drove the same to Perundurai where on the way it met with an accident. The accident was reported to the opposite parties and a claim was made. The Surveyor wrote a letter on 26.11.1994 to Guru Auto Garage, Erode, to inform him after dismantling the damaged part for assessing the liability. The complainant was also required to produce necessary documents. The complainant was unable to send the documents immediately. The complainant has informed by letter dated 1.9.1995 to the 1st opposite party of the delay and told them that he sold the vehicle to one Chellappan. In the meanwhile, Chellappan who intended to purchase the vehicle, refused to purchase the vehicle and returned back the advance paid. No transfer of vehicle had taken place. While so, the 1st opposite party informed the complainant that the claim has been closed as no claim as per letter dated 27.3.1995 and the complainant has no interest in the vehicle at the time of accident. Thus, there is deficiency in service on the part of the opposite parties. The claimant is a proper insurance holder who is entitled to make claim and recover the claim amount. Hence, the complaint.
2. The 2nd opposite party filed a version pleading as follows: There is no deficiency in service at all. The complainant has not mentioned the date of accident anywhere in the claim. It is stated by the complainant that on 14.7.1994 one Chellappan took the vehicle after paying an advance of Rs. 5,000/- and the vehicle met with an accident. It is the duty of the complainant to send a claim form to the Insurance Company. After sale, the transaction comes to an end regarding movables once the vehicle is handed over. The change in the registry is only a subsequent act. Therefore, there is no duty cast upon the opposite parties to indemnify the complainant. The complainant sent a claim form on 18.11.1994 to the company informing about the accident. The date of accident was stated as 14.7.1994. It was not immediately reported to the Insurance Company. It is also not stated when the complainant came to know of the accident. There is considerable delay on the part of the complainant and the complainant and Chellappan have conspired together to get benefit from the policy. Both the complainant and the purchaser of the vehicle Chellappan took time and made it look such a way that the said Chellappan did not want to purchase the vehicle. It is only an after-thought to get the money from the opposite party Insurance Company. On receiving the claim form dated 18.11.1994, the Company deputed a Surveyor to inspect the vehicle. They also requested the complainant to send all the documents. But, they were not sent. It is only on 1.9.1995 by his letter, the complainant informed the 1st opposite party that he sold the vehicle to Chellappan. He has in that letter requested the purchaser Chellappan to informed the Erode Branch. The allegation that the advance amount was returned to the complainant is false. The vehicle was with the transferee namely Chellappan sufficiently for a long time. In such circumstances, no body would return the advance or accept the return of the advance. The Motor Vehicle Inspector, Karaikkal had issued no objection certificate for transfer of the ownership with effect from 22.10.1994. It is only at the instance of the complainant, Chellappan had agreed to repair the van. Chellappan has also signed the sale deed and form of transferee of insurance. One Murthi of Thirumurugan Auto Finance has financed for the repair of the vehicle on receipt of the original R.C. of the vehicl
