The Insurance Company's liability is for the insured amount less the depreciated value of the vehicle, and market value should be assessed by way of depreciated value and not independently.

Mr. Justice J.D. Kapoor, President—The complainant through this complaint has sought directions to the opposite party to pay Rs. 7,33,995/- along with interest @ 18% p.a. towards insured amount as there was a total loss because of his vehicle having been stolen. The opposite party assessed the loss at Rs. 5,68,500/- through its Surveyor which was not to the satisfaction of the complainant. Hence this complaint.

2. Facts in brief are that the complainant purchased car Lancer Mitsubishi make of 1998 model and insured the same with the opposite company against Policy No. 6108226 w.e.f. 16.10.1998 to 15.10.1999 for an estimated value of Rs. 7,33,995/- by paying a premium of Rs. 24,696/-. On 26.9.1999, the car was stolen and an FIR was lodged with Police Station. Defence Colony, New Delhi. Intimation about the theft of the car was sent to the opposite party on the same day and when the car in question could not be traced, the police filed the untraced report before the Magistrate. The complainant preferred the claim of the insured amount with the opposite party.

3. However, the opposite party appointed a surveyor who assessed the total loss at the market value of the vehicle at the relevant time which according to him was Rs. 5,66,500/-. Though according to the respondent, the complainant initially agreed for this amount but later on declined to accept but according to the complainant, the so-called consent was a forged document as he never agreed to receive Rs. 5,66,500/-.

4. Be that as it may the aforesaid offer was made by the opposite party on the basis of untraced report, no challan certificate, copy of the FIR and other requisite documents furnished by the complainant some time in the month of December, 1999. Even if it is assumed that the complainant initially consented to receive Rs. 5,66,500/- still the fact remains that complainant did not receive this amount nor did he give any receipt showing that this amount was received by him towards full and final satisfaction of his claim.

5. In case of total loss, the Surveyor report is relevant only for the purpose of assessing the depreciated value of the vehicle against the insured amount. Once the Insurance Company issues the policy for specific amount and receives the corresponding premium, its liability is for the insured amount less the depreciated value of the vehicle which is termed as ‘market value’. Insurance Company is not entitled to assess the market value independent of the insured amount. If such a concession is given to the Insurance Company, the very purpose of receiving premium for specific amount would be rendered meaningless and ineffective. This is neither the object of insuring vehicle nor is the purpose of insurance policy issued by the Insurance Company. Once the Insurance Company issues a policy, the insured amount has to be taken as estimated market value of the vehicle at the relevant time. The contention of the Counsel for the opposite party as per relevant clause of the policy its market value or the insured amount whichever is less at the relevant time is payable does not find favour us with. According to us, the said clause means that market value has to be assessed in respect of insured amount by way of depreciated value of the vehicle and not independently. For instance in this case, the insured amount was assessed by the Surveyor at Rs. 5,68,500/-. It is not understandable and is beyond comprehension that the Insurance Company charged the premium on the amount of Rs. 7,33,995/- whereas its market value was Rs. 5,68,500/-. To say that Insurance Company is entitled to assess the value afresh which Insurance Company was required to assess at the time of issue of insurance policy is difficult to accept. Market value is assessable by way of depreciated value and not afresh i.e., after the event. If such a criteria is adopted the very purpose of receiving the corresponding premium would be rendered meaningless.

6. In view of the aforesaid reasons, we f