IMPORTANT POINT
Provisions of delay in informing Insurance Company or lodging report with police are of little significance as these are of directory nature and not of mandatory nature.

V.B. Gupta, Presiding Member—Petitioners/Opposite Parties No.1 and 2 being aggrieved by the impugned order dated 18.01.2008 passed by State Consumer Disputes Redressal Commission, Delhi (for short, ‘State Commission’)have filed the present revision petition under Section 21(b)of the Consumer Protection Act, 1986(for short, ‘Áct’)

2. Brief facts are that Respondent No.1/ Complainant got his Safari LX Car insured with the petitioners for the period from 22.10.2003 to 21.10.2004, through their Agent-Respondent No.2/Opposite Party No.3. The vehicle met with an accident and fell into deep gorge while returning from Vaishno Devi to Delhi at Damtaal, Distt. Kangra, HP. The vehicle was towed and police report vide DD No.14 dated 6.11.2003, was lodged at Damtaal. The Petitioners were informed but despite insurance, they refused to get the vehicle repaired. After delaying the claim, petitioners appointed an investigator, Mr.G.B.Mathur who visited the accident site along with respondent no.1 on 19th and 20th April,2004. It was a case of total loss and respondent no.1 has claimed market value of the vehicle Rs.6,93,157/-.

3. Petitioners in their written statement took the plea that claim of respondent no.1 was repudiated firstly, on the ground that the agent,(respondent no.2) had played fraud. He in collusion with the respondent no.1 issued cover note on or after 5.11.2003, the date of alleged accident. Secondly, respondent no.1 has taken inordinately long time in informing the Petitioners’ Company.

4. District Consumer Disputes Redressal Forum, New Delhi-I (for short, District Forum’) allowed complaint vide its order dated 18.09.2007 and passed the following directions;

“1. OP 1 & 2 will pay Rs.6,90,488/- to the complainant under the insurance and shall take the custody of the car with letter of subrogation. The complainant will inform the transport authority for transferring the title of the vehicle from the name of the complainant to the name of OP-1 &2 and after the payment the complainant will have no claim or title in this vehicle.

2. On account of deficiency in service by not honouring the claim, OP-1 and 2 will pay Rs.50,0000/- as compensation on account of deficiency in service.

3. OP-1 & 2 will pay Rs.10,000/- to the complainant as cost of litigation”.

5. Aggrieved by the order of the District Forum, petitioners filed appeal before the State Commission, which dismissed the same vide the impugned order.

6. Hence, this revision.

7. Respondent No.1 alone has contested this petition. Respondent No.2 was served by publication but he did not appear, hence was proceeded exparte.

8. We have heard the learned counsel for the petitioners as well as counsel for respondent no.1 and gone through the record.

9. It is submitted by the learned counsel for the petitioners that it is settled principle of law that a principal is bound only by those acts done by his agent on his behalf in good faith and not by his fraudulent acts. Petitioners have never authorized respondent no.2,its agent to issue back dated cover note. If the agent has done so, petitioners cannot be held liable for the same. It is further submitted that there was delay on behalf of the respondent no.1 in informing the petitioners with regard to the accident. As such, there is violation of the terms and conditions of the insurance policy.

10. On the other hand, it has been submitted by the learned counsel for respondent no.1 that cover note in this case was issued by the agent of the petitioners on 22.10.2003 whereas, the accident had taken place on 06.11.2003. Therefore, the cover note issued in this case is legal and valid. Lastly, it is contended that police was informed immediately about the accident and since the vehicle had fell into deep gorge, it was to be retrieved from the site of accident and thus there was delay in informing the insurance company.

11. The District Forum, while allowing the complaint held;

“The report of investigator, G.B. Mathur & Co.