IMPORTANT POINT
Insurance Company is liable for acts done by its agent.

J. M. Malik, Presiding Member—Learned counsel for the parties present. Arguments heard.

2. Shri Sushil Kumar Tamboli, the complainant purchased a Tata Safari vehicle from M/s Yash Motors, Bhilwara on 21.5.2008. His car was stolen, on the next very day, in the night falling between 22-23rd May, 2008. The report was lodged with the police and intimation was given to New India Assurance Co. Ltd. The said vehicle could not be traced. The claim of the complainant was repudiated by the insurance company.

3. The complaint was filed with the District Forum. The District Forum vide order dated 19.5.2009 directed the opposite party/insurance company to pay a sum of Rs.7,49,400/- to the complainant alongwith simple interest @9% p.a. and costs of Rs.100/-.

4. The insurance company filed an appeal before the State Commission. The State Commission accepted the appeal and dismissed the complaint. It must be mentioned here that the State Commission came to the conclusion that there were disputes regarding the receipt of the amount, delivery of the vehicle, gate pass and the invoice of the dealer.

5. The case of the opposite party is that no ownership had passed to the complainant on 21.5.2008. He had made part payment in the sum of Rs.1,25,000/-. Despite that, he wrongly claimed that the vehicle was given to him. It is urged by learned counsel for the respondent that all these documents are manipulated. Above all, the invoice was issued by the dealer on 23.5.2008 . Without receipt of full amount, it cannot be held to be Sale under the Sale of Goods Act. The gate pass was given on 19.5.2008 but it was cancelled again. It was given on 21.5.2008. It is also interesting to note that subsequently the dealer, M/s Yash Motors, Bhilwara filed a case under Section 138 of the Negotiable Instruments Act against the complainant because after the car was stolen, the complainant had stopped the payment of cheque. That is the dispute between the dealer and the complainant. A criminal case is pending and the law will take its own course.

6. It is difficult to fathom why the insurance policy was granted in favour of the complainant. In case, M/s Yash Motors, Bhilwara had granted the insurance as an agent of the insurance company, in that case, the insurance company is bound by that. This is a question of vicarious liability.

7. We are hearing the complaints by so many consumers that the insurance companies grant insurance with closed eyes. They are concerned with the payment of the premium. In case the agent of the insurance company has done something wrong, insurance company can always take action against him. It is also interesting to note that M/s Yash Motors, Bhilwara is still continuing to be their agent even after the lapse of 8 years. No action was taken against M/s Yash Motors till now.

8. Learned counsel for the opposite parties has invited our attention towards the relevant portion of the order of State Commission, which runs as follows.

“As regards Cover Note No. 314156 in the name of the complainant was first issued on 20.05.08 which was later on cancelled. There is no explanation why this cover note was cancelled by the dealer acting in his capacity as an insurance agent. The second Cover Note No. 314161 stated to be issued on 21.05.08, while the proceeding Cover Note No. 314160 is of 22.05.08.”

9. It also reveals the negligence, inaction and passivity on the part of the agent against which no action has yet been taken. Unfortunately, the agent was not a party in this case. Since the insurance company has issued the policy in favour of the complainant, thereafter, the question of full payment pales into insignificance. The insurance company should have been vigilant and should not have given such like important powers to the dealer of Tata Motors.

10. Consequently, we partly allow the revision petition. The opposite party is directed to refund a sum of Rs.1,25,000/- to the complainant without interest within 30 days from today otherwi