NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Prem Narain, Presiding Member
United India Insurance
Company Limited —Petitioner
versus
Aji Pal and Ors. —Respondents
Revision Petition No.2089 of 2015
(Against the Order dated 09/10/2014 in Appeal No. 931/2013 of the State Commission Haryana)
Decided on 13.2.2019

IMPORTANT POINT
Delay in intimation of occurrence may weaken claim for compensation.

Headnote:Consumer Protection Act, 1986—Sections 15, 17, 19 and 21—Insurance—Theft of insured Tractor—District Forum allowed complaint and directed Opposite Party to pay Rs.4, 02, 000/- as price of tractor with 9% interest, Rs.10,000/- as compensation along with Rs.5500/- as litigation expenses—Delay in intimation has not been properly explained—Insurance Company could not get opportunity to investigate the matter and to help Police in future investigation—IRDA has issued guidelines to all general Insurance Companies to examine claims on merits received with delay if claims seem to be genuine—Though in present matter FIR has been lodged on 25.10.2009 but complaint was given to local Police Station on 13.6.2009, therefore, to some extent genuinity of theft can be assumed because this fact has not been controverted by Insurance Company and is also supported by fact of ‘untraced report’ submitted by Police—Tractor was insured for Rs.3,42,000/- only—Both Fora below have not considered this aspect that in a case of theft only IDV can be allowed—Fora below have erred in allowing claim of Rs.4,02,000/- instead of Rs.3,42,000/- which was IDV of the tractor under Insurance policy—Insurance Company directed to pay Rs.1,71,000/- (50% of IDV of Rs.3,42,000/-) along with 7% interest—Award of Rs.10,000/- as compensation set aside—However, order in respect of award of cost of litigation of Rs.5,500/- maintained.

       Held: I have given a careful consideration to the arguments advanced by both the parties and have examined the record. The condition No.1 of the Policy clearly stipulates that in case of any damage or loss Insurance Company should be immediately informed and in case of theft police should also be intimated. In the present case the FIR has been lodged on 25.10.2009 and intimation to the Insurance Company has been given on 02.12.2009 whereas the theft of tractor had occurred on 12th June 2009. Even if the version of the respondents/complainants is taken to be true that a complaint was given to the local Police Station on 13.6.2009 even then the condition is violated as the Insurance Company was not informed in time. It is also to be noted that the judgment of Hon’ble Supreme Court in Om Prakash Vs. Reliance General Insurance & Anr. (supra) relates to a case where the intimation was given to the Insurance Company after a delay of 8 days whereas in the present case there is a delay of more than 5 months. Moreover, Supreme Court has held that the delay can be condoned if it is properly explained. In the present case the delay has not been properly explained. Clearly the Insurance Company could not get the opportunity to investigate the matter and to help police in future investigation. In addition condition No.5 has also been violated as claim has not been submitted to the Insurance Company within 14 days of the incident. Thus, basically two conditions have been violated in the present case. It is true that the IRDA has issued guidelines to all the general Insurance Companies to examine the claims on merits received with delay if the claims seem to be genuine. Though in the present matter the FIR has been lodged on 25.10.2009 but a complaint was given to the local Police Station on 13.6.2009, therefore, to some extent the genuinity of the theft can be assumed because this fact has not been controverted by the Insurance Company and is also supported by the fact of ‘untraced report’ submitted by the police. Hon’ble Supreme Court in Amalendu Sahoo Vs. Oriental Insurance Co. Ltd., II (2010) CPJ 9 (SC) has held that if some conditions of the policy are violated under a motor insurance, then it can be considered to allow claim up to 75%. As two conditions have been violated in the present case, relying upon the complaint filed with the local police on 13.6.2009 and the IRDA circular dated 20.9.2011as well as guidelines given by the Hon’ble Supreme Court in Amalendu Sahoo Vs. Oriental Insurance Co. Ltd. (supra), I deem it appropriate to allow 50% of the Insurance claim.

       It is also seen from the orders of the fora below that they have allowed claim as submitted by the respondents for Rs.4,02,000/- which is the price of the tractor whereas the tractor was insured for Rs.3,42,000/- only. Both the fora below have not considered this aspect that in a case of theft only the IDV can be allowed. Hence, both the fora below have erred in allowing a claim of Rs.4,02,000/- instead of Rs.3,42,000/- which was the IDV of the tractor under the Insurance policy.

       Based on the above discussion, the revision petition is partly allowed and the Insurance Company is directed to pay Rs.1,71,000/- (50% of the IDV of Rs.3,42,000/-) along with 7% interest from the date of the order of the District Forum i.e from 30.10.2013. Accordingly, the orders of the fora below stand modified in this regard. As the respondents have themselves delayed the submission of claim they are not entitled to any compensation for mental agony and harassment and the order of the District Forum for award of Rs.10,000/- as compensation is set aside. However, the order in respect of award of cost of litigation of Rs.5,500/- is maintained. (Paras 12, 13 and 14)

       Result: Revision Petition Partly allowed.