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HARYANA STATE CONSUMER DISPUTES REDRESSAL COMMISSION
R.S. Madan, President and B.M. Bedi, Judicial Member
ORIENTAL INSURANCE COMPANY LTD. - Appellant
Versus
SHIV KUMAR AND ANR. - Respondents
First Appeal No. 3437 of 2007
Decided on : 14-12-2011
Mr. Varun Chawla, Advocate, for the Appellant; Mr. G.S. Sandhu, Advocate, for the Respondent
Failure to transfer the insurance policy to the purchaser's name within the specified time period as per the Motor Vehicles Act, 1988 and Indian Motor Tariff Rules results in the absence of a valid contract between the purchaser and the Insurance Company.
Headnote:
Insurance Policy - Transfer of Insurance Policy - Motor Vehicles Act, 1988, Section 157; Indian Motor Tariff Rules, GR.17
Fact of the Case:
The appellant appealed against the District Consumer Forum's order to pay insurable benefits to the complainant No. 2, who had purchased a vehicle but failed to transfer the insurance policy to his name. The appellant argued that there was no valid contract between the complainant and the Insurance Company due to the non-transfer of the insurance policy.
Finding of the Court:
The court found that as per Section 157 of the Motor Vehicles Act, 1988 and GR.17 of the Indian Motor Tariff Rules, the purchaser of the vehicle is obligated to inform the Insurance Company for transferring the Insurance Certificate in his name. Since the purchaser failed to comply with this provision, there was no valid contract between the complainant and the Insurance Company.
Issues: The main issue was whether the Insurance Company was liable to pay insurable benefits to the purchaser of the vehicle who failed to transfer the insurance policy to his name.
Ratio Decidendi: The court held that the failure to transfer the insurance policy to the purchaser's name within the specified time period as per the Motor Vehicles Act, 1988 and Indian Motor Tariff Rules resulted in the absence of a valid contract between the purchaser and the Insurance Company.
Final Decision: The court accepted the appeal, set aside the District Forum's order, and dismissed the complaint. The appellant was directed to refund the statutory amount deposited at the time of filing the appeal.
ORDER
R.S. Madan, President - This appeal has been preferred against the order dated 5.11.2007 passed by District Consumer Forum, Karnal in complaint No. 509/2006 which relates to the insurable benefits in respect of Swaraj Mazda vehicle bearing Registration No. HR-55A-1022.
2. Undisputed facts of the present case are that complainant No. 1 (respondent No. l herein) had sold his vehicle Swaraj Mazda vehicle bearing Registration No. HR-55A-1022 to the respondent-complainant No. 2 Rajpal. The vehicle was insured with the appellant-opposite party for the period 2.11.2005 to 1.11.2006. The vehicle was transferred in the name of complainant No. 2 on 30.11.2005 but the Insurance Policy was not transferred in the name of complainant No. 2. Unfortunately, the vehicle damaged in an accident on 3.5.2006. According to the complainants, there was damage to the vehicle to the tune of Rs. 68,405. Upon an intimation given to the appellant-opposite party, Shri Dinesh Chandra Gupta, Surveyor and Loss Assessor investigated the matter who reported the damage of the vehicle to the extent of Rs. 21,528. However, the claim lodged by complainant No. 2 - Rajpal was repudiated on the ground that there was no contract between the complainant No. 2 and the Insurance Company as the Insurance Policy was not got transferred in the name of purchaser Rajpal. Challenging the action of the Insurance Company, the complainants filed complaint before the District Forum.
3. The opposite party appeared and resisted complainants' claim on the above stated ground and prayed for dismissal of the complaint.
On appraisal of the pleadings of the parties and the evidence adduced on the record, District Forum accepted complaint and issued following direction:
".....we direct OP to pay the assessed amount of Rs. 33,028 (Rs. 30,528 plus 2,500) to the complainant No. 2 along with interest @ 10% p.a. from the date of repudiation i.e. from 23.10.2006 till payment. The order shall be complied with within 30 days of the receipt of copy of this order. The complaint stands disposed of accordingly in terms of the orders above with no order as to costs."
Aggrieved against the order of the District Forum, the opposite party has come up in appeal.
4. We have heard learned Counsel for the parties and perused the case file.
At the threshold of arguments, it is contended by Mr. Varun Chawla, Advocate for the appellant that on the date of damage to the vehicle in accident, there was no valid contract between the complainant No. 2 Rajpal as well as the Insurance Company as the Insurance Policy obtained by the previous owner Shiv Kumar was never transferred in the name of Rajpal, though the Registration Certificate was transferred in his name on 30.11.2005.
On the other hand Mr. G.S. Sandhu, learned Counsel appearing on behalf of the respondent-complainants has reiterated the findings recorded by the District Forum while allowing the complaint. In support of his arguments learned Counsel for the respondent-complainants has referred to the judgment rendered by Hon'ble National Commission in Revision Petition No. 556 of 2002, decided on 22.5.2007 titled as Shri Narayan Singh v. New India Assurance Company Ltd., (2007) 4 CPJ 289 (NC) wherein the Insurance Company was held liable to pay the insurable benefits to the complainant.
5. Having taken into consideration the rival contentions of the learned Counsel for the parties, we find that the contention raised on behalf of the appellant cannot be brushed aside in view of the legal position involved in the instant case. As per Section 157 of the Motor Vehicles Act, 1988 as well as GR.17 of the Indian Motor Tariff Rules, the purchaser of the vehicle is under an obligation to inform the Insurance Company for transferring the Insurance Certificate in his name by depositing the required charges. In the instant case the purchaser of the vehicle namely Rajpal failed to comply with the provisions of Section 157 of the M.V. Act because he did not inform the Insur
