IMPORTANT POINT
Absence of permit is a fundamental breach of terms and conditions of policy.

ORDER

This appeal has been filed by the National Insurance Co. Ltd. against the order dated 07.07.2017 of the State Consumer Disputes Redressal Commission, Bihar, (in short ‘the State Commission’) passed in Complaint Case No.44 of 2014.

2. Brief facts of the case are that the respondent/complainant had purchased a truck from Tata Motor. It was engaged in lifting soil for making four lane Mohnia-Arra Road. On 08.06.2014 near Narayanpur village due to short circuit fire was broken in truck and the truck was burnt. The local police as well as the appellant/ Insurance Company were informed. The vehicle was taken to workshop which is lying there since 15.6.2014. The cost of repairing was estimated to be Rs.23,74,142/- which was more than the cost of a new truck. The claim for the total loss was submitted by the complainant but it was not settled by the Insurance Company. Aggrieved, the complainant filed a consumer complaint before the State Commission. The complaint was resisted by the opposite party stating that the vehicle did not have any permit and therefore the claim was not payable. The State Commission, however, allowed the complaint and directed Insurance Company to settle the claim on non-standard basis.

3. Hence the present appeal.

4. Heard the learned counsel for both the parties and perused record.

5. Learned counsel for the appellant stated that non-availability of the permit is a fundamental breach of provisions of the Motor Vehicles Act, 1988, therefore, also a fundamental breach of terms and conditions of the policy. It was argued that the State Commission has relied upon the judgment of the Hon’ble Supreme Court in National Insurance Company Limited Vs. Nitin Khandelwal, IV (2008) CPJ 1 (SC). It was argued that the facts of that case are totally different from the present case. In National Insurance Co. Ltd. Vs. Nitin Khandelwal, (supra), the vehicle was stolen and therefore, the Hon’ble Supreme Court has held that violation of a condition of the policy is not germane in case of theft of the vehicle. The instant case is not a case of theft.

6. It was argued that against fundamental breach of terms and conditions of the policy, claim cannot be approved even on non-standard basis. Approval on non-standard basis is generally resorted to in cases where either the vehicle has been found over weight or the driver may not be having licence of the required category. The truck cannot ply on any road without the relevant permit. Thus, if the truck is not supposed to be at the site of the accident, how the accident claim can be entertained?

7. In support of his arguments, learned counsel referred to the following judgments:-

1. Narinder Singh Vs. New India Assurance Company Ltd. and others, Civil Appeal No.8463 of 2014, decided on September 04, 2014 (SC).

2. Lalaram Vs. Oriental Insurance Company Ltd. & others, RP No.1433 of 2016, decided on 25.5.2016 (NC).

3. New India Assurance Co. Ltd. Vs. Birbal Singh Jhakhar, RP No.2476 of 2012, decided on 06.02.2014 (NC).

8. On the other hand learned counsel for the respondent/complainant stated that Hon’ble Supreme Court in Amalendu Sahoo Vs. Oriental Insurance Company Limited, (2010) 4 SCC 536 has observed that if certain conditions of the Motor Vehicles Act and consequently of the policy are violated, the claim can be settled on non-standard basis as per the following table:-

9. It was argued