PUNJAB STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHANDIGARH
Paramjeet Singh Dhaliwal, Presidentand Mr. Rajinder Kumar Goyal, Member
Mrs. Kanika Gupta – Complainant
Versus
New India Assurance Company
Limited – Opposite Party
Consumer Complaint No.645 of 2019
Decided on 04.06.2021

IMPORTANT POINTS
(1) Deductions not permissible to be deducted to determine total loss per terms of insurance policy.
(2) Surveyor assessed the liability of the under the lowest liability, whereas it is a case of total loss.

Headnote:

(A) Consumer Protection Act, 2019 – Complaint - On 29.05.2019, insured Audi car met with accident, got damaged - Intimation of accident given to OP by complainant, claim was lodged - Accidental vehicle was shifted to Audi authorized service centre, Raipur -Repair estimate of Rs.31,58,663/- raised by service centre - OP appointed Surveyor for investigation to assess cost of repair of the said vehicle - Cannot brush aside the report of Audi authorized service centre, which is unrebutted on record - Net loss after deduction is Rs.13,50,753/- per Surveyor’s report -Deductions not permissible to be deducted to determine total loss per terms of insurance policy - Surveyor assessed liability under the lowest liability, whereas it is a case of total loss - Surveyor assessed loss applicable only in partial loss claims - Surveyor and Loss Assessor reports could not assign any reason with regards to deductions, in relation to various parts while assessing the loss, when the repair cost was more than 75% of the Insured Declared Value(IDV) of the Vehicle – Act and conduct of the OP is deficiency in service and unfair trade practice.

Held: Learned counsel for the complainant vehemently argued that as per the policy, the IDV of insured vehicle is Rs.30,50,000/-. On 29.05.2019, the insured vehicle met with an accident at Raipur and got damaged. Intimation of the accident was given to OP and claim was lodged. The accidental vehicle was shifted to the authorized service centre of Audi at Raipur and repair estimate to the tune of Rs.31,58,663/- was raised by the authorized service centre of Audi, vide Ex.C-2. OP appointed a Surveyor, Mr. Gagan Chopra, for investigation of the case and to assess of the cost of repair of the said vehicle. On 19.06.2019, OP sent an email to complainant assessing its liability to the tune of Rs.13,50,753/-, vide Ex.C-3. The complainant sent letter to OP, vide Ex.C-4 (colly) for providing documents/report and requested to settle the claim on the basis of constructive total loss, because the repair cost of vehicle was more than 75% of the IDV of the insured vehicle. OP’s Surveyor had illegally instructed the authorized service centre to dismantle the insured vehicle and to start the repair work without any intimation to her. OP sent the assessment of aggregate repair cost to the tune of Rs.25,37,330.60. Learned counsel for complainant strongly contended that OP arbitrarily applied ‘depreciation’ on various metal and rubber parts in violation of insurance policy, GR-8 of the Indian Motor Tariff and law laid down in various judgments. On 20.07.2019, OP refused to settle the case as constructive total loss and also sent motor (final) survey report of Surveyor Gagan Chopra (Ex.C-10), which is being contested by the complainant. Learned counsel further argued that as per terms of policy, OP has to consider the IDV and cannot apply depreciation on the same, because the repair estimate given by the authorized service centre as well as company’s own Surveyor are both above 75% of the IDV of the insured vehicle. Learned counsel further contended that GR-9 deals with the depreciation on part for partial loss, whereas the claim of the complainant falls under the GR-8 of Indian Motor Tariff.

During arguments, he further contended that OP is also liable to pay the parking/demurrage charges of the parking of the vehicle, which is still lying in the service centre of Audi at Raipur in accidental condition. Learned counsel prayed for acceptance the complaint.

The Surveyor has admitted the fact of accident of the insured vehicle, which occurred on 29.05.2019 during the currency of the policy, in survey report dated 18.07.2019 and the fact of issuance of policy in question for the period from 03.02.2019 to 02.02.2020 is also not in dispute. It is also admitted fact of the case that the OP appointed the Surveyor, who assessed the liability of OP to the tune of Rs.13,50,753/- only under lowest liability. The main grievance of the complainant is that the Surveyor has arbitrarily assessed the liability of the OP to the tune of Rs.13,50,753/- and the same amount was offered to the complainant on the basis of report of Surveyor Ex.C-10. The core point for adjudication in this case before us is whether the vehicle in question suffered total loss or partial loss? From perusal of Surveyor’s report Annexure R-2, he estimated the amount of Rs.31,40,303/-, as repair charges and net labour charges. On the other hand, the complainant produced on record the main estimate prepared by the authorized service centre of Audi to the tune of Rs.31,58,663.92, as total insurer liability, but OP contended that this is exaggerated amount, but on the other side OP’s own Surveyor also estimated the loss suffered by the vehicle in question to the tune of Rs.31,40,303/- and there is only difference of amount of Rs.18,360.92 paisa. It is pertinent to mention that the OP has failed to explain that how much amount is exaggerated, whereas the estimate prepared by the Surveyor is almost near to the amount of estimate prepared by the authorized service centre of Audi, as such the plea of the OP with regard to exaggerated amount is not tenable. This Commission also held in case “ICICI Lombard General Insurance Co. Ltd. Vs. Kanta Jain” F.A. 134 of 2012, decided on 15.09.2015 that “The estimate is given by the authorized service station (Cargo Motors India Pvt. Ltd.) of Tata Motors and hence we cannot say that the estimate of loss to the vehicle, which was prepared by Cargo Motors Pvt. Ltd., the authorized service station, is liable to be ignored.” In view of this, we cannot brush aside the report of authorized service centre of Audi, which is unrebutted on record and there is only estimate of the Surveyor on the record, which is in corroboration of estimate prepared by the authorized service centre of Audi.

As per insurance policy Annexure R-1, the Insured Declared Value (in short “IDV”) of the vehicle in question is Rs.30,50,000/- and under the heading Sum Insured: Insured’s Declared Value of the terms and conditions of the policy, Ex.C-1/A, it has been specifically mentioned that “IDV shall be treated as the ‘Market Value’ throughout the policy period without any further depreciation for the purpose of Total Loss (TL)/Constructive Total Loss (CTL) claims. The insured vehicle shall be treated as a CTL if the aggregate cost of retrieval and/of repair of the vehicle, subject to the terms and conditions of the policy, exceeds 75% of the IDV of the vehicle.” The authorized service centre of Audi has given the estimate for repair including labour charges to the tune of Rs.31,58,663.92 paisa, which remained unrebutted on the record and the Surveyor of OP has also estimated the total cost of repair i.e. Rs. Rs.31,40,303/-. Net loss after deduction has been stated as Rs.13,50,753/- in Surveyor’s report. The deductions are not permissible to be deducted to determine the total loss, as per terms of the insurance policy specifically Clause 2 of Ex.C-1/A as well as GR-8 read with GR-9. In these circumstances, it is clear that the aggregate estimated cost of repair is more than the IDV of the vehicle i.e. Rs.30,50,000/-, as such this is a case of total loss and the IDV is treated as the ‘Market Value’ throughout the policy period without any further depreciation for the purpose of total loss. Moreover, it is also pertinent to mention that 75% of the IDV comes to Rs.22,87,500/- and generally a person get the estimate to know about the expenses incurred on the repair of the thing and after getting repaired the same, the difference is very small, which can be on higher side or lower side. In view of this, we are of the view that the Surveyor assessed the liability of the under the lowest liability, whereas it is a case of total loss, as discussed above. The OP relied upon the report of Surveyor, but every time the report of the Surveyor is not final one.

The Surveyor assessed the loss under GR.9, which is applicable only in partial loss claims. In this case, the OP failed to prove on record that the vehicle in question suffered partial loss in the said accident. The Telangana State Commission in case “M.Thirupathi Reddy Vs. Bajaj Allianz General Insurance Co. Ltd.” C.C. No.213 of 2015, decided on 17.04.2017 held as under:-

“19. Coming to the report of the Surveyor, it may be stated here, that it is settled principle of law that the same is neither binding on the parties nor the Consumer Foras. Though the report of the Surveyor has got evidentiary value, yet, it cannot be said to be the final word. The Surveyor and Loss Assessor, in his report, could not assign any reason, as to why, he made deductions, in relation to various parts, referred to above, while assessing the loss, when the repair cost was more than 75% of the IDV of the Vehicle. By not declaring the vehicle, as total loss, Opposite Parties No.1 and 2, were certainly deficient, in rendering service.”

This Commission in case “Surinder Pal Mittal Vs. Bajaj Allianz General Insurance Co. Ltd.” F.A. No.730 of 2012, decided on 28.03.2014 held as under:-

“19. The District Forum has relied upon the authority of the Hon’ble Supreme Court dated 22.07.1983, but the above authority referred by the District Forum of the Hon’ble Supreme Court is not applicable to the facts and circumstances of the present case. The District Forum has altogether lost sight of the Generation Regulations of India Motor Tariff and the law prevailing at present which provides that where the cost of the repair exceeds 75% of the IDV of the vehicle, then it has to be considered as the total loss.” On the other hand, the OP has not relied upon any law point and authority in support of its contentions. As such, the report of Surveyor Ex.C-10/Annexure R-2 assessing the liability of OP under lowest liability to the tune of Rs.13,50,753.60 paisa is not conclusive one and is not applicable in this case. The OP has wrongly settled the claim of the complainant under GR.9 instead of GR.8 read with Clause 2 of terms and conditions of the insurance policy. As such the above act and conduct of the OP is a deficiency in service and unfair trade practice on its part and the complainant is entitled to the amount of IDV i.e. Rs.30,50,000/- in this case alongwith compensation and cost of litigation and due to non-settlement of remaining amount of claim i.e. Rs.16,99,246/-, out of total IDV of Rs.30,50,000/-, the complainant is entitled to the same with interest.

As a result of our above discussion, the complaint is partly allowed with the following directions to OP:

(i) to pay remaining amount of insurance claim of Rs.16,99,246/- on account of total loss suffered by the vehicle, as per terms and conditions of the policy and GR.8 of India Motor Tariff to the complainant alongwith interest @7% per annum from the date of filing the complaint till actual realization ;

(ii) to pay the parking charges to the relevant authorized service centre i.e. Audi Raipur;

(iii) to pay compensation of Rs.25,000/- for mental harassment as well as litigation expenses;

(iv) The OP is at liberty to take the scrap of the insured vehicle in its custody and complainant is also directed to transfer the RC and other relevant papers as well as to execute the subrogation letter in favour of the OP. The OP must ensure cancellation of certificate of registration of the said vehicle, as per circular No.IRDAI/NL/CIR/MOTOD/118/07/2019, dated 25.07.2019 issued by Insurance Regulatory and Development Authority of India. The above amounts shall be payable by OP to complainant only if she comply with direction (iv) within 45 days from the date of receipt of certified copy of the order, failing which OP shall be liable to pay interest @9% per annum from the date of filing of the complaint. (Paras 11, 16, 17 & 19)

Result: Complaint partly allowed. Opp. Party to pay remaining amount of insurance claim of Rs.16,99,246/- on account of total loss suffered by the vehicle alongwith interest @7% p.a. from the date of filing the complaint till actual realization, compensation of Rs.25,000/-