IMPORTANT POINTS
(1) Settlement on Non-Standard Basis (Insurance Law Principle) – As established by the Supreme Court in Nitin Khandelwal, when a vehicle is insured as a private vehicle but meets with an accident while being used for hire/reward (breach of policy condition), the insurer cannot totally repudiate the claim. The insured is legally entitled to 75% of the admissible claim on a non-standard basis.
(2) Rule against Double Compensation – The Commission enforced the established legal principle that a consumer forum should not award both interest on the principal amount and separate, additional compensation for mental/financial agony, as interest itself serves as compensation for the delayed payment and associated hardships.
(3) Section 41 of the Consumer Protection Act, 2019 – This provision governs the appellate jurisdiction of the State Commission to hear appeals against the orders passed by the District Commission. It was invoked by the insurance company to challenge the lower forum’s absolute award.

ORDER

Kumkum Rani, President—This appeal under Section 41 of the Consumer Protection Act, 2019 has been directed against the impugned judgment and order dated 19.03.2024 passed by learned District Consumer Disputes Redressal Commission, Bageshwar (hereinafter to be referred as “The District Commission”) in consumer complaint No. 04 of 2019, styled as Sh. Lalit Prasad Arya Vs. Micro Branch Manager, United India Insurance Company Limited and another, wherein and whereby the consumer complaint was allowed and the appellant - insurance company to pay compensation of Rs.2,08,000/- to respondent No. 1 / complainant together with interest @8% p.a. from 11.10.2018, i.e., the date of repudiation of the claim till payment, besides to pay Rs.20,000/- towards mental agony and Rs.10,000/- towards litigation expenses. It was further held that since the surveyor of the insurance company has assessed the loss on Net of Salvage Basis with R.C., hence the insurance company shall have no right over the salvage of the insured vehicle. The proceedings of the consumer complaint were dropped against respondent No. 2 / opposite party No. 2.

2. The facts giving rise to the present appeal, in brief, are, as such that respondent No. 1 / complainant is the registered owner of vehicle bearing registration No. UK-02-A-0273, which was insured with the appellant - insurance company under Private Car Package Policy for the period from 13.11.2017 to 12.11.2018 at an IDV of Rs.2,64,000/-. During the currency of the insurance policy, the insured vehicle met with an accident on 07.04.2018 at 10:00 p.m. near Khirabgarh, Nayal and fell in a 40 mts. deep ditch. The intimation of the accident was given by the complainant to the insurance company. The insurance company got the claim investigated through its investigator - respondent No. 2 / opposite party No. 2. The insurance company through letter dated 11.10.2018 repudiated the claim of the complainant on the ground that as per the investigation report, at the time of accident, the insured vehicle was being used for commercial purpose, i.e., hire and reward, in contravention of the terms and conditions of the SC/5/A/16/2024 United India Insurance Company Limited 22.01.2026 Versus Sh. Lalit Prasad Arya and another insurance policy, hence the claim is not payable. Therefore, the consumer complaint was filed by the complainant before the District Commission.

3. The appellant - insurance company filed written statement before the District Commission and pleaded that upon receipt of intimation of accident of insured vehicle, Sh. Ravindra Pal Singh Tomar was appointed as investigator to investigate the matter. During the course of investigation, it transpired that on 07.04.2018 at 9:30 p.m., the complainant had taken the insured vehicle on booking of Rs.500/- from Kapkot to Pothing and while returning back, the accident took place. The vehicle was registered and insured as a private vehicle, whereas at the time of accident, it was being used for commercial purpose, in violation of the terms and conditions of the insurance policy. Thus, the claim of the complainant was rightly repudiated by the insurance company and there lies no deficiency in service on their part.

4. Inspite of sufficient service of notice, the respondent No. 2 / opposite party No. 2 neither appeared before the District Commission, nor filed any written statement, hence the District Commission vide order dated 01.06.2019 proceeded the consumer complaint ex-parte against him.

5. The District Commission, after hearing learned counsel for the contesting parties and after taking into consideration the material available on record, allowed the consumer complaint vide impugned judgment and order dated 19.03.2024 in the above terms. Feeling aggrieved by the impugned judgment and order, the insurance company has preferred the instant appeal before this Commission.

6. We have heard learned counsel for the appellant - insurance company and perused the record. Vide