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2025 Supreme(Online)(NCDRC) 3471
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
AVM J. Rajendra, AVSM, VSM (RETD.), PRESIDING MEMBER, Mr. Anoop Kumar Mendiratta, MEMBER
M/s. Bharti Axa General Insurance Co. Ltd. – Appellant
Versus
K. Subbulakshmi – Respondent
Revision Petition No. 599 of 2019
For the Appellants/Petitioners: Mr. S.M. Tripathi
For the Respondents: Mohd. Aman Alam, Proxy Counsel
Marginal overloading of a vehicle does not constitute a fundamental breach of insurance policy, thus not negating insurer's liability for claim payment.
Headnote:(A) Consumer Protection Act, 1986 - Section 21(b) - Insurance policy terms and conditions - Claim repudiation - Complainant's vehicle overloaded at the time of the accident, leading to claim denial by insurer for deficiency in service - Appeal succeeds in part; overloading not deemed a fundamental breach causing total repudiation. Calculation of compensation directed at 75% of assessed loss of Rs.2,51,723 for payment. (Paras 17, 18)
(B) Deficiency in Service - Principles outlined on insurance repudiation - Basic premise rests on whether the alleged breach nullifies policy obligations; the court clarifies that acceptable marginal overloading does not extinguish the insurer's liability in absence of direct causal link to loss. (Paras 11, 12, 14)
Facts of the case:
The complainant sought redress for repudiated insurance claim following an accident involving her Eicher van, alleging deficiency by the insurer upon denial despite submission of all required documents.
Findings of Court:
The state commission's order acceptably compensated the complainant while identifying the claim's validity remains tied to verified facts of usage exceeding mandated limits without constituting a service deficiency.
Issues: The central legal question pertains to the classification of management of risk under policy terms relative to actual vehicle operation within mandated law.
Ratio Decidendi: The court's reasoning centers on the principle that marginal overloading does not establish a fundamental breach barring liability, emphasizing that such exclusions must align with the policy's fundamental purpose of indemnification.
Result: Revision petition disposed of; insurer required to pay Rs.1,88,792.
| Table of Content |
|---|
| 1. this case addresses the interpretation of insurance policy terms regarding overloading. (Para 1 , 2 , 3) |
| 2. the vehicle's damage and the subsequent claim denial are central facts of the case. (Para 4 , 5 , 6) |
| 3. arguments reference the validity and justification of the insurer's repudiation. (Para 7 , 8 , 9) |
| 4. examination of insurer's liability concerning marginal overloading as non-fundamental breach. (Para 10 , 11 , 12) |
| 5. the concluding sections address remedy and compensation based on assessed losses. (Para 13 , 14 , 15 , 16) |
JUDGMENT
AVM J. RAJENDRA, AVSM, VSM (RETD.), PRESIDING MEMBER
1. This Revision Petition is filed under Section 21 (b) of the Consumer Protection Act, 1986 (‘the Act’) challenging the Tamil Nadu State Consumer Disputes Redressal Commission, Chennai (‘State Commission’) order dated 28.09.2018 partly allowing FA No.531 of 2012 and setting aside the District Consumer Disputes Redressal Forum, Coimbatore (‘District Forum’) order dated 27.06.2012.
2. As per the Registry report, there is 18 days delay in filing this Revision Petition. For the reasons stated in IA/5000/2019, the delay is condoned.
3. For convenience, the parties in the present matter are referred to as stated in the complaint before the District Forum. K. Subbulakshmi is the Complainant (Respondent herein) while M/s. Bharti Axa General Insurance Co. Ltd. is the Opposite Party (OP) (Petitioner herein).
4. Brief facts of the case, as per the Complainant, are that the complainant is the owner of vehicle Eicher Van No. TN38W1708 which was insured by the Opposite Party (OP) insurer vide Policy No. FCV/1228504/T1/03/C2T111 valid from 30.03.2010 to 29.03.2011. This was a Comprehensive Policy for indemnifying the loss which may be suffered by the Complainant. The said vehicle had met with an accident on 10.02.2011 at 11.00 PM near Vellore and sustained damages. On being reported, the vehicle was inspected by a Motor Vehicle Inspector on 11.02.2011 and the Motor Vehicle Inspector had rendered an inspection report. Thereafter, the complainant had preferred a claim with the OP insurer on 17.02.2011 and all necessary documents were submitted. However, the OP illegally repudiated the claim vide letter dated 21.03.2011 on the ground that the permitted capacity of the vehicle was 9.2 Tons, but at the time of the accident the vehicle was carrying the load of 11.2 Tons thereby violating the terms of the policy. Alleging deficiency in service by the insurer for repudiating the claim for Rs.4,04,205 (out of claimed Rs.5,14,205) towards repairs of the insured vehicle, the Complainant contended that the reasons cited for repudiation are false and that the vehicle had carried only normal load, and that the repudiation is a tactic to evade liability, constituting deficiency in service causing loss and mental agony to her. The Complainant had caused issue of a legal notice dated 09.05.2011, which the insurer rebutted maintaining the stand of overloading. She filed the Consumer Complaint before the District Forum seeking payment of Rs.4,04,205 along with interest, Rs.50,000 as compensation and costs.
5. On being issued notice, the OP insurer filed its written version, contesting the complainant’s claims and the OP contended that the vehicle was carrying approximately 11,880 kgs of goods at the time of the accident, exceeding its permitted carrying capacity by over 2.5 Tons. OP contended that this action had violated the policy terms, as the vehicle's registration certificate and policy specified a Gross Vehicle Weight (GVW) of 16,200 kgs and an unladen weight of 7,000 kgs, resulting in a permitted carrying capacity of 9,200 kgs. Although their surveyor assessed the loss at Rs.2,51,723, they maintained that the significant overloading constituted a fundamental breach of the terms of the policy conditions. Consequently, they contended the repudiation was valid, made with due application of mind, and did not amount to deficiency in service under the Act, 1986.
