B V NAGARAJU Vs. ORIENTAL INSURANCE CO LTD

JUDGEMENT

(1.) In this appeal by special leave, the question of importance arising therein is whether the alleged breach of carrying humans in a goods' vehicle more than the number permitted in terms of the insurance policy, is so fundamental a breach so as to afford ground to the insurer to eschew liability altogether Ancillary to the question is the poser:whether the terms of the policy of insurance need be construed strictly or be read down to advance the main purpose of the contract as viewed by this Court in Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan, (1987) 2 SCC 654

(2.) The appellant herein was the registered owner of a 'Tata' Truck bearing No. KA-13/438, duly insured with the Oriental Insurance Co. Ltd, the respondent herein, vide Policey dated 24-8-1990 covered for period uptil 23-8-1991. The policy was comprehensive in nature, covering risk to the limit of Rs. 2,09,000/-. During the subsistence of the policy, the vehicle of the appellant met with an accident on 5-8-1991 when, allegedly, a gas tanker came and dashed against the said vehicle. Apart from the other damage which occasioned due to the accident, the appellant's vehicle sustained major damages on account of which repairs were necessitated. The appellant, therefore, incurred from his pocket repair charges/damages to the turn of Rs. 87,170/- in order to make the vehicle road-worthy. Pursuant to such expenditure, the appellant raised a claim with the respondent-Company inter alia for reimbursement of the repair charges/damages submitting therewith the claim-form and the bills for payment. The claim of the appellant was spurned. The appellant sent a legal notice calling upon the respondent-Company to make payment of the claim as per contractual conditions of the policy but in vain. The appellant then moved the Karnataka State Consumer Redressal Forum under the Consumer Protection Act, 1986 raising a demand of Rs. 2,13,500/-, diversifying the claim as repair charges, loss of prospective income, interest, legal notice charges and other miscellaneous expenses.

(3.) The respondent-Company denied their liability altogether stating that since the appellant's goods vehicle was used for the purpose of carrying passengers, the appellant was disentitled to claim any compensation, and even otherwise those were nine in number. The amount of money spent by the appellant on repairs however was not seriously disputed as the respondent's Official Surveyor himself had estimated the repair possibility at Rs. 75,700/-.