NEW INDIA ASSURANCE COMPANY LTD Vs. KOTLU BRAHAMANA, EX-SERVICEMEN’S TRANSPORT COOPERATIVE SOCIETY LTD

JUDGEMENT

(1.) This revision petition has been filed by the New India Assurance Co. Ltd. against the order of the H.P. State Consumer Disputes Redressal Commission, Shimla (hereinafter referred to as 'the State Commission' in Appeal No. 215 of 2006. The Kotlu Brahamana, Ex-Servicemen's Transport Cooperative Society Ltd., original complainant before the District Forum is the Respondent in this revision petition. In its complaint before the District Forum, the Respondent society had contended that it had insured its bus bearing registration No. HP-23-2879 with the Petitioner Insurance Company vide Policy No. 3135240422206 (31/22206) Cover Note No. 11893 dated 15.3.1994 valid from 21.3.1994 to 20.3.1995 for a sum of Rs. 4,00,000. During the validity period of the insurance, the bus met with an accident on 16.5.1994 as a result of which it was badly damaged and the estimated loss was Rs. 2,71,094. On being informed, the Petitioner Insurance Company appointed a Surveyor to assess the loss. However, the claim submitted by the Respondent society was repudiated on the grounds that at the time of accident the driver of the bus was not having a valid and effective driving licence and also because the bus was overloaded which was in violation of the terms and conditions of the policy. Being aggrieved by the repudiation of the claim which according to the Respondent society was not based on correct facts, it filed a complaint before the District Forum requesting that Petitioner Insurance Company be directed to pay Respondent society Rs. 2,71,094 being the damages suffered in the accident and Rs. 1,00,000 as compensation.

(2.) The above contentions were denied by the Petitioner who stated that the claim was not admissible as the driver of the bus Kewal Krishan was not having a valid driving licence and also while the capacity of the bus was for 40 passengers, there was credible evidence that as many as over 100 passengers were travelling in the bus including on the roof of the bus.

(3.) The District Forum after hearing the parties noted that the issue of validity of the driving licence of the driver had been adjudicated by the District Forum as well as the State Commission in Appeal No. 94/1996 wherein the Fora below gave a finding that driver did have a valid licence. Regarding overloading of the bus and the consequences thereof, the District Forum concluded that even if the bus was carrying passengers above the permissible limit, there was no tangible and clinching evidence on record to conclude that the cause of the accident was because of overloading. The District Forum cited the judgment of the Apex Court in B.V. Nagaraju v. Oriental Insurance Co. Ltd., 1996 2 CPJ 18, wherein it had inter alia been stated that if over-loading is not the instant cause of an accident, the Insurance Company cannot repudiate the claim. Thus by applying the ratio of this judgment, the overloading in the instant case amounted to merely "irregular use" of the bus by the Respondent society and did not justify total repudiation of the claim. In view of this finding and as per Clause-10 of the Manual of Motor Claims, the complainant would be entitled to refund of 75% of the admissible claim. Since the Surveyor appointed by the Petitioner had assessed the admissible claim due to the accident at Rs. 1,01,100, the District Forum directed the Insurance Company to pay the Respondent society Rs. 75,810 (i.e. 75% of the admissible amount) with interest @ 9% p.a. from the date of institution of the claim till realization and costs of Rs. 10,000.