ANIL KUMAR Vs. NEW INDIA ASSURANCE CO LTD

JUDGEMENT

(1.) THESE two appeals arise from a common order passed by the State Commission. Brief facts of the case are that admittedly the complainant, Anil Kumar had a Bus which was covered by an insurance policy valid for 27.3.1995 to 26.3.1996. The Bust went to Kathmandu (Nepal) where it met with an accident and fell in a river. Incident was reported to the Insurance Company, as soon as the complainant came to know of the episode, on 21.6.1995 and preferred a claim of Rs. 5.50 lakhs, the insured amount. The Insurer repudiated the claim yet offered to pay Rs. 2,99,100/- as ex-gratia. Not impressed by this, a complaint was filed praying for direction to the insurer to pay the full policy amount of Rs. 5.5 lakhs alongwith interest @ 24% and compensation of Rs. 30,000/-. State Commission after hearing the parties allowed the complaint in part, i.e., directing the insurer to pay Rs. 5.5 lakhs alongwith interest @ 18% p.a. and cost of Rs. 5,000/-. Aggrieved by the order both the parties have filed two separate appeals - while Appeal Nos. 239/1999 is for enhancement of interest on the awarded amount and compensation. FA 404/1999 is to pray for setting aside the order passed by the State Commission as not being maintainable. We heard the arguments and perused the material on record.

(2.) IT cannot be disputed that the policy is the contract between the parties. A perusal of the policy makes it clear that the policy was valid for the vehicle use in the geographical territory of India. There is no disputing this fact, as borne out by the record. In these circumstances the Insurance Company cannot be held liable for compensating for any loss sustained outside India. Reliance by State Commission on a certain letter informing the insurer by the insured of a possible use of bus in Khatmandu at a subsequent date cannot be deemed to extend the territory to include Nepal. Contract is the policy and is binding on the parties. There is no mention of extending the policy confines to include Nepal. We find it very difficult to understand the illogical logic of the State Commission, when it finds insurer not defining the limits of geographical area. It escapes our comprehension as to what definition is required when admittedly the policy states that insurer would not be liable for any loss to vehicle outside the geographical area and the area is clearly given in capital thus 'GEOGRAPHICAL AREA-INDIA'.