GOPICHAND AGARWALA Vs. NATIONAL INSURANCE CO LTD

JUDGEMENT

(1.) Deficiency in insurance and banking services is grievance of complainant.2. Case of complainant is that he purchased a chasis on hire purchase scheme with finance from Urban Cooperative Bank, Baripada, opposite party No.2. On purchase, he obtained insurance policy from Hindustan General Lisurance Society Limited whose assets and liabilities have been taken over by opposite party No.1. Risk in respect of the truck was covered under comprehensive insurance policy for the period between 3.2.70 and 2.2.71. On 30th November, 70, the truck was stolen, for which claim was made with Hindustan Insurance. Bank having taken steps to realise the loan amount and insurer not having settled the claim, this complaint has been filed on 12.3.92.3. Opposite Party No.1 stated its case in reply to the complaint. It has decided the claim on the ground that the complaint is barred by limitation, complainant being a mere hirer, complaint at his instance is not maintainable, actual owner of the vehicle having omitted to make any claim, grievance of complainant is not tenable in law. Claim in the complaint is not to be adjudicated since it involves complicated facts and is only entertainable in Civil Court. Possession of the truck having been taken away from the possession of the insured forcibly, the claim that there was burglary of the truck is not covered under the risk. It is the further case that complainant intimated the insurer, Hindustan Insurance on 7.12.70 that on 30th Nov. '70, at early hours, one Nagraj, employee of M/s. Siremull Hirachand has taken away the truck on the point of gun and pistol. An enquiry was made by Hindustan Insurance where it was found that the very chassis was subject-matter of two transactions, one by complainant under agreement with opposite party No.2 and another by his son-in-law with Hiremull Hirach and, a financier of Madras. The very chasis was registered under the Motor Vehicles Act in Baripada as ORM 1357 and at Keenjhar as ORJ 2710. A surveyor was appointed by opposite party No.1 who after conducting an enquiry independently submitted a report to the similar effect. Urban Cooperative Bank, the financier of complainant, intimated a dispute under the Orissa Cooperative Societies Act in which award has been made against the complainant. Opposite Party No.1 has been made a party at the appellate stage in that dispute where complainant lost. Complicated question of fact being involved, Civil Court ought to go into the question.4. Opposite Party No.2 has not stated any case despite notice. Large number of documents have been filed by both the parties. On account of assertions and counter-assertions, it is first to be examined whether the complainant is a consumer; whether opposite party Nos.1 and 2 were rendering service to the complainant; whether there was deficiency in service rendered; whether the deficiency in service was on account of negligence of the opposite parties and whether the complainant has suffered for which his claim for compensation of Rs.5 lakhs is justified.5. As regards opposite party No.2 the question of deficiency in service or negligence need not be gone into since from the documents it is clear that opposite party No.2 has initiated a recovery proceeding under the Orissa Cooperative Societies Act and all questions can be adjudicated in that forum. Since under Sec.3 of the Act, this Act is in addition to other laws in force and is not to be inconsistent with them, we are not inclined to deal with the question of deficiency in service by opposite party No.2 in view of the earlier proceeding under the Orissa Cooperative Societies Act between the banker, opposite party No.2 and complainant. A1-though insurer, opposite party No.1, is made a party, we are inclined to hold that complainant had justifiably added insurer as a party in appeal when the bank did not prefer to add the insurer. Accordingly, complaint as against opposite party No.2 is dismissed. We would have awarded cost in case opposite party No.2 would have entered appearance in this case as complainant made opposite party No.2 a party suppressing facts in the complaint.6. As regards complaint against opposite party No.1, we are not inclined to accept the objection of opposite party No.1 that complainant is not a consumer in respect of service rendered by opposite party No.1 so far as vehicle ORM 1357 is concerned. Opposite party No.1 has not disputed that Hindustan Insurance covered the risk and in case there would be theft, opposite party No.1 would be liable to reimburse. It is the case that the bank which was financier was the owner and complainant is only one hirer. Therefore, complainant is not a consumer in respect of the service. This submission is without any force. From the report of the surveyor dt.20.3.80 it is seen that complainant is treated to be insurer. Otherwise also the complainant is beneficiary of the insurance policy, since opposite party No.1, Hindustan Insurance has received premium. Therefore, complainant is a consumer. When a claim is made in respect of a vehicle, insured, claim is to be finally decided by the insurer, either repudiating it or accepting it in whole or in part. Non-finalisation of a claim is a deficiency in service. Basing on the case of opposite party that it has repudiated its claim, the claim is still pending with it to be finally decided. Therefore, keeping a claim pending from 7.12.70 till date is a deficiency in service.7. Opposite Party No.1 has stated that the complainant is barred by limitation since a claim as back as 22 years, is being agitated in the year 1992. As has been held by the National Commission in the decision reported in Oriental Insurance Co. Ltd. V/s. Lekhraj Dang,II (1992) CPJ 402, the period of limitation for filing complaint under the Act is three years from the date of repudiation of the claim. Therefore, until there is repudiation by the insurer, the cause of action continues, and it cannot be said that the complaint is barred by limitation.8. It is true that if the claim of the complainant from the insurer 20 years after is sustained, liability incurred by the insurer is to be barred by limitation. If a suit is filed where the insurer keeps the complainant in the hope and it is the cause for delay in approaching Civil Court, failure to approach the Civil Court is a suffering of complainant. Insurer being a Govt. Company carries on the welfare activities of the State. By its inaction if it has deprived a complainant from approaching the Civil Court, who had the expectation that the insurer would reasonably act and consider the claim there would be a clear case of deficiency in service. Unreasonable delay without any explanation for the same would amount to negligence and the suffering is to be redressed by payment of compensation commensurate with the suffering. We have no doubt that in this case insurer had not acted reasonably. When a claim was pending and report was given that complainant might have committed fraud since the same vehicle was registered at two places, it ought to have repudiated the claim immediately on acceptance of such a report. If it would have repudiated the claim, the complainant could have agitated his grievance in the available forum at that time within the period of limitation. When the dispute by the bank went against it and complainant preferred an appeal, complainant unnecessarily added the insurer as a party in the appeal. Registrar could not have given an award against the insurer. While claim was pending with the insurer, if it was dragged to a forum which cannot adjudicate liability of the insurer, it would not be unreasonable for the insurer to wait for the adjudication in that forum, In such case, if there is no intimation of repudiation although decision had been taken, it cannot be said to be negligent. If the complainant made the insurer a party in that forum, it cannot make a grievance of delay in disposal of the claim when insurer had clarified in that forum that it has no liability.9. In view of the aforesaid discussion, we are inclined to hold that though absence of intimation for a long time either repudiating the claim or settling the same in full or in part is a deficiency in service, there is no negligence on the part of the insurer in this case and complainant has also not suffered any loss on that account. The loss if any is the own invitation of the complainant.10. In result, there is no merit in this complaint which appears to be frivolous. Complainant is to pay cost of Rs.2,000/- to the insurer.