ORIENTAL INSURANCE CO. LTD. Vs. LAXMEGOWDA

JUDGEMENT

(1.) This revision petition has been filed under section 21(b) of the Consumer Protection Act, 1986 against the impugned order dated 05.04.2006, passed by the Karnataka State Consumer Disputes Redressal Commission (hereinafter referred to as 'the State Commission') in First Appeal No. 748/2004, "The Oriental Insurance Company Ltd. v. Lakshimegowda," vide which, while partly allowing the said appeal, the order dated 26.03.2004 in complaint No. 180/2003, passed by the District Forum Hassan, was modified.

(2.) The facts of the case are that the complainant is the owner of a vehicle, bearing registration No. KA-13-4266, which was insured with the petitioner/opposite party (OP), The Oriental Insurance Company, valid up to 16.12.2002. The said vehicle met with an accident on 04.09.2002 by dashing against a road-side tree and was damaged. The matter was reported to the local police vide CR 117/1002. On intimation, the insurance company appointed a surveyor to assess the loss, but they repudiated the claim on the ground that the vehicle was carrying passengers at the time of accident, even though it was registered as a goods-carrying vehicle. The consumer complaint in question was then filed before the District Forum, which allowed the same vide their order dated 26.03.2004 and directed the OP Insurance Company to pay a sum of 2,26,808/- to the complainant, being the amount of repair charges paid by him for damage to the vehicle. The District Forum held that although the vehicle was carrying 14-15 passengers at the time of accident as stated in the FIR, but this factor did not lead to violation of the terms and conditions of the policy in question. Being aggrieved against the order of the District Forum, the OP Insurance Company challenged the same by way of appeal, bearing No. FA 748/2004 before the State Commission. The State Commission partly allowed the appeal and directed the insurance company to pay a sum of 1,37,000/- to the complainant along with interest @9% p.a. from the date of accident till realisation. The State Commission stated in their order that the surveyor had assessed the loss at 1,36,613/- and hence, they were directing the payment of a round figure of 1,37,000/-. Being aggrieved against the said order of the State Commission, the OP Insurance Company has filed the instant revision petition before this Commission, seeking directions to set aside the order passed by the State Commission on the ground that the complainant had violated the terms and conditions of the policy and hence, there was no deficiency in service on the part of the insurance company.

(3.) During hearing before us, the learned counsel for the OP Insurance Company stated that the policy had been taken for a goods-carrying commercial vehicle, as was clear from a copy of the policy already placed on record. However, as brought out in the report of the Investigator, 14 persons were travelling in the said vehicle at the time of the accident. There was obviously the violation of the terms and conditions of the policy and hence, the claim had been rightly repudiated by the insurance company. The learned counsel has drawn attention in support of his arguments to an order made by the Hon'ble Apex Court in " The Oriental Insurance Company v. Sony Cheriyan" [II (1999) CPJ 13 SC], saying that the insurer was not liable to compensate the insured for the loss suffered, if there had been a violation of the terms and conditions of the policy. The learned counsel has drawn attention to another judgment passed by the Hon'ble Apex Court in " The Oriental Insurance Company v. Devi Reddy Konda Reddy and Ors. [2003 (2) SCC 339] ", saying that when persons were found travelling in a goods-carriage, the insurer had no liability to pay the claim. The learned counsel for the petitioner, however, stated during arguments that the insurance company had earlier agreed to pay a sum of 1,36,612/- as assessed by the surveyor. The Insurance Company was prepared to pay this amount even now, but without interest to the complainant.