These appeals arise from a claim made by the first respondent, Mr Mukul Aggarwal (the owner), on account of damage caused to his BMW 3 Series 320D car (the car). (Para 1)
According to the case of the owner, a conjoint reading of the two policies shows that where the car suffers damage of more than 75% of IDV, a new car must be provided to the insured. (Para 1)
As the claim under the policy was not dealt with, the owner filed a complaint before the State Consumer Disputes Redressal Commission, Delhi (the State Commission). An order was made by the State Commission directing the insurer to take a decision on the claim of the owner within one month and forward a copy of the said decision to BMW. (Para 4)
The insurer repudiated the claim on the grounds that (a) there was a delay in submitting the claim, (b) the owner failed to reply to the letters of the insurer, (c) there was a difference in the description of the accident between the Claim Form and the Police Report, and (d) there was suppression of material facts as blood stains were found in the vehicle. However, there were no reasons recorded for coming to the said conclusions. As a result of the repudiation of the claim by the insurer, even BMW did not honour its commitments under the BMW Secure. (Para 5)
Therefore, the State Commission directed both the insurer and BMW to indemnify the owner for a total loss of the BMW 3 Series 320D car by replacing the car with a new car of the same make/model. In addition, a direction was issued to the insurer and BMW to pay a sum of Rs.50,000/towards compensation and Rs.10,000/for litigation charges. (Para 6)
The National Commission dismissed the appeals on merits by the impugned judgment. (Para 7)
Therefore, we turn to the issue of whether the repudiation of the insurance policy by the insurer was valid. The first ground of repudiation in the letter dated 9th January 2013 is that there has been a considerable delay in providing intimation of the accident to the insurer and that the vehicle was removed from the spot without providing an opportunity to verify the facts relating to the damage of the vehicle and the circumstances leading to loss. (Para 23)
There is a finding of fact recorded by the State as well as the National Commission that the Dealer immediately informed the insurer. However, it was found that in the policy of the insurance, the Engine and Chassis numbers of the vehicle were incorrectly mentioned. The National Commission has held that it is an admitted position that the insurer made necessary corrections in the policy, and thereafter, on 9th August 2012, a fresh claim was submitted to the insurer. Thus, the insurer accepted the errors in the policy. We may note here that the first claim form dated 30th July 2012 was placed on record of the State Commission. In the written statement filed by the insurer before the State Commission, it is accepted that the police authorities reached the spot at 1.20 a.m. In fact, in paragraph 5(a), the insurer has referred to the claim form dated 30th July 2012. The accident took place in the wee hours of 29th July 2012, and on 30th July 2012, a claim form was filled in by one Deepak Yadav. This is apart from the case made out by the Dealer that it had informed the insurer about the accident. Moreover, within a few days of the accident, the surveyor appointed by the insurer surveyed the vehicle, as can be seen from the preliminary survey report dated 17th August 2012. Therefore, the first ground taken for the repudiation cannot be sustained as held by the Commissions. (Para 25)
The second ground of repudiation is the failure to reply to the letters dated 23rd August 2012, 3rd September 2012, 27th September 2012, and 7th December 2012. On this, there is a concurrent finding of fact recorded by the Commissions that the insurer failed to place on record the proof of service of letters dated 3rd September 2012, 17th September 2012, and 7th December 2012. In fact, in the Complaint, there was a specific grievance made that the said three letters were not received. The finding is that only one letter dated 23rd August 2012 was received by the insured, and it was immediately replied to by the insured (the owner). Therefore, even the second ground cannot be sustained. (Para 26)
The third ground is that in the claim forms and the accident reported to the police, there are discrepancies about the manner in which the accident happened. The fact that the accident happened is not disputed. As mentioned earlier, it is not the case of the insurer that there was any negligence on the part of the driver of the car. Moreover, it is not the case of the insurer that any of the general or specific exceptions in the policy of insurance apply to this case. Hence, the policy could not have been repudiated on account of alleged discrepancies. (Para 27)
The last ground is also relating to the alleged discrepancy. After engaging a surveyor, the insurer engaged another Agency, which found blood stains on the steering and dashboard of the vehicle. Again, this fact is irrelevant as the factum of the accident cannot be disputed. It is not the case of the insurer that the damage was caused to the car due to any activity covered by the exceptions incorporated in the policy. Therefore, none of the grounds of repudiation have any substance. (Para 28)
Hence, for the reasons recorded earlier, there is a deficiency in service rendered by the insurer and BMW within the meaning of clause (g) of Section 2 of the Consumer Protection Act,1986. Therefore, the owner is entitled to compensation from both of them. (Para 37)
As held earlier, the direction of the State Commission, confirmed by the National Commission, is to replace the car. It cannot be sustained for the reasons already discussed, and the same will have to be substituted by a direction to pay monetary compensation. (Para 41)
Therefore, the appeals succeed partly, and we pass the following order:
a. The operative part of the impugned order of the State Commission is set aside
b. We permit the owner to withdraw a sum of Rs.22,09,000/deposited by the insurer in this Court on 24th April 2023, together with interest accrued thereon. In addition, the insurer shall pay simple interest on the amount of Rs.22,09,000/, at the rate of 6% per annum from the date of filing of the complaint before the State Commission till 24th April 2023;
c. The insurer shall pay a sum of Rs. 3,74,012/to the owner with simple interest thereon at the rate of 6% per annum from the date of filing of the complaint before the State Commission till payment. The amount shall be paid within three months from today;
d. The owner shall be entitled to withdraw the sum of Rs.7 lakhs deposited by BMW with the State Commission, together with interest accrued thereon. In addition, BMW shall pay simple interest at the rate of 6% per annum on the amount of Rs.7 lakhs to the owner from the date of filing of the complaint before the State Commission till 11th March 2015. The said amount of interest shall be paid within a period of three months from today;
e. The order of costs made by the State Commission is maintained in view of the findings recorded in this judgment; and
f. There will be no order as to costs in these appeals.
SUPREME COURT OF INDIA
2023 STPL(Web) 429 SC
[2023 INSC 1005]
Bajaj Allianz General Insurance Co.Ltd. Vs. Mukul Aggarwal & Ors.
Civil Appeal No. 1544 of 2023 With Civil Appeal No.1545 of 2023-Decided on 20-11-2023
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