Gujarat High Court
National Insurance Company Limited vs Premaji Babuji Oad on 11 February, 2025
NEUTRAL CITATION
C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 14447 of 2024
With
CIVIL APPLICATION (DIRECTION) NO. 1 of 2025
In R/SPECIAL CIVIL APPLICATION NO. 14447 of 2024
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE ANIRUDDHA P. MAYEE Sd/-
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Approved for Reporting Yes No
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NATIONAL INSURANCE COMPANY LIMITED & ANR.
Versus
PREMAJI BABUJI OAD
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Appearance:
MS KRUPALI N BHATT(9455) for the Petitioner(s) No. 1,2
MR BHARAT B SHAH(739) for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE ANIRUDDHA P. MAYEE
Date : 11/02/2025
ORAL JUDGMENT
1. The present Special Civil Application impugns the judgment and order dated 03.07.2024 passed by the National Consumer Disputes Redressal Commission in Revision Petition No.1352 of 2022.
2. The brief facts of the case are that, Shri Hari Krishna Maheshwari owner of Tata Truck bearing registration No.UP.66.E.9989 had taken insurance from the petitioner insurance company vide policy No.30020031116300005537 Page 1 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined from 17.12.2011 to 16.12.2012. The said vehicle came to be sold by the insured to the respondent herein about 5 months prior to the date of alleged theft of the vehicle. That on 20.12.2011, the said vehicle was stolen. Accordingly, a claim came to be lodged by the respondent who was the new owner/Power of Attorney holder of the vehicle. That on 07.08.2013, the claim of the respondent came to be repudiated by the petitioner insurance company.
2.1 Aggrieved, the respondent owner filed a consumer complaint before the District Consumer Disputes Redressal Commission ["District Commission" for short]. By order dated 15.06.2017, the District Commission was pleased to reject the complaint of the respondent on the ground that the policy was subject to specific terms and conditions and the respondent had failed to promptly report the theft of the vehicle to the police and there was a delay in reporting the theft to the insurance company. Therefore, there was a breach of crucial policy terms and conditions. It was held that delay in filing the FIR deprived the petitioner from opportunity to effectively search for the stolen vehicle.
2.2 Aggrieved, the respondent filed an Appeal No.378 of 2017 Page 2 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined before the State Consumer Disputes Redressal Commission ["State Commission" for short]. By order dated 04.07.2022, the State Commission was pleased to allow the appeal and directed the insurance company to pay Rs.10,20,180/- towards the claim of the petitioner.
2.3 Aggrieved, the petitioner herein filed revision petition No.1352 of 2022 before the National Consumer Disputes Redressal Commission ["National Commission" for short]. The National Commission vide judgment and order dated 03.07.2024 has upheld the order passed by the State Commission and the revision petition came to be dismissed.
Aggrieved, the petitioner insurance company filed the present Special Civil Application.
3. Ms. Krupali N. Bhatt, learned advocate for the petitioner submitted that the findings arrived at by the District Commission ought to have been upheld by the State Commission as well as the National Commission. She submits that the respondent was not the actual owner of the vehicle and the policy was also taken in the name of the earlier owner and that he was only a Power of Attorney holder. She submits that Page 3 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined the respondent did not inform the insurance company immediately as well as lodged the FIR with the police with delay in respect of the theft of the vehicle. She submits that such a delay is fatal and therefore, the petitioner insurance company had all rights to repudiate the claim as it was in breach of the conditions of the policy. Further, it was submitted that the vehicle was sold to the respondent and the vehicle was in possession of the Power of Attorney holder, however, the vehicle was not transferred in the name of the Power of Attorney holder/purchaser and the insurance policy was continued in the name of the earlier owner itself. She submits that the earlier owner did not have any interest in the vehicle after the sale. She further submits that it was wrongly concluded by the State Commission that the claim of the complainant was genuine and that the District Commission had not adjudicated the said issue as there was a breach of conditions of the policy. She further submits that the National Commission has also erred in holding that the delay in intimation to the insurance company as also purported transfer of the vehicle to the third party by entering in a sale agreement, is not an important factor for the insurer to deny the claim.
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NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined 3.1 In support of her case, she has relied upon the judgment of the Apex Court in Special Leave to appeal (C) No.6518 of 2022 - Kanwarjit Singh Kang v. M/s. ICICI Lombard General Insurance Co.Ltd. & Anr. - dated 29.03.2022 wherein it has been held that the necessity of giving immediate notice to the police cannot be gainsaid and if that had not been done, the entire claim would come under a thick cloud of suspicion and the onus is then heavy on the insured to justify the delay. The delay in lodging the FIR has to be explained by the insured. She, therefore, submits that in the present case, since the FIR has been lodged after a delay of 10 days and the petitioner has been intimated about the same on 15.02.2012, the present Special Civil Application be allowed and the impugned judgment and order of the National Commission as well as State Commission be set aside.
4. Per contra, Mr. Bharat B. Shah, learned advocate for the respondent submits that the claim of the respondent is genuine. He submits that immediately on the theft of the vehicle, the police was informed, however, after some search when the vehicle was not traceable, the police has registered the FIR. He submits that there is no delay in informing the police, however, Page 5 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined the FIR came to be lodged after search of the stolen vehicle remained unfruitful. He submits that thereafter the petitioner had obtained signature of the owner of the vehicle and then lodged the claim with the petitioner insurance company. He submits that in the facts of the present case, there is no delay in informing the police or lodging the FIR. He submits that though the sale of the vehicle had taken place, since necessary NOC from the RTO office was unavailable, the said vehicle could not be registered with the new owner. He submits that in the present case, the claim which has been lodged by the respondent is a genuine claim. The Truck in question has been stolen and is not traceable and has not been recovered. He, therefore, submits that the District Commission erred in rejecting the claim of the petitioner. However, the State Commission as well as the National Commission have rightly held that since the claim of the petitioner is genuine, the same could not be repudiated by the petitioner insurance company. He submits that the petitioner insurance company is claiming breach of the conditions of the policy when there are none. The delay has also been properly explained in the present case. He, therefore, submits that it was a duty of the petitioner insurance company to grant the claim of the petitioner instead of repudiating the same. Page 6 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025
NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined 4.1 In support of his case, he relies on the decision of Apex Court in Civil Appeal No.2632 of 2020 - Surendra Kumar Bhilawe v. The New India Assurance Company Ltd. dated 18.06.2020 wherein it has been held that as per the definition of "owner" in Section 2(30) of the Motor Vehicles Act, the respondent would be the owner of the said Truck and the insurer could not have avoided its liability for the loss suffered by the owner on the ground of transfership of the vehicle. He, therefore, submits that the orders passed by the State Commission as well as the National Commission be upheld.
5. Heard learned advocates for the parties and perused the documents on record.
6. In the present case, the petitioner insurance company has repudiated the claim of the respondent on the grounds of (i) violation of condition No.1 of the policy; (ii) misrepresentation of facts; (iii) differences in signature; (iv) violation of condition 5 of the policy; (v) question of insurable interest; and (vi) suppression and misrepresentation of material facts.
7. The learned advocate for the petitioner has emphasized on the facts that there was a delay in filing the FIR before the police Page 7 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined and also delay in informing the insurance company about the theft of the vehicle. She submits that the said delay is fatal and has deprived the insurance company as well as the police from tracing the vehicle. She has submitted that in view thereof, there is breach of conditions of the policy.
8. In the present case, the respondent owner had informed the police immediately upon the theft of the vehicle and as search for the vehicle was unfruitful, the FIR has been lodged on 30.12.2021 i.e. after 10 days.
9. The petitioner insurance company was informed about the incident only on 15.12.2022, i.e. after delay of 55 days. In the present case, the said delay has been properly explained. It has come on record that the respondent had to go to the earlier owner in Uttar Pradesh and thereafter obtain his signatures on the relevant papers before lodging the claim with the petitioner and the said steps were taken after the police had registered the FIR.
10. Further, in the present case, it is not the case of the insurance company that the claim of the petitioner is not genuine and not covered by the policy of insurance. The main Page 8 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined emphasis of the rejection of the claim is on the ground of purported transfer to the respondent herein by entering into a sale agreement and further on the ground of delay. It has been held by both the State Commission as well as the National Commission that the claim of the petitioner is genuine. In such a situation, if the respondent has denied the claim merely on the ground that there is some delay in intimating the insurance company about the occurrence of the theft, then, it would be hyper technical view resulting in rejection of the genuine claim. It has been held that the Consumer Protection Act aims at protecting the interest of the consumers and it being a beneficial legislation deserves pragmatic construction. However, issue of delay in intimating the insurance company about the theft of the vehicle as well as lodging of the FIR has been well settled by the Hon'ble Supreme Court in various decisions. In the present case, the findings rendered by the State Commission as well as National Commission are in consonance with the law laid down and no infirmity could be pointed out by the learned advocate for the petitioner for interfering with the same.
11. The judgment relied upon by the learned advocate for the petitioner would not be applicable in the facts and Page 9 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025 NEUTRAL CITATION C/SCA/14447/2024 JUDGMENT DATED: 11/02/2025 undefined circumstances of the present case as in the said case, the Court had dismissed the claim of the insured therein on the ground of unexplained delay, but in the present case, the facts as are brought out on record in respect of delay and show a satisfactory explanation for delay.
12. In view of the aforesaid observations, the present Special Civil Application is devoid of merits and is, accordingly, dismissed. No order as to costs.
Connected Civil Application for Direction also stands disposed of accordingly.
Sd/-
(ANIRUDDHA P. MAYEE, J.) KAUSHIK D. CHAUHAN Page 10 of 10 Uploaded by KAUSHIK D. CHAUHAN(HC00197) on Wed Feb 12 2025 Downloaded on : Wed Feb 12 22:22:47 IST 2025