M/S. National Insurance Co.Ltd., Rep. by Its Branch Manager Vs. Smt. K. Kamala - Court Judgment

Oral Order: (R. Lakshminarasimha Rao, Member)

1. The opposite party is the appellant. The respondent filed complaint claiming insured sum of Rs.14,92,500/- with interest , compensation and costs. The respondent is the owner of the Link Belt HT450Mobile Crane bearing No.MH43 1808 which was insured with the appellant vide policy bearing No.550213/31/08/630001112 for a sum of Rs.36,00,000/-. The policy covers the risk including “Accidental loss or damage occurring during the period of insurance” and validfor the period from 8.11.2008 to 7.11.2009. On 26-1-2009, on receipt of phone call from one person regarding accident, the respondent sent mobile crane to the accident spot on the same day at 4.30 PM and the crane started lifting the fly ash tanker and during the process, the fly ash weight in lorry has shifted from one end to another end resulting in tare of crane into two parts.

2. The police conducted spot panchanama and in the mean while the respondent reached the spot and has intimated to appellants office over phone about the accident. The appellant has arranged surveyor by name Mr. D.Brahmaiah for spot survey to probe into the truth of the accident and the damage caused to the respondents vehicle and the surveyor has submitted his preliminary report to the appellant. As the garage for repairs for this sort of heavy cranes are only at Mumbai, the damaged crane was shifted to Mumbai on intimation to the appellant. The complainant submitted an estimate to the appellant at their Mumbais office and on that the appellant arranged a surveyor by name Mr.V.D.Ajmera for final survey.

3. The surveyor came to the garage i.e., Siddhivinayak garage at Navi Mumbai and submitted the final survey report to the appellant and confirmed the amount of Rs.14,92,500/- paid by the respondent to repairers at Mumbai. The appellant addressed a repudiation letter dated 15-9-2009 to the respondent on the ground that the accident was occurred due to overturning only. The respondent addressed letter to the respondent and explained that there is no overturning of the crane at the site of accident and that the fact is evident by photographs taken at the spot of accident which confirmed by the spot surveyor appointed by the appellant. The claim was not settled. On 19-4-2010 addressed a letter to the appellant to furnish the final survey report, for which there was no response.

4. The appellant resisted the case contending that the final survey or assessed the loss of the Crane to the extent of Rs.9,73,675/- after depreciation of damaged parts as 50%. The appellant through their letter dated 17-4-2009 informed the complainant that “the damage occurred arising out of operation of tool and hence the company is not liable. The damage occurred by loss or damages resulting from overturning arising out of operation. This is not accidental external impact to the machine”. The claim of the respondent was rightly repudiated and prayed for dismissal of the complaint.

5. The respondent filed her affidavit and the documents, Exs. A1 to A7. On behalf of the appellant, its Assistant Manager filed his affidavit and the documents, Exs.B1 to B3.

6. The District forum allowed the complaint directing the appellant to pay Rs.9,55,675/- with interest @ 9% and costs of Rs.2,000/- on the premise that as per the opinion of the surveyor the loss occurred due to shifting of load resulting in breaking of boom and falling from the vehicle and not by overturning of the vehicle.

7. Feeling aggrieved by the order of the District Forum, the opposite party filed appeal contending that the District Forum passed orders on perverse application of mind and not followed the terms of policy coverage as also exclusions thereof and that the risk coverage was limited to mobile cranes under miscellaneous and special type of vehicles policy and that the insured did not take coverage except to own damage. It is contended that the vehicle was engaged as a tool of trade for lifting an accident effected third party vehicle which had got imbalance and sustained damages and in the process the insured mobile crane got imbalanced and its turn plate was cut off. It is contended that the District Forum has not appreciated IMT 47 which is applicable to the facts of the case. As per Sec.1 of the Insurance Policy only loss or damage arising directly from fire, explosion etc., are covered.

8. The point for consideration is whether the order of the District Forum suffers from misappreciation of facts or law?

9. The facts beyond any dispute are issuance of comprehensive miscellaneous and special type of vehicle policy by the appellant insurance company in favour of the respondent in respect of her LINK Belt HT 450 Mobile Crane for sum assured Rs.36 lakhs valid for the period from 8.11.2008 to 7.11.2009. The respondent contended that the tanker turned turtle at the outskirts of G.Kicha Reddys fields and she had sent the mobile crane to lift the fly ash tanker and during process of lifting the mobile crane torn into two parts.

10. The learned counsel for the appellant has contended that the vehicle in question met with an accident and the mobile crane sustained damage which arose out of it being operated as tool. It is contended that the damage occurred by loss or damage resulting from overturning arising out of operation and not accidental external impact to the machine. He has contended that the repudiation of claim is justified. IMT 47 upon which the learned counsel laid stress reads as under:

IMT-47 Mobile cranes/drilling rigs/mobile plants/excavators/navies shovels/grabs/rippers.

“It is hereby declared and agreed that notwithstanding anything to the contrary contained in this policy that in respect of vehicles insured the insurer shall be under no liability : -

Under Section I of the policy in respect of loss or damage resulting from over-turning arising out of the operation as a tool of such vehicle or of plant forming part of such vehicle or attached thereto except for loss or damage arising directly from fire, explosion, self-ignition or lightning or burglary, housebreaking or theft.”

11. The respondent contended that the damage occurred to the crane was not due to overturning. She addressed letter dated 25.11.2009 in reply to repudiation letter which reads as under:

Your letter dated 15/09/09 cited in the above reference states that “Claim preferred by you for accidental damags cannot be entertained by us in view of the endorsement attached to the policy i.e., IMT47 damages due to overturning”.

The letter of Mr.V.D.Ajera and Co., Automobile surveyors, Mumbai-22 dt:17/042009 address to M/s National Insurance Co.Ltd. RO – stated that “The damages are occurred arising out of operation as tool and hence the company is not liable. The damages are occurred by loss of damages resulting from overturning arising out of operation. There is no accidental external Impact to the machine”.

Now we bring to your kind notice that the damages occurred are not due to overturning. It is very clear from the spot photos that the boom along with upper portion above turn table was fallen down due to breakage/failure of turn table outer ring while lifting a fly ash tanker on 26^th Jan. 2009. This can be verified with the spot survey report available with you.

In fact, there was no overturning of the machine as stated in our letter. The boom along with upper portion above turn table were damaged due to accidental external impact only. Hence our claim is tenable under the scope of insurance policy.”

12. As against what is stated by the respondent in regard to the manner in which the crane sustained damage, the final surveyor submitted his report to the appellant opining that the endorsement no.47 does not cover overturning and through letter dated 17.4.2009 the surveyor further informed the appellant that “the damage occurred arising out of operation as tool and hence the company is not liable”

13. The Honble Supreme Court in New India Assurance Company Ltd. Vs. Sadand Mukh reported in II (2009) ACC 32 (SC) observed that " The provisions of the Act therefore, provide for two types of insurance – one statutory in nature and the other contractual in nature. Whereas the insurance company is bound to compensate the owner or the driver of the motor vehicle in case any person dies or suffers injury as a result of an accident, in case involving owner of the vehicle or others are proposed to be covered, an additional premium is required to be paid for covering their life and property.” Following the above decision, we are of the opinion that contract of insurance pertaining to mobile crane is governed by terms and conditions of the policy. The terms of the policy and also the quantum of the premium payable for insuring the vehicle depends not only upon the carrying capacity of the vehicle but also on the purpose for which the same was being used, and the extent of the risk covered thereby.

14. The Honble Supreme Court in Deokar Exports Pvt. Ltd., Vs. New India Assurance Company Ltd., reported in 2009 (1) ALD 15 (SC) opined that rights and obligations are strictly governed by policy of insurance. No exception or relaxation can be made on ground of equity. The complainant has to blame herself for this when he did not choose to take the policy in respect of loss or damage resulting from over-turning arising out of operation. As risk is not covered by the terms of the policy the complainant cannot claim the amount. The District Forum did not consider this aspect at all. Awarding compensation is contrary to the terms of the policy.

In the result the appeal is allowed setting aside the order of the District Forum. Consequently the complaint is dismissed. However, no costs.