Judgment:
Baldev Singh Sekhon, Member
1. This is an appeal against the order dated 23.11.2011 passed by the District Consumer Disputes Redressal Forum, Mohali (hereinafter called as âDistrict Forumâ) vide which the complaint of the respondentcomplainant (hereinafter called as ârespondentâ) was allowed.
2. Briefly stated, the facts of the case are that the respondent got his vehicle Pajero, Mitsubishi, 2.8 GL, bearing Registration No. HR- 03-K-0023 insured with the appellant company for the period 24.9.2010 to 23.9.2011 for insured declared value (IDV) of Rs. 11,14,285/-. The vehicle met with an accident on 21.5.2011 and was a total loss. DDR No. 24 dated 29.5.2011 regarding accident was lodged with the Police Station, Butana, District Karnal. The claim was lodged with the appellant company. A letter dated 12.7.2011 was sent to the respondent by the appellant company asking the respondent to supply certain details. Appellant company appointed its surveyor, who took the photographs of the vehicle. As per estimate of repairs prepared by Premier Motor Garage, the vehicle was a total loss. It was pleaded that the appellant as well as its surveyor also acknowledged this fact. But the appellant had not so far paid the claim and surveyor of the appellant even tried to negotiate with the respondent for accepting the lower amount than the IDV of the vehicle without any valid reason. It was pleaded that non-payment of IDV of the vehicle amounted to deficiency in service on the part of the appellant.
3. Hence, the complaint before the District Forum seeking directions to the appellant for payment of Rs. 11,14,285/- and another payment Rs. 1,00,000/- as compensation for mental agony and harassment alongwith costs of litigation.
4. Upon notice, the appellant filed written statement pleading that as per the report of the surveyor appointed by the appellant, the vehicle was in repairable condition and this fact was conveyed to the respondent. The respondent, however, refused to give his consent for the repair of the vehicle and demanded full IDV of the vehicle, which was not permissible under the terms and conditions of the policy. It was pleaded that the appellant company has not yet repudiated the claim of the respondent. The surveyor appointed by the appellant conducted the survey on 31.5.2011 and submitted his report on 2.6.2011, in which the loss to the vehicle was assessed to the tune of Rs. 4,76,671/-. The appellant company wrote a letter dated 12.7.2011 asking the respondent to give his consent for repair of the vehicle. This was followed by reminder dated 19.7.2011. The respondent has refused to give his consent, therefore, as per terms and conditions of the policy full IDV is payable only in case of total loss or constructive total loss and the vehicle is to be treated as constructive total loss only if the aggregate of the retrieval and/or repairs of the vehicle, subject to terms and conditions of the policy, exceeds 75% of the IDV of the vehicle. Dismissal of the complaint was prayed.
5. The parties led their evidence by way of affidavits and documents.
6. The learned District Forum, after going through the pleadings of the parties and evidence on record, allowed the complaint of the respondent and directed the appellant company to pay the respondent full IDV of the vehicle to the tune of Rs. 11,14,285/- with interest @ 9% per annum with effect from the date of report of surveyor i.e. 2.6.2011 till the date of actual payment. Rs. 10,000/- was also awarded as costs and litigation to the respondent.
7. Aggrieved by this order, the appellant has come up in appeal.
8. The appellant has filed the present appeal on the ground that as per terms and conditions of the policy, the vehicle shall be treated as total loss only if repair cost of the vehicle exceeds 75% of the IDV i.e. Rs. 8,35,713/-. Since the company liability is Rs. 4,76,671/-, the vehicle cannot be termed as a total loss. The District Forum has not appreciated the fact that the survey report is an important document and has to be given due importance while deciding the complaint. The survey report cannot be equated with the repair estimate. The District Forum has wrongly interpreted the word ânot allowedâ and ârepair allowedâ. It is pertinent to mention here that the items which have not been allowed by the surveyor were either consumables i.e. engine coolant or the parts which were not required to be repaired at all. Surveyor is the authorized person to analyze the liability of a company in case of any accident. It was further submitted that the parts which were reparable as per the survey report but have been shown in the list of replaceable parts and the same is not at all permissible as per terms and conditions of the policy. There are several parts wherein the replacement is not required and the same has been added only to increase the liability of the company. Acceptance of the appeal and setting aside of the impugned order was prayed.
9. Learned counsel for the respondent submitted that there was no merit in the appeal and the same may be dismissed.
10. Submissions have been considered. Record has been perused.
11. The admitted facts of the case are that the vehicle of the respondent, which met with an accident during the subsistence of the insurance policy, was insured for an IDV of Rs. 11,14,285/-. Report was lodged with the Police Station, Butana vide DDR No. 24 dated 29.5.2011 (Ex. C-4). The respondent filed the claim with the appellant company seeking full payment of the IDV of the vehicle as claiming that the vehicle was a total loss. The respondent has placed on record the estimate prepared by the Premier Motor Garage (Ex. C-6). As per this document, repair cost of the vehicle has been estimated as Rs.11,07,230.63. However, while assessing the loss, the surveyor, Sh. Manoj Kukreja in his report dated 2.6.2011 (Ex. R-1) has assessed the liability of the insurance company as Rs. 4,76,671/- and salvage value was assessed as Rs. 22,304.78. The appellant has contended that since the liability of the appellant was less than 75% of the IDV of the vehicle, therefore, it can not be considered as total loss and can only be repaired. The appellant has primarily relied upon the survey report and has declared the vehicle as repairable. However, the respondent had not given the consent for getting the vehicle repaired inspite of the letter written to the respondent. The case of the respondent was still pending and the same was not yet repudiated. The assessment report of the surveyor, proved as Ex. R-1, shows that the total reparable cost of the vehicle was Rs. 11,07,230.63 but the liability of the appellant company has been assessed as Rs. 4,76,671.12 only. Perusal of the provision of terms and conditions of the policy document (Ex. R-4) reveals that the vehicle is to be declared a total loss if the cost of retrieval and/or cost of repair exceeds 75% IDV. Thus, it is the cost of repair involved and not the liability of the insurer that determines the vehicle is a total constructive loss or not. The appellant has wrongly taken the liability of the company as cost of repair. In fact, the cost of repair even after excluding ânot applicable partsâ exceeds 75% of IDV and the District Forum has rightly worked out the cost of repair which is definitely more than 75% of the IDV.
12. Hence the appellant has wrongly declared the vehicle as reparable and, therefore, the respondent is entitled to the payment of full IDV value. Accordingly, the appeal of the appellant is dismissed. However, the interest applicable on the IDV is reduced to 7.5% instead of 9% per annum and the litigation cost of Rs. 10,000/- is reduced to Rs. 5,000/-. The respondent is directed to hand over the salvage to the appellant and also transfer the ownership of vehicle in the name of the appellant within one month of receipt of order by executing necessary documents. In case the respondent fails to return the salvage then an amount of Rs. 22,304/- be deducted from the IDV. The appellant shall pay the IDV alongwith interest and cost within one month from the date of transfer of ownership. Remaining order of the District Forum is upheld. The appeal is disposed of in the above terms. No order as to costs.
13. The appellant has deposited an amount of Rs. 25,000/- with this Commission at the time of filing of the appeal on 6.1.2012 and Rs. 10,89,285/- on 24.2.2012 as per the order of this Commission. Amount of Rs. 11,14,285/- minus salvage value i.e. Rs. 22,304/- with interest accrued thereon, if any, be remitted by the registry to the respondent by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and the appellant. Remaining amount out of the deposited amount be remitted to the appellant. Final amount payable to the respondent shall be settled by the appellant within two months from the receipt of copy of this order as directed in para 12 above after adjusting the amount released by this Commission.
14. The interest on the amount of Rs. 25,000/- shall stop running with effect from 6.1.2012 and on Rs. 10,89,285/- from 24.2.2012, the date on which the appellant has deposited the same in this Commission. Interest on this amount of Rs. 11,14,285/- shall be what has accrued on this amount when it remained deposited by this Commission in the Bank.
15. Remaining amount shall be paid by the appellant to the respondent immediately as ordered above.
16. The arguments were heard on 9.1.2013 and the order was reserved. Now, the order be communicated to the parties.