Sunday, 19 March 2017

Whether insurance company can repudiate insurance claim for theft of vehicle if theft is not promptly intimated?

 We have considered the rival contention and perused the record. On perusal of complaint we find that it is the case of the complainant that he reported the theft of subject vehicle to the concerned Police Station on the same day and gave oral information of theft to the petitioner insurance company. It is not the case of the complainant that he gave immediate intimation of theft of vehicle in writing to the insurance company. Thus, the question is whether the Fora below were justified in allowing in the consumer complaint ignoring condition no. 1 of the insurance contract, which reads as under:
“1. Notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage in the event of any claim and thereafter the insured shall give all such information and assistance as the company shall require. Every letter claim writ summons and/or process or copy thereof shall be forwarded to the company immediately on receipt by the insured. Notice shall also be given in writing to the company immediately the insured shall have knowledge of any impending prosecution, inquest or fatal inquiry in respect of any occurrence which may give rise to a claim under this policy. In case of theft or criminal act which may be the subject of a claim under this policy the insured shall give immediate notice to the police and co-operate with the company in securing the conviction of the offender.”
 8. Similar issue came up before the Coordinate Bench of this Commission in the mater of Reliance General Insurance Co. Ltd. v. Jai Prakash, Revision Petition No. 2479 of 2015 decided on 11.01.2016. In the said matter, the Coordinate Bench of this Commission took the view that on account of failure of the complainant to perform his contractual obligation to intimate the theft of vehicle to the insurer, repudiation of contract was justified. Similar view was taken by Bench No. 4 of this Commission in Revision Petition No. 2391 of 2015 titled Reliance General Insurance Co. Ltd. v.Harbhajan Khaira.
 9. We do not find any reason to differ with the aforesaid view taken by Coordinate Benches. Accordingly, we hold that Fora below have committed a grave irregularity by passing the impugned order in utter disregard of law laid down by the Supreme Court of Parvesh Chander Chadha (supra). Thus, we have no hesitation in holding that as the insured has failed to fulfil his obligation to intimate the theft of vehicle to the insurer in writing immediately after the theft, insurance company was justified in repudiating the insurance claim.
National Consumer Disputes Redressal Commission, New Delhi
(Before Ajit Bharihoke, Presiding Member and S.M. Kantikar, Member)

Reliance General Insurance Co. Ltd.
V
Arun Kumar Singh & anr.
Revision Petition No. 1054 of 2016
Decided on January 3, 2017
Citation:2017 SCC OnLine NCDRC 1

 Ajit Bharihoke, Presiding Member:— This revision is directed against the order of the State Commission Uttar Pradesh dated 08.12.2015 in Appeal No. 2081/13 whereby the State Commission dismissed the appeal preferred by the petitioner opposite party against the order of the District Forum.
 2. Undisputed facts relevant for the disposal of this revision petition are that respondent complainant being owner of vehicle no. UP76L 2478 purchased an insurance policy from the petitioner-opposite party for the sum insured Rs. 5,41,000/-. The policy was valid w.e.f 06.11.2009 to 05.11.2010. According to the complainant, the vehicle was stolen by some unknown person from Loco Road, Bholepur on 11.08.2010. The theft was reported to the police station Kotwali on the same day. Oral information of theft was given to the opposite party. The vehicle could not be traced. The complainant filed insurance claim which was repudiated on the ground that in violation of the terms and conditions of the insurance policy, the complainant had failed to give immediate intimation of theft in writing to the insurance company.
 3. The petitioner opposite party on being served with the notice of the complaint filed written statement resisting the claim and justified repudiation of insurance claim. The District Forum on consideration of the pleadings and evidence allowed the complaint and directed the petitioner as under:
Opposite party no. 1 is directed to ensure payment to the complainant within 30 days from today's date of the amount of insurance claim of the insured vehicle Rs. 5,41,000/- with interest from dated 12-8-2010 till date of payment the rate 06 per cent simple interest annual. Opposite party no. 1 is also ordered to ensure payment of Rs. 500/- as compensation for mental and physical loss and 200/- as litigation cost within the aforesaid time period.
 4. The petitioner being aggrieved of the order of the District Forum approached the State Commission Uttar Pradesh in appeal. The State Commission vide impugned order did not find merit in the appeal and confirmed the order of the District Forum. This has led to the filing of the revision petition.
 5. Shri Rajeev M Roy, Advocate for the petitioner opposite party has contended that impugned order of the Fora below have been passed in utter disregard of the terms and conditions of the insurance contract. Expanding on the argument, learned counsel has taken us through condition no. 1 of the insurance contract and submitted that as per the aforesaid condition, the complainant was under obligation to give immediate written information about the theft of the vehicle to the insurance company, which he has admittedly failed to do. It is contended that in the matter ofOriental Insurance Company Ltd. v. Parvesh Chander Chadha, Civil Appeal No. 6739 of 2010, Hon'ble Supreme Court while dealing with issue has categorically held that failure of the insured to give immediate information of theft in writing to the insurance company would entitle the insurance company to repudiate the claim. It is argued that similar view has been taken by Coordinate Bench of this Commission in RP No. 2391 of 2015 titled Reliance General Insurance Co. Ltd. v. Harbhajan Khairadecided on 19th May, 2016 as also Revision Petition No. 2479 of 2015 titled Reliance General Insurance Co. Ltd. v. Jai Prakash decided on 11.01.2016.
 6. Shri Pawan Kumar Ray, Advocate on the contrary has argued in support of the impugned order and submitted that Fora below have correctly appreciated the facts and impugned order does not suffer from jurisdictional or factual infirmity.
 7. We have considered the rival contention and perused the record. On perusal of complaint we find that it is the case of the complainant that he reported the theft of subject vehicle to the concerned Police Station on the same day and gave oral information of theft to the petitioner insurance company. It is not the case of the complainant that he gave immediate intimation of theft of vehicle in writing to the insurance company. Thus, the question is whether the Fora below were justified in allowing in the consumer complaint ignoring condition no. 1 of the insurance contract, which reads as under:
“1. Notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage in the event of any claim and thereafter the insured shall give all such information and assistance as the company shall require. Every letter claim writ summons and/or process or copy thereof shall be forwarded to the company immediately on receipt by the insured. Notice shall also be given in writing to the company immediately the insured shall have knowledge of any impending prosecution, inquest or fatal inquiry in respect of any occurrence which may give rise to a claim under this policy. In case of theft or criminal act which may be the subject of a claim under this policy the insured shall give immediate notice to the police and co-operate with the company in securing the conviction of the offender.”
 8. Similar issue came up before the Coordinate Bench of this Commission in the mater of Reliance General Insurance Co. Ltd. v. Jai Prakash, Revision Petition No. 2479 of 2015 decided on 11.01.2016. In the said matter, the Coordinate Bench of this Commission took the view that on account of failure of the complainant to perform his contractual obligation to intimate the theft of vehicle to the insurer, repudiation of contract was justified. Similar view was taken by Bench No. 4 of this Commission in Revision Petition No. 2391 of 2015 titled Reliance General Insurance Co. Ltd. v.Harbhajan Khaira.
 9. We do not find any reason to differ with the aforesaid view taken by Coordinate Benches. Accordingly, we hold that Fora below have committed a grave irregularity by passing the impugned order in utter disregard of law laid down by the Supreme Court of Parvesh Chander Chadha (supra). Thus, we have no hesitation in holding that as the insured has failed to fulfil his obligation to intimate the theft of vehicle to the insurer in writing immediately after the theft, insurance company was justified in repudiating the insurance claim.
 10. Consequently, we allow the revision petition, set aside the order of Fora below and dismiss the complaint.
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