Case: GURSHINDER SINGH Vs. SRIRAM GENERAL INSURANCE CO. LTD

3. The appellant had got his tractor insured with the respondent(s) on 19.06.2010. On 28.10.2010, the tractor was stolen and an FIR was lodged on the same day. However, the claim was submitted to the respondent(s) on 15.12.2010. It was rejected on the ground that intimation was given belatedly after 52 days. The appellant herein, therefore, approached the District Consumer Disputes Redressal Forum, Jalandhar, Punjab, (hereinafter referred to as the District Forum) vide Complaint No. 380 of 2011. The District Forum, relying on the decisions of the National Consumer Disputes Redressal Commission (hereinafter referred to as the National Commission) in the case of Parvesh Chander Chadha (supra) and T.D.P. Gram Sewa Sahakari Samiti Ltd. & Ors. vs. Charanjit Kaur and Ors.2011(3) CPC 422, allowed the complaint and directed the respondents to pay a sum of Rs.4,70,000/- being the declared insured value of the vehicle to the complainant within one month from the date of receipt of copy of the order, failing which, the respondents were made liable to pay interest at the rate of 12% per annum from the date of order till payment4. Being aggrieved thereby, the respondents preferred an appeal before the State Consumer Disputes Redressal Commission, Punjab (hereinafter referred to as the State Commission). The State Commission dismissed the appeal vide order dated 26.03.20135. Being aggrieved by the dismissal of the appeal by the State Commission, the respondents preferred a Revision Petition before the National Commission. The National Commission relying on its earlier judgment in the case of New India Assurance Co. Ltd. vs. Trilochan Jane (2012) CPJ 441 (NC) allowed the revision petition thereby setting aside the orders of the District Forum as well as the State Commission and dismissed the complaint. Being aggrieved thereby, the appellant is before this Court6. When the matter was heard by the two-Judge bench of this Court, it noticed that though in the case of Om Prakash (supra), the theft of the vehicle was reported to the police on the day after the theft occurred, the intimation was sent to the insurance company much later. This Court took the view that delay in informing the insurance company would not debar the insured to get the insurance claim. Per contra, it noticed that in the case of Parvesh Chander Chadha (supra), this Court accepted the contention of the insurance company that on account of delay in intimating the insurance company about the theft, though the FIR was lodged immediately, the insurance company was entitled to repudiate the claim of the claimant. Hence, the present appeal.

Court's reasoning:
10. We are of the view that much would depend upon the words co-operate and immediate, in condition No. 1 of the Standard Form for Commercial Vehicles Package Policy11. A perusal of the aforesaid shows that this contract is to be interpreted according to the context involved in the contract. The contract we are interpreting is a Commercial Vehicle Package Policy. There is no gainsaying that in a contract, the bargaining power is usually at equal footing. In this regard, the joint intention of the parties is taken into consideration for interpretation of a contract. However, in most standard form contracts, that is not so. In this regard, the Court in such circumstances would consider the application of the rule of contra preferatum, when ambiguity exists and an interpretation of the contract is preferred which favors the party with lesser bargaining power13. In our view, applying the aforesaid principles, Condition No. 1 of the Standard Form for Commercial Vehicles Package Policy will have to be divided into two parts. The perusal of the first part of Condition No. 1 would reveal, that it provides that a notice shall be given in writing to the company immediately upon the occurrence of any accidental loss or damage. It further provides, that in the event of any claim and thereafter, the insured shall give all such information and assistance as the company shall require. It provides, that every letter claim writ summons and/or process or copy thereof shall be forwarded to the insurance company immediately on receipt by the insured. It further provides, that a notice shall also be given in writing to the company immediately by the insured if he 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 policy14. A perusal of the wordings used in this part would reveal, that all the things which are required to be done under this part are related to an occurrence of an accident. On occurrence of an accidental loss, the insured is required to immediately give a notice in writing to the company. This appears to be so that the company can assign a surveyor so as to assess the damages suffered by the insured/vehicle. It further provides, that any letter claim writ summons and/or process or copy thereof shall be forwarded to the company immediately on receipt by the insured. As such, the intention would be clear. The question of receipt of letter claim writ summons and/or process or copy thereof by the insured, would only arise in the event of the criminal proceedings being initiated with regard to the occurrence of the accident. It further provides, that the insured shall also give a notice in writing to the company immediately if the insured shall have the knowledge of any impending prosecution inquest or fatal inquiry in respect of any occurrence which may give rise to a claim under this policy. It will again make the intention clear that the immediate action is contemplated in respect of an accident occurring to the vehicle15. We find, that the second part of Condition No. 1 deals with the theft or criminal act other than the accident. It provides, that in case of theft or criminal act which may be the subject of a claim under the policy, the insured shall give immediate notice to the police and co-operate with the company in securing the conviction of the offender. The object behind giving immediate notice to the police appears to be that if the police is immediately informed about the theft or any criminal act, the police machinery can be set in motion and steps for recovery of the vehicle could be expedited. In a case of theft, the insurance company or a surveyor would have a limited role. It is the police, who acting on the FIR of the insured, will be required to take immediate steps for tracing and recovering the vehicle. Per contra, the surveyor of the insurance company, at the most, could ascertain the factum regarding the theft of the vehicle16. It is further to be noted that, in the event, after the registration of an FIR, the police successfully recovering the vehicle and returning the same to the insured, there would be no occasion to lodge a claim for compensation on account of the policy. It is only when the police are not in a position to trace and recover the vehicle and the final report is lodged by the police after the vehicle is not traced, the insured would be in a position to lodge his claim for compensation. As observed by the bench of two learned Judges in the case of Om Prakash (supra), after the vehicle is stolen, a person, who lost his vehicle, would immediately lodge an FIR and the immediate conduct that would be expected of such a person would be to assist the police in search of the vehicle. The registration of the FIR regarding the theft of the vehicle and the final report of the police after the vehicle is not traced would substantiate the claim of the claimant that the vehicle is stolen. Not only that, but the surveyors appointed by the insurance company are also required to enquire whether the claim of the claimant regarding the theft is genuine or not. If the surveyor appointed by the insurance company, upon inquiry, finds that the claim of theft is genuine then coupled with the immediate registration of the FIR, in our view, would be conclusive proof of the vehicle being stolen18. We concur with the view taken in the case of Om Prakash (supra), that in such a situation if the claimant is denied the claim merely on the ground that there is some delay in intimating the insurance company about the occurrence of the theft, it would be taking a hyper technical view. We find, that this Court in Om Prakash (supra) has rightly held that it would not be fair and reasonable to reject genuine claims which had already been verified and found to be correct by the investigator19. We find, that this Court in Om Prakash (supra) has rightly held that the Consumer Protection Act aims at protecting the interest of the consumers and it being a beneficial legislation deserves pragmatic construction. We find, that in Om Prakash (supra) this Court has rightly held that mere delay in intimating the insurance company about the theft of the vehicle should not be a shelter to repudiate the insurance claim which has been otherwise proved to be genuine22. In the present case, the facts are undisputed. The theft had occurred on 28.10.2010. The FIR was lodged at P.S. Nakodar, Jalandhar, Punjab on the same day i.e. 28.10.2010. The police have admittedly lodged the final report. The investigators appointed by the insurance company have submitted their investigation report on 25.02.2011, finding the claim of the appellant to be genuineIn this background, the National Commission was not justified in reversing the concurrent orders of the District Forum and the State Commission.