Parhlad Kumar v. Permanent Lok Adalat and Others

CWP-28048-2019o(O&M) ooooooooooooooooo-1-NeutraloCitationoNo.o2023:PHHC:159439o INoTHEoHIGHoCOURToOFoPUNJABoANDoHARYANAoAT CHANDIGARH 225o CWP-28048-2019o(O&M) Dateoofodecision:-o12.12.2023 PARHLADoKUMAR oooooo ...ooPETITIONER VS. PERMANENToLOKoADALAToANDoOTHERSo ...RESPONDENTS CORAM:ooHON'BLEoMR.oJUSTICEoVINODoS.oBHARDWAJ ***** Present: Mr.oTarunoDhingra,oAdvocateoando Mr.oSaliloSoni,oAdvocateoforotheopetitioner.o Mr.oSanjeevoKodan,oAdvocateofororespondentsoNo.o2oando3.o ***** oVINODoS.oBHARDWAJoo,oJ.o(Oral)o

¶1Challengeoinotheopresentopetitionoisotootheoawardodated

07.03.2019o(AnnexureoP-2) opassedobyotheoPermanentoLokoAdalat, PublicoUtilityoServices,oKurukshetrao oinocaseoNo.o60oofo2017ovide whichoanoapplicationounderoSectiono22-CoofoPublicoUtilityoServiceoand LegaloServicesoAuthorities,oAct,o1987opreferredobyotheoapplicant-petitionerohasobeenodismissed.o

¶2Learned oCounsel o for o the o petitioner o contends o that o the petitioneroisotheoowneroofomotorocycleobearingoregistrationoNo.oHR-41G-4625.oTheosaidovehicleowasoinsuredowithorespondent-Reliance GeneraloInsuranceoCompanyow.e.f. o29.04.2016otoo28.04.2017oon CWP-28048-2019o(O&M) ooooooooooooooooo-2-paymentoofopremium.oTheosaidovehicleowasoparkedoinofrontoofothe houseoofotheopetitioneroono05.06.2016oatoabouto10:00oam.oWhenohe cameooutoofotheohouseoato12:00onoon,otheomotorocycleowasomissing. Theosameohavingobeenostolen,otheopetitioneromadeobestoeffortsotootrace the o same, o however, o the o efforts o went o in o vain. o o The o petitioner immediatelyoapproachedotheopoliceoandogototheoFIRoNo.o251odated

06.06.2016oregisteredoatoPoliceoStationoPehowaoaboutotheoincident. IntimationowasoalsoosentotootheoInsuranceoCompanyoaboutotheftoofothe aboveomotorcycle.oTheorespondentoNo.2-InsuranceoCompanyodeputed anoinvestigatorotooinquireointootheomatteroandoconfirmedoaboutothe theft.o oCertainodocumentsowereoalsoodemandedobyotheoinvestigator whichowereodulyofurnished.oHowever,otheoclaimoofotheopetitionerowas repudiatedobyotheorespondent-InsuranceoCompanyoonotheogroundoof breachoofoconditionoNo.1oofotheopolicy.o Aggrieved o thereof, o the applicationowasopreferredobeforeotheoPermanentoLokoAdalat.

¶3oTheorespondent-Insuranceocompanyooappearedobeforeothe PermanentoLokoAdalatoandosubmittedothatotheoinformationoofotheotheft ofotheomotorocycleohadobeenogivenotootheoinsuranceocompanyoafteroa delayoofo31odaysoi.e.oono06.07.2016.oTheosameodeprivedotheoinsurance companyoofoanoimmediateoopportunityotooinvestigateotheotheftoandoto takeoeffectiveostepsotoomitigateoitsoloss.oTheofurnishingoofodelayed information o to o the o Insurance o company o amounted o to o breach o of conditionoNo.1oofotheopolicy.oTheoinsuranceocompanyowasothus justifiedoinorepudiatingotheoclaimoofotheopetitioner.oAocommunication inothisoregardowasoalsoosentotootheopetitioneroono10.08.2016.o CWP-28048-2019o(O&M) ooooooooooooooooo-3-

¶4AsotheoconciliationoproceedingsounderoSectiono22-C(4)oto

(7)oofotheoLegaloServiceoAuthoritiesoAct,o1987ofailedotoofructifyoinoan amicableosolutionoofotheodispute,oadjudicationoofotheodisputeowas undertakenobyotheoPermanentoLokoAdalat.oo

¶5Parties o adduced o their o respective o evidence o before o the PermanentoLokoAdalat.oUponoconsiderationothereof,otheoPermanent Lok o Adalat o Public o Utility o Services, o Kurukshetra o dismissed o the applicationoupholdingothatothereowasoaobreachoofoconditionoNo.1oofothe contractoofoInsuranceoonotheopartoofotheopetitioner.oHenceotheopresent petition.o

¶6oCounseloforotheopetitionerohasoarguedothatotheopetitionerohad approachedotheorespondentoauthoritiesoatotheoearliestoandoevenoan investigatorowasodeputedobyotheoInsuranceocompanyotooverifyothe allegationoandotheoclaim.oTheoinformationoofotheftowasogivenotoothe policeoimmediatelyoonotheonextodayoitselfoandowithoutoanyodelay. Further,oinosoofaroasotheofactumoofotheftoofotheomotorocycleois concerned,otheosameoisonotodisputedoorobeliedobyoanyocogentomaterial. Theorespondentsoareojustifyingotheiroactsoonotheogroundothatohadothe informationobeenofurnishedotoothemoinotime,otheyowouldohaveogot ampleoopportunityotooinvestigateoandoverifyotheoclaimomadeobyothe petitioner.oEvenothoughothereoisonooallegationothatonootheftotookoplace inotheomanneroallegedooroevenosuggestingohowotheoinvestigationoby Policeoisonototoobeoreliedoupon. oRelianceoisoalsooplacedoonothe judgment o of o this o Court o in o the o matter o ofo Iffco o Tokioo General InsuranceoCompanyoLtd.oVs. oVedoPaloandoanother, oreportedoas CWP-28048-2019o(O&M) ooooooooooooooooo-4-2014(4)oPLRo595,owhereinothisoCourtohasoheldothatowhereotheoFIRois registeredoonotheonext odayo of otheotheftoitself,otheosameocannotobe presumedoasoanoinordinateodelayoonotheopartoofotheovehicleoowneroin reportingotheoauthoritiesoaboutotheftoofotheovehicle.ooAwardopassedoin favouroofotheoinsuredowasoupheldoandotheowritopetitionofiledobyothe insuranceocompanyowasodismissed.o

¶7Onotheootherohand,ocounseloforotheorespondent-insurance company ocontends o that o petitioner o approached o the o respondent-insuranceocompanyobyowayoofolodgingoaoclaimoaftero31odaysoofothe incidentoandothatothereowasonoosatisfactoryoexplanationofurnishedoby theopetitionero foro sucho delay. oEven othougho suchoconditionowas incorporatedoinotheocontractoofoInsuracne.oHadotheopetitioneroexercised dueocareoandocautionoandowouldohaveobeenopromptoinoreportingothe matterotootheoinsuranceocompany,otheyowouldohaveomadeobestoefforts tootraceotheovehicleoandotoorecoverotheosameotoomitigateotheiroloss.ooThe failureoono theopartoofotheopetitioneroin onotoproviding oimmediate informationotootheorespondent-insuranceocompanyoisothusoinoviolation ofotheotermsoandoconditionsoofotheopolicyoandoitowouldobeojustifiedoin repudiatingotheoclaim.oAorelianceoisoplacedoonotheojudgmentoNational BulkoHandlingoCorporationoLtd.oVs.oOrientaloInsuranceoCompany reportedoaso2016(3)oCPRo203oasowelloasoonotheojudgmentoofoNational ConsumeroDisputesoRedressaloCommission,oNewoDelhioinotheomatter ofoMantoooRamoBhaioVersusoNewoIndiaoAssuranceoCo.oLtd.oand anotheroreportedoaso2016(2)oCLTo310.oItoisocontendedothatoinobothothe abovesaidocase,owhenothereowasoaodelayoonotheopartoofotheoinsuredoin CWP-28048-2019o(O&M) ooooooooooooooooo-5-reportingotheolossotootheoinsuranceocompany,otheosameowasoconstrued asoaobreachoofomandatoryoconditionsoofotheopolicyoandoheldoasoinsured nototakingoeffectiveostepsotoopreventoescalationoofolossotootheoinsurance company.oTheodecisionotoorepudiateotheoclaimofiledobyotheoinsuredowas upheldobyotheoNationaloConsumeroDisputesoRedressaloCommission, NewoDelhi.

¶8Iohaveoheardolearnedocounseloappearingoonobehalfoofothe respectiveopartiesoandohaveogoneotheodocumentsoplacedoonorecord.o

¶9Theoundisputedofactsowhichoemergeoareothatotheftoofothe vehicleowasoheldoono05.06.2016;oFIRowasoregisteredoono06.06.2016 while o claim o filed o with o Insurance o company o and o submission o of intimationoofotheftowasodelayed.oTheoconditionoNo.1oofotheoInsurance policyoreliedouponobyotheoInsuranceoCompanyotoorepudiateotheoclaim readsothus:- "Notice o shall o be o given o in o writing o to o the Company o immediately o upon o the o occurrence o of o any accident,olossoorodamageoandoinotheoeventoofoanyoclaim andothereafterotheoinsuredoshallogiveoallosuchoinformation andoassistanceoasotheoCompanyoshallorequire.oEvery letteroclaimowritosummonsoand/oroprocessoorocopyothereof shallobeoforwardedotootheoCompanyoimmediatelyoon receiptobyotheoinsured.oNoticeoshalloalsoobeogivenoin writingotootheoCompanyoimmediatelyotheoinsuredoshall haveoknowledgeoofoanyoimpendingoprosecutionoinquestoor fataloinjuryoinorespectoofoanyooccurrenceowhichomayogive riseotooaoclaimounderothisopolicy.oInocaseoofotheftoor criminaloactowhichomayobeotheosubjectoofoaoclaimounder thisopolicyotheoinsuredoshallogiveoimmediateonoticeotoothe policeoandoco-operateowithotheoCompanyoinosecuringothe CWP-28048-2019o(O&M) ooooooooooooooooo-6-convictionoofotheooffender."

¶10Aoreadingoofotheosaidoclauseoshowsothatoitocalledouponothe insuredotooreportotheolossoimmediatelyoandotoorenderoalloinformation and o assistance o required. o The o insured o is o required o to o extend o all cooperationotootheoPoliceoandotheoInsuranceoCompanyoforosecuring convictionoofotheooffender.oTheoemphasisoofotheoclauseoisoquick reportingoofotheomatteroandotoorenderoalloassistance.oTheosaidoclauseonot onlyodoesonotoprovideoanyotimeoperiodowithinowhichoinformationohas toobeoprovidedobutoalsoodoesonotoassignoanyofataloconsequenceoforosuch lapse.oNotoeveryoclauseoofoaopolicyocanobeoconstruedoasofatalotoothe policyoitself.oTheoobjectobehindotheoclauseoisoonlyotooensureothatomatter isoreportedotootheoInvestigatingoAgencyoimmediatelyosoothatostepsoto traceoandorecoverotheovehicleocanobeotakenoandoculpritoisonabbed.oThe aboveoclauseoisonotofundamentalotootheodecisionomakingoofothe InsuranceoCompanyotoounderwriteoaoriskooroinotheonatureowhereosuch violationowoldoshakeotheounderlyingofoundationoofotheocontractual relationshipoandotherebyodemolishotheoentireorelationshipobetweenothe parties.oNotoeveryoclauseoandoletteroofotheoInsuranceopolicyobeoreadoas mandatoryoentitlingoInsuranceoCompanyotoorepudiateotheoclaimoand seekoexonerationofromoliability.oAnyosuchoheadingowouldodefeatothe objectoofotheocontractoofoinsurance.oTooupholdoanyoclauseoatosucholevel, theoviolationohasotoobeoofobasicofundamentalsoofotheocontract,othe violationowhereofowouldobeoaocrucialofundamentalobreacholeadingoto vestingoofoaorightowithotheoInsuranceoCompanyotoodenyoindemnifying theoliability.oSuchoimportois,ohowever,onotodrawnofromoaoreadingoof clauseoreliedobyoInsuranceoCompany.oVISHAL SHARMA CWP-28048-2019o(O&M) ooooooooooooooooo-7-

¶11ItoisoalsooevidentothatotheomatterowasoreportedotootheoPolice withoutodelay.oItoisonototheocaseoofotheoInsuranceoCompanyothatothe petitionerodidonotoco-operateowithotheoInvestigatingoAgencyoorodidonot furnishoinformationorequiredoofohimodueotoowhichoinvestigationowas stalled.oItoisoalsoonototheocaseoofotheoInsuranceoCompanyothatothe InvestigatingoAgencyofoundotheoinformationotoobeofalse.oItoisoalso indiscernibleoasotoohowotheoInsuranceoCompanyowasobetteroequipped thanotheoPoliceotooinvestigateoandowhatofundamentaloerrorsohaveobeen committedobyotheoInvestigatingoAgency.oFurther,othereoisoalsoonothing onorecord.oWhereotheoInsuranceocompanyohasolodgedoprotestoagainst theountraceoreportosubmittedobyotheoPolice.oHence,omerelyobecause claimowasolodgedoafterodelay,oitocan'tobeoheldosufficientotooassumeothat thereoisoaofundamentalobreacho oandohenceotheoclaimooughtotoobe rejected.o

¶12TheojudgmentoofotheoNationaloConsumeroDisputesoRedressal CommissionoreliedouponobyotheoInsuranceoCompanyofailsotoosatisfyothis Courtoasotheosaidojudgmentsoareonotoonlyobindingobutoalsooforotheoreason thatonooobjectiveoandointentobasedoreasonsoofoaocontractoofoInsuranceovis-a-visoitsobeneficialonatureoareobornooutofromotheosame.ooBesides,otheolaw interpretedobyotheoHon'bleoSupremeoCourtodoesonotosupportoitoasowell.o

¶13TheoHon'bleoApexoCourtoinotheomatteroofo'Gurshinder Singh o Vs. o Shriram o General o Insurance o Company o Limited o and another'oreportedoaso(2020)11oSCCo612ohasoheldoasounder:- "9.o Beforeoweoanalyzeothisocaseoanyofurther,owe needotooobserveotheorulesoofointerpretationoapplicable tooaocontractoofoinsurance.oGenerally,oanoinsuranceo CWP-28048-2019o(O&M) ooooooooooooooooo-2-contract is governed by the rules of interpretation applicable to the general contracts. However, due to the specialized nature of contract of insurance, certain rules are tailored to suit insurance contracts. Under the English law, the development of insurance jurisprudence is given credence to Lord Mansfield, who developed the law from its infancy. Without going much into the development of the interpretation rules, we may allude to Neuberger J. in Arnold v. Britton, which is simplified as under:

(1) Reliance placed in some cases on commercial common sense and surrounding circumstances was not to be invoked to undervalue the importance of the language of the provision which is to be construed.

(2) The less clear the words used were, the more ready the court could properly be to depart from their natural meaning, but that did not justify departing from the natural meaning.

(3) Commercial common sense was not to be invoked retrospectively, so that the mere fact that a contractual arrangement has worked out badly, or even disastrously, for one of the parties was not a reason for departing from the natural language.

(4) A court should be very slow to reject the natural meaning of a provision as correct simply because it appeared to be a very imprudent term for one of the parties to have agreed.

(5) When interpreting a contractual provision, the court could only take into account facts or circumstances which existed at the time that the contract was made and which were known or reasonably available to both parties.

(6) If an event subsequently occurred which was plainly not intended or contemplated by the parties, if it was clear what the parties would have intended, the court would give effect to that intention.

¶10A perusal of the aforesaid shows that this contract is to be interpreted according to the context CWP-28048-2019o(O&M) ooooooooooooooooo-1-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 power.

¶11xxx xxx xxx

¶12In our view, applying the aforesaid principles, Condition 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 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 policy.

¶13A 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. CWP-28048-2019o(O&M) ooooooooooooooooo-13-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.oThe 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 vehicle.

¶14We find, that the second part of Condition 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 CWP-28048-2019o(O&M) ooooooooooooooooo-11-

¶15It 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.

¶16As observed by the bench of two learned Judges in the case of Om Prakash, 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 stolen.

¶17xxx xxx xxx

¶18xxx xxx xxx

¶19xxx xxx xxx

¶20We, therefore, hold that when an insured has lodged the FIR immediately after the theft of a vehicle occurred and when the police after investigation have lodged a final report after the vehicle was not traced and when the VISHAL SHARMA surveyors/investigators appointed by the insurance CWP-28048-2019o(O&M) ooooooooooooooooo-12-companyohaveofoundotheoclaimoofotheotheftotoobe genuine,othenomereodelayoinointimatingotheoinsurance companyoaboutotheooccurrenceoofotheotheftocannotobe aogroundotoodenyotheoclaimoofotheoinsured."

¶14Inoviewoofotheoaforesaidofactsoandopositionoinolaw,oitois evidentothatotheoPermanentoLokoAdalato(PublicoUtilityoServices) Kurukshetraofailedotooapplyotheocorrectolegaloprinciples.oFailureoto appreciateotheoaboveoandoconsideringothatothereoisonoodisputeoas regardsotheoaspectoofotheftoasowelloasotheofactothatotheointimationoinothis regardowasopromptlyomadeotootheopoliceohasoaobearingoonotheoaward. Further,oitoisoalsoonotodisputedothatotheo'untracedoreport'osubmittedoby theoinvestigatingoagencyowasoincorrectoorothatotheopolice,oatoanyopoint ofotime,osuspectedothatotheovehicleoinoquestionowasoneverostolenoand thereowasoaomis-reporting/mis-representationomadeobyotheopetitioner. TheoPermanentoLokoAdalatothusofailedotooappreciateotheocrucialoaspects andolegalopositionowhichohaveocausedotravestyoofojustice.oIofindothatothe sameoisoanoillegalityothatogoesotootheorootoofotheocaseorenderingothe awardopassedobyotheoPermanentoLokoAdalatoliableotoobeosetoaside.

¶15Theopresentowritopetitionoisoaccordingly,oallowed.o oThe awardodatedo07.03.2019o(AnnexureoP-2)opassedobyotheoPermanentoLok Adalat,oPublicoUtilityoServices,oKurukshetra,ooinocaseoNo.o60oofo2017 titled oas oParhlad o Kumar o Versus o Reliance o General o Insurance CompanyoLtd.oandoanother,oisosetoaside.ooTheorespondents-insurance companyoisodirectedotoodisburseotheosumoassuredovalueoofotheovehicle tootheopetitioneroonohisofurnishingoofotheorequisiteodocumentsowithothe insuranceocompanyotooprocessoandodisburseotheoclaim. CWP-28048-2019o(O&M) ooooooooooooooooo-13-

¶16Inotheoeventoofotheofurnishingoofotheorequisiteodocumentsoby theopetitionerowithinoaoperiodoofofouroweeks,otheorespondent-insurance companyoshalloreleaseotheosumoassuredotootheopetitionerowithinoa periodoofo6oweeksothereafter,ofailingowhich,otheopetitioneroshallobe entitledotoointeresto@o6%operoannumow.e.f.otheodateoofofilingoofothe applicationotilloitsoactualorelease.o (oVINODoS.oBHARDWAJo) DECEMBERo12,o2023 JUDGE PoojaoSaini/VishaloSharma Whetherospeaking/reasoned :oYes/No Whetheroreportable :oYes/No