Oral Order (As per Sri R.Lakshminarasimha Rao, Honble Member)
1. The unsuccessful complainant is the appellant. The complainant purchased on 22.9.2005 Tata Indigo Marina LS vehicle bearing No.AP 26N 5294 and insured the same with the opposite parties. The complainant after using the vehicle for about 1 Â½ years sold it to one R.Ramesh on 5.3.2007 for a consideration of `4,25,000/-. The complainant delivered the vehicle to R.Ramesh but his name was not registered in the records as R.Ramesh did not pay the entire consideration. On 26.3.2007 the vehicle met with an accident and the same was informed to the opposite party no.1. The opposite party no.1 deputed one Bhaskar Reddy who estimated the damage to the vehicle at `1,95,257/-. Mr. Ramesh got the vehicle repaired at M.G.Brothers Nellore and the final bill was issued for `79,595.62. After receiving the final bill Ramesh approached the oppsotie party to settle the claim but the opposite party did not settle the same. On 5.5.2007 the complainant received notice from Ramesh informing him that he was unable to bear the risk arising out of the vehicle and he was ready to return the vehicle. The complainant took back the vehicle and claimed the insurance amount. The opposite party no.1 had not taken any steps to settle the claim of the complainant. The policy was in force from 10.8.2006 to 9.8.2007. The complainant had submitted claim to the opposite party no.1 which was repudiated by the opposite party no.1 on the ground that the claim was not within the purview of the policy. The complainant sustained loss to the tune of `79,595.62.
2. The opposite party no.3 filed counter which was adopted by the opposite parties no.1 and 2 and stated that the claim was repudiated for the reason that there was no insurable interest under the insurance policy. The complainant sold the property to third party and the third party is not impleaded in the complaint. No case is registered in connection with the accident. Neither owner of the vehicle nor the driver employed by him caused alleged accident and the third party who was not having any valid driving license was driving the vehicle at the time of accident. The complainant filed the complaint suppressing the fact of earlier accident that occurred on 11.9.2006. The complainant did not implead the owner and insurer of the tractor which hit the car. The complainant without transferring his right or title to third party is at liberty to file case against the third party and claim damages from him.
3. The complainant has filed his affidavit and also the affidavit of R.Ramesh and documents Exs.A1 to A11. The Manager (Legal) of the opposite party no.2 filed his affidavit. No documents were marked on their behalf.
4. The points for consideration are:
1) Whether there was any deficiency in service on the part of the opposite parties?
2) To what relief?
5. POINTS NO 1: The complainant had purchased on 22.9.2005 the vehicle bearing No. AP 26N 5294. After using of the vehicle for about 1 Â½ years, the complainant sold it to R.Ramesh for a consideration of `4,25,000/-. The sale deed was executed on the same day. The vehicle was involved in the accident on 26.3.2007 i.e., after Ramesh has purchased it from the complainant. There is no dispute of the fact that the vehicle was insured with the opposite party for the period from 10.08.2006 to 09.08.2007. By the time of the accident, the insurance policy was in force. After the accident, the complainant states that Ramesh had got it repaired and incurred an amount of `79,595.62/- for reimbursement of which he had lodged claim with the opposite party no.1. The opposite party no.1 had deputed a surveyor who assessed the loss at `1,95,257/-.
6. Â A bare perusal of the pleadings of the complaint would show that the complainant sold the vehicle on 5.3.2007 to Ramesh for a consideration of `4,25,000/- and on the same date executed sale deed in favour of the purchaser. It is stated in the complaint that the complainant had delivered possession of the vehicle to the purchaser. Accordingly the change in name in the registration certificate was not effected due to non receipt of total sale consideration by the complainant. The vehicle met with an accident on 23.6.2007 at Ongole and Mr.Ramesh brought it to M.G.Brothers Nellore and intimated the opposite parties about the accident and thereafter the first opposite party deputed a surveyor who had assessed the loss caused to the vehicle to the tune of `1,95,257/- and by the time of preparation of final bill, the purchaser of the vehicle, Ramesh incurred an amount of `79,595/- and on his failure to get the claim settled by the opposite parties, Ramesh had got issued notice on 5.5.2007 informing the complainant that he is unable to bear the risk on the vehicle as also attitude of the first opposite party and expressed his readiness to return the vehicle to the complainant.
7. The aforementioned averments of the complaint manifest the sale transaction of the vehicle in favour of R.Ramesh. A perusal of the sale deed goes to show that the complainant had sold the car on 5.3.2007 in favour of Ramesh from 5.3.2007 the complainant is not responsible for any liability including the insurance claims and other complaints in respect of the vehicle and from that date the purchaser only is responsible for all or any of the liabilities that arise in respect of the car. The sale deed establish completion of sale transaction and manifest the rights conferred on R.Ramesh as also the liabilities in respect of the vehicle shifting over to Ramesh. Coupled with the sale deed, delivery note dated 5.3.2007 with an undertaking incorporated therein by the purchaser acknowledging his responsibility for all the future claims on the vehicle, would indicate the completion of sale transaction of the vehicle. In addition to the sale deed and delivery note, the notice got issued by the purchaser through his counsel Sri N.Suresh Babu to the complainant would further strengthen the establishment of the fact that the complainant had sold away the vehicle in favour of R.Ramesh and the sale transaction was complete in all aspects such as receipt of sale consideration by the complainant and acknowledging delivery of the car by the purchaser. In the circumstances, the complainant cannot be heard to say that the sale transaction was incomplete and that there was non-payment of total sale consideration by the purchaser.
8. The sale transaction of the vehicle having been completed and the vehicle was being plied on the road by its purchaser R Ramesh met with an accident on 26.3.2007 which resulted in causing damage to the vehicle and as stated in the final bill the purchaser of the vehicle R.Ramesh had incurred an amount of `79,595.62 for repairs of the vehicle. The purchaser of the vehicle realizing that his claim could not be settled had got issued notice through his advocate informing the complainant that after he had purchased the vehicle, it met with an accident and the surveyor deputed by the opposite party insurance company had assessed estimate to the extent of `1,95,927/- for carrying out the repairs to the vehicle and the insurance company avoided to settle the claim whereby he was âunable to bear the risks arising out of the vehicleâ and requested the complainant to take back his vehicle.
9. The complainant had got issued notice to the opposite parties intimating them that he had sold the vehicle to R Ramesh for a consideration of `4,25,000/- and on the vehicle meeting with an accident and the purchaser of the vehicle submitting the claim the opposite parties failed to settle the claim whereby Ramesh got issued notice that he was ready to return the vehicle to the complainant and the complainant requested the opposite parties that he has filed fresh claim since his name still appeared in the RTA records as the owner of the vehicle and in view of his obtaining insurance policy in respect of the vehicle.
10. The complainant sold the vehicle in favour of R.Ramesh and in terms of the sale deed executed by him in favour of the purchaser, the complainant had lost insurable interest in the vehicle. The purchaser of the vehicle cannot claim any amount under the insurance policy for reimbursement of the amount stated to have been incurred by him for getting the vehicle repaired for the reason that the insurance policy had been transferred in his favour and was in force with the name of the complainant still as the insured at the time of the accident.
11. The action by the insured for an insurance claim on the foot of an insurance policy belongs to the realm of enforcement of an insurance contract. The ground theme of any insurance contract that is agreed between the parties is indemnification in monetary terms for the risk covered therein. Its enforceability and sweep of operation again depend not only on the express terms but also on the law supplying some more flesh and blood to such contract
12. The Supreme Court in âComplete Insulations Pvt. Ltd. Vs. New India Assurance Company Ltdâ. reported in I (1996) CPJ 1 (SC) clearly held that Section 157 of the M.V. Act is applicable only in cases of 3rd party risk and in the matter of others, the claim has to be decided only on the basis of actual terms of the contract of insurance policy. The Supreme Court upheld the decision of the National Commission which dismissed the claim of the transferee, referring to the full bench judgment of Andhra Pradesh High Court in âMadineni Kondaiah and others vs Yaseen fatima and others . reported in Kondiahs case (AIR 1986 A.P. 62) .
13. There is a clear distinction all along, as borne out from the dicta contained in Supreme Court judgment, between the 3rd party risk under the Motor Vehicles Insurance Act and the other benefits flowing out of comprehensive insurance policy . Section 157 of the M.V. Act reads as follows:
157. Transfer of certificate of insurance.
(1) Â Where a person in whose favour the certificate of insurance has been issued in accordance with the provisions of this Chapter transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer .
1[Explanation.-For the removal of doubts, it is hereby declared that such deemed transfer shall include transfer of rights and liabilities of the said certificate of insurance and policy of insurance.]
(2) The transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the fact of transfer in the certificate of insurance and the policy described in the certificate in his favour and the insurer shall make the necessary changes in the certificate and the policy of insurance in regard to the transfer of insurance.
14. In complete Insulations (Pvt) Ltd., case (supra) the Supreme Court has considered and affirmed the decision of the High Court of A.P. in Kondaiahs case 1986 ACJ 1 that âthe sale is complete on payment of the consideration and delivery of vehicle regardless of transfer of registration in the name of the transfereeâ. In the light of the complainant receiving the sale consideration and delivering possession of the vehicle to the transferee the complainants name continuing in the RTA records in respect of the vehicle, does not enable the complainant to maintain the complaint even in the absence of his insurable interest in the vehicle.
15. It is contended on behalf of the opposite parties that the insurance policy was issued in favour of the complainant with the risk coverage on owner-driver and also for paid driver and that at the time of the accident the complainant was not driving the vehicle nor the driver who had caused the accident was under the employment of the complainant. It is already noted hereinabove that the complainant had lost his insurable interest in the vehicle by the its sale in favour of R Ramesh. Therefore, the question of the complainant driving the vehicle or his driver plying it on the road after the vehicle was sold, does not arise. Even the averments of the complaint would show that the purchaser of the vehicle along with his brother âin- law were proceeding in it when the vehicle met with an accident.
16. The opposite parties pleaded that the driver of the vehicle does not hold any driving license to drive it at the time of the accident and the accident stated to have occurred as a result of collusion between the car and a tractor has not been reported to the police nor was proved by any evidence thereof. It is true the purchaser of the vehicle who lodged the claim at an earlier instance had not produced the driving license of the driver who drove the vehicle at the time of the accident. In view of our conclusion the complainant does not possess any insurable interest, all other pleas do not require any appreciation. In the circumstances, we do not find any infirmity either factual or legal in the order passed by the District Forum.
17. In the result, the appeal is dismissed confirming the order of the District Forum. No costs.