LAW FOR ALL

Vehicle theft - premium paid through cheque for renewal of policy was bounced due to bank fault - Refusal of granting insurance claim - not tenable = In the meanwhile, the vehicle, in question, was stolen on the mid-night of 09.07.2004. The complainant lodged an FIR with the Police and also informed OP No. 2 Insurance Company regarding the theft and requested for payment of insurance claim. However, the said claim was rejected by OP No. 2 and they informed the complainant that his cheque bearing number 282302 dated 16.06.2004 for Rs.9,623/- had been dishonoured by OP No.1 and hence the insurance policy could not be renewed. The complainant then contacted OP No. 1 bank, where it was found that there was sufficient balance in the account of the complainant. The bank authorities vide their letter dated 13.07.2004 sent to the OP No. 2 insurance company stated that their counter clerk / officer had inadvertently returned the cheque issued by the complainant by oversight on 18.06.2004 and there was sufficient balance in savings account no. 6148 of the complainant. They also issued a banker’s cheque dated 13.07.2004 for Rs.9623/- in favour of OP No. 2 but the OP No. 2 rejected the said request and also rejected the claim filed by the complainant as the vehicle had already been stolen by that time. It is further borne out from record that after receiving the cheque of Rs.9,623/-, the Insurance Company did issue policy in favour of the complainant which was valid for a period of one year till 15.06.2005 but the said policy was cancelled by the Company after the cheque was dishonoured by the Bank. In the said insurance policy the total Insured Declared Value (IDV) of the vehicle has been shown to be Rs.2,62,000/-. The complainant in his complaint and further in written submissions has stated that since the vehicle was purchased for a sum of Rs.3,45,959.40 and it was only 16 months old, when it was stolen. The complainant has demanded a sum of Rs.4 lakh as compensation for the value of the vehicle. However, from the IDV mentioned in the Policy issued by the insurance company, it can be safely presumed that the complainant is not entitled to get more than Rs.2,62,000/- for loss of the vehicle. However, looking at the negligence shown by the complainant in not pursuing this case after submitting cheque for the premium amount he needs to be penalised also to some extent. It is felt, therefore, that a sum of Rs.1,50,000/- as already allowed by the State Commission seems to be a reasonable amount for awarding compensation to the complainant for loss of the vehicle.