GURSHINDER SINGH versus SHRIRAM GENERAL INSURANCE CO. LTD. & ANR.

Citation: [2020] 2 S.C.R. 564 · Decided: 24-01-2020 · Supreme Court of India · Bench: N.V. RAMANA · Disposal: Appeal(s) allowed

Cited by 2 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

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SUPREME COURT REPORTS
[2020] 2 S.C.R.
   [2020] 2 S.C.R. 564
564
GURSHINDER SINGH
v.
SHRIRAM GENERAL INSURANCE CO. LTD. & ANR.
(Civil Appeal No. 653 of 2020)
JANUARY 24, 2020
[N. V. RAMANA, R. SUBHASH REDDY AND B.R. GAVAI, JJ.]
Consumer Protection – Insurance – Standard Form Contract
– Commercial Vehicles Package Policy – Appellant’s tractor was
insured with respondent(s) on 19.06.10 – Tractor stolen on 28.10.10
– FIR lodged on the same day – Claim submitted to the respondent(s)
on 15.12.10 – Rejected on the ground that intimation was given
belatedly – District Forum & State Commission allowed the
appellant’s complaint– National Commission dismissed it – Conflict
between two Judges’ Bench decisions of Supreme Court in Om
Prakash v. Reliance General Insurance & Anr. [2017] 11 SCR 893 &
Oriental Insurance Co. Ltd. v. Parvesh Chander Chadha (2018) 9 SCC
798, as to whether delay in informing about theft of vehicle to
insurance company, though the FIR was registered immediately,
would disentitle the insurance claim – In view thereof, present matter
referred by two Judges’ Bench – Held: Much would depend upon
the words ‘co-operate’ & ‘immediate’, in condition no.1 of the Policy
wherein immediate action is contemplated in case of accident of the
vehicle – Second part of aforesaid condition deals with ‘theft or
criminal act other than accident’ – While assessing the ‘duty to co-
operate’ for the insured, inter alia the Court should have regard to
those breaches by the insured which are prejudicial to the insurance
company – Usually, mere delay in informing the theft to the insurer,
when the same was already informed to the law enforcement
authorities, cannot amount to breach of ‘duty to co-operate’ of the
insured – View taken in the case of Om Prakash is concurred with,
that in such a situation if the claimant is denied the claim merely on
the ground of delay, it would be taking hyper technical view – It
was also rightly held that Consumer Act being beneficial legislation
deserves pragmatic construction – When an insured has lodged the
FIR immediately after the theft of vehicle and when the police on
investigation lodged final report after the vehicle was not traced
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and when the surveyors appointed by the insurance company found
the claim of the theft to be genuine, then mere delay in intimating
the insurance company cannot be a ground to deny the claim of the
insured – In the present case, facts are undisputed – Impugned order
set aside – Order of District Forum, upheld by State Commission is
maintained – 75% of the claim amount deposited by respondents in
Registry be withdrawn by the appellant with interest accrued thereon
– Remainder be paid within six weeks from today with interest @
12% p.a. on entire amount of Rs.4,70,000/- from the date of order
of District Forum till its realisation.
Insurance – Contract of insurance – Rules of interpretation
– Discussed.
Allowing the appeal, the Court
HELD: 1.1 Much would depend upon the words ‘co-
operate’ and ‘immediate’, in condition No. 1 of the Standard Form
for Commercial Vehicles Package Policy. Generally, an insurance
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. The contract being interpreted 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. The insurance policy is a contract between the insurer
and the insured and the parties would be strictly bound by the
terms and conditions as provided in the contract between the
parties. [Paras 10-12][571-B; 572-B-D]
Om Prakash  v. Reliance General Insurance & Anr.
[2017] 11 SCR 893 – affirmed.
Oriental Insurance Co. Ltd. v. Parvesh Chander Chadha
2018 (9) SCC 798 ; T.D.P. Gram Sewa Sahakari Samiti
Ltd. & Ors. v. Charanjit Kaur and Ors. 2011 (3) CPC
GURSHINDER SINGH v. SHRIRAM GENERAL INSURANCE
CO. LTD. & ANR.
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SUPREME COURT REPORTS

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