LexMANJEET SINGH versus NATIONAL INSURANCE COMPANY LTD. & ANR.
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A B c ' / [2017] 12 S.C.R. 90 MANJEET SINGH v. NATIONAL INSURANCE COMPANY LTD. & ANR. (Civil Appeal No. 21552 of2017) DECEMBER 08, 2017 [MADAN B. LOKUR AND DEEPAK GUPTA, JJ.] Consumer Protection Act, 1986 - lnsurance Policy - Breach of - On facts, theft of vehicle by passengers who were given lift by the driver - Owner not at fault - Insurance claim - Compensation - Held: Violation of the condition should be such a fundamental breach so ihat the claimant cannot claim any amoullt whatsoever - Carrying such passengers may he a hr<!acl1 of the policy, but it cannot be said to be such a fundamental breach as to bring the insurance policy to an end and to terminate the insurance policy - D Act of the driver, giving lift to some persons standing on the road on a cold wintery night, was a humanitarian gesture and not a breach that it nullifies the policy - Driver would not have foreseen stealing of the vehicle - Furthermore, arbitration proceedings between the financer and the insurer, relating to recovery of the loan amount, E F would not negate the rights of the insured against the insurance cvmpany - Thus, insurance company to pay 75% of the insured amount of R.«. 7,28,0001- along with interest at the mte of 9% per annum from the date of filing the claim petition till the deposit of the amount and Rs.1.00,000/- as compensation. Disposing of the appeal, the Court HELD: 1.1 The violation of the c!>ndition should be such a fundamental breach so that the claimant cannot claim any amount whatsoever. In the instant case, the appellant who is the owner, was not at fault. His driver gave a lift to some passengers. Carrying G such passengers may be a breach of the policy, but it cannot be said to be such a fundamental breach as to bring the insurance policy to an end and to terminate the insurance policy. The driver, on a t'Uld wintcry night, gave lift to some persons standing on the road. It was a humanitarian gesture. It cannot be said to be such a breach that it nullifies the policy. No doubt, these passengers H 90 MANJEET SINGH v. NATIONAL INSURANCE COMPANY 91 LTD. & ANR. turned against the driver and stole the truck, but this, the driver A could not have foreseen. Such claims where there is breach of policy, have been treated to be non-standard claims and have been directed to be settled at 7S%. [Para 7] [93-G-H; 94-A] 1.2 As far as the second ground is concerned, the arbitration proceedings between the financer and the insurer, relating to B recovery of the loan amount, cannot negate the rights of the insured against the insurance company. [Para 8] [94-B] 1.3 The orders of the courts below are set aside. The respondent no.1-insurancc company is directed to pay 7S% of the insured amount of Rs.7,28,000/- along with interest at the rate of 9°1., per annum from the date of filing the claim petition till the deposit of the amount. In addition, the insurance company shall also pay another sum of Rs.1,00,000/- as compensation. Since C< the financer is also a party to the petition, the amount shall be deposited before the District Forum, and in case the claim of the D financer has not been settled in terms of the arbitration award, then the deposited amount shall first be used to pay the awarded amount and the balance, if any, shall be paid to the appellant. [Para 9] [94-C-D] National Insurance Co. Ltd. v. Swara11 Singh (2004) 3 SCC 297 : [2004] 1 SCR 180 ; National Insurance Co. Ltd. v. Nitin Khandelwal (2008) 11 SCC 2S9 ; Lakhmi Chand v. Reliance General Insurance (2016) 3 SCC 100 ; B. V. Nagaraju v. Oriental Insurance Co. Ltd. (1996) 4 SCC 647 : [1996] 3 Suppl. SCR 22 - referred to. Case Law Reference [2004] .1 SCR 180 referred to Para S (2008) 11 sec 2s9 referred to Paras (2016) 3 sec 100 referred to Paras [1996] 3 Suppl. SCR 22 referred to Para S E F G H 92 SUPREME COURT REPORTS [2017] 12 S.C.R. A CIVIL APPELLATE JURISDICTION: Civil Appeal No. 21552 B of2017. From the Judgment and Order dated 03.06.2015 of the National Consumer Disputes Redressal Commission, New Delhi (in short, National Commission) in Revision Petition No. 4419 of 2014. Dharmendra Kumar Sinha, Sanjeev Kr. Verma, Advs for the Appellant. Gaurav Sharma, Adv for the Respondents. The Judgment of the Court was delivered by C DEEPAK GUPTA, J. 1. Leave granted. D 2. None has put in appearance on behalf of the respondent no. 2 despite service. Hence, the matt
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