OM PRAKASH versus RELIANCE GENERAL INSURANCE AND ANR.

Citation: [2017] 11 S.C.R. 893 · Decided: 04-10-2017 · Supreme Court of India · Bench: R.K. AGRAWAL · Disposal: Appeal(s) allowed

Cited by 3 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

[2017] ll S.C.R. 893 
OM PRAKASH 
v. 
RELIANCE GENERAL INSURANCE AND ANR. 
(Civil Appeal No. 15611 of2017) 
OCTOBER 04, 2017 · 
[R.K. AGRAWAL AND S. ABDUL NAZEER, JJ.] 
A 
B 
Consumer Protection - Insurance claim - Delay in -
Appellant insured his truck with respondent-company - The vehicle 
was stolen - Appellant along with the truck driver, went with the 
C 
police officials for their assistance to search the vehicle - Thereafter, 
appellant reached his village and lodged insurance claim with the 
· respondent-company - Pursuant thereto, Investigator appointed by 
respon-dent-company, who, after verification, confirmed the factum 
of theft - Consequently, the Corporate Claims Manager approved 
an amount towards the said claim of the appellant - Thereafter, the 
D 
appellant made several requests and demands to the respondent-
company, inter alia, seeking speedy processing and disposal of his 
insurance claim - However, the respondent-company repudiated 
the insurance claim of the appellant citing breach of condition, i.e. 
immediate information about the loss/theft of the vehicle - On the 
E 
ground that Claim was filed after a delay of 8 days from the 
occurrence of theft - Held: Rejection of claims on purely technical 
grounds in a mechanical manner will result in loss of confidence of 
policy holders in the insurance industry - If the reason for delay in 
making a claim is satisfactorily explained, such a claim cannot be 
rejected on the ground of delay-- In instant case, the appellant has 
F 
given cogent reasons for delay of 8 days in informing the respondent 
about the incident - Appellant was busy with the police in searching 
the vehicle - It would not be fair and reasonable to reject genuine 
claims which had already been verified and found to be correct by 
the investigator - The condition regarding the delay shall not be a 
G 
shelter to repudiate the insurance claims which have been otherwise 
proved to be genuine -
Consumer Protection Act aims at providing 
better protection of the interest of consumers - It is a beneficial 
. legislation that desen,es liberal construction - Penal Code, 1860 -
s.379. 
893 
H 
894 
SUPREME COURT REPORTS 
[2017] I 1 S.C.R. 
A 
Allowing the appeal, the Court 
B 
c 
HELD: 1. It is common knowledge that a person who lost 
his vehicle may not straightaway go to the Insurance Company 
to claim compensation. At first, he will make efforts to trace the 
vehicle. 
It is true that the owner has to intimate the insurer 
immediately after the theft of the vehicle. However, this condition 
should not bar settlement of genuine claims particularly when 
the delay in intimation or submission of documents is due to 
unavoidable circumstances. The decision of the insurer to reject 
the claim has to be based on valid grounds. Rejection of the 
claims on purely technical grounds in a mechanical manner will 
result in loss of confidence of policy-holders in the insurance 
industry. If the reason for delay in making a claim is satisfactorily 
explained, such a claim cannot be rejected on the ground of delay. 
The police had asked truck-driver and the owner to stay with 
them in order to help them for tracing out the truck. The police 
D had also asked them to collect necessary documents in relation 
to the said truck. They were, consequently, busy with the 
Rajasthan Police in searching the vehicle. They visited many 
places in Rajasthan. The police had compelled the appellant to 
accompany them while searching the truck. It is only thereafter, 
E 
F 
the appellant went back and reached his village. Also, it would 
not be fair and reasonable to reject genuine claims which had 
already been verified and found to be correct by the Investigator. 
The condition regarding the delay shall not be a shelter to 
repudiate the insurance claims which have been otherwise proved 
to be genuine. Consumer Protection Act aims at providing better 
protection of the interest of consumers. It is a beneficial legislation 
that deserves liberal construction. This laudable object should 
not be forgotten while considering the claims made under the 
Act. [Paras 10, 11] [897-G-H; 898-A-B] 
2. In the instant case, the appellant has given cogent 
G reasons for the delay of 8 days in informing the respondent about 
the incident. The Investigator had verified the theft to be genuine 
and the payment towards the claim was approved by the Corporate 
Claims Manager, which is just and proper. [Para 12] [898-C-D] 
H 
OM PRA

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