Summary
The Supreme Court held that an insurer could not repudiate a fire-damage claim on a truck for want of a valid permit when the vehicle held a National Permit valid to 2017 and was burnt within its home State, where no authorisation fee was payable; the National Commission's order was set aside and the claim directed to be paid with 9% interest.
Issues
- Whether the insurer could repudiate the claim for fire damage to the insured truck on the ground that the authorisation fee under the National Permit had not been paid, so that there was no valid permit.
- Whether the appellant was entitled to interest on the claim amount.
Held
- The National Permit on record was valid up to 13.10.2017. Under its terms, the authorisation fee was payable only when the truck moved out of Bihar, the State in which it was registered and the permit was issued. Since the truck caught fire due to a short-circuit within Bihar during the policy period, non-payment of the authorisation fee did not make the permit invalid, and repudiation of the claim on that ground was frivolous. (¶ 8)
- The appellant was entitled to the claim as held by the State Commission, and the National Commission's order reversing it was set aside. (¶ 8)
- Because the claim fell due and was repudiated in 2014 and the litigation ran until 2020, the appellant was entitled to the full claim amount with interest at 9% per annum from the date of the complaint before the State Commission until payment. (¶ 8)
Result
Appeal allowed; National Commission's order dated 19.08.2020 set aside; insurer directed to process and pay the claim with interest at 9% per annum from the date of the complaint within 60 days; no order as to costs.