Delhi HC directs insurance company to make payment of compensation in a case of a stolen vehicle as no wilful breach on the part of insurer was establish

Delhi HC directs insurance company to make payment of compensation in a case of a stolen vehicle as no wilful breach on the part of insurer was establish

The Delhi High Court directed the insurance company to make payment of compensation in a case of a stolen vehicle as no willful breach on the part of the insurer was established.

The deceased was going to Pocket-1, Sector B-4, Delhi on a scooty and at about 5.30 AM when he reached near Pocket 13, Sector-4, Delhi the offending Eeco Car being driven in a rash and negligent manner by one Sh. Niraj @ Mika came and hit the scooty of the deceased with great force. As a result of the forceful impact, the deceased fell down and sustained fatal injuries.

Advocate Sankar N. Sinha, appearing for the appellant argued that since the vehicle was stolen and driver was a professional thief there was no liability on the insurance company to pay the amount. 

the issue raised before the court was whether the insurance company is absolved of the liability to pay the amount in a case where the vehicle is stolen and unauthorisedly being driven by somebody else.

The single judge bench of Justice Sanjeev Sachdeva noted that the insurance company has not been able to show any breach on the part of the insured to avoid its liability.

The court said that if the proposition of the insurance company was accepted, it would militate against the very concept of beneficial legislation for the victims of an accident. If such a finding were to be returned then the effect would be that even though a vehicle is insured but is stolen, not only would the insurance company be entitled to avoid its liability but the owner of the vehicle who has insured his vehicle against theft and accident would be saddled with a liability for no fault of his. 

The court stated that the tribunal has found that the vehicle was stolen and there was no willful breach of the terms and conditions of the insurance policy by the insured.

The court dismissed the appeal and found no infirmity in impugned award whereby the Tribunal has directed the insurance company to make the payment of the compensation amount and thereafter recover the same from the driver Niraj @ Mika who had stolen the vehicle.

Case title: United India Insurance Co. Ltd v/s Smt Anita Devi and Ors.

Citation: MAC.APP. 15/2022 & CM APPL. 2953-54/2022

Click here to read the Order/Judgment

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