A Rajasthan consumer commission has upheld an order directing New India Assurance Company Limited to pay 75% of the insured amount for a tourist bus that was set on fire by a mob after a fatal road accident near Phalsund in June 2019.
The Rajasthan State Consumer Disputes Redressal Commission, sitting in Jodhpur, rejected appeals filed by both the bus owner, Jairam, and the insurer. Jairam had sought the full insured amount, while the insurance company challenged the direction to make any payment.
The dispute concerns a tourist bus travelling from Barmer to Haridwar when a motorcycle collided with it. The motorcyclist died in the accident, following which an agitated crowd set the bus on fire. The vehicle suffered extensive damage and was assessed by a surveyor as a total loss.
After the owner informed the insurer, New India Assurance rejected the claim. The company alleged that the bus had breached the conditions of its policy by being operated as a stage carriage rather than as a contract carriage.
The district consumer commission had earlier ordered the insurer to pay 75% of the insured amount, which was recorded as Rs 38 lakh. The owner and the insurer both challenged that decision before the state commission.
While hearing the appeals, the state commission noted that Jairam held an All India Tourist Permit. According to the commission, the permit authorised the vehicle to transport a party or its members from one place to another. The panel comprised president Devendra Kachhawaha and member Liaquat Ali.
The commission also considered the allegation that the driver had picked up passengers from the roadside. The district commission had treated that conduct as contributory negligence and had restricted the payout to 75% of the insured amount on that basis. The state commission upheld the district forum’s order rather than directing payment of the entire insured value.
The ruling leaves the insurer liable for a substantial portion of the claim despite the alleged policy-condition violation. It also records the distinction between the vehicle’s permit classification and the conduct attributed to the driver at the time of operation.
For commercial bus operators, the case places the focus on how permit conditions, passenger-boarding practices and policy terms may be examined when a vehicle is destroyed. The ruling, however, concerns the specific facts considered by the consumer commissions, including the All India Tourist Permit, the alleged roadside passenger pickups and the circumstances of the fire.
The state commission’s decision concludes the appeals filed against the District Consumer Commission-II, Jodhpur’s order. The insurer is required to pay 75% of the insured amount of Rs 38 lakh, in line with the order upheld by the state panel.
