State Consumer Disputes Redressal Commission
Oriental Insurance Co. Ltd. vs M/S Spring View Guest House on 21 March, 2012
H H.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION, SHIMLA. First Appeal No: 267/2007. Date of Decision: 21.03.2012. . The Oriental Insurance Co. Ltd., through its Divisional Manager, Hospital Road, Mandi Town, H.P. Appellant. Versus M/s. Spring View Guest House, Vill. & P.O. Tattapani, Tehsil Karsog, District Mandi, H.P. through it Proprietor, Charan Dass, S/o Sh. Viptu Ram, R/o Vill. & P.O. Tattapani, Tehsil Karsog, District Mandi, H.P. Respondent. For the appellant: Mr. Narender Sharma, Advocate For the respondent: Mr. Peeyush Verma, Advocate. . First Appeal No: 284/2007. Date of Decision: 21.03.2012. M/s. Spring View Guest House, Vill. & P.O. Tattapani, Tehsil Karsog, District Mandi, H.P. through it Proprietor, Charan Dass, S/o Sh. Viptu Ram, R/o Vill. & P.O. Tattapani, Tehsil Karsog, District Mandi, H.P. Appellant. Versus The Oriental Insurance Co. Ltd., through its Divisional Manager, Hospital Road, Mandi Town, H.P. Respondent. Coram Honble Mr. Justice Surjit Singh , President Honble Mr. Chander Shekhar Sharma, Member Honble Ms. Prem Chauhan, Member Whether approved for reporting?[1]Yes. For the appellant: Mr. Peeyush Verma, Advocate For the respondent: Mr. Narender Sharma, Advocate . O R D E R:
Justice Surjit Singh, President (Oral)
1. By this order, we proceed to dispose of two appeals, particulars whereof are given in the heading of this order, as both the appeals are directed against the same order i.e. order dated 11th June, 2007, passed by District Consumer Disputes Redressal Forum Mandi, in a complaint under section 12 of the Consumer Protection Act instituted by M/s. Spring View Guest House, appellant in First Appeal No.284/2007, against Oriental Insurance Company, appellant in the other appeal i.e. First Appeal No.267 of 2007.
2. M/s.
Spring View Guest House, hereinafter referred to as complainant, filed a complaint under section 12 of the Consumer Protection Act, against the Oriental Insurance Company, hereinafter called opposite party, seeking compensation equivalent to insurance claim and also damages for harassment etc. caused to it on account of repudiation of insurance claim.
Complainant owned a three-storeyed building at a place called Tattapani in the district of Mandi. The building stood on an area measuring 2 biswas a 2 biswansi. In the said building, complainant ran a guest house.
Besides the three-storeyed building, there existed three bath rooms, which were also constructed by the complainant. The building and the bath rooms were insured by the complainant with the opposite party, for a sum of Rs.8,00,000/-, for the period from 20.12.2004 to 19.12.2005. The policy, among others, covered risk of damage to the building by floods.
The insured building and the bath rooms were flooded on 26.6.2005 and 3.7.2005 by the water of river Satluj. The same were substantially damaged. Intimation of the damage was given to the opposite party. A surveyor was deputed by the opposite party. Complainant submitted estimate of the damage, amounting to Rs.6,47,150/-, to the surveyor. Surveyor felt that the estimate of damage was grossly on the higher side. He assessed the loss, after applying the excess clause and the average clause as also depreciation in the value of the building, at Rs.54,243/-. Surveyor also reported that the building of the complainant stood acquired even before the purchase of insurance policy by it and compensation to the extent of 80% had already been paid to it, and this fact was concealed by the complainant while insuring the building and the bath rooms. So, he reported that nothing was payable. Opposite party, on the basis of the report of the surveyor, repudiated the claim.
3. Complainant then filed complaint under section 12 of the Consumer Protection Act before the District Consumer Disputes Redressal Forum. It was alleged that though the process for acquisition of the property had been initiated, but actual acquisition had not taken place nor had it been paid any compensation for the insured building and bath rooms. It was stated that the complainant had insurable interest in the insured property and hence it was entitled to the indemnification of loss sustained by it as a result of the flooding of the structures. Complainant claimed that the loss caused to the building and the bath rooms was to the extent of Rs.6,47,150/-.
4. Opposite party contested the claim. It took the plea that the complainant had suppressed the fact of acquisition of the insured property. It was stated that complainant had no insurable interest in the insured property when it purchased the insurance policy and so it was not entitled to any amount of money for the loss sustained by it. As regards the quantum of loss, it was stated that the total loss sustained by the complainant was to the tune of Rs.56,243/- only.
5. Learned District Consumer Disputes Redressal Forum concluded that there was no material on record in respect of the opposite partys plea that the insured building and the bath rooms stood acquired before the purchase of insurance policy by the complainant and, therefore, rejected the opposite partys plea that the complainant had no insurable interest in the insured property. A regards the quantum of damage to the insured structures, learned Forum concluded that assessment done by the surveyor was unreasoned ad arbitrary. Learned Forum, by sheer guess work, held that the loss sustained by the complainant was Rs.2,00,000/- and awarded the aforesaid amount of money as compensation with interest @ 9% per annum from the date of the complaint till the payment of the aforesaid amount of money, besides awarding costs of Rs.2,000/-.
6. Opposite party, i.e. Insurance Company, is aggrieved by the finding that the complainant had insurable interest in the property, as also the finding of the learned Forum with regard to the quantum of loss sustained by the complainant.
So, it has challenged the Forums order.
Complainant is dis-satisfied with the quantum of damages for the damage to the structures as awarded by the Forum.
According to it, the damage was to the tune of Rs.6,47,150/-as assessed by an expert engaged by it.
7. We have heard learned counsel for the parties and gone through the record. An application was moved by the complainant in its appeal, F.A. No.284 of 2007, seeking leave of the Commission to lead additional evidence by tendering certain documents. That application was allowed. Opposite party was afforded an opportunity to rebut the evidence. It also tendered additional documents by way of rebuttal evidence.
8. Additional evidence led by the parties, includes an extract of list of land owners, whose land had been acquired. This extract was submitted by the opposite party alongwith the reply and is available at page-139 of First Appeal No.284 of 2007. The document pertains to the compensation paid to the complainant by the Kol Dam Authorities for the acquisition of the land and the structure, in question. As per this statement, complainant had been paid a portion of the value of the land only to the tune of Rs.53,360/- initially. Nothing was paid to the complainant in the initial stage (during the process of acquisition) for the building and the bath rooms. Remaining compensation for the land and the entire amount of compensation for the building and the bath rooms was paid to the complainant in the year 2008, or say not only much after the purchase of the insurance policy & the incidents of flooding, but even after the disposal of the complaint by the District Forum, as is made out from the copy of the Jamabandi for the year 2004-05 filed by way of rebuttal evidence by the opposite party. This document is available at page-59 of the record of First Appeal No.284 of 2007. There is a note in red ink on this document that the property stands acquired, vide award dated 8.3.2008, of Land Acquisition Collector. There is another document i.e. Annexure-X submitted by the complainant by way of additional evidence, which shows that compensation was distributed to the land owners in accordance with the award dated 8.3.2008 of the Land Acquisition Collector on the next following day, i.e. 9.3.2008.
9. The above discussed additional evidence gives a complete lie to the opposite partys contention that the complainant had no insurable interest in the building and the bath rooms at the time, when it insured the same with the opposite party, for the period from 20.12.2004 to 19.12.2005.
10. As regards the quantification of damage, surveyors report, Annexure:O-3 (available on the record of the complaint) shows that the surveyor reduced the estimated figures of loss of several items and also ignored several other items without any reason, in an arbitrary manner. Learned Forum also erred in quantifying the damage just by guess work. When estimate submitted by the complainant was there and the figures of item-wise damage indicated in that estimate, which is at pages 69 to 75 of the complaint file, and some of those figures were reduced and some of those were totally ignored by the surveyor without giving any reason, learned Forum ought to have taken note of at least the figures of those items as were indicated in the estimate of the complainant, which the surveyor also noticed but reduced in his survey report. The total estimated damage to those items comes to Rs.4,71,433/-, including of 25% increase on account of cost index, which, has been allowed by the surveyor of the opposite party also on the reduced figures. The building and the bath rooms have been estimated to be eleven years old by the surveyor and the total life of the building and the bath rooms has been estimated to be 60 years, in the case of building and 40 years in the case of bath rooms. After making a cut on account of depreciation, the figure of estimated loss comes to Rs.3,85,000/-.
In our considered view, this should be the right amount of total loss sustained by the complainant as a result of two incidents of flooding. Out of this amount, a sum of Rs.10,000/- is required to be deducted on account of excess clause. Surveyor has stated in his report that the estimated value of the building was Rs.8,90,000/- but he has not given any discount on this amount on account of depreciation. So, we are of the view that the depreciated value of the building and the bath rooms was supposed to be Rs.8,00,000/- only, for which amount the same were insured.
11. As a result of the above discussion, we hold that the complainant is entitled to a sum of Rs.3,75,000/- on account of insurance money.
12. As observed in our aforesaid discussion, appeal filed by the opposite party i.e. Oriental Insurance Company, is dismissed. Appeal filed by the complainant is partly allowed and the amount of insurance money payable to the complainant is increased from Rs.2,00,000/-, as awarded by the Forum, to Rs.3,85,000/- and the opposite party is directed to pay the aforesaid amount of money, together with interest @ 9% per annum, from the date of institution of the complaint, till the payment of the entire amount of compensation, and also to pay Rs.5,000/- on account of the cost of the appeal.
13. Both the appeals stand disposed of accordingly.
14. This order be placed on the record of F.A. No.267 of 2007 and its authenticated copy, on the record of the second appeal filed by the complainant, i.e. First Appeal No.284 of 2007.
15. One copy of this order be sent to each of the parties, free of cost, as per Rules.
(Justice Surjit Singh) President (Chander Shekhar Sharma) Member (Prem Chauhan) Member March 21, 2012.
[1] Whether reporters of the local papers may be allowed to see the order?