State Consumer Disputes Redressal Commission
M/S Shahi vs Uiic on 12 December, 2013
2nd Addl. Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
SECTOR 37-A, DAKSHIN MARG, CHANDIGARH
First Appeal No.124 of 2012
Date of institution : 02.02.2012
Date of Decision : 12.12.2013
M/s Shahi & sons, Oppl Grain Market, Chamkaur Sahib, Tehsil Chamkaur Sahib,
Distt. Ropar through its authorized signatory Sukhwinder Singh.
....Appellant
Versus
1. United India Insurance Company Ltd. #24, Whites road, Chennai- 600014.
2. United India Insurance Company Ltd., through its Branch manager, 1st
Floor, near PNB, G.T.Road, Morinda, Tehsil Chamkaur Sahib, Distt. Ropar
...Respondents
Argued by:-
For the appellant : None
For respondent : Sh. R.K.Bashamboo, Advocate
2nd Appeal
First Appeal No.42 of 2012
Date of institution : 12.01.2012
1. United India Insurance Company Ltd. #24, Whites road, Chennai- 600014.
2. United India Insurance Company Ltd., through its Branch manager, 1st Floor,
near PNB, G.T.Road, Morinda, Tehsil Chamkaur Sahib, Distt. Ropar.
Both through Sh. Anil Kakkar, Deputy Manager of United India Insurance Co.
Ltd. Regional Office, SCO no.123-124, Sector 17-B, Chandigarh duly
constituted attorney.
....Appellants
Versus
M/s Shahi & sons, Oppl Grain Market, Chamkaur Sahib, Tehsil Chamkaur Sahib,
Distt. Ropar through its authorized signatory Sukhwinder Singh.
...Respondent
First Appeal against the order dated 30.11.2011 of the
District Consumer Disputes Redressal Forum, Ropar.
First Appeal no.124 of 2012 2
Before:-
Shri Piare Lal Garg, Presiding Member
Shri B.S.Sekhon, Member Present:-
For the appellant : Sh. R.K.Bashamboo, Advocate
For respondent : None
PIARE LAL GARG, PRESIDING MEMBER:
This order will dispose of two appeals i.e. First Appeal No.124 of 2012 (M/s Shahi & Sons Vs. UIIC) and First Appeal No.42 of 2012 (UIIC Vs. M/s Shahi & Sons). Both appeals are against the same impugned order dated 30.11.2011 passed by the District Consumer Disputes Redressal Forum, Ropar (in short the "District Forum") and are being disposed off in a single order. Vide impugned order, the complaint of the complainant was partly accepted.
2. The status of the parties is taken from 'First Appeal No. 124 of 2012' and the parties would be referred by their status in this appeal.
3. The brief facts of the case are that the appellant covered its risk of stock lying in its business premises vide policy bearing no.112181/98/08/3400000030 for the period of 23.5.2008 to midnight of 22.5.2009 with the respondent no.2 for an amount of Rs.20 lacs against the payment of Rs.9937/- as premium and also covered the stock for an amount of Rs.12 lac vide cover note Ex.C-23, as such the stock of the appellant was insured for an amount of Rs.32 lacs lying in the business premises of the appellant.
4. On 3.9.2008 a burglary took place in the business premises of the appellant and FIR no.102 under Sections 380/457 IPC Police Station, Chamkaur Sahib was registered on 4.9.2008. Intimation of Burglary was given by the appellant to the respondents and Surveyor was appointed by the respondents to inspect and assess the loss suffered by the appellant. The Surveyor inspected the business premises of the appellant and took the signature and requisite documents/papers First Appeal no.124 of 2012 3 from the appellant.The Surveyor vide its letter dated 5.9.2008 instructed the appellant to provide some documents which were provided by the appellant to the Surveyor personally in his office. The Surveyor again issued a letter dated 26.11.2008 to provide some more documents and the appellant again visited the office of the Surveyor who assured the appellant that he satisfied with all the documents and the claim will be settled shortly. It was further pleaded that Vishal, Raj Kumar, Rajjan and Ravi accused were arrested in the case by the Police and some articles/goods were recovered from the above accused by the Police. These articles were also taken by the appellant on Spurdhari from the Court vide order dated 17.04.2009.
5. The value of the stolen goods was Rs.4,76,352/- as per the purchase bills, balance sheet and stock register of the appellant.
6. That the appellant after two months of the incident inquired from the respondent no.2 regarding his claim, who told that it will take some time. The appellant approached the respondent no.2 time and again but the matter was lingering on one pretext or the other.
7. The complainant filed a complaint no.34 of 4.3.2010 before the District Forum which was dismissed by the District Forum with the direction to the appellant to supply requisite documents as demanded by the Surveyor within a period of 15 days and the respondent No. 2 was directed to settle the claim within a period of one month thereafter. The appellant was at liberty to file fresh complaint in case he was not satisfied with the claim/order passed by the respondents or there was any delay in settlement of the claim vide its order dt. 29.7.2010.
8. The appellant supplied the required documents in the office of the respondent no.2 at Morinda on 6.8.2010 and also send the copies of the same to Sh. Rajjan Sharda, Surveyor on 12.8.2010. Thereafter, the respondent no.2 again issued letter dated 1.9.2010 to the appellant for supply of some more documents and clarification. The documents were supplied on 27.09.2010 to the respondent First Appeal no.124 of 2012 4 no.2 at Morinda and also clarify the query raised by the respondent no.2 but the claim was not paid by the respondents.
9. The appellant filed an execution application in the District Forum then the respondents deposited a cheque of Rs.34,290/- which was received by the counsel of the appellant under protest.
10. The respondents failed to pay the claim of loss of Rs.4,76,000/- suffered by the appellant due to Burglary and even no reason was given by the Surveyor how loss of Rs.34,290/- was calculated against loss of Rs.4,76,000/- by him. The complaint was filed alleging deficiency in service on the part of the respondents with the prayer that the respondents may be directed to pay the remaining amount out of Rs.4,76,352/- alongwith interest as well as Rs.10,000/- as compensation and Rs.10,000/- as litigation expenses.
11. Upon notice reply was filed by the respondents in the shape of affidavit of Alka Kumra, Deputy Manager of the respondents taking preliminary objections that the complaint of the appellant was not maintainable and earlier complaint no.34 of 4.3.2010 of the appellant was dismissed by the District Forum vide its order dated 29.7.2010. The answering respondents received two reports from the Surveyor dated 16.8.2010 and addl. report dated 8.11.2010. The appellant had already taken some goods from the Court on Spurdhari which were recovered by the Police from the accused persons. The Surveyor assessed loss of Rs.85,500/- which was suffered by the appellant due to burglary. The appellant submitted stock statement to the bank of Rs.40 lacs against the insurance cover of Rs.32 lacs, as such, the stock was under insured. By applying average Clause the loss was assessed as Rs.68,400/-. The appellant had already taken the goods of value Rs.34,110/- on Spurdhari from the Court as such Rs.32,290/- was to be paid by the respondents as remaining claim to the appellant which was paid vide cheque no.249217 dated 22.11.2010 and same was accepted by the appellant.
12. It was also alleged that the District Fourm had no jurisdiction to try and decide the complaint as complicated questions of facts and law are involved and First Appeal no.124 of 2012 5 only the Civil Court had the jurisdiction to try and decide the complaint. It was also alleged that there was no deficiency in service on the part of the answering respondents and no cause of action arose to the appellant to file the complaint as he had already accepted the amount of the claim without any protest. The appellant had not approached the District Forum with clean hands as such the complaint of the appellant was also liable to be dismissed. On merits the same grounds are reiterated by the respondents.
13. The District Forum partly accepted the complaint of the appellant and the respondents were directed to pay Rs.91,600/- more to the appellant with interest @9% per annum w.e.f.22.11.2010 till date of payment as well as Rs. 1,000/- as costs within one month from the receipt of the copy of the order.
14. Aggrieved by the order of the District Forum the appellant has filed the appeal for the modification of the order on the grounds that the District Forum has erred to assess a sum of Rs.91,600/- to be paid by the respondents to the appellant as the same is for less than the loss suffered by the appellant due to burglary. F.A. NO. 42 OF 2012
15. The appellants/opposite parties have also filed First Appeal No. 42 of 2012 against the order of the District Forum on the grounds that the District Forum has fallen an error by not accepting the report of the Surveyor, and the District Forum did not appreciate the deduction on account of average clause, as such the order of the District is liable to be set-aside.
16. We have gone through the pleadings of the parties, grounds of appeals, perused the record of the learned District Forum and heard the arguments of the counsel for the respondent.
17. There is no dispute between the parties that the stock lying in the business premises of the appellant was insured with the respondents. There is also no dispute that Burglary took place on 3.9.2008 in the business premises of the appellant and FIR no.102 was registered on 4.9.2008 under 380/457 IPC in the Police Station Chamkaur Sahib. The Police during investigation of the case arrested First Appeal no.124 of 2012 6 four accused namely Vishal, Raj Kumar, Rajjan and Ravi and goods/articles of value of Rs.34,110/- were recovered from the accused, which were taken on Spurdhari by the appellant from the Judicial Court on 17.4.2009.
18. The version of the appellant that the value of the goods which were stolen from its premises was Rs.4,76,352/-. But the Surveyor appointed by the respondents to inspect and assess the loss had assessed the loss of Rs.57,000/- only as per his report dated 16.8.2010.
19. The dispute between the parties only regarding the amount of loss suffered by the appellant, due to burglary. The appellant in para no.4 of the complaint had pleaded that the total value of the stolen items was Rs.4,76,352/- and the appellant has all the purchase bills of stolen items and the same were also mentioned in the balance sheet of the stock of the appellant and same was provided to the respondent no.2 from time to time. In reply to this para the respondents had not specifically denied the value of the stolen goods as not Rs.4,76,352/- as alleged by the appellant. It was pleaded that the Surveyor had assessed the loss of Rs.57,000/- and reproduced the report of the Surveyor. It was also not specifically denied by the respondents that the stock statements were not supplied by the appellant to the respondent no.2.
20. It is also admitted case of the parties that some stolen items of Rs.34,110/- were recovered by the Police, which were taken on Spurdhari from the Court by the appellant.
21. The version of the appellant is that the report of the Surveyor was against the terms and conditions of the policy as well as not as per the loss suffered by the appellant on the other hand, the version of the respondents was that the Surveyor had assessed the loss to the tune of Rs.57,000/- correctly after physical inspection and as per the stock at the spot.
22. We have perused the Surveyor report Ex.R-2/A dated 16.8.2010. The relevant paras of the report of the Surveyor are reproduced:-
ABOUT THE INCIDENT First Appeal no.124 of 2012 7 As informed the insured closed his hop in routine on 03.09.2008 and went to their home around 8 p.m. Around 4 a.m. in the morning of 4.9.2008, the chowkidar Balwinder Singh telephoned Kulbir Singh on of the partner that shutter of insured shop is broken open. The insured immediately rushed to the shop and found that shutter of the shop was bent and lifted approx 2 ft from the floor level and the locks fixed were intact. The insured immediately went inside the shop and found stocks of sanitary goods missing. He immediately sensed that burglary has taken place. He informed the police station Chamkaur Sahib. The police party visited the shop and started the investigation. The insured also informed the insurer office who is turn appointed us to carry out the survey.
POLICE REPORT The police station Chamkaur Sahib was informed about the incident. The Police authorities have registered the incident vide FIR no.102 dated 4.9.2008 u/s 457/380 IPC. The FIR do not contain the list of stolen items. VERIFICATION OF FINANCIAL RECORD The insured is reportedly maintaining regular books of accounts viz Cash Book, Ledger. The financial record was not submitted at the time of our visit to insured shop. The insured submitted us the financial statement for last 3 years. The gross profit analysis of insured's last 3 years performance is made as under:-
2005-06 2006-07 2007-08
Opening Stock 15.11 12.62 18.22
Purchase 32.94 38.79 36.71
Closing Stock 12.62 18.22 21.91
Gross Profit 5.45 4.42 4.14
No abnormal variation observed in G.P. rate in last 3 years. The insured had already done business upto date of incident and have submitted us the copy of Trading Account as on that date. The detail Trading Account on the date of incident is reproduced as here under:-
Particulars Amount particulars Amount (Rs. in lac)
Opening Stock 2191209 Sales 4423132
Purchase 3906493 Closing Stock 2105430
Gross profit 430860
_______ _________
6528562 6528562
_______ _________
STOCK STATEMENT OF BANK
The insured has been enjoying cash credit limit of Rs.22 lacs from Punjab National Bank Morinda and declaring stock to bank as under :-
Amount (Rs. in lac) 30.04.2008 46.90 30.06.2008 43.43 31.08.2008 43.15 From the above date it is observed that the stock holding of insured was around Rs.40 to Rs.45 lac. The insured has declared stock as per trading account submitted dated 3.9.2008 for Rs.21.05 lac. During the course of survey and physical inspection of the insured shop the stock holding in the shop was observed in range of Rs.40 lac.
From the large variance in stocks physically lying, declared to bank and as per financial record, it has been concluded that financial record submitted by insured is not reliable.
OUR OBSERVATION & ASSESSMENT On receipt of instructions we visited the premises of the insured. The shop of insured is situated on left hand side of road leading to Chamkaur Sahib from Morinda Opp. Grain Market. The insured was present there. The front of the shop is secured by steel rolling shutter. The steel rolling shutter was bent and lifted about 2ft from the floor level. The locks were intact. The miscreants in all probability lifted the shutter by using jack and gained entry in the shop. The insured had made interior of wooden shelves alongside the walls and stock of sanitary and hardware items were kept in the racks. Few bulky items viz paint buckets, Sintex water tank etc. were also kept on floor of the shop. We took complete round of the shop. There were few racks which were lying empty. The insured informed that miscreants took away the stock of sanitary goods viz long noze, Pillar lock, wall mixture, Ball valve, Angle lock etc. kept in the racks. The size of the shop was roughly measured as 17ft * 49ft. The insured was asked to submit list of stolen articles. There were only 16 racks which were found empty from where the miscreants took away the sanitary goods. The insured was asked as to how he will arrive at the quantities of stolen items in the absence of stock record. The insured replied that he will estimate the quantities. The First Appeal no.124 of 2012 8 insured after that did not provide us the list of stolen items which has been submitted now. The list of stolen items submitted for Rs.476352 was found to be on abnormally high sides, since only stocks from 16 racks were stolen. The quality of sanitary goods kept in the shop was found to be medium range as per the buying power of residents of Chamkaur Sahib and surrounding villages. The size of one rack was observed as ftx1.25ft. The sanitary goods viz bib cook, long nose, wall mixture sink mixture, conseal etc. are packed in Card Board boxes. Considering items viz. long nose, Angle cock, Sink Cock, Bib Cock, Piller Cock etc. the cost of which ranges between Rs.250 to Rs.300 not more than 30pcs can be stored in 1 shelf. Thus the value of stock that could be stored in 1 shelf. Thus the value of stock that could be stored in 1 shelf comes to Rs.9000/-. The costly items wall mixture, sink mixture etc. are voluminous in nature and thus occupy more space. Thus number pcs that can be stored in one shelf of costly items reduces. In our opinion stock not more than value of Rs.10000 could be kept in one shelf. The value of stolen items have been arrived as under:-
Total numbers of shelves affected 16 Nos
Approx value of stock in 1 shelf Rs.10000
Total Numbers of shelves stocks 16 * Rs.10000 = Rs.1,60,000/-
The insured has not submitted any stock record in support of his claim. The loss has been assessed on estimate basis. In absence of any quantitative details submitted in support of claim a deduction of 25% have been applied on assessed loss. A deduction of 5% have been applied on account of slow moving/ dead stock. The loss has been assessed as under :-
Amount (Rs.) Value of stolen item arrived 160000 Less 5% deduction on account of 8000 Dead stock __________________ Less 25% on account of approx 152000 And non submission of stock record 38000 _________________ Loss Assessed 114000 ________________ Value at Risk The insured has declared stock as per stock statements submitted to bank for Rs.40 lacs and the physical inspection also confirms the stock holding to the tune of Rs.40 lacs in the shop. The insured has taken an insurance cover of Rs.20 lac against stock holding of Rs.40 lac. Thus the stocks are under insured. By applying average Clause the loss assessed is adjusted as Rs.114000*2000000/4000000= Rs.57000.
23. From the report of the Surveyor that stock of Rs.40 lacs was lying in the business premises of the appellant, but the Surveyor in his observation and assessment it was mentioned that stock record in support of claim was not produced by the appellant and loss was assessed on estimate basis, therefore, Surveyor come to the conclusion that value of the stock was Rs. 40 lacs. The Surveyor deducted 25% of the claim as no quantitative details were submitted by the appellant to the Surveyor in support of its claim. The above finding of the Surveyor are self contradictory if the appellant had not supplied the stock record then how the Surveyor had confirmed that stock for the value of Rs.40 lacs was lying in the business premises of the appellant.
First Appeal no.124 of 2012 9
24. It is also admitted by the Surveyor that list of the stolen items was provided by the appellant alleging the value of the same as Rs.4,76,352/- but the same was found to be abnormally high side. The Surveyor had not mentioned any fact/finding, how he come to the conclusion that the value of the stolen items provided by the appellant was on higher side. The Surveyor neither enquired the rates of the items from the market nor from the dealer/dealers to come to the conclusion that whether the value of the stolen items provided by the appellant was correct or not. The Surveyor had neither tallied the price of the stolen items with the bills which were supplied by the appellant to the Surveyor nor in his report he had mentioned that list/bills of the stolen items were not provided to tally with the price of stolen goods. It is mentioned by the Surveyor that items of 16 racks were stolen but no detail as well as price / value of the same was mentioned by the Surveyor in his report. The report of the Surveyor was only on the basis of exemptions and presumptions and without any basis.
25. We have also perused the list of stolen items Ex.C-6 and bills of the dealers Ex.C-7 to Ex.C-12 vide which the said items were purchased by the appellant. It is also not the version of the respondents that these bills are fabricated or arranged by the appellant after the occurrence. It is pleaded version of the Surveyor that after the direction of the District Forum the appellant had submitted the claim form, list of stolen goods and copies of the purchase bills, but the price of stolen goods submitted was found to be very high side. The Surveyor had not mentioned in his report what items/goods were not stolen and the appellant added the same wrongly in the list of stolen goods and which was the actual price of the stolen goods.
26. On intimation of burglary, FIR no.102 under Section 457/380 IPC on 4.9.2008 was registered at P.S.Chamkaur Sahib and during the investigation four accused were arrested by the Police and items of Rs.34,110/- were recovered from the accused. The Police after investigation presented the challan in the Court of Judicial Magistrate First Class, Ropar on 3.1.2009 against the accused. The First Appeal no.124 of 2012 10 accused confess voluntarily regarding the theft in the Court and there statements were recorded separately by the Court by pleading guilty and begged mercy. The accused were in the custody since 12.11.2008 i.e. for the last about six months as such the accused were sentenced to imprisonment for the period of detention already undergone. So from the investigation by the Police and confession by the accused proved beyond doubt that the version of the appellant proved beyond doubt that the value of stolen goods was Rs.4,76,352/-. During the investigation it was not found by the investigator Officer of Police that quantity and value of the items given by the appellant in his statement for registration of the FIR was not correct.
27. The report of the Surveyor is without any basis and based on surmises and conjectures and not as per the record/bills etc. supplied by the appellant to the Surveyor. The Surveyor also not annexed the said documents with his report which were provided by the appellant to him, even no detail of the same was given by the Surveyor in his report.
28. The Courts believes the reports of the Surveyors to be correct and grant the relief of claim to the insured persons but such like Surveyors shake the confidence of the Courts to believe their reports which are not prepared as per the loss suffered by the insured persons. The Surveyors are in the race to please the insurance companies to take more work from the Insurance companies, which is not fair on their part.
29. On the basis of the above discussion, we are of the view that the items of value Rs.4,76,352/- was stolen from the business premises of the appellant and items of value Rs.34,110/- was recovered by the Police from the accused which were taken by the appellant on Spurdhari from the Court as such the appellant is entitled for the amount of Rs.4,42,242/- (Rs.4,76,352-34110=4,42,242/-).The order of the District Forum is against the evidence, documents on record as such the order of the District Forum is modified to the extent that the appellant is entitled for Rs.4,42,242/- and the respondents are directed to pay the same to the appellant First Appeal no.124 of 2012 11 within one month from the receipt of the copy of the order with interest @9% p.a. after three months of the occurrence i.e.3.9.2008 till its realisation. FIRST APPEAL NO. 42 OF 2012
30. In view of the above discussion, there is no merit in First Appeal No.42 of 2011 filed by opposite parties/appellants and the same is dismissed.
31. The arguments in these appeals were heard on 06.12.2013 and the orders were reserved. Now the orders be communicated to the parties.
32. The appellant-United India Insurance Co. Ltd. haddeposited an amount of Rs. 25,000/- with this Commission at the time of filing the appeal and Rs. 77,294/- on 08.02.2012. These amounts i.e. Rs. 25,000/- and Rs.77294/- with interest accrued thereon, if any, be remitted by the registry to the appellant-M/s Shahi & sons by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and to the opposite parties-United India Ins. Co.
33. The appeals could not be decided within the statutory period due to heavy pendency of Court cases.
34. Copy of this order be placed on First Appeal No. 42 of 2012 (UIIC Vs. M/s Shahi & Sons).
(Piare Lal Garg)
Presiding Member
December 12, 2013 (B.S.Sekhon)
as Member