State Consumer Disputes Redressal Commission
M/S P.C.M Cement Concrete Ltd vs Sr Branch Manager on 27 February, 2014
State Consumer Disputes Redressal Commission State Consumer Disputes Redressal Commission West Bengal 11A, MIRZA GHALIB STREET, KOLKATA-700 087. S.C. CASE NO- CC/49/10 DATE OF FILING: 20.07.10 DATE OF FINAL ORDER: 27.02.14 COMPLAINANT: 1. M/s P.C.M Cement Concrete Ltd. P.C.M Tower, Sebok Road, Siliguri- 734001, District Darjeeling, being represented by, Sri Saibal Chaudhury, son of Late Ramendranath Chowdhury. OPPOSITE PARTIES : 1. Sr. Branch Manager, The Oriental Insurance Company Ltd. Gurdwara Building, Sebok Road, Siliguri- 734001, District- Darjeeling. 2. The Oriental Insurance Company Ltd. Gurdwara Building, Sebok Road, Siliguri- 734001, District- Darjeeling. BEFORE HONBLE MEMBER : Mr. Debasis Bhattacharya. HONBLE MEMBER : Mr. Jagannath Bag. FOR THE COMPLAINANT : Mr. Somnath Saha, Mr. Souvik Nandi, Ld. Advocates. FOR THE OPPOSITE PARTIES : Mr. Prasanta Banerjee, Ld. Advocate. _____________________________________________________________________________ : O R D E R :
MR. J.BAG, LD. MEMBER The present complaint emerges from the repudiation of insurance claim in respect of a Holland Containerized Flash Butt Welding Machine (Fabricated) which was covered by a Special Contingency Insurance Policy issued by the insurer, namely, the Oriental Insurance Company Ltd. Such repudiation dated 19.05.2010 was in the nature of a fresh one after adjudication of a complaint of the same Complainant in the original matter as in the case No. CC/51/2009 by this State Commission vide its order dated 29.01.2010. The Complainants case in CC/51/2009, in short, was as follows:
The Petitioner took a Special Contingencies Insurance Policy under No. 81 on 09.09.2007 which was effected from 9th August 2007 to 8th August 2008 upon payment of premium of Rs. 6,33,710/-with risk coverage of fire, explosion , self ignition, lightening , accidental external means , burglary, house breaking , theft , breakdown of equipments due to the accidental reasons , transit coverage, earthquake and A.O.R etc. An accident occurred while the equipment known as Holland Containerized Flash Bulb Welding Machine was working on 27th November 2007. The incident was brought to the notice of the insurance company, and upon receiving the complaint the OP insurance company engaged Mr. S.R. Das as Surveyor on 10.12.2007 for ascertaining the reasons of accident. The Petitioner Company submitted a statement of loss disclosing a total sum of Rs. 49,39,088.58/- .The insurance company repudiated the claim vide their letter dated 30.12.2008 saying that the claim in question was not covered by the policy. The Complainant filed a case before this Commission under No. CC/51/09 which was disposed of by this Commission by a judgment and order dated 29th January 2010 whereby the complaint was allowed and repudiation by the insurer dated 30.12.08 was set aside and the insurer was directed to take a decision, also taking into consideration the .. subsequent view of the surveyor expressed in the joint meeting held on 19.09.08. The Complainants allegation as stated in the present complaint is that the insurer has issued a fresh letter dated 18.05. 2010 repudiating his claim.
The OPs in their W.V have submitted that the issue involved in the previous as well as the present complaint cases are the same and identical. As such two separate complaints can not be filed in respect of self same matter. The OPs claimed that they complied with the judgment of the Commission and decided the matter as per direction of the Commission. It is argued that the OPs were never directed to take the decision in favour of the Petitioner. The complaint is not maintainable on the ground of resjudicata , the Petitioner having no legal right to challenge the decision of the OP without filing any appeal. The Petitioner was never able to prove that the surveyor was biased and since the surveyor opined that the loss as reported by the Complainant was not due to any accident, the question of providing any relief does not arise. The Petitioner could not disprove the contents of the letters dated 01.03.08 of Mr. S.R. Das by adducing any cogent evidence. The Petitioner as such is not entitled to get any relief as prayed for.
We have gone through the petition of complaint together with the copy of the policy schedule, repudiation letter of the insurer dated 30.12.2008, order of this Commission dated 29.01.2010 in CC/51/2009, copy of the minutes of meeting held on 19.09.2008 (Annexure E to the complaint ) , the letter of repudiation dated 19.05.2010 issued by the insurance company etc. The preliminary written objection for and on behalf of the OP challenging the maintainability of the present complaint vide M.A. 63/2011 has been disposed of by this Commission by Order dated 25.08.2011.Questionnaire for and on behalf of the OP to cross examine the Complainant and replies to such questionnaire have been perused. Affidavit on evidence for and on behalf of the OPs and questionnaire on behalf of the Complainant and reply thereto by OP have been filed. Written notes of argument by both the Complainant and the OPs have been perused. Ld. Advocates appearing for the Complainant and the OPs have been heard.
Ld. Advocate appearing for the Complainant submitted that the repudiation of the insurance claim by the insurer dated 19.05.2010 was without any consideration of the surveyors subsequent view which was reflected in the joint meeting attended by the Surveyor himself , who accepted the fact that the breakdown of the machine was by accident. Such view being taken after discussion with the representative of the manufacturer of the machine must be relied upon by the insurance company . The Honble State Commission in case No. CC/51/2009 directed the insurance company to take into consideration , the subsequent / changed view of the surveyor and directed the insurance company to decide the claim which the insurance company failed to do and deficiency in service on their part is thereby established.
Ld. Advocate appearing for the OP submitted that manufacturer of the equipment in question has not been made any party. How and when the machine went out of order has not been mentioned. No expert on the issue of alleged accident was cross examined. The policy condition stipulates that only in case of any accident the risk will be covered. In the present case the Surveyors report was that the breakdown of the machine was due to wear and tear and as such the claim of the Complainant not being covered by the insurance policy , no question of compensation arises. The repudiation has been rightly done .
The OP insurance company appears to have sought subsequent views from the surveyor and the surveyor vide their letter Ref 79/313/13 Dt. 26.04.2010 stated that the State Consumer Disputes Redressal Commissions order has not changed his opinion as given in his survey report and therefore as per views of the surveyor, the insurance company was not liable for compensation as claimed by the Complainant in respect of his Flush Butt Welding Machine .
The Complainants present cause of action appears to have arisen after receipt of the repudiation letter issued by the insurance company on 19.05.2010. The grievance of the Complainant is that the OPs did not take into consideration, the views expressed by the surveyor in the joint meeting held on 19.09.2008 where the agenda for the meeting was fixed to assess the cause of break down.
It appears from copy of the minutes of meeting held on 19.09.2008 (Annexure-E to the complaint petition ) that Sri S.R. Das Surveyor , Mr. Priya Pathak , Engineer of Holland Company, Mr. Sudip Bandhyopadhyay, Branch Manager, Oriental Insurance Siliguri, Mr. Debasish Deshmukh, Agent, Oriental Insurance, Siliguri, Mr. Sandeep Sharma, PCM Representative and Mr. Ramkrishna Das, Oriental Insurance , Kolkata were present . It has been recorded in the minutes of the meeting that the cause of accident was high horizontal stress on the shaft. The same was due to a combination of the malfunctioning of the generator and hydraulic pumps which caused the two quadrants to move unevenly. This was said to be due to an accident and this does not happen under normal movement / circumstances of the machine. Mr. S. R. Das accepted that stress is a cause of break down but he wanted to know the type of stress and reasons for such stress.
What this Commission in its order dated 29.01.2010 recorded is that the survey report prepared by the surveyor earlier to his forming final opinion in a joint meeting could not be relied upon for the purpose of repudiation. This has amounted to deficiency in service as the subsequent altered view of the surveyor expressed in a joint meeting did not form basis of his report. In fact, the view of the surveyor about the break down of the machine insured was totally different from the view reflected in his survey report. In his report he mentioned that the cause of damage to the central shaft was shear due to fatigue, upset rods and quadrant developed scratches due to wear and tear which is not sudden or accidental but gradual and same with generator components and none due to any accident or due to any accidental reason . This view of the surveyor is not the same as reflected in the joint meeting held on 19.09.2008 . In the proceedings of the said meeting it has been recorded that stress is a cause of break down of the machine which Mr. S.R. Das Surveyor accepted and in token of such acceptance signed the proceedings of the joint meeting.
It appears from the repudiation letter dated 19.05.2010 of the insurer that the surveyor was requested to give his subsequent views which was not at all necessary in so far as the subsequent views meant the views taken in the joint meeting subsequent to his giving comments in the survey report and nothing else. The attempt of the insurance company to seek subsequent views from the surveyor after adjudication of the complaint case No. CC/51/2009 made the matter unnecessarily complicated. That was done either intentionally or without appreciating the literal meaning and exact sprit of the Order of this Commission dated 29.01.2010.
The cause of breakdown of the machine being accepted by the Surveyor , the stress which was explained by Mr. Priya Pathak Engineer of Holland Company and accepted by Mr. S. R. Das Surveyor , needs no elaboration and the question as to whether the break down was by accident or not has been finally concluded. In the said joint meeting Mr. S.R. Das , Surveyor wanted to know the type of stress and reasons for such stress. What ever be the stress or whatever be the reasons for such stress , those are separate questions . That the breakdown of the machine was accidental in nature, may be for defect in design of the machine or otherwise was not disputed or challenged by the Surveyor with any sort of argument .
Decision with Reasons What is peculiar in the present case is that a fresh letter of repudiation dated 19.05.2010 has given rise to this complaint with prayer for orders for compensation of Rs. 8778029.58 as the insurance company has not taken into consideration , the altered (subsequent) view of the Surveyor which indicates that the reported breakdown of the machine insured was caused by accident. The insurance company, in seeking subsequent view after passing of the order of this Commission in CC Case No . 51/2009 does not appear to be what actually was meant by this Commissions order in the previous case. The insurance company was requested to take into consideration the altered view about the cause of break down of the machine which has not been done.
Surveyor in his report assessed the net loss to be Rs.14,92,333/- in terms of the policy condition. We have no hesitation to hold that the insurance company issued repudiation letter on 19.05.2010 in an improper manner in so far as without following the direction of this Commission to take into consideration , the surveyors altered view , they insisted on submission of a subsequent view after the joint meeting. We are not inclined to endorse the stand taken by the insurance company and we deem it a deficiency in service on the part of the insurance company to repudiate the claim of the insured. We are of the considered view that the damage of the machine was caused by an accident and as covered by the insurance policy the net assessed loss of Rs. 14,92,333/- is payable by the insurance company with interest from the date of preferring the claim.
Hence, Ordered that the complaint be and the same is allowed in part with direction upon the OP Insurance Company to pay a sum of Rs. 14,92,333/- with interest @ 9% from the date of preferring the claim till realization. There shall be no order as to costs.
Sri Jagannath Bag Sri Debasis Bhattacharya (Member) (Member)