Delhi District Court
Evershine Marble Co vs Oriental Insurance Co. Ltd on 15 February, 2024
1
In the Court of Dig Vinay Singh, District Judge (Commercial Court)-03,
West, Tis Hazari Extension Building, Delhi
In re:
CS (COMM) 147/2023
CNR No. DLWT01-000917-2023
Surender Kumar Agarwal
Proprietor
M/s Evershine Marble co.
D-208, Mansarover Garden, Ring Road,
New Delhi - 110015 ...... Plaintiff
Vs.
The Oriental Insurance Co. Ltd.
Through its CMD
Registered Office :-
Oriental House, A-25/27,
Asaf Ali Road, New Delhi - 110002 ..... Defendant
Date of institution :30.01.2023
Date of arguments :03.02.2024
Date of judgment :15.02.2024
JUDGMENT
1. This is a commercial suit for recovery of ₹23,03,834/-, (₹Twenty-Three Lakh Three Thousand Eight Hundred Thirty-Four), with interest. The dispute between the parties is a 'commercial dispute' within the definition of Sec. 2(1)(c) of the Commercial Courts Act, 2015 (CCA). Pre-litigation mediation between the parties remained unsuccessful vide a non-starter report dated 13.07.2022 of the concerned District Legal Services Authority.
2. The present judgment is directed against the above named defendant only, which is an Insurance Company. Initially, the plaintiff had also impleaded Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 1 of 14 2the seller of the car as well as Department of Financial Services as defendants, both of which had no concern with the dispute in question. Both those defendants were deleted from the array of defendants vide order dated 27.04.2023. The suit of the plaintiff is based on the facts that the plaintiff was not given the insured amount by the defendant despite duly insured and despite the fact that his car met with a fire incident in which the vehicle was burnt completely.
3. Admitted facts of the case are, that the plaintiff owned a Car having registration no. DL4C NA 1793 which was insured with the defendant for the period 26.03.2017 to midnight of 25.03.2018. The Insured Declared Value (IDV) of the vehicle was ₹5,65,000/- (₹Five Lakhs Sixty-Five Thousand).
4. Plaintiff claims that just one day prior to the expiry of insurance the car was completely burnt when the plaintiff, his son and one more person were travelling in the car in Haryana. The fire incident took place on 24.03.2018 at about 9-9.30 PM. The plaintiff and other occupants of the car sustained some burn injuries and were taken to Artimis Hospital in Gurugram and then they were referred to Safdarjung Hospital. Plaintiff claims that matter was orally reported to local police station in Sohna, but it was learnt that the correct jurisdiction was of PS Bhondsi in Gurugram, Haryana. Accordingly, a complaint was given in PS Bhondsi, Gurugram, Haryana. The defendant was duly informed by the plaintiff and despite repeated communications to the defendant, through e-mail/physical communications, the insured amount was never given to the plaintiff. It is mentioned by the plaintiff that the Defendant insurance company was asking for estimate of repairs whereas the car was completely burnt, and Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 2 of 14 3despite efforts the plaintiff could not obtain estimate of repairs and therefore could not submit it. However, the defendant's own surveyor did survey the damaged vehicle and also gave survey reports dated 13.04.2018 & 08.02.2019. Yet the claim was not processed. Plaintiff even claims that when the plaintiff got in touch with the authorized service center of the car manufacturer M/s Skoda, the plaintiff was asked to pay 5% of the estimate as commission for issuance of estimate of repairs. As per plaintiff, he was orally informed by the service center that the car repair would cost somewhere around ₹38-40 Lakhs and since the plaintiff was not willing to pay 5% of that huge amount, therefore, he had asked the defendant whether the said amount should be paid or not. And when the defendant did not reply, the plaintiff did not obtain estimate of repairs. Together with interest calculated by the plaintiff on the IDV, the suit amount is claimed. It may be mentioned here that the above mentioned facts are in brief, shorn of unnecessary details pleaded in the plaint.
5. The defendant insurance company contested the suit claiming that the plaintiff failed to provide estimate of repairs and other documents despite repeatedly being asked to do so by the surveyor as well as the officials of the defendant and therefore the defendant was left with no choice but to close the claim of the plaintiff. As per the defendant, the plaintiff was required to submit previous policy, original copy of estimate of repairs from authorised workshop, other original documents viz., police report, MLC, discharge summary, fire brigade report etc. Defendant also nurtures suspicion about the incident of fire, claiming that admittedly the vehicle was a diesel vehicle which was running into the last year of its scheduled life, there being a prohibition of running diesel vehicle in Delhi beyond Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 3 of 14 4ten years, and that just one day before the expiry of the insurance, the incident was claimed. There is no need to mention other details pleaded in the written statement, being unnecessary.
6. From the pleadings of the parties, following issues were framed:-
ISSUES "1. Whether the plaintiff supplied the documents demanded by the defendant as mentioned in para 6 of the preliminary objections in the WS? OP Plaintiff
2. Whether the plaintiff is entitled to decree for the sum of Rs. 23,03,834/-? OP Plaintiff
3. If the answer to the last mentioned issue is in affirmative, whether the plaintiff is entitled to any interest? If so, at what rate and for which period? OP Plaintiff
4. Relief."
7. In support of its case, plaintiff examined himself as the only witness, as PW1. He tendered his evidence by way of affidavit Ext. PW1/A, reiterating the averments of the plaint and he relied upon documents Ext. PW1/1, 1/2, 1/4, 1/5 & 1/7 to 1/30A. There are no documents Ext. PW1/3 & 1/6 as mentioned in the affidavit of PW1 as they were only photocopies and they were de-exhibited at the time of tendering of affidavit in evidence of PW1. It may also be mentioned here that in support of its case the plaintiff exhibited various e-mails written by the plaintiff to the defendant and some written by the defendant to the plaintiff, along with certificate U/s 65B of the Evidence Act. Along with the e-mails the plaintiff had also attached and mentioned as exhibit certain attachments of emails. The proving of those attachments were objected to by the defendant at the time of examination-in-chief of PW1, which objection was sustained by this Court specifically observing that only e-mails shall be read as exhibited Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 4 of 14 5and proved, and the attachments which are not original documents shall not be read in evidence in favour of the plaintiff until they are proved in accordance with law. The plaintiff however never took any steps to prove those attachments in accordance with law.
8. On the other hand, on behalf of defendant one witness namely Abhinav Kumar, the Deputy Manager of the defendant, was examined as DW1. He also tendered his evidence by way of affidavit Ext. DW1/A reiterating the averments of the Written Statement. DW1 relied upon three documents viz., the surveyor's reports dated 13.04.2018 & 08.02.2019 respectively as Ext. DW1/1 & DW1/2, and the private car package policy as Ext. DW1/3.
9. I have heard Ld. Counsel for the plaintiff and Ld. Counsel for the defendant. The relevant arguments advanced from both the sides are adverted to hereinafter at appropriate stage.
10. Issue wise findings are as follows :-
ISSUE NO. 1"1. Whether the plaintiff supplied the documents demanded by the defendant as mentioned in para 6 of the preliminary objections in the WS? OP Plaintiff"
10.1. Onus to prove this issue was on the plaintiff. It was the defence of the defendant that despite being repeatedly asked, the plaintiff never supplied the estimate of repairs and other documents i.e. previous policy, police report, MLC, discharge summary and fire brigade report etc. The defendant claims that vide e-mail dated 16.04.2018 the surveyor had sought various documents and information relating to the claim from the plaintiff and further reminders were sent to the plaintiff on 03.05.2018, 07.05.2018, 06.06.2018, 18.01.2019 & 06.02.2019, but the plaintiff did Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 5 of 14 6not provide those documents, especially the estimate of repairs from authorised workshop. Even the surveyor in his final survey report dated 08.02.2019 mentioned that the plaintiff did not submit the original claim form, estimate and relevant documents.
10.2. In his cross-examination PW1 admitted that since the plaintiff could not obtain the repair estimate, therefore he could not furnish the same to the defendant.
10.3. Though, in the subsequent report dated 08.02.2019 Ext. DW1/2 of the surveyor of defendant it is mentioned that the claimant had not submitted the original claim form, estimate and other relevant documents, but during arguments counsel for the defendant conceded that the entire controversy in the present matter is confined to non-submission of estimate of repairs. E-mail Ext. PW1/17 dated 16.04.2018 reveals that through this e-mail the defendant asked the plaintiff to supply claim form, estimate of repairs, copy of RC of the vehicle, driving license of the driver at the relevant time, copy of FIR/fire brigade report, copy of insurance policy from the claimant/plaintiff. But e-mail dated 18.04.2018, forming part of Ext. PW1/17, reveals that the plaintiff had sent claim form, copy of RC, driving license, insurance policy and copy of FIR. Thereafter, defendant vide its e-mail dated 03.05.2018 Ext. PW1/18 asked the plaintiff to provide estimate of repairs only. Thus, from the e-mail Ext. PW1/18 dated 03.05.2018, it is clear that the defendant had received other documents and lastly it only confined the document sought from the plaintiff to the estimate of repairs.
10.4. The claim form was sent by the plaintiff in original as Ext. PW1/20 to the defendant through post which was delivered as per the tracking report. So Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 6 of 14 7far as the letter Ext. PW1/23 dated 10.03.2019 sent by the defendant to the plaintiff seeking various documents, including those which had already been supplied to the defendant by the plaintiff, and additionally stamp paper, cancelled cheque, NOC from financer/photograph, PAN card etc. are concerned, Ld. Counsel for the defendant conceded that it was non-supply of the estimate of repairs which lead to claim closure of the plaintiff.
10.5. The plaintiff did attempt to obtain estimate of repairs, but could not obtain it, admittedly. E-mail dated 12.04.2019, forming part of Ext. PW1/19, by the car manufacturer's authorised service centre suggests that a payment of 5% of the estimate would have been charged from the plaintiff for providing estimate of repairs. The plaintiff however did not pay that amount and did not obtain the estimate.
10.6. Thus, so far as issue no. 1 is concerned, it is partially decided in favour of the defendant and against the plaintiff to the effect that the plaintiff failed to supply estimate of repair to the defendant despite being repeatedly asked by the defendant, even though the plaintiff did provide other documents to the defendant.
11. ISSUE NO. 2"2. Whether the plaintiff is entitled to decree for the sum of Rs. 23,03,834/-? OP Plaintiff"
11.1. Onus to prove this issue was on the plaintiff. In view of the decision of issue no. 1 to the effect that the plaintiff failed to provide original estimate of repairs from authorised workshop of the car manufacturer, the question is whether non-submitting of that document alone justifies the stand of the defendant to not process the claim of the plaintiff? Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 7 of 14 811.2. There is no dispute in the present matter that the car in question was insured. Damage due to 'Fire' was indeed covered under the insurance in question. The plaintiff has proved e-mail Ext. PW1/8 sent to the defendant on 25.03.2018 at 9.34 PM informing about the incident, which is prior to the expiry of the insurance which was scheduled to expire in the midnight of 25 & 26 of March, 2018.
11.3. The plaintiff did not prove in the present suit the first police complaint made to police authorities at Sohna police station, which the plaintiff claims to have orally made on 25.03.2018 itself. The plaintiff also fails to prove the medical documents of the car occupants, either of Artimis Hospital or of Safdarjung Hospital as only photocopies, that too in the form of attachments to the e-mails, were placed on record and the originals thereof were not proved in accordance with law. The plaintiff has exhibited the complaint lodged to police station Bhondsi on 26.03.2018 as Ext. PW1/7 in which at 7.15 PM on 26.03.2018 the plaintiff has mentioned about the incident and about the earlier information to Sohna Police Station. The complaint to police station Bhondsi is dated 26.03.2018 i.e. after the insurance period. But then, the defendant never disputed the fact whether the incident in question occurred within the period of insurance or after it. Nevertheless, the e-mail Ext. PW1/8 sent by the plaintiff on 25.03.2018, i.e. within the insurance period, has to go in favour of the plaintiff qua the fact that the incident occurred within the insurance period.
11.4. The suspicion nurtured by the defendant that since the incident is claimed to have occurred just one day prior to expiry of insurance and, in the last Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 8 of 14 9year of life of a diesel vehicle, cannot be a ground to nurture any such suspicion against the plaintiff, in absence of any material to the contrary. 11.5. The question now is whether non-submission of the original estimate of repairs by the plaintiff can be a reason for the defendant to not process the claim of the plaintiff.
11.6. As per surveyor's report Ext. DW1/2 the present is a case of total loss of the vehicle. The IDV of the vehicle is ₹5.65 Lakhs, whereas the rough estimate given by the surveyor himself is of ₹13 Lakhs. In Exhibit DW1/2, the surveyor proceeded to give his rough estimate of repairs and the surveyor mentioned that the IDV of the vehicle is ₹5.65 Lakhs, whereas the estimate of repair would be approximately ₹13 Lakhs. The surveyor recommended that the claim settlement is accordingly recommended as per the assessment done subject to final approval as per terms & conditions. It is also mentioned in the survey report that till this survey was conducted, almost about ten months from the fire incident, the car was not yet picked from the spot of accident, meaning thereby that the car was lying at the spot where it caught fire.
11.7. The two survey reports Ext. DW1/1 & 1/2 specifically mentions that photographs of the damaged vehicle were attached with the survey report. Under Ext. DW1/1, 16 photographs were taken by the surveyor which were enclosed with the survey report. Similarly, it is mentioned in Ext. DW1/2 that the 16 photographs obtained by the surveyor were attached with the report of the surveyor. Obviously those photographs were sent to the defendant's office by the surveyor along with the survey report. Very conveniently, the defendant chose not to place on record even one of those 16 photographs obtained by the surveyor appointed by the defendant. An Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 9 of 14 10adverse inference has to be drawn against the defendant for not proving and filing on record those photographs. On one hand those crucial photographs were withheld by the defendant from court and on the other hand it is claimed that the insurance claim of the plaintiff was not processed because of non-submission of estimate of repairs. Those photographs would have revealed the condition of the vehicle, and in case the vehicle was complete total loss as per Ext. DW1/2, the defendant ought to have processed the claim without waiting for estimate of repairs to be submitted by the plaintiff. The plaintiff had sent certain photographs of the condition of the vehicle through e-mail to the defendant, but unfortunately the plaintiff failed to prove those photographs in accordance with law and merely placed copies of those photographs as attachments to the e-mails along with the e-mails. This Court at the time of evidence specifically mentioned that the attachments shall not be taken to be proved along with the e-mails and they shall have to be proved by the plaintiff in accordance with law. The plaintiff however failed to prove it. Nevertheless, the report of the surveyor appointed by the defendant clinches the issue to the effect that the condition of the vehicle was such that its repair would have costed more than IDV. It seems that for this very reason, defendant did not file on record and proved the photographs of the burnt vehicle. The very estimate given by the surveyor appointed by the plaintiff indicates that the condition of the vehicle was constructive total loss as it was costing more than twice the value of IDV. 11.8. In such circumstances, even if the plaintiff failed to obtain and submit original estimate of repairs from authorised workshop, that itself could not have been a ground to not process the claim of the plaintiff. The Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 10 of 14 11defendant could have processed the claim based on their own surveyor's report.
11.9. It is argued by the counsel for the defendant that claim of the plaintiff was never repudiated, but it was only closed as the plaintiff failed to supply estimate of repairs and thus the suit is pre-mature. Ld. Counsel for the defendant argues that the plaintiff was sent claim closure letter Ext. PW1/28 because of non-submission of document by the plaintiff and therefore the suit should be dismissed and issue no. 2 should be decided against the plaintiff. He also argues that report of the surveyor is not final and it is scrutinised by the defendant and therefore in absence of submission of repair bill, the suit of the plaintiff is pre-mature. 11.10. Though, counsel for the defendant argues that the surveyor appointed by the defendant are third party surveyors and they are not technically qualified to assess the estimate of repairs, but the said argument does not help the defendant. If the defendant claims that the vehicle of the plaintiff could have been repaired at less than the IDV, the defendant at least ought to have placed on record the photographs of the vehicle obtained by the surveyor. Defendant insurance company cannot be permitted to blow hot & cold at the same time i.e. by not processing the claim of the plaintiff on the ground of non-submission of estimate of repairs and also by not believing rough estimate given by its own surveyor and also at the same time by concealing the photographs of the vehicle obtained by none other than the surveyor of the defendant to show its condition to the Court. For several months from the date of claim the defendant did not process the claim of the plaintiff, for whatever reason. The defendant cannot choose on the one hand to not grant the claim and term the claim as closed and Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 11 of 14 12on the other hand state that the claim was not repudiated. Even if the claim of the plaintiff was closed because of non-submission of the estimate and even if the defendant terms it a claim closure, its actual effect is repudiation of claim.
11.11. The contention of the counsel for the plaintiff that DW1 admitted that on Ext. PW1/28 (a printout of a screen shot of the claim status obtained by the plaintiff from the website of the defendant) word 'settled' is mentioned and therefore the defendant must be held liable to pay amount of insurance to the plaintiff, is without force. It was clarified by DW1 in his cross-examination that in absence of any settlement amount mentioned on this document, it is clear that the claim was not settled and that the plaintiff did not provide documents. Thus, merely because the word 'settled' exists in the said claim status in the screen shot obtained by the plaintiff from the defendant's website, it cannot be claimed by the plaintiff that the defendant had at any point of time allowed the claim of the plaintiff.
11.12. As per Ext. DW1/3 loss by fire is covered in the insurance in question.
Though Under Section I, Clause 3 of Ext. DW1/3, detailed estimate of cost of repairs was to be furnished, but the said clause does not provide specifically that in case it is not furnished the claim would be repudiated or not processed.
11.13. When the company's own surveyor gave a report about the condition of the vehicle being such that its repair would have costed more than IDV, there should not have been any problem in the defendant processing the claim even without waiting for the estimate of repair from the side of Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 12 of 14 13plaintiff. After all, the defendant was liable only to pay IDV with necessary deductions and depreciation if any as per Ext. DW1/3. 11.14. The plaintiff has claimed ₹23,03,834/-, whereas the IDV was for ₹5.65 Lakhs only. The plaintiff has placed on record its statement of account Ext. PW1/29 qua that calculation which reflects that on the IDV amount, the plaintiff has calculated interest every year at the end of the financial year. It is not mentioned therein as to what is the rate of interest calculated by the plaintiff.
11.15. As per the car package policy Ext. DW1/3 IDV shall be treated as the market value throughout the policy period without any further depreciation for the purpose of total loss (TL)/constructive total loss (CTL) claims.
11.16. Thus, the defendant is liable to pay to the plaintiff the IDV of ₹5,65,000/-
11.17. Accordingly, issue no. 2 is decided in favour of the plaintiff and against the defendant to the effect that the plaintiff is entitled to ₹5,65,000/- (Five Lakh Sixty-Five Thousand) from the defendant.
12. ISSUE No. 3"3. If the answer to the last mentioned issue is in affirmative, whether the plaintiff is entitled to any interest? If so, at what rate and for which period? OP Plaintiff"
12.1. Onus to prove this issue was on the plaintiff. In view of decision of issue no.2, the plaintiff is entitled to interest, but the question is how much? Neither the counsel for the plaintiff, nor the counsel for defendant advanced any argument on this point.
12.2. In the considered opinion of this Court, interest of justice would be met if the plaintiff is awarded interest @ 6% per annum from 26.03.2018 till Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.
dated 15.02.2024; Page 13 of 14 14realisation of the amount on the recoverable amount of ₹5,65,000/- (₹Five Lakh Sixty-Five Thousand), calculated simply. This issue is accordingly decided.
13. Relief 13.1. Suit of the plaintiff is accordingly decreed for ₹5,65,000/- (₹Five Lakh Sixty-Five Thousand) with interest @ 6% per annum from 26.03.2018 till the date of realisation. Plaintiff shall also be entitled to the cost of the suit. Decree sheet be prepared accordingly.
13.2. A copy of the judgment be supplied to the plaintiff as well as the defendant through electronic modes in compliance of Order 20 Rule 1(1) of CPC. File be consigned to the record room.
Announced in the open Court on 15th day of February, 2024. Digitally DIG signed by DIG VINAY SINGH VINAY Date:
2024.02.15 SINGH 14:27:41 +0530 Dig Vinay Singh District Judge (Commercial Court)-03, West, Tis Hazari, Delhi (r) Judgment CS (COMM) 147/2023 CNR No. DLWT01-000917-2023 Surender Kumar Agarwal Vs. The Oriental Insurance Co. Ltd.dated 15.02.2024; Page 14 of 14