State Consumer Disputes Redressal Commission
M/S. Bscpl Infrastructure Ltd. vs The New India Assurance Co.Ltd. & Ors. on 28 January, 2016
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G.)
Complaint Case No.CC/2015/08
Instituted on : 20.02.2015
M/s. B.S.C.P.L. Infrastructure Limited,
Through : Project Incharge B. Shrinavaslu Reddy,
S/o Shri B. Jairam Reddy, Aged 44 years,
Ooffice : K.M. - 229, N.H.06,
Village : Godhari, Post - Birkoni, Mahasamund,
Teshil and District - Mahasamund (C.G.) ... Complainant.
Vs.
1. The New India Assurance Company Limited,
Through : Chief Manager,
Office : Chandana Complex,
Harshamahal Marg, Hasan,
Teshil and District Hasan, Karnataka 573201
2. The New India Assurance Company Limited,
Through : Divisional Manager,
Office - Madina Building, Kuchery Chowk, Raipur,
Tehsil and District Raipur (C.G.)
3. Shri Utkarsh Shingwekar,
Surveyor & Loss Assessors,
House No.B-84, V.I.P. Estate,
Near V.I.P. Club, Shankar Nagar, Raipur,
Tehsil and District Raipur (C.G.) ... Opposite Parties
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE MS. HEENA THAKKAR, MEMBER
HON'BLE SHRI D.K. PODDAR, MEMBER
COUNSEL FOR THE PARTIES:-
Shri R.K. Rastogi, for the complainant.
Shri P.K. Paul, for O.P. No.1 & 2.
Shri Shishir Bhandarkar, for O.P.No.3.
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ORDER
Dated : 28/01/2016 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT. The complainant filed this consumer complaint under Section 17 of the Consumer Protection Act, 1986 against the OPs seeking following reliefs :-
1. To direct the Insurance Company to pay the sum assured Rs.30,00,000/- (Rupees Thirty Lakhs) under Contractors Plant & Machinery Policy due to loss suffered by L & T Komatsu Grader.
2. To direct the Insurance Company to pay interest @ 18% p.a. from 18.04.2014 till final payment.
3. To direct the Insurance Company to pay a sum of Rs.1,00,000/- (Rupees One Lakh) towards compensation for financial, physical and mental agony because the claim of the complainant was repudiated by the Insurance Company without any appropriate reason.
4. To direct the Insurance Company to pay a sum of Rs.1,00,000/- (Rupees One Lakh) to the complainant towards compensation because due not settlement of claim of the complainant for one year, the complainant could not got repair the L & T Komatsu Grader nor purchase a new L & T Komatsu Grader.
5. To direct the Insurance Company to pay a sum of Rs.20,000/- (Rupees Twenty Thousand) towards cost of litigation and advocate fees.
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6. To direct the Insurance Company to pay any other compensation, as this Commission deems fit.
2. Brief facts of the complaint are that : Shrinavaslu Reddy, S/o Shri B. Jairam Reddy, Project Incharge is authorized officer of M/s B.S.C.P.L. Infrastructure Ltd. and he is operating Project at Mahasamund and he is authorized to file present complaint on behalf of the complainant company. The Head office of M/s B.S.C.P.L. Infrastructure Limited is situated in Andhra Pradesh. M/s B.S.C.P.L. Infrasture Limited received a order construct road from Mahasamund to Orissa Border Surguja. To complete the contract work the complainant company constructed a temporary office at Village Godhari, Post Birkoni, Tehsil and District Mahasamund and to complete the construction of the above road, Shrinivasalu Reddy has been made Project Side Incharge and the company has authorized him to do the work and to sign on behalf of the company. The O.P.No.1 is General Insurance Company, which is doing business of insurance in all over the country as per instructions and Circular issued by I.R.D.A. The O.P.No.1 insured the L & T Komatsu Grader, which is under ownership of the complainant. The O.P.No.1 is having its office at Hasan, Karnataka. The O.P.No.2 is divisional office of the New India Assurance Company Limited, which is providing services to the complainant under the insurance policy and it is having divisional office at Raipur. The O.P.No.3 is licensed Surveyor of I.R.D.A. who is // 4 // conducting survey work provided by the Insurance Company and is submitting his report before the Insurance Company As the claim of the complainant has been wrongly repudiated by the Insurance Company on the basis of disputed survey report of the O.P.No.3, therefore, O.P.No.3 has been impleaded as party in the complaint. The complainant purchase L & T Komatsu Grader in the year 2001 at the cost of Rs.84,00,000/- and for safety of the same, Contractors Plant and Machinery Policy was obtained from the O.P.No.1 & O.P.No.2 so that during work if in any accident the L & T Komatsu Grader suffers some defect, break or fire, then the compensation can be obtained from the Insurance Company. The complainant paid premium amount of Rs.13,763/- for the period from 07.07.2013 to 06.07.2014 for the sum assured Rs.30,00,000/-. The Policy Number is 672401/44/13/07/900000020. The O.P.No.1 issued three page insurance policy without any terms and conditions. After purchasing the policy, the O.P.No.1 & O.P.No.2 assured the complainant that if there is any defect or the machine is break in the accident or L & T Komatsu Graders is damaged in the fire incident, then the O.P.No.1 & O.P.No.2 will pay sum insured to the complainant or will pay the amount incurred in the parts which are to be repaired. The complainant has not claimed any compensation earlier in respect of L & T Komatsu Grader. On 18.04.2014, during work at Village Dongripalli, Post Pithora, District Mahasamund the L & T Komatsu // 5 // Grader was suddenly damaged due to fire incident. The matter was reported by the competent officers of the complainant company to Police Station, Pithora. The Police Officer came to the spot and investigated the matter and prepared panchanama under fire incident No.06/2014. After conducting investigation, investigation report was submitted before Executive Magistrate, Pithora. The complainant gave intimation regarding the fire incident to the O.P.No.2 through email on 19.04.2014 and requested to depute Surveyor and assess the loss. After receiving intimation regarding the incident of fire, the authorized officer of the O.P.No.2 directed the complainant company to obtain repair estimate in respect of damages occurred to L & T Komatsu Grader and till then the O.P.No.2 will depute any Surveyor. As per the directions given by the Insurance Company, the complainant obtained repairing quotation. In the above quotation the repairing cost of the L & T Komatsu Grader has been mentioned as Rs.36,36,223/-. On the date of incident i.e. 18.04.2014, the above machine was being operated by by K. Suresh and he is having valid licence to operate the above machine. The O.P.No.2 appointed Shri Sunil Surana as Preliminary Survey, who on the next date of the incident conducted survey of the damaged L & T Komatsu Grader. After receiving preliminary surveyor, the Insurance Company issued claim form to the complainant company. The complainant company duly filled up the form and by giving all information submitted claim form along with // 6 // all relevant documents in the office of O.P.No.2. After receiving claim form, the Insurance Company appointed Shri Utkarsh Shingwekar, Surveyor for conducting final survey and for assessment of loss. Shri Utkarsh Shingwekar conducted survey of the damaged L & T Komatsu Grader, took photographs and recorded statements of the employees and officers of the complainant company and got it signed. The Surveyor assured the officers of the complainant company that he will submit his report at the earliest before the Insurance Company and within 15 days from the submission of the Survey Report, the Insurance Company will pay the compensation in respect of L & T Komatsu Grader to the complainant company The officers of the complainant company requested the Surveyor to provide copy of Final Survey Report to them, but the Surveyor (O.P.No.3) expressed his inability to provide copy of the same because the Survey Report is a confidential document. Shri Sunil Surana, who was appointed as Preliminary Surveyor has also not provided copy of Preliminary Survey Report to the complainant company and did not obtain any consent letter from the complainant company. The complainant company continuously contacted the O.P.No.1 and O.P.No.2 through telephone for settlement of the claim, but the complainant did not receive any satisfactory reply from the Insurance Company. Lastly vide letter dated 11.09.2014, the Insurance Company repudiated the claim of the complainant on the ground that the cause of loss is purely // 7 // due to short circuiting which is an Electrical Breakdown and is an Exclusion under the subject policy. The Insurance Company for the first time sent terms and conditions of the policy along with claim repudiation letter. The Insurance Company has deliberately repudiated the claim of the complainant on the false ground. The Preliminary Surveyor and Final Surveyor appointed by the Insurance Company during conducting survey could not ascertain that why in L & T Komatsu Grader fire was occurred and due to which reason the fire incident happened. Both the Surveyors assumed that due to fire incident the L & T Komatsu Grader was completely damaged and all parts became useless, but even then the Insurance Company repudiated the claim on the basis of the statement, which comes in the category of deficiency in service. In the year 2001 when the above L & T Komatsu Grader was purchased by the complainant company, at that time its cost was Rs.84,00,000/- and from year 2001 till 2014 the complainant company is obtaining Contractors Plant and Machinery Policy from the O.P.No.1 & O.P.No.2 and prior to year 2014, the complainant has not made any claim, thus in 2013-2014 the L & T Komatsu Grader was insured for Rs.30,00,000/-, which was completely damaged in fire incident which was occurred during work. Today, the complainant company is required Rs.1,00,00,000/- to purchase a new L & T Komatsu Grader and the complainant company is required to purchase the above machine to complete the contract work. The Insurance // 8 // Company was required to pay Rs.30,00,000/- which is insured declared value of the machine, but the Insurance Company has deliberately repudiated the claim of the complainant, which comes in the category of deficiency in service.
3. The O.P.No.1 & 2 filed their joint written statement and averred that the Shri Shreenivaslu Reddy, S/o Shri B. Jairam Reddy in the of Project Incharge, is not authorized to file the present complaint on behalf of the complainant company. For want of information and documents, the Project in Mahasamund is not being supervised by the above official. The complainant company has not been given a contract assignment for building road from Mahasamund to Orissa Border. The contractual parties in the EPC Contract Agreement, appear to be sister concerns, working under the same management. The contract purporting to be awarded to the above referred employer by the NHAI have not been placed before this Commission. The fact that the complainant company has constructed a temporary office at Village Ghodari, Post Birkoni, Tehsil and District Mahasamund for completion of the contract is not known the O.P.No.1 & O.P.No.2. Shri Shreenivaslu Reddy S/o Shri B. Jairam Reddy was not appointed as Project Incharge for carrying out the above mentioned assignment of road construction and office and also that he was not authorized in writing by the complainant to sign on behalf of the complainant in the discharge of his duties. The O.P.No.1 & O.P.No.2 has been licensed by // 9 // the IRDA and have been pursuing the General Insurance business in India, subject to guidelines and circular issued by the above regulatory body from time to time. The O.P.No.1 is the policy issuing office and O.P.No.2 is the Divisional office of the insurer. L & Komatsu Grader, 2001 has been insured by the O.P.No.1 & O.P.No.2 subject, of court, to terms and conditions of the policy being adhered to. The O.P.No.3 is a recognized Surveyor and Loss Assessor duly licensed by the IRDA. The Survey report prepared by O.P.No.3 is not a disputed one and also that the O.P.No.1 has not disposed of claim of the complainant company unjustifiably. The reasons cited for impleading the Surveyor as O.P.No.3 are absurd and misleading. The complainant company had not purchased an L & T Komatsu Grader in the year 2001 for Rs.84 lacs. A Contractor's Plant & Machinery Policy No.67240144130700000020 was issued for the period from 07.07.2013 to 06.07.2014 for a sum insured of Rs.30,00,000/- subject to the terms and conditions and exclusion clauses that form an inherent & integral part of the above policy which bind the parties to Insurance Contract. No separate undertakings or promises are made by the insurer outside the scope of the policy. The O.P.No.1 & 2 has issued insurance policy to the complainant along with terms and conditions. The above L & T Komatsu Grader caught fire on 18.04.2014 near the site at Dongripalli, P.O. Pithora, District Mahasamund (C.G.) due to Electric Short Circuiting and as a result the above machine was damaged. The // 10 // insurers promptly deputed one Mr. Sunil Surana, Surveyor & Loss Assessor duly licensed by the IRDA, on the very same day i.e. 19.4.2014, to conduct the preliminary survey and an inspection was carried out at working site of the insured (complainant) by the above Surveyor on the same day in the presence of the Works Manager Mr. V. Rama Rao along with the operator of the machine Mr. Suresh Kumar, near Pithora. The authorized official of O.P.No.2 had not instructed the complainant company to get the Machine Repairs Estimate from any repairer of the machine as a pre-condition for appointing the Surveyor. Had the case been so the Preliminary Surveyor would not have been conducted on the same day on which intimation regarding accident was received by the insurer. The above contention of the complainant that the Quotation/estimate is a pre- requisite for appointment of a Surveyor is further negated by the quotation dated 09.05.2014 (Annexure C-7) filed by the complainant and also relied upon, which is self explanatory. The operator of the vehicle is not possessing valid and effective driving licence. That immediately after receiving information of the damage to L & T Komatsu Grader by fire, the preliminary surveyor Mr. Sunil Surana was deputed by the insurer, who conducted the preliminary survey on the same day when he was appointed. The above clearly reflects the promptitude on the part of insurer to pursue the claim. The claim form was not issued by the insurer only after the preliminary survey was // 11 // completed. No such restrictions are ever imposed by the insurer under any conditions. Mr. Utkarsh Shingwekar was deputed by the insurer to conduct the final survey of the damaged L & T Komatsu Grader on account of fire, as alleged. The said Surveyor had conducted the final survey after taking photographs of the damaged grader and also taking statements of the officials and employees of the complainant company which obviously is an essential part of the survey. Assurances were not given by the Surveyor that the complainant's claim shall be settled. The Surveyor is not empowered to make assurances on behalf of the Insurance Company. The above Surveyor's report was not ever sought by the officials of the complainant company The Insurance Company seeks the services of the Surveyor to help them to assess the damages and also ascertain the cause of damage to the subject matter under the policy. The preliminary survey report was not at any time sought by the complainant. The telephonic conversations were not ever exchanged between the O.P.No.1 & 2 Insurers and the complainant insured. The insurer with malafide intentions, have not deprived the complainants of its alleged justified claim. The plausible reason has been cited by the insurer for repudiating the claim of the complainant company. The preliminary surveyor as also the final surveyor have categorically opined and inferred that the cause of fire was due to electric short circuiting which is not indemnifiable under the captioned policy. The repudiation letter dated 11.09.2014 is also accompanied by // 12 // copy of the Contractor's Plant and Machinery Insurance Policy containing interalia the exception clauses. In the repudiation letter it is mentioned that the cause of loss is purely due to short circuiting which is an electrical breakdown and is an Exclusion under the subject policy. Clause (b) under the head Exceptions which have an impact on the present case reads as follows "loss or damage due to electrical or mechanical breakdown, failure, breakage or derangement, freezing of coolant or other fluid, defective lubrication or lack of oil or coolant, but if a s a consequence of such breakdown or regangement an accident occurs causing external damage, such consequential damage will be indemnifiable.". The above clause is comprehensible leaving no room for any ambiguity and hence justified. The terms and conditions guiding the policy were not issued for the first time by the Insurance Company to the complainant at the time of issuance of the above repudiation letter. The present claim has not been deliberately disallowed by the insurer O.P.No.1 & O.P.No.2 on baseless grounds, Based on the statements made by the driver/operator of the above damaged machine and on the basis of both the Surveyors the O.P.No.1 & O.P.No.2 Insurers have proceeded with the above repudiation. The driver of the above vehicle / machine have asserted that the damage had been caused due to short circuiting. Also the preliminary Survey Report in page 1 last para mentions that "The operator explained that at the time of running all of a sudden due to some short circuit near // 13 // the battery side there was fire, which further propogated through hydraulic hoses and diesel pipes etc. and then it got intensified and vehicle was burning in flames". The above substantiates the fact that short circuiting was the sole cause of fire which damaged the vehicle. The final Surveyor have corroborated the finding of the Preliminary Surveyor. The upshot of the above facts, findings and circumstances very clearly establishes that the insurers have objectively pursued the claim instead of being guided by surmises and conjectures and hence have not committed any deficiency in service. The complainant company had purchased the L & T Komatsu Grader for about Rs.84 lacs in year 2001, as no invoice has been produced in support of the same. The contention of the complainant that starting from 2001 the CPM Policy is regularly taken from the insurer is subject to verification. Even if otherwise the above premise does not entitle the complainant company to claims, which would in the ordinary course of business are disallowed. Also the onus of proving the declaration by the complainant company that no previous claim has been made prior to 2014 as a result of which above machine was insured for Rs.30 lacs, lies upon the insured complainant. The new L & T Komatsu Grader did not costs about Rs.1 crore. The O.P.No.1 & O.P.No.2 reiterate that the repudiation of the above claim is in conformity with the policy terms and conditions based on concrete facts and findings and therefore have not committed any deficiency in service as alleged by the complainant // 14 // company. No cause of action is available to the complainant as the repudiation of the claim has been made on the basis of statement of their own driver and also on the basis of expert opinion of both the Surveyors.
4. The O.P.No.3 filed his written statement and averred that the complainant is not the consumer of the O.P.No.3 as the O.P.No.3 has not extended any services to it not has charged any money from it for conducting survey. The complainant is a big business organization engaged in commercial activity and as such it does not fall under the category of consumer as defined under Consumer Protection Act, 1986, hence the present complaint, so far it relates to the O.P.No.3, is not maintainable and deserves to be dismissed summarily. Averments regarding insurance and issuance of policy etc. do not call for any reply. It is however admitted that the O.P.No.3 is duly licensed Surveyor and Loss Assessor and as such is an independent authorized person to conduct survey on the request of any person. In the present case also the O.P.No.3 was requested by the CRM of The New India Assurance Co. Limited to conduct the survey of subject Komatsu Grader. The survey report of the O.P.No.2 is not a disputed one and that the O.P.No.1 & 2 have not wrongly disposed of the claim on the basis of the survey report. The O.P.No.3 has in fact prepared the Survey Report after thorough inspection. It would not be out of place to mention that the job of a qualified Surveyor is to inspect the // 15 // damaged item thoroughly and to assess the loss considering its depreciation value, under insurance and salvage value; and also to see the admissibility of the claim subject to nature of and terms of the policy, which in the present case was CPM Policy. The O.P.No.3 has thus considered all the above aspects while preparing the Survey Report, which as a result cannot be made any grievance of. The complainant has not availed any services from the O.P.No.3 nor has paid any money to him, it therefore, cannot maintain the present complaint against the O.P.No.3. The O.P.No.3 did not ever give assurance to the complainant regarding settlement of its claim. It is worth mentioning that it is not the job of a Surveyor to settle the claim or give assurances to the insured nor they are empowered to do so. The fact is that as per Section 64 UM of the Insurance Act, the services of a Surveyor are sought by the insurers to help them to assess the damages and to ascertain the actual cause of damage to the insured item under the policy and accordingly the Surveyor conducts the survey considering depreciation value, under insurance, salvage value of the insured damaged item, excess clause deduction under the policy etc. and gives his report without prejudice after thorough inspection. The Surveyor also sees the admissibility of the claim subject to the nature of damage and terms of the policy. Allegation to this effect therefore is false and baseless. The complainant's claim was not repudiated unjustifiably by the O.P.No.1 and O.P.No.2 because the // 16 // damage to the Grader on account of the fire was due to short circuiting, which was not indemnifiable under exclusion clause of the subject CPM policy, under which the loss or damage due to electrical or mechanical breakdown, failure, breakage or derangement of coolant or other fluid, defective lubricant or lack of oil coolant, is excluded from the coverage under the policy. The repudiation therefore by the insurer was justified. The O.P.No.3 has ascertained the actual cause of damage to the Grader. The fact is that the O.P.No.3 as well as Preliminary Surveyor had found that there was no other cause of fire except electrical short circuiting near the battery location in the machine. It is worth mentioned that on request of CRM of the Insurance Company, the O.P.No.3 visited the insured's BSCPL Infrastructure Ltd. at Village Birkoni, to inspect / survey and assess the loss / damage to their L & T Komatsu Grader Machine, which was reported to have been damaged due to fire on 18.04.2014. During the course of survey it was reported and further confirmed by Preliminary Surveyor that the subject Grader was in operation when the operator observed that some smoke was coming out of the engine compartment and further found that the cables inside have caught fire, which further propogated to cause damage to other parts of the machine. The O.P.No.3 during the survey himself observed that the organization of fire was solely due to short circuiting as there was no other possible cause for such fire to originate. This fact of short circuiting also gets confirmed from the claim form // 17 // submitted by the complainant itself. The O.P.No.3 therefore was of the confirmed opinion that the damage to the Machine was due to the fire originated from short circuiting, which was not covered under the policy. Though such loss was out of the coverage under the policy, but as part of procedure the O.P.No.3 assessed the loss. While computing the loss, it came to the know of the O.P.No.3 that subject machine was 13 years old hence its depreciated value was assessed to Rs.29,41,072/- after the deduction of 65% of depreciation, as per prevailing norms of assessment. It was further found that the salvage of the damaged machine would have fetched Rs.3,00,000/-. Apart from it, it was also observed that the complainant's claim also suffered from under insurance because as per the complainant itself the value of the Grader was alleged to be Rs.84,00,00/-, whereas its value while taking the policy was declared to be Rs.30,00,000/- only, hence under insurance factor was also calculated by the O.P.No.3 as 0.357 and thus loss was assessed to the tune of Rs.8,92,862/-, calculation to this effect has been mentioned on page 6 of the survey report dated 26.06.2014. The amount so assessed is of course was not payable to the complainant as it was excluded from the coverage under the policy. The subject claim was not repudiated on false and presumptive basis by the Insurance Company. The complainant in fact has not produced any documents to substantiate its allegations nor has given any proof much less origination of fire which propogated and intensified to // 18 // damage the machine. Whereas facts and circumstances and nature of the damage as ascertained by the O.P.No.3 and also statement in the claim form, clearly establishes that the damage was solely due to short circuiting, which was not covered under the subject CPM Policy. No deficiency in service was committed by the Insurance Company in repudiating the complainant's claim. Any cause of action did not accrue to the complainant against the O.P.No.3 as the complainant is not consumer of the O.P.No.3. The complainant is not entitled to get any relief against the O.P.No.3, firstly because the complainant is not a consumer of the O.P.No.3, secondly because the nature and cause of damage to the Grader was not covered under the subject CPM Policy, thirdly because the complainant has measurably failed to substantiate its claim and lastly because there is no cogent evidence on record to negate the finding of well reasoned survey report of the O.P.No.3, which as a result cannot be brushed aside. The complaint be dismissed with cost.
5. The complainant filed documents. Annexure C-1 is Company Registration Certificate, Annexure C-2 is Work Order, Annexure C-3 is Power of Attorney, Annexure C-4 is Insurance Policy, Annexure C-5 is Nuksani Panchanama, Annexure C-6 is Investigation Report, Annexure C-7 is Quotation dated 09.05.2014, Annexure C-8 is driving licence of Shri Suresh K., Annexure C-9 is Claim Form, Annexure C-10 is letter // 19 // dated 11.09.2014 sent by The New India Assurance Co. Ltd. to the complainant.
6. The O.P.No.1 & O.P.No.2 have also filed documents. Documents are CPM Policy No.67240144130700000020 with terms and conditions, policy is valid for the period from 07.07.2013 to 06.07.2014, claim intimation through email dated 21.04.2014, intimation regarding the incident given by M/s BSCPL Infrastructure Limited to Incharge, Police Station Pithora dated 09.05.2014, Preliminary Survey Report of Surveyor Shri Sunil Surana dated 26.06.2014 with photographs, No Claim letter of The New India Assurance Company Limited to the complainant dated 11.09.2014.
7. The O.P.No.3 has filed documents i.e. pre-receipted bill dated 21.04.2014, Survey Fees Bill dated 26.06.2014.
8. Shri R.K. Rastogi, learned counsel appearing for the complainant has argued that the complainant obtained a contract for construction of road from Mahasamund to Orissa Border Surguja. The complainant purchase L & T Komatsu Grader in the year 2001 at the cost of Rs.84,00,000/- and for safety of the same, the complainant obtained Contractors Plant & Machinery Policy from the O.P.No.1 & O.P.No.2 and policy was effective for the period from 07.07.2013 to 06.07.2014. The Insured Declared Value of the L & T Komatsu Grader was Rs.30,00,000/-. The said Grader was purchased by the complainant in // 20 // the year 2001 at the cost of Rs.84,00,000/- and after passing of 12 years the cost of the Grader was declared as Rs.30,00,000/- i.e. 1/3rd of its original value, therefore, the Insured Declared Value was Rs.30,00,000/- which is just and proper. It cannot be held that Insured Declared Value of the Grader is under insurance. The insurance policy was issued by the O.P.No.1 & O.P.No.2 after duly inspecting the Grader, therefore, the objection raised by the O.P.No.1 & O.P.No.2 regarding under insurance of the L & T Komatsu Grader, is not tenable. The terms and conditions of the insurance policy were not provided to the complainant. Only 3 page policy has been provided by the Insurance Company to the complainant and terms and conditions were not provided to the complainant, therefore, the terms and conditions of the policy are not binding upon the complainant. Shri R.K. Rastogi, has further argued that on 18.04.2014, the L & T Komatsu Grader was working at Village Dongripalli, Post Pithora, District Mahasamund (C.G.), all of sudden the smoke came out from the Engine of the L & T Komatsu Grader and the same was completely damaged due to fire incident. The matter was immediately reported to the concerned Police Station and Police came to the spot and panchanama was prepared and Fire Incident No.06/2014 was registered. The matter was investigated and investigation report was submitted before Executive Magistrate, Pithora. Intimation regarding the incident was also given to the O.P.No.1 & O.P.No.2. The // 21 // complainant obtained quotation for repairs and repairer gave quotation to the tune of Rs.36,36,223/-. The operator of the Komatsu Grader was having valid and effective driving licence for operating the same. The O.P.No.1 & O.P.No.2 appointed Shri Sunil Surana, as Preliminary Surveyor, who visited to spot and inspected the Komatsu Grader and gave his preliminary survey report. The complainant submitted claim form before the O.P.No.1 & O.P.No.2 but the O.P.No.1 & O.P.No.2 did not provide copy of the Preliminary Survey Report. Thereafter the O.P.No.1 & O.P.No.2 appointed Shri Utkarsh Shingwekar as Final Surveyor. Shri Utkarsh Shingwekar, did not inspect the L & TKomatsu Grader and did not visit the spot and gave his report on the basis of preliminary survey report given by Shri Sunil Surana. The Report of Shri Utkarsh Shingwekar, is erroneous and is not reliable. The Komatsu Grader was completely damaged due to fire. At the time of incident, the L & T Komatsu Grader, was in stationary condition, therefore, it is not acceptable that the fire caught to the L & T Komatsu Grader due to short circuiting. Even if we assume that fire caught to the L & T Komatsu Grader due to short circuiting, even then the Komatsu Grader was completely damaged, therefore, the complainant is entitled to get the insurance amount relating to the damaged parts of the Komatsu Grader and the O.P.No.1 & O.P.No.2 are liable to pay the insured amount to the complainant, therefore, the complaint may be // 22 // allowed and complainant be awarded reliefs as prayed by the complainant in the relief clause of the complaint.
9. Shri P.K. Paul, learned counsel appearing for the O.P.No.1 & O.P.No.2 has argued that the incident took place due to short circuiting. The complainant himself submitted claim form before the O.P.No.1 & O.P.No.2. In the claim form, it is mentioned that fire was occurred due to electrical short circuiting and the electrical short circuiting is not covered under the insurance policy. In Exceptions Clause of the insurance policy, it is mentioned that loss or damage due to electrical or mechanical breakdown failure are not covered under the policy and the insured cannot not claim anything more than what was covered by the insurance policy, therefore, the complainant is not entitled to get the insured amount from the O.P.No.1 & O.P.No.2. Shri Sunil Surana, was appointed as Preliminary Surveyor, who inspected the Komatsu Grader and gave his report, thereafter Shri Utkarsh Singhwekar was appointed as Final Surveyor, who also inspected the L & T Komatsu Grader and contacted with the complainant and he also perused the preliminary survey report, thereafter he gave his report. Shri Utkarsh Shingwekar, is an independent Survey, who was duly licenced by Insurance Regulatory and Development Authority and is duly authorized, therefore, his report is reliable. Shri Utkarsh Shingwekar mentioned in his report that the cause of loss is purely due to short circuiting in the electrical cables which is an electrical breakdown and // 23 // is an exclusion in the subject policy. Shri Sunil Surana also mentioned in his Preliminary Survey Report that "at the time of running, all of sudden due to some short circuiting near the battery side there was fire." It appears that fire was caught to the Komatsu Grader due to short circuiting and the Insurance Company is not responsible to pay any compensation to the complainant and the complaint is liable to be dismissed. Shri P.K. Paul, has further argued that complainant purchased the L & T Komatsu Grader at the cost of Rs.84,00,000/- and in the claim form (Annexure C-9) the complainant assessed the amount of damages as Rs.50,00,000/-.The complainant filed quotation (Annexure C-7) in which the estimated charges for repairing of the Komatsu Grader is mentioned as Rs.36,36,223/-. It appears that the insured value declared by the complainant comes within under insurance. He placed reliance on Dr. Tarunjit Dutta Roy vs. The Branch Manager, The New India Assurance Company Ltd. 2013 NCJ 418 (NC); Deokar Exports Pvt. Ltd. vs. New India Assurance Company Limited, I (2009) CPJ 6 (SC); Export Credit Guarantee Corpn. of India Ltd. vs. M/s Garg Sons International, 2013 (4) CPR 373 (SC); United India Insurance Co. Ltd. vs. M/s Harchand Rai Chandan Lal, 2005(1) CPR 64 (SC); Captain Brij Mohan vs. New India Assurance Co. Ltd. & Ors. I (2015) CPJ 621 (NC) and Prem Processor vs. Oriental Insurance Co. Ltd., IV (2014) CPJ 675 (NC);
// 24 //
10. Shri Shishir Bhandarkar, learned counsel appearing for the O.P.No.3 has argued that Shri Utkarsh Shingwekar, is an independent Surveyor and he gave his report after inspecting the Komatsu Grader and his report is reliable. The complainant is not a consumer of the O.P.No.3, therefore, the complaint is liable to be dismissed against O.P.No.3.
11. We have heard arguments of both the counsels and perused the documents filed by the parties in the case.
12. It is not disputed that the complainant obtained Contractors Plant & Machinery Policy from the O.P.No.1 & O.P.No.2 which was effective for the period from 07.07.2013 to 06.07.2014.
13. Now we shall examine whether the value of the Komatsu Grader as declared by the complainant to the tune of Rs.30,00,000/-, comes within under insurance ?
14. The complainant specifically pleaded that he purchased the Komatsu Grader in the year 2001 at the cost of Rs.84,00,000/- and the incident took place on 18.04.2014. The policy was valid for the period from 07.07.2013 to 06.07.2014 i.e. near about 12 years from the purchase of the L & T Komatsu Grader and after passing of 12 years definitely value comes to 1/3rd of its original cost. The L & T Komatsu Grader was purchased by the complainant in the year 2001 at the cost of Rs.84,00,000/- . The value of the L & T Komatsu Grader was declared // 25 // at the time of obtaining insurance policy as Rs.30,00,000/-, which is just and proper and it cannot be held that the value of the L & T Komatsu Grader declared by the complainant at the time of obtaining insurance policy, comes within under insurance.
15. Now we shall examine whether the complainant is entitled to get compensation from the O.P.No.1 & O.P.No.2 even when Komatsu Grader was damaged due to electrical short circuiting ?
16. The complainant filed document Annexure C-9 which is claim form (From Page 33 to Page 36). In the claim form, at page No.33 the complainant mentioned that the L & T Komatsu Grader "burned due to Electrical Short Circulate". At page no.34 of the same document again in reply to question no.9 that what was the cause of damage and how did it occur, the answer was given by the complainant that "due to Electrical Short Circulate". In Page No. 36 the complainant again mentioned that "due to Electrical Short Circulate our motor grader machine 11253 Engine & Transmission has burned." Annexure C-10 is repudiation letter dated 11.09.2014 sent by the Insurance Company to the complainant. In the above repudiation letter, it is mentioned that "On going through the survey reports, it is observed that, the cause of loss is purely due to short circuiting which is an Electrical Breakdown and is an Exclusion under the subject policy."
// 26 //
17. The terms and conditions of the Contractor's Plant & Machinery Insurance Policy is annexed at page No.38 to 43 of the record of the case. In Exceptions Clause (b) it is mentioned thus :-
"(b) loss or damage due to electrical or mechanical breakdown failure, breakage or derangement, freezing of coolant or other fluid, defective lubrication or lack of oil or coolant, but if as a consequence of such breakdown or regangement an accident occurs causing external damage, such consequential damage will be indemnifiable."
18. Shri Sunil Surana, Preliminary Surveyor in his Preliminary Survey Report dated 21.04.2014 mentioned thus :-
"Cause of Loss :
The Operator Mr. Suresh K. explained that at the time of running all of sudden due to some short circuit near the battery side there was fire, which further propogated through hydrolic hoses and diesel pipes etc. & then it got intensified and vehicle was burning in frames."
19. Shri Utkarsh Shingwekar, Final Surveyor, in his Final Survey Report dated 26.06.2014 mentioned thus :-
"NATURE AND CAUSE OF LOSS :
As reported to me and further confirmed from the Preliminary report of Mr. Sunil Surana the subject grader was in operation at Village - Dongripalli, near Pithora. The operator observed some smoke coming out of the engine compartment and further found the cables inside to have caught fire which further spread through the hoses and dieses pipes finally engulfing the cabin assy. Rear tyres near the engine caught fire and the flames further damaged the nearby parts. The // 27 // Operator and Helper tried their level best to control the fire with the help of available sand and water. The fire was totally controlled after an hour but in the meantime all the major items were badly burnt and damaged.
The Insured were not able to justify/predict any reasonable cause towards origination of fire. As mentioned in the preliminary report the origination of fire was due to electrical short circuiting noticed near the battery location in the machine. I am also of the opinion that any other feasible cause cannot be judged and hence ruled out.
CONCLUSION :
The cause of loss is purely due to short circuiting in the electrical cables which is an electrical breakdown and is an exclusion in the subject policy.
The Exclusion is as under :-
Loss or damage due to electrical Mechanical breakdown, failure, breakage or derangement, freezing of coolant or other fluid , defective lubrication or lack of oil or coolant, but if as a consequence of such breakdown or derangement an accident occurs causing external damage; such consequential damage will be indemnifiable.
No other cause of loss can even be thought of.
Hence, the claim is not being recommended for payment."
20. The complainant himself pleaded that Shri Utkarsh Shingwekar, the Surveyor inspected the L & T Komatsu Grader and took photographs and also recorded statements of the employees of the // 28 // complainant company. In Final Survey Report, Shri Utkarsh Shingwekar, Surveyor (O.P.No.3) has specifically mentioned that he visited the Insured M/s BSCPL Infrastructure Ltd. at Village Birkoni, Near Pithora, District Mahasamund to inspect/survey and assessed the loss / damages to their L & T Komatsu Grader machine reported to have been damaged due to fire accident on 18.04.2014. Under the head Nature and Cause of Loss, he mentioned that "As reported to him and further confirmed from the Preliminary Report of Mr. Sunil Surana the subject Grader was in operation at Village - Dongripalli, near Pithora. From the bare perusal of Final Survey Report of Shri Utkarsh Shingwekar, Surveyor, it appears that he visited the spot and inspected the L & T Komatsu Grader and thereafter he prepared his Final Survey Report.
21. The complainant himself admitted that the incident of fire was occurred due to electrical short circuiting and the Komatsu Grader was burnt due to electrical short circuiting.
22. In Export Credit Guarantee Corpn. of India Ltd. Vs. M/s Garg Sons International (Supra), Hon'ble Supreme Court has observed thus :-
"9. The insured cannot claim anything more than what is covered by the insurance policy.
// 29 // "...The terms of the contract have to be construed strictly, without altering the nature of the contract as the same may affect the interests of the parties adversely."
23. In United India Insurance Co. Ltd. Vs. M/s Harchand Rai Chandan Lal (Supra), Hon'ble Supreme Court has observed thus :-
"6. The terms of the policy have to be construed as it is and we cannot add or subtract something. Howsoever liberally we may construe the policy but we cannot take liberalism to the extent of substituting the words which are not intended. It is true that in common parlance the term 'burglary' would mean theft but it has to be proceeded with force of violence. If the element of force and violence is not preset then the insured cannot claim compensation against theft from the insurance company. (Para 6).
It is not open to interpret the expression appearing in policy in terms of common law; but it has to give meaning to the expression reproduced the terms of the policy as also the definition of burglary and / or housebreaking as defined in the policy."
24. In Deokar Exports Pvt. Ltd. Vs. New India Assurance Company Ltd. (Supra), Hon'ble Supreme Court, has observed thus :-
"11. A policy of insurance is a contract based on an offer (proposal) and an acceptance. The appellant made a proposal. The respondent accepted the proposal with a modification. Therefore, it was a counter proposal, in which event three would have been no contract. The second was to accept either expressly or impliedly, the counter proposal of the respondent (that is respondent's acceptance with modification) which would result // 30 // in a concluded contract in terms of the counter proposal. The third was to make a counter proposal to the counter proposal of the respondent in which event there would have been no concluded contract unless the respondent agreed to such counter proposal. But the appellant definitely did not have the fourth choice of propounding a concluded contract with a modification neither proposed nor agreed to by either party..."
25. In National Insurance Company Limited vs. Abdul Razak, 2015 (4) CPR 492 (NC); Hon'ble National Commission has observed thus :-
"8. ......... In the case of Oriental Insurance Co. Ltd. Vs. Sony Cherian, AIR 1999 SC 3252, in which the Apex Court held that :
"The Insurance policy between the insurer and the insured represents a contract between the parties. Since the insurer undertakes to compensate the loss suffered by the insured on account of risks covered by the insurance policy, the terms of the agreement have to be strictly construed to determine the extent of liability of the insurer. The insured cannot claim anything more than what is covered by the insurance policy. That being so, the insured has also to act strictly in accordance with the statutory limitations or terms of the policy expressly set out therein."
26. Therefore, the complainant cannot claim anything more than what is covered by the insurance policy. The terms of the contract have to be construed strictly, without altering the nature of the contract as // 31 // the same may affect the interests of the parties adversely. From bare perusal of the Exclusion Clause (b), it is clear that loss or damage due to electrical or mechanical breakdown is not covered under the policy.
27. The complainant obtained Contractors Plant and Machinery Insurance Policy from O.P.No.1 & O.P.No.2 and the terms and conditions of the insurance policy were also provided to the complainant. From bare perusal of the Exception Clause of the terms and conditions of the policy, it appears that the short circuiting is out of policy conditions and loss caused to L & T Komatsu Grader, is purely due to short circuiting in the electrical cable, which is excluded under the policy, therefore, the Insurance Company has rightly repudiated the claim of the complainant and the complainant is not entitled to get any compensation under the above insurance policy.
28. Therefore, the complaint of the complainant is liable to be and is hereby dismissed. No order as to the cost of this complaint.
(Justice R.S. Sharma) (Ms. Heena Thakkar) (D.K. Poddar)
President Member Member
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