State Consumer Disputes Redressal Commission
Kosaraju Nageswara Rao Vijayawada vs Oriental Insurance Company Ltd ... on 29 April, 2014
A. P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION : AT HYDERABAD Circuit Bench at Vijayawada FA 903/2012 against CC. No. 06/2012 on the file of the District Consumer Forum II, Krishna District at Vijayawada. Between : Kosaraju Nageswara Rao S/o Krishna Murthy, Hindu, 61 years Lorry Owner, R/o 6-108, SER Centre Prasadampadu, Vijayawada .. Appellant/complainant And M/s. Oriental Insurance Co. Ltd Rep. by its Chief Regional Manager Office at 48-14-111, 2nd floor, Sri Nitya complex Opp. Karnataka Bank, Rama Talkies road, Visakhapatnam .. Respondent/opposite party Counsel for the Appellant : M/s. N. Subba Rao Counsel for the Respondent : M/s. Bhaskar Poluri Coram ; Sri S.Bhujanga Rao . Honble Member
And Sri R. Lakshminarasimha Rao Honble Member Tuesday, the Twenty Nineth Day of April Two Thousand Fourteen Oral Order :
( As per Sri R. Lakshminarasimha Rao , Honble Member ) **** 01 The Complainant is the appellant. The appeal is filed challenging the order of the District Forum on the aspect of quantum of compensation awarded as inadequate.02
The appellant insured with the respondent his Lorry bearing Registration No. AP 20X 3447 for a sum of Rs.9 lakhs. The respondent issued insurance policy bearing No. 462-100/31/20.12/634 for the period commencing from 28.04.2011 till 27.04.2012.03
The vehicle met with an accident on 20.08.2011 at Kolkata and the appellant had given intimation about the accident to the respondent which deputed surveyor Chenchal Biswas to visit the place of accident and conduct spot survey. The surveyor conducted spot survey and undertook photographs of the damaged vehicle on 22.08.2011 and he submitted report on 09.09.2011. The surveyor had not mentioned in his report any amount assessed as damage.04
The appellant shifted the vehicle from the place where the accident occurred to M/s. Lakshmi Durga Mechanical works, Vijayawada. The respondent appointed a surveyor, V. Ramana and deputed another surveyor Vijaya Kumar Gadre on 17.10.2011. The surveyor appointed by the respondent Insurance company opined that loss to the tune of Rs. 5 lakhs is payable and he submitted his report to that effect to the respondent on 28.10.2011.05
The respondent appointed another surveyor, Shiva Shankar, who, estimated the loss at Rs.3,11,888/-. The appellant did not accept the loss as assessed by the surveyor, Shiva Shankar. Thereafter, the appellant filed the complaint before the District Forum .
06The respondent resisted the claim on the premise that the assessment of loss made by M/s. VKG Engineers is not correct and the cost of the parts exceeded to the actual cost at dealers point and that the engine of the vehicle was not totally damaged. The respondent contended that repairs to the engine will not exceed 50% of the cost of the new engine.
07The appellant filed his evidence affidavit and the documents Ex. A-1 to A-11 and on behalf of the respondent/Insurance company Sri P. Srinivasa Rao, Manager filed his evidence affidavit and the documents Ex. B-1 to B-12. Sri Vijaya Kumar Gadre, V.K.G. Engineers and surveyors, Sri L. Shiva Sankar and V. Ramana, surveyors also filed their respective affidavits.
08The District Forum allowed the complaint and directed the respondent to pay an amount of Rs.3,10,000/- as assessed by the surveyor V. Ramana. The District Forum has also awarded interest @ 9% PA from the date of submission of the surveyors report.
09Dis-satisfied with the quantum of amount of Rs.3,10,000/- awarded as the sum to which the appellant is entitled to, the complainant has filed the appeal contending that the District Forum failed to see that the respondent appointed one surveyor after the another surveyor and it had not granted the relief taking into consideration of the bills submitted by him, as also, that the District Forum failed to award compensation. The appellant has contended that after deducting salvage and depreciation, the District Forum ought to have allowed the relief as prayed for. The appellant has contended that the second and third surveyors deducted huge amount than the first surveyor and the District Forum failed to award interest at 2% per month in addition to the Bank rate of interest on the delayed period.
10The learned counsel for the respondent has filed written arguments.
11The point for consideration is whether the appellant is entitled to any extra amount than the amount awarded by the District Forum ?
12While the insurance cover of the vehicle was in existence with the respondent Insurance Company, the vehicle met with an accident on 20.08.2011 at Kolkata and the appointment of three surveyors by the respondent Insurance company are the facts beyond any dispute and need no any discussion. The learned counsel for the appellant has submitted that the District Forum has not considered the appointment of the second and third surveyors by the respondent as invalid in the light of the decision of the Honble Supreme Court of India, whereas, the learned counsel for the respondent has supported the order of the District Forum and he has contended that the claim cannot be considered on total loss basis and therefore the District Forum has rightly allowed the loss on repair loss basis.
13The learned counsel for the appellant has relied upon the following decisions.
(i) Oriental Insurance Co. Ltd Vs. Pemmadi Narsimha Murthy in FA 324/2006 decided by the Honble Natioal Commission on 30.07.2012.
(ii) New India Assurance Co Ltd Vs. Pradeep Kumar, 2009 ACJ 1729 14 The learned counsel for the respondent has placed reliance upon the following decisions.
(I ) 2012 (1) CPR 124 (NC ) in between National Insurance Company Limited Vs. Sri Chakravarthi Enterprises.
(ii ) 2012 (2) CPR 127 (NC ) in between Chanan Preet Singh VS. United India Insurance Company Limited
(iii) 2012 (2) CPR 152 (NC ) in between Priya Industries Vs. National Insurance Company Limited and others
(iv) 2012 (2) CPR 165 (NC ) in D. N.Badoni Vs. Oriental Insurance Company Limited
15. The accident took place on 20.08.2011.
The respondent deputed a surveyor who conducted the spot survey on 22.08.2011. The surveyor submitted his report on 09.09.2011 and without assessing the loss on the premise of certain parts of the vehicle which are damaged were not visible which can be seen after dismantling the engine of the vehicle. As the surveyor has not assessed the loss caused to the vehicle, there is no dispute in so far as the report submitted by the spot surveyor.
16. The appellant shifted the vehicle to the garage at Vijayawada and got estimated the repairs of the vehicle for a sum of Rs.16,22,495/-. The estimate was issued by M/s. Sri Lakshmi Durga Mechanical works,Vijayawada, who, assessed the loss at Rs. 5 lakhs and submitted its report on 17.10.2011 to the respondent. The respondent thereafter appointed another surveyor, Shiva Shankar, on the premise that it was mandatory under cash loss basis settlement to obtain second surveyors opinion. Shiva Shankar assessed the loss on Cash loss basis to an extent of Rs.3,11,888/- and opined that the loss to the tune ofRs.5,04,987/- assessed by M/s. VKG Engineers on repair basis is not correct, the price of some of the parts calculated by the surveyor exceeded their actual cost at dealers point and the engine of the vehicle was not totally damaged. The surveyor opined that the cost of the new engine at dealers point is Rs.4,50,000/- and the repairs to the engine will not exceed 50% of the new engine and the salvage was calculated at about 5% than the actual practice. The appellant had not accepted the loss to the extent of Rs.3,11,888/- as assessed by Shiva Shankar.
17 The respondent appointed another surveyor, Ramana and Vijaya Kumar on the premise that as the earliers surveyors report was not acceptable to the appellant and the surveyors, Ramana and Vijaya kumar assessed the loss at Rs.3,10,471/- and submitted their report on 05.12.2011. Thereafter, the respondent requested M/s. V.K.G. Engineers to re-assess the loss as Ramana and Siva Shankar assessed the loss to the extent of the same amount.
18. The surveyor, when he inspected the vehicle on 17.10.2011 assessed the loss to the tune of Rs. 5 lakhs and thereafter on being requested by the respondent on the premise of assessment of loss made by Shiva Shankar and Ramana at the same amount, he, i.e., VKG, again inspected the vehicle and submitted his report in tune with the report of the two surveyors. The reasons shown were that as per the G. O. 8, the claim of the appellant does not fall as under total construction loss as the respondent did not get the vehicle repaired.
19. A perusal of the terms of the insurance policy would show that the insured declared value (IDV) is Rs. 9 lakhs. It is not clear whether the IDV was declared in consonance with the Art 1 or Art 2 of the terms of the Insurance policy. The total constructive loss is defined as the aggregate cost of removal and/or repair of the vehicle subject to terms and conditions of the policy, exceeds 75% of the IDV of the vehicle .
20. The cause shown by the respondent/insurance company for appointing one surveyor after the another surveyor in total is that loss could not be considered under constructive total loss and the loss to be assessed on repair basis was to be assessed by one surveyor and the same is to be corroborated by another surveyor. We do not see any substance in the contention of the learned counsel for the respondent.
21. In FA 324/2006 between Oriental Insurance Co. Ltd and Pemmadi Narasimha Murthy, the Honble National Commission referring to the decision of the Honble Supreme Court in Sri Venkateswara Syndicate Vs. Oriental Insurance Co. Ltd and another observed that the Insurance Company cannot discord reports of various surveyors till getting a favourable report.
22. In Pradeep Kumar case, the question that fell to the consideration of the Honble Supreme Court was whether the loss assessed by the approved surveyor was binding on the insured and the insurance company, It was held that the report of the surveyor is not binding on the insured and the insurance company and the surveyors report can be made basis or foundation for settlement of claim.
23. We do not find any reason to differ with the assessment of loss to the tune of Rs. 5 lakhs as assessed by M/s. VKG at first instance. The respondent ought to have assigned reasons for appointing another surveyor and not after receiving the report of subsequently appointed surveyor. The respondent has to show sufficient cause for deviating from the assessment of loss made by the surveyor. The respondent has not shown any reason for appointing the surveyor one after the other. The ratio laid down in the aforementioned decisions relied upon by the learned counsel for the appellant is applicable to the facts of the case.
24. For the fore-going reasons, we are inclined to accept the contention of the learned counsel for the appellant that the respondent had appointed the surveyors without showing any valid reason. However, we do not agree with the contention of the learned counsel for the appellant that the appellant is entitled either to a sum of Rs. 9 laksh or a sum of Rs. 6 lakhs. We accept the assessment of loss that was made by Vijaya Kumar Gadre in his report dated 17.10.2011 and accordingly modifiy the order of the District Forum enhancing the amount payable from Rs.3,10,000/- to Rs.5 lakhs and confirm the rest of the order.
25. In the result, the appeal is allowed modifying the order of the District Forum.
The respondent/opposite party is directed to pay an amount of Rs. 5 lakhs ( Rupees Five Lakhs only ) as assessed by the surveyor, Vijaya Kumar Gadre, with interest at 9% PA from the date of submission of the report dated 17.10.2011 till payment and an amount of Rs. 2,000/- towards costs. There shall be no separate orders as to costs in the appeal. Time for compliance four weeks.
MEMBER MEMBER DATED : 29.04.2014.