State Consumer Disputes Redressal Commission
New India Assurance Co. Ltd vs Harminder Singh Suri on 7 December, 2006
IN THE STATE COMMISSION:DELHI IN THE STATE COMMISSION:DELHI (Constituted under Section 9 of The Consumer Protection Act, 1986) Date of Decision: 07-12-2006 Appeal No.542 of 2000 (Arising out of Order dated 02-12-1999 passed by the District Consumer Forum North West, Shalimar Bagh, Delhi, in Complaint Case No. 4554/1998) The New India Assurance Co. Ltd. Registered Officer at: 87-Mahatma Gandhi Road, Fort, Mumbai 400001. AND B-8, Community Centre, Commercial Complex, Janakpuri, New Delhi. . . . Appellant Through Mr. R.K. Tripathi, Advocate Versus Harminder Singh Suri, B-2/60, Jankapuri, New Delhi 110058. . . . Respondent Through Mr. H.S. Kohli, Advocate CORAM: Justice J.D. Kapoor, President Ms. Rumnita Mittal, Member
1. Whether Reporters of local newspapers be allowed to see the judgment?
2. To be referred to the Reporter or not?
Justice J.D. Kapoor (Oral)
1. Admittedly the respondent took a Householders Policy from the appellant covering the risk against theft for the articles mentioned in the policy that included the jewellery also. The policy was valid for the period 21-05-1994 to 20-05-1995. It is also admitted that on 12-12-1994 a theft had taken place in the house of the respondent. The respondent filed a claim for Rs. 2,03,200/- towards the cost of the stolen articles including Rs. 87,000/- towards the cost of the ornaments.
2. On repudiation of the claim of the respondent by the appellant company, the respondent filed the instant complaint before the District Forum.
3. Vide impugned Order dated 02-12-99, the District Forum assessed the loss of the ornaments to the tune of Rs. 87,200/- and directed the appellant to pay the said amount alongwith interest @ 15% w.e.f. 29-03-96, i.e. the date of repudiation of the claim, and Rs. 1000/- as cost of the complaint. Feeling aggrieved, the appellant has preferred this appeal under Sec. 15 of the Act.
4. It is pertinent to mention at the outset that in the FIR No. 743/94 lodged by the respondent, the respondent had reported the theft of the following articles:-
i) Rs. 18,000/- in cash;
ii) A Share Certificate of Bank of India;
iii) 8 Bangles of Gold;
iv) 2 Karas of Gold;
v) 2 Necklaces of Gold;
vi) 3 Rings of Gold;
vii) 4 Gold Jhumkas; and
viii) 1 Gold Tops.
5. However, in the said report it was mentioned by the respondent that he has not properly checked the articles and would give the supplementary list after checking thoroughly. Supplementary list provided by the respondent was in respect of the following items:-
i) One set Pearl Necklace;
ii) One set Red Stone Necklace with Golden beads;
iii) Two Number Diamond Rings;
iv) One Wrist Watch (Ladies) Citizen with golden strap;
v) One set Necklace with Diamond Ear Rings; and
vi) One set Diamond Ear Rings.
6. There is no dispute that the policy covers only the following articles:-
i) Gold Bangles - 6 Nos;
ii) Gold Kara - 1 No;
iii) Gold Necklace - 1 No;
iv) 4 Sets Gold Tops & Ear Rings; and
v) One Wrist Watch.
7. The main ground for repudiation of the claim of the respondent by the appellant Insurance Company was that the items not covered in the policy ought to have been kept in the bank locker but some of the items were mentioned in the list of stolen ornaments, which shows that some of the items not insured were also kept at the residence of the respondent, therefore, it contradicts the statement of the respondent that items not covered under the policy were kept in the bank locker. It was also contended by the appellant that it was unimaginable that the respondent would have kept all his valuable items that too in a wooden almirah when he has steel almirahs and bank locker.
8. The Ld. Counsel for the appellant has relied upon the report of the investigator appointed by it which is as follows:-
i) As per specific statement of the insured only insured jewellery items were kept at home. The jewellery, which was not insured, used to be kept in the bank locker.
ii) No person would keep jewellery worth around Rs. 2 Lakh whether insured or uninsured in the house when he has got a bank locker.
iii) The locker was not operated for more than two months prior to the occurrence of theft. Hence, no heavy jewellery as indicated in the supplementary list had been taken out and should have been available in the house.
iv) The insured jewellery like bangles, karas, tops, rings etc. was kept at home. The insureds wife should have been wearing the same at the time of occurrence of theft. As such there was no chance of the same being stolen when the insureds wife and daughters were sitting in the Drawing-cum-Guest Room on the ground floor.
v) The stolen jewellery was kept in a wooden drawer despite the fact that a steel almirah with an inbuilt locker was lying in the adjacent bedroom.
vi) The insured showed me only a wooden drawer of a wardrobe with a small inbuilt locker.
He did not show me any other place or almirah which too may have been tampered with and from where heavy jewellery as indicated in the supplementary list may have been stolen.
vii) The FIR was lodged after check up from the wardrobe drawer and from other places. There was thus no question of a supplementary list of theft of jewellery.
viii) It would be interesting to note that only one item of jewellery (Two Diamond Rings) out of the supplementary list is covered under the policy. The items reportedly stolen from the wooden drawer and indicated in the FIR are also not entirely covered under the policy.
ix) Theft of cash was neither shown in the FIR nor even in the supplementary list. This was mentioned by the insured in his statement to me and that too after being question specifically be me in this respect. The intention obviously was to avoid mention of cash at all since the insured intended to covert the loss of cash into that of jewellery.
x) The antecedents of the servant Suresh were not got verified. The latter was employed for domestic jobs at the instance of a Chowkidar, who did not even know the correct address of the servant. The servant was allowed to sleep in the house.
9. In addition to the above, the Ld. Counsel also referred and relied upon the terms of the policy providing that if the inmate of the house is involved in the theft, insurance company would not compensate the insured. The aforesaid term is being invoked by the appellant company merely on the premise that on the date of theft the servant of the house was missing and could not be traced thereafter and, therefore, the presumption was raised that it was he who had stolen the goods.
10. While refuting the above contentions of the appellant, the Ld. counsel for the respondent has contended that insurance was taken in respect of the house hold articles as well as ornaments which were frequently used by the family members of the insured and in respect of this a list was furnished to the appellant company which is Annexure A-2 and merely because some of the items out of this list were found in the locker did not disentitle the insured to claim against the theft.
11. We do not find any substance in the contentions of the appellant for the simple reason that the insured had chosen to insure those articles against this policy which he had stated to be keeping at home and this statement shows that the insured had given the list of those ornaments and jewellery amongst other items which he intended to use on day to day basis either by himself or by the family. Had it not been the intention, the respondent would have also obtained a policy in respect of items, which he used to keep in the locker. Therefore, in terms of the policy and in view of the contract between the parties the appellant was liable to compensate the insured in respect of those items, which form part of the list of the insured articles, which he had stated to be keeping at home and no other items.
However, so far as the contention of the appellant that the jewellery was kept in a wooden almirah inspite of the fact that the respondent was having a steel almirah with locker, it is highly flimsy and unethical plea as the appellant company was not concerned with the fact as to in which type of almirah the ornaments are kept by the insured.
12. It is the predominant object of the insurance policy, which is relevant. In this case, the predominant object was to cover the risk against theft from the residence. Even if we assume that the inmate of the house was involved, though the word inmate does not include the servant, still the fact remains that no recovery was effected from the servant nor the servant was arrested nor any investigation was made by the police as to whether this theft was committed by the servant.
13. After perusing the impugned order, we find that the District Forum has scanned the list of articles insured as well as the stolen articles closely and come to the conclusion that the ornaments of the value of Rs. 87,2000/- were stolen from the house, the risk in respect of which was covered by the instant policy. We do not find any reason to differ with this finding.
14. However, as regards interest awarded by the District Forum at the rate of 15%, it may be pointed out that interest is always awarded by way of compensation on equitable grounds if there is no term of contract between the parties. Recently, in DDA v/s Hori Lal & Anr, Appeal No. 372/2006 decided on 08-09-2006, we have dealt with this concept in a highly dissective manner by discussing each and every point and every judgment of the Supreme Court on the point and latest judgment in LIC Vs Smt. S. Sindhu II (2006) CLT 18 (SC), and came to the following conclusions:-
Thus when the ratio of the aforesaid authorities is weighed in the context of provisions of Consumer Protection Act 1986 in providing various remedies including compensation as to the actual loss or injury or damages arising from sale of defective goods, deficiency in service, restricted trade practice etc. the following broad criteria can be laid down for deciding whether it is case of awarding interest by way of compensation and at what rate and for what period or whether it is case of awarding an amount as compensation:-
i) Such compensation shall constitute the actual loss or expected loss and may extend to compensation for physical, mental agony or insult suffered by the consumer. In the word of Supreme Court such compensation is for vindicating the strength of law. There is no hard and fast rule applicable while awarding interest either by way of compensation or otherwise as this question mainly depends upon the facts of each case as facts of no two cases are akin nor are the circumstances.
ii) Wherever contract provides for payment of interest consumer is entitled for agreed rate of interest as of right for the agreed period and at reasonable rate for subsequent period by way of compensation.
iii) Where no interest is payable as per term of the contract or even as per Interest Act 1978, interest can be awarded by the Consumer Forum by way of compensation but only on equitable grounds.
iv) Where the contract does not provide for payment of interest, the interest by way of compensation can be awarded ordinarily in cases where deposits are made by the consumer in respect of purchase of goods or booking of flat or house or service without reaping the benefit of the house or flat or service for long as such a consumer is deprived of the interest against such deposits.
v) Interest may not be ordinarily awarded where a consumer purchases goods or avails service against payment of consideration which later on is found to be defective or deficient, as in such cases the consideration amount cannot be treated or deemed as deposit made by the consumer without having benefit thereof. In such cases the lump sum amount of compensation may be awarded in lieu of interest as to the actual loss or injury suffered by him
vi) Interest so awarded shall be reasonable which means it should neither be too high nor too low.
vii) Interest should be awarded ordinarily either from the date of legal notice served by a consumer or otherwise from the date of filing of the complaint till date of the order.
15. In our view, in such type of cases the interest should be awarded at a very reasonable rate because these are cases which involve adjudication of matters by the insurance company by way of appointing assessors, surveyors and investigators etc and these are not such transactions which are made by way of fixed deposit by the consumer with the Finance Company or such like matters.
16. In our view, the reasonable rate of interest in the facts and circumstances of the case would be 9%. We partly allow the appeal by reducing the interest to 9% from 15% and maintain the rest of the order.
Payment shall be made within one month of the receipt of the order.
17. A copy of this order be made available to the parties free of cost as per statutory requirement and also to the concerned District Forum and thereafter the file be consigned to record. FDR/Bank Guarantee, if any, be released forthwith under proper receipt.
(Justice J.D. Kapoor) President (Rumnita Mittal) Member HK