National Consumer Disputes Redressal
National Insurance Co. Ltd. vs Regency Creations Ltd. on 12 May, 2023
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 905 OF 2017 (Against the Order dated 10/08/2016 in Complaint No. 2/2009 of the State Commission Delhi) 1. NATIONAL INSURANCE CO. LTD. DIVISION NO.26,SECOND FLOOR,EMCA HOUSE 23/23-B,ANSARI ROAD, DARYAGANJ,NEW DELHI-110002 NEW DELHI 2. RAKESH KUMAR, THROUGH DEPUTY MANAGER, NATIONAL LAGAL VERTICAL,2E/9,JHANDEWALAN EXTENTION NEW DELHI-110055 NEW DELHI ...........Appellant(s) Versus 1. REGENCY CREATIONS LTD. A-106,SECOND FLOOR,LAJPAT NAGAR,NEW DELHI-110024 NEW DELHI ...........Respondent(s)
BEFORE: HON'BLE DR. INDER JIT SINGH,PRESIDING MEMBER
For the Appellant : MR. K.K. BHAT, ADVOCATE For the Respondent : MR. ABHISHEK K. SINGH, ADVOCATE WITH
MR. Y. RAJAN, DIRECTOR & AR
Dated : 12 May 2023 ORDER
1. The present First Appeal (FA) has been filed by the Appellant against Respondent as detailed above, under section 19 of Consumer Protection Act, 1986, against the order dated 10.08.2016 of the State Consumer Disputes Redressal Commission, Delhi (hereinafter referred to as the 'State Commission'), in Appeal Case (CC) No.02/09 inter alia praying to set aside the impugned judgment dated 10.08.2016 of the State Commission in Complaint No. 02/09 (wrongly mentioned as Appeal No.02/09) and dismiss the Complaint. While the Appellant was the OP, the Respondent was Complainant in the said CC/Appeal No. 02/09 before the State Commission.
2. Notice was issued to the Respondent on 24.05.2017 and operation of impugned order dated 10.08.2016 was stayed subject to Appellant depositing entire awarded amount with interest with the State Commission. Parties filed their written arguments/synopsis on 06.05.2018 and 21.08.2018 respectively. Delay of 9 days in filing the Appeal was condoned.
3. Vide Order dated 10.08.2016, the State Commission has allowed the complaint and OP was directed to pay the complainant amount of Rs.83,07,319/- alongwith interest @12% per annum from the date of fire i.e. 13.01.2007 till date of payment.
4. Appellant has challenged the Order dated 10.08.2016 of the State Commission mainly/inter alia on following grounds:-
State Commission failed to appreciate that the Appellant had paid the due amount of Rs.1,83,14,410/- to the Respondent which was accepted by the Respondent without any protest, out of its own free will and consent. The Respondent had also executed a valid, legally enforceable and binding discharge voucher for this amount in full and final settlement of the claim. Hence Respondent was estopped from claiming any further amount from the Appellant. State Commission failed to notice that the liability in any respect of the Appellant ceased the moment the Respondent/Claimant accepted the amount voluntarily without any kind of coercion, undue influence, fraud, misrepresentation applied by the Appellant.
The Surveyor had evaluated the loss on the basis of information and documents provided by the Complainant/Respondent itself and the final assessment was in terms of the policy terms and conditions which was absolutely fair under the circumstances. The Surveyor had given acceptable reasons for every assessment and/or deduction which were fully justified under the circumstances.
The claim of the Appellant for additional amount of Rs.83,07,319/- is apparently frivolous and not justified by any stretch of reasoning. The State Commission in this case has just allowed the claim of Respondent simply because it so was claimed by the Respondent which obviously is without any proof thereof.
The State Commission has assumed the role of a surveyor to determine the correct application of reinstatement value without appreciating its correct meaning and implication. Nowhere in its judgement has the State Commission discussed as to where the surveyor has erred in assessment of loss and how the Respondent's claim of additional amount of Rs.83,07,319/- was correct and justified. The State Commission has not given any reasoning on merits as to how and why and on what basis it has allowed the claim of the Respondent in full.
The State Commission has without any reasons discarded/deviated from the Surveyor's Report insofar as assessment is concerned.
The State Commission ignored that this Commission and the Hon'ble Supreme Court have time and again held in a catena of judgments that the terms of insurance contract are sacrosanct. It has been held by various courts that once the Insurance Company has taken the decision after detailed consideration of facts and in terms of the policy, it is not open for the Consumer Fora to substitute its opinion for the opinion of Insurance Company.
The rate interest awarded is high and the State Commission had no logic to allow the interest from the date of fire.
The State Commission has thus acted in the exercise of its jurisdiction illegally and with material irregularity inasmuch as it has failed to apply its judicious mind independently to facts of the case and legal position while allowing such a complaint.
5. During the hearing on 24.05.2017, the Appellant had stated that he limits his arguments to the fact that State Commission while awarding an additional amount of Rs.83,07,319 with interest @12% has not discussed the matter nor given any reasons in para 16 for awarding the said amount.
6. Heard counsel of both sides. Contentions/pleas of the parties, on various issues raised in the FA, based on their FA/Reply, Written Arguments, and Oral Arguments advanced during the hearing, are summed up below.
6.1. It was argued by the Appellant that State Commission has not given any reasoning as to how and why and on what basis it has allowed the claim of the Respondent in full. The additional amount has been allowed without any discussion thereon. There is no deficiency of service on the part of Appellant, the rate of interest awarded is high and State Commission has no logic to allow the interest from the date of fire.
6.2 Respondent on the other hand argued that coverage of policy of Rs.8.00 crores was on reinstatement basis/value, the reduced claim offered by Appellant was accepted under immediate protest, he was not intimated of the basis of assessment and was not supplied a copy of Surveyor's report, which he got subsequently under R.T.I. Surveyor has, without any justifiable basis, takes two options to calculate the loss, the capitalization method was in complete contravention of the insurance policy that clearly mandated the reinstatement value method, and this provision was the very heart and soul of the policy. The Respondent in its complaint before the State Commission has given detailed reasons justifying the complaint, however, in response thereto, the Appellant herein primarily raised legal and technical objections in relation to limitation, estoppel, disputed questions of fact not suited for examination by the State Commission. In its evidence affidavit before the State Commission, the Respondent raised the issue of replacement value method being wrongly ignored by the surveyor. The Appellant in its evidence before the State Commission, made general denials without responding to specific claims w.r.t. deliberate breach of reinstatement value clause. The State Commission upon consideration of all the facts and contentions raised by both parties and after dealing with the technical objections raised by the Appellant, allowed the claim of Respondent on merits. Relying on judgments of Hon'ble Supreme Court in New India Assurance Co. Ltd. Vs. Pradeep Kumar (2009) 7 SCC 787, and Union of India & Ors. Vs. N.V. Phaneendran (1995) 6 SCC 45, the Respondent argued that as Appellant did not raise the substantive issues before the State Commission, he is estopped from raising these issues now.
6.3. Appellant, on the other hand, relying on judgment of this Commission dated 08.09.2017 in FA No.1098 of 2014 argued that non-speaking order of State Commission is unsustainable. Relying on judgment of Hon'ble Supreme Court in Mohd. Akram Ansari Vs. Chief Election Officer & Ors. (2008) 2 SCC 95, Respondent argued that Hon'ble court in this case observed that a judge will deal only with the points which are pressed before him in the arguments and it will be presumed that Appellant gave up other points, otherwise, he would have dealt with them also. If a point is not mentioned in the judgment of a court, the presumption is that that point was never pressed before the judge and it was given up. Appellant contended that Respondent has signed a valid, legally enforceable and binding discharge voucher. Hence, after receiving the said amount, the Respondent is estopped from claiming any further amount.
7. We have carefully gone through various case records, in particular the four policies, the Surveyor report and contentions raised by the parties. Policy dated 25.08.2006 covering building, furniture fixtures and fittings, office equipments, plant and machinery and other assets for Rs.8.00 crore is clearly on Reinstatement Value, although the other three policies for Rs.30.00 lakhs, Rs.10.00 lakh and Rs.30.00 lakh are not on Reinstatement Value. These policies cover all kinds of goods, including finished goods, semi-goods and packing materials, stocks, including raw materials, work in progress, packing materials etc. Surveyor in his report dated 05.05.2008 has stated that majority of the reinstatements were carried out prior to completion of 1 year after the loss, only a few items, totalling Rs.11.27 lakh (assessed loss of RV basis and Rs.5.61 lakh (assessed loss on MV basis, were procured after 1 year, for which a deduction of Rs.5.65 lakh has been made.
8. A perusal of complaint filed by the Respondent before the State Commission and reply of the Appellant thereto shows that Respondent did raise issues relating to replacement value as per policy and Surveyor not adopting this method to assess the loss, but except for general denial of liability to pay additional amounts claimed, no specific points were raised by the Appellant opposing the contentions of Respondent regarding replacement value. State Commission has duly considered various rival contentions of parties before coming at the final conclusion.
9. We do not find any illegality or infirmity in the order of the State Commission in directing the Appellant to pay the Respondent the balance amount of Rs.83,07,319/-. However, we find that rate of interest awarded viz 12% p.a. is on a higher side. Hence, we reduce the rate of interest from 12% p.a. to 9% p.a. Rest of the order of the State Commission is upheld. Appeal is disposed off accordingly. Parties to bear their respective costs.
10. The pending IAs in the case, if any, also stand disposed off.
................................... DR. INDER JIT SINGH PRESIDING MEMBER