State Consumer Disputes Redressal Commission
M/S United India Insurance Co. Ltd. vs M/S Kumar Labour Contractor on 14 October, 2010
BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT PUDUCHERRY BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT PUDUCHERRY THURSDAY, the 14th day of October, 2010 First Appeal No.11/2008 M/s United India Insurance Co. Ltd. Rep. by its Divisional Manager Appellant Vs. M/s Kumar Labour Contractor, Rep. by K.Kumar .. Respondent (On appeal against the order passed by the District Forum, Puducherry in Consumer Complaint No.80 of 2005, dated 27.09.2007) Consumer Complaint No.80 of 2005 M/s Kumar Labour Contractor, Rep. by K.Kumar, S/o Kothandapany, 71/2, Main Road, Koodapakkam, Pondicherry .. Complainant Vs. 1. The United India Insurance Co. Ltd., Rep. by its Development Officer, No.46, J.N.Street, Pondicherry. 2. The Divisional Manager, M/s United India Insurance Co. Ltd., No.46, J.N. Street, Pondicherry. Opposite Parties BEFORE: HONBLE JUSTICE THIRU J.A.K.SAMPATHKUMAR PRESIDENT TMT. K.K.Ritha, MEMBER
FOR THE APPELLANT:
M/s B.Mohandoss, K.Ilango, K.Velmurugan, Advocates, Puducherry.
FOR THE RESPONDENTS:
Thiru M.Nakkeeran,, Advocate, Puducherry.
O R D E R (By Honble Justice President) This is an appeal filed under Section 15 of the Consumer Protection Act, 1986 against the order in Consumer Complaint No.80/2005, dated 27.09.2009 of the District Consumer Disputes Redressal Forum, Puducherry questioning the validity both on facts and law for the various reasons referred thereon.
2. Two witnesses were examined and twenty-nine exhibits were marked on the side of the complainant. One witness was examined and four exhibits were marked on the side of the opposite party. The District Forum after analyzing the evidence on record and passed the impugned order after accepting the claim of the complainant.
3. Brief facts of the complaint are as follows:
The complainants are doing re-packing and banding operation on contract with M/s Hindustan Lever Limited (HLL) at Earnest Godown-D, Villupuram Main Road, Pallithennal Post, Kandamangalam, Puducherry. The stocks in the godown were insured with M/s United India Insurance Company Limited, Puducherry Branch (appellant herein) under two Policies 1) 011700/11/03/00202 and 2)011700/46/3/00027, dated 26.12.2003 for Rs. 1,00,00,000/- (Rupees One Crore) each for the period 12.26 hrs. on 26.12.2003 to midnight of 25.12.2004. The relevant documents are Exs.C1 to C4. The said policies were taken for risk under fire and burglary.
4. While taking stock verification on 19.02.2004, the complainant found that 459 boxes containing soaps each 100 grams were stolen. Each stolen box contains 162 soaps and each soap valued at Rs.12/-. The complainant estimated the loss at Rs.8,92,296/-.
5. Immediately, the complainant had lodged a complaint with the Station House Officer of Kandamangalam Police Station on 20.02.2004 under Section 380 IPC. Ex.C5 (= Exs.C17, C8 and C19),is the copy of the F.I.R. and the complaint.
6. The Station House Officer, Kandamangalam P.S. visited the scene of occurrence on 21.02.2004 and examined the witnesses and prepared observation mahazar and sketch. Exs.C20 to C27 are the relevant documents. The investigation revealed that unknown culprit entered through the ventilator situated between the roof and wall on the southern side of the godown and scaled down the wall and committed theft. Foot prints were found on the wall.
7. Since the theft committed by unknown culprit, the Investigating Officer could not apprehend the culprit and hence dropped further action. Exs.C8 and C29 are relevant documents.
8. Exs.C6 to C16 are letters of correspondence between the parties to the proceedings.
9. The appellant Insurance Company resisted the claim on the ground that they are not liable to the claim as the theft was not committed either by force or by house-breaking in consonance with the policy conditions . They examined witnesses and marked four exhibits to substantiate their claim.
10. After hearing the arguments on both sides, the points for consideration are:
1.
Whether theft to accompany either by force or by house-breaking is necessary to make insurance claim under burglary policy?
2. Whether the award of interest at 12% p.a. by the District Forum is in order?
11. POINT NO.1:
The stocks of the complainant were insured with M/s United India Insurance Company Limited, Puducherry Branch under two policies covering risk for fire and burglary for Rs.1.00 crore each. The stocks worth Rs.8,92,296/- were found stolen while taking inventory on 19.02.2004. A Police complaint was given in this regard. On investigation, the officials of Police found that some unknown culprit committed theft of stocks concerned in this case by entering into the southern side godown through the ventilator situated between the roof and the wall. It was also found that the said unknown culprit had left foot prints on the wall.
These facts were not disputed by the appellant insurance company.
12. Ex.C20 mahazar and Ex.C21 sketch are proof for the existence of the ventilator in between roof and wall and also about the existence of trees on the southern side of the godown. To substantiate these facts, the Investigating Officer examined the mahazar witness namely, 1) Sankar, s/o Duraisamy and 2) Shanmugam, s/o Pooshnam and recorded their statements. The relevant portion reads as follows:
Fnlhd; RtUf;Fk;
Tiuf;Fk; cs;s xd;wiu mo mfyj;jpy; btz;onyl;lu; tptuKk; kw;Wk; Fnlhd; bjd;g[w Rtupy; fhy; gjpe;j jla fs; nghd;w tptu fis ghu;it kf$upy; vGjpf;bfhz;lhu;fs;
Their statements have been marked as Exs.C22 and C23. The opposite party have not questioned the genuineness and the contents of these documents.
13. More so, the Investigating Officer has examined Mr. Kumar, S/o Gothandapani, who was doing job work for M/s Hindustan Lever Limited soap company and recorded his statement. This statement was marked as Ex.C27. To corroborate his statement, the Investigating Officer has also examined 1) Sathiamoorthy, S/o Ayyanarappan,
2) Velu, S/o Ganapathy and 3) Kumar S/o Gothandapani, who are working as supervisor under Mr.Kumar. Their statements are marked as Exs.C24 to C26.
The relevant portion of their statement reads as follows:
Fn;lhdpy;
cl;g[wKs;s bjd;g[w Rtw;wpy; fhy; gjpe;j kw;Wk; fhy; jl fs; ,Ue;jJ. Rkhu; 50 kPl;lu; cauKs;s me;j Rtw;wpd; Tiuf;Fk; Rtw;Wf;Fk; ,ilna fhw;W kw;Wk; btspr;rk; trjpf;fhf Rkhu; xd;wiu mo ,ilbtsp tHpahf jpUlu;f;s Fnlhdpy; cs;ns EiHe;J nrhg;g[[ bgl;ofis jpUo ,Ug;gJ bjupfpd;wJ. FnlhDf;F bjd;g[wk; btspna ,Uf;Fk; kuj;jpd; kPJ Vwp m fpUe;j Fnlhd; Rtu; kPJ Vwp ,ilbtsp tHpahf ,uz;L K:d;w ngu;fs; nru;e;Jf; bfhz;L nrhg;g[ bgl;ofis jpUo ,Uf;fpwhu;fs;. ,e;j Fnlhd; mikg;g[ bjupe;jtu;fs;jhd; jpUo ,Uf;fpwhu;fs;
Their statements are marked as Exs.C24 to C27. The opposite party have not questioned the genuineness and the contents of these documents.
14. It is admitted by the opposite party that they received the claim petition from the complainant and submitted a reply for the same denying their liability. If that be so, the opposite party ought to have made a thorough enquiry in this regard and prepared a survey report to deny the claim of the complainant. But, the appellant opposite party miserably failed to file the survey report to confront the claim of the complainant under Exs.C20 to C27. No explanation offered by the Insurance Company for not marking the survey report. Therefore, adverse inference had to be drawn against the appellant insurance company as they have not filed the survey report which is a relevant document to deny the claim of the complainant. .
15. More so, CW1 at the time of cross-examination admitted that the burglary policy included house-breaking also.
16. Now, we have to find out whether the facts as such would attract the offence of theft under the category burglary. It is also the specific stand of the appellant Insurance Company that , as regards Burglary Policy, the specific clause specifically mentioned that theft following upon an actual forceable and violent of and or house breaking should be there for the applicability of the policy The policy conditions refer two types of cases which are eligible for insurance claim. They are: 1) theft by force and violence and 2) hose-breaking.
17.With reference to 1st case, the offence of theft should have occurred with the knowledge of the person concerned by using force. Such act would attract either robbery or decoity.
18. With reference to the 2nd case, the offence of theft should have occurred without the knowledge of the person concerned.
19,. The facts on hand is referable to the second case. The Appellant Insurance Company accepted the nature of offence, i.e. theft but declined to fulfil the claim of the complainant stating that the theft did not involve forcible entry or house breaking. It is not the case of the complainant that the theft had occurred due to forcible entry. Then, what is left out is to find out whether the theft as alleged by the complainant would attract the definition of house-breaking. Now, let us go through the definition of Section 445 I.P.C. to find out the real position of law in this regard.
Section 445 IPC A person is said to commit house-breaking who commits house trespass, if he effects his entrance into the house or any part of it in any of the six ways hereinafter described Second: If he enters or quits through any passage not intended by any person other than himself or an abettor of the offence, for human entrance or through any passage to which he has obtained access by scaling or climbing over any wall or building.
Illustrations:
(b) A commits house trespass by creeping into a shop at a port-hole between decks. This is house-breaking.
(c) A commits house-trespass by entering Zs house through a window. This is house-breaking.
20. Narration of events of theft described in the earlier paragraphs which was not confronted by the appellant, namely M/s United India Insurance Company Ltd., Puducherry Branch, fit in with the definition of burglary u/s 445 I.P.C. and as such the consumer/complainant is entitle to claim insurance under the Insurance Burglary Policy against the United India Insurance Company, Puducherry Branch and the loss would cover the policy.
21. Learned counsel for both parties have relied on the following decisions and explained the legal positions in this regard.
1. 2006(3) C.P.r. 219 B.N. Rama and Company (Stores) - Appellant Oriented Insurance Company Limited - Respondnet
2. 2007 (1) C.P.R. 20 New India Assurance Co. Ltd -
Appellant United Building Stores - Respondent.
3. 2007 (2) C.P.R. 433 The Oriental Insurance Co. Ltd -
Appellant Shri Abhishek Kumar Sahu - Respondent
4. 2004 SAR (Supreme Appeal Report) Civil 311 United India Insurance Company Ltd -
Appellant M/s Pushpalaya Printers -
Respondent
5. 2007(1) C.P.R. 449 (NC) Life Insurance Corporation of India - Appellant Ram Singh Tanwar -
Respondent.
6. 2007 (2) C.P.R. 21 United India Insurance Co. Ltd. thro its Divisional Manager Vs. Payal Guptha
7. 2004 SAR (Civil) 907 = 2004 Vol.12 CLD (Consumer Law Division) 97 (SC) United India Insurance Co. Ltd - Appellant M/s Harchand Rai Chandarlal
22. The principles laid down in the said rulings have been taken note of in depth. The first three decisions are not relevant to the case on hand as the issues involved in the said rulings are not related to the issues in the present case.
23. The principles laid down by the Honble Supreme Court in the fourth ruling reads as follows:
In case of any ambiguity or a term being capable of two possible interpretations one beneficial to the insured should be accepted consistent with purpose for which policy is taken.
This principle is followed in the fifth ruling and decided the case. Similar view was laid down in the sixth ruling. But, the said principles are not relevant to the issues on hand as there is no ambiguity in the policy conditions.
24. Ina the seventh ruling, it was held that if the policy condition stipulates theft preceded with force or violence, to claim insurance amount for the loss sustained due to theft. Then such condition would bind the parties to the policy. It was further held that the policy is a contract between the parties and both parties are bound by the terms of contract. The terms of the policy have to be construed as it is and one cannot add or subtract something. Howsoever liberally court may construe the policies but court cannot take liberalism to the extent of substituting the words which are not intended. Before part with this case, the Honble Supreme Court has held that, We would like to observe that the terms of the policy as laid down by the Insurance Company should be suitably amended by the Insurance Company so as to make it more viable and facilitate the claimants to make their claim. The definition is so stringent in the present case that it gives rise to difficult situation for the common man to understand that in order to maintain their claim they will have to necessarily show evidence of violence or force. The definition of the word burglary should be given meaning which is closer to the realities of life. The common man understands that he has taken out the policy against theft. He hardly understands whether it should precede violence or force. Therefore, a policy should be a meaningful policy so that a common man can understand what is the meaning of burglary in common parlance. Therefore, we have interpreted the present policy strictly in terms of the policy but we hope that the insurance company will amend their policies so as to make them more meaningful to the public at large. It should have the meaning while common man can easily understand rather than become more beneficial so as to defeat the cause of the public at large.
25. The guidelines rendered by the Honble Supreme Court has been taken note of. In fact, the District Forum has incorporated the guidelines of the Honble Supreme Court while deciding the case on hand and rendered opinion in favour of the consumer. We do not find any infirmity in the finding of the District Forum in this regard.
26. In this case, the theft occurred not in the presence of anyone. This act is classified as burglary within the definition of Section 445 I.P.C. The insurance policy covers any loss due to burglary, which has not disputed by the insurance company. Even in case if there is any ambiguity in the policy conditions as per the decisions referred above, the interpretation should be in favour of the consumer only and not in favour of the Insurance Company. In this context also, the claim of the consumer has to be allowed.
27. The appellant Insurance company relied on the conditions referred in Ex.R3 and contended that they are not liable to the claim of the consumer. The evidence of CW1 in this regard reads as follows.
Ex.R3 contained the terms and conditions for burglary and house-breaking policy. Ex.R3 contains the terms about house-breaking which includes the theft following upon an actual forcible and violent entry of and/ or exit from that premises. The proposal form also mentions house-breaking in the same manner as found in Ex.R3 Ex.C16 is the model format of the proposal form for burglary and house-breaking insurance. The house breaking mentioned in Ex.R3 is not the same format as found in Ex.C16, but it conveys the same meaning.
But, on comparison of Ex.C16 and Ex.R3, we found they are totally different. The conditions found in Ex.R3 do not reflect in Ex.C16. Further, the appellant Insurance Company did not establish that they have furnished a copy of Ex.R3 to the consumer while accepting the proposal form from the consumer for the risk under burglary act, to deny the claim of the consumer. In this context also the objections to the claim of the consumer, raised by the Insurance Company has to be negatived.
28. The District Consumer Forum in fact dealt these facts in detail rightly considered that the consumer/complaint is entitled to claim insurance claim and accordingly rejected the objections of the insurance company and ultimately decreed the claim as prayed for. We do not find any infirmity in the finding of the District Forum and hence we do hereby confirm the same. In the result, this issue is answered in favour of the consumer/complainant.
29. ISSUE NO.2:
The District Consumer Forum while awarding the insurance claim amount granted interest at 12% pa. on the award amount. The appellant Insurance Company relied on the decision reported in 2005(4) SCALE in the case Tamilnadu State Transport Corporation Limited Vs. S.Rajapriya and Two Others and contended that the District Consumer Forum had erred in awarding interest at 12% p.a. in favour of the complainant instead of 7.5% p.a. The counsel for the complainant/ consumer conceded that the award amount should carry interest at 7.5% p.a. We have gone through the principles laid down in the said ruling, along with the submissions of the counsels of both parties in this regard. We agree that the claim amount shall carry interest at 7.5% p.a. instead of 12% p.a. The District Forum had erred in this regard. Accordingly, we reduce the rate of interest to 7.5% p.a. from 12% p.a. In the result, this issue is answered in favour of the Appellant Insurance company.
30. In the result, this appeal is dismissed. The order of the District Consumer Forum is hereby confirmed with the modification to the extent that the interest rate is reduced to 7.5% p.a. from 12% p.a. The parties herein to bear their respective costs.
Dated this the 14th day of October, 2010 (J.A.K.SAMPATHKUMAR) PRESIDENT (K.K.RITHA) MEMBER