State Consumer Disputes Redressal Commission
Naresh Cloth Stores vs The New India Assurance Company Limited ... on 23 December, 2013
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G)
Appeal No.FA/13/228
Instituted on : 25.03.2013
The New India Assurance Company Limited,
Branch Manager, Divisional Office No.1,
Kutchery Chowk, Jail Road,
Post & District Raipur (C.G.) ... Appellant
Vs.
1. Naresh Cloth Stores,
Through : Proprietor - Shri Naresh Kumar Khubnani,
Cloth Market, Main Rod, Tilda,
Post - Neora, District Raipur (C.G.)
2. Branch Manager,
State Bank of India,
Neora Branch, Post Neora, Dist. Raipur (C.G.) ... Respondents
Appeal No.FA/13/235
Instituted on : 26.03.2013
Naresh Cloth Stores,
Through : Proprietor - Shri Naresh Kumar Khubnani,
Cloth Market, Main Rod, Tilda,
Post - Neora, District Raipur (C.G.) ... Appellant.
Vs.
1. The New India Assurance Company Limited,
Through ; Branch Manager, Divisional Office No.1,
District Raipur (C.G.)
2. State Bank of India,
Neora Branch, Neora, District Raipur (C.G.) ... Respondents
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE MS. HEENA THAKKAR, MEMBER
COUNSEL FOR THE PARTIES IN BOTH THE APPEALS: -
Shri P.K. Paul, for The New India Assurance Company Limited. Shri R.K. Bhawnani, for Naresh Cloth Stores, Tilda. Shri R.K. Agrawal, for State Bank of India, Neora Branch.
// 2 // O RDER Dated : 23/12/2013 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT.
This order will govern disposal of Appeal No .FA/13/228 as well as Appeal No. FA/13/235, which have been preferred respectively by the O.P.No.1 / Insurance Company and complainant of Complaint Case No.519/2011 against the order dated 26.02.2013 of District Consumer Disputes Redressal Forum, Raipur (C.G.) (henceforth called "District Forum" for short), whereby the complaint filed by the complainant, has been allowed in part, and directed the O.P. No.1/Insurance Company to pay a sum of Rs.79,567/- along with interest @ 6% p.a. from the date of filing of the complaint till date of payment and also pay Rs.10,000/- as compensation for mental agony and Rs.2,000/- as cost of litigation to the complainant. For the purpose of convenience, hereinafter in this order, the parties will be referred as per their original nomenclature in the complaint case. The original of this order be retained in the file of Appeal No.FA/13/228 and its copy be placed in the file of Appeal No. FA/13/235.
2 The case of the complainant before the District Forum was that Naresh Kumar Khubnani, is proprietor of Naresh Cloth Stores, Cloth Market, Main Road, Tilda, Post Neora, District Raipur (C.G.). He obtained hypothecated loan from the O.P.No.2 State Bank of India and // 3 // also obtained insurance policy from the O.P. No. 1 The New India Assurance Company Limited through O.P.No.2. The stock was insured for Rs.28,63,000/- and insurance policy No.450300/48/08/34/00000072, was valid for the period from 13.05.2008 to 12.05.2009. The amount of Rs.15,741/- was paid to the O.P. No.1/Insurance Company as premium through O.P. No.2. On intervening night 28-29/08/2008 some unknown person entered in the shop of the complainant and committed theft. On 29.08.2008 the complainant came to his shop, he saw that that cash sum of Rs.15,764/- and goods valuing Rs.,500,000/- were stolen. The complainant lodged First Information Report in Police Station, Neora where offence under Section 457 and 380 IPC was registered against unknown person. The complainant submitted claim before O.P. No.1/Insurance Company, but the O.P.No.1 / Insurance Company appointed a Surveyor who inspected the spot and submitted his report, but O.P. No.1/ Insurance Company did not pay any amount to the complainant and repudiated his claim. The complainant filed complaint before the District Forum.
3. O.P. No.1 filed its written version and denied the allegation leveled by the complainant and averred that no insurance policy was issued in favour of the complainant's shop situated at Tilda. The insurance policy No. 450300/48/08/34/00000072 was issued for the // 4 // shop of the complainant situated at Kharora, therefore, the shop of the complainant situated at Tilda was not insured with it. Had premium was deduced from the account of Naresh Cloth Stores, Tilda then why the insurance policy was issued in the name of Naresh Cloth Stores, situated at Kharora. The complainant could not reply satisfactorily and the complainant himself is liable for the mistake and negligence. The complaint of the complainant is barred by limitation and O.P. No.1 had not committed any deficiency in service. The complainant is not entitled for any compensation and the complaint filed by the complainant is liable to be dismissed. O.P. No.2 / Bank had not filed its written version before the District Forum.
4. Learned District Forum, after appreciation of the materials available before it, has partly allowed the complaint and awarded a sum of Rs.79,567/- along with interest @ 6% p.a. from the date of filing of the complaint till date of payment and Rs.10,000/- as compensation for mental agony and Rs.2,000/- as cost of litigation in favour of the complainant.
5. Shri P.K. Paul, learned counsel for O.P. No.1/ Insurance Company (Appellant of Appeal No.FA/13/228) argued that the policy issued by the Insurance Company was for shop of Naresh Cloth Stores, situated at Kharora and was not for the shop situated at Tilda. The incident occurred at the shop of the complainant situated at Tilda, // 5 // which is not within the knowledge of the Insurance Company and complainant is having knowledge about the terms and conditions of the insurance policy. He further argued that terms and conditions of the insurance policy have to be construed as it is. Therefore, the Insurance Company has rightly repudiated the claim of the complainant and learned District Forum has wrongly held the Insurance Company liable and awarded a sum of Rs.79,567/- along with interest @ 6% p.a. from the date of filing of the complaint till date of payment and Rs.10,000/- as compensation for mental agony and Rs.2,000/- as cost of litigation in favour of the complainant. He further submitted that order of the District Forum is erroneous and it is not sustainable in eye of law. He placed reliance on judgment of Hon'ble National Commission in case of M/s Vijay Concerns vs. State Bank of India, Through Branch Manager & Anr., 2013 (4) CPR 165 (NC). He also placed reliance on judgments of Hon'ble Supreme Court in case of Export Credit Guarantee Corpn. of India Ltd. vs. M/s Garg Sons International, 2013 (4) CPR 373 (SC); United India Insurance Company Ltd. vs. M/s Harchand Rai Chandan Lal, 2005 (1) CPR 64 (SC); Deokar Exports Pvt. Ltd. vs. New India Assurance Company Ltd. , I (2009) CPJ 6 (SC).
6. Shri R.K. Bhawnani, learned counsel for the complainant (Appellant in Appeal No.FA/13/235) argued that the order of the District Forum is not based on correct and proper appreciation of the // 6 // pleadings of the parties and the materials brought on record. The goods of the complainant were hypothecated with O.P. No. 2 State Bank of India and premium of the insurance was deducted from the account of the complainant and the premium of insurance was deposited in favour of the O.P.No.1/Insurance Company, therefore the OPs were on obligation to take the insurance policy on the correct address where the shop of the complainant is situated, but O.P. No.2/ Bank instead of address of shop situated at Tilda, wrongly mentioned the address of Kharora shop in the insurance policy. The mistake was committed by the O.P. No.2/Bank. He further argued that when the complainant could know about the wrong address mentioned in the policy he wrote letter to the O.P.No.2/Insurance Company for changing the address in the policy, therefore, the OPs are liable to indemnify the loss occurred to the complainant. He further argued that the complainant suffered loss of about Rs.4,31,577/-, but learned District Forum, relied on the report of the Surveyor and only awarded compensation to the tune of Rs.79,567/- and the complainant is also entitled for compensation towards mental agony as claimed by him, but learned District Forum awarded Rs.10,000/- only which is inadequate and the complainant is also entitled for the compensation as prayed by him.
// 7 //
7. Shri R.K. Agrawal, learned counsel for the O.P. No.2 / Bank (Respondent No.2 in both appeals), argued that the insurance policy was issued for the shop of the complainant situated at Tilda, but by mistake instead of address of Tilda, address of Kharora was mentioned in the insurance policy and the O.P. No.2 /Bank asked the O.P.No.1/Insurance Company to correct the above mistake. He supported the impugned order of the District Forum and submitted that it does not call for any interference by this Commission.
8. We have heard learned counsel for all parties and have also perused the record of the District Forum.
9. Complainant filed documents before the District Forum. Document A-1 is. insurance policy, A-2 is letter for change of address in the insurance policy, A-3 is letter written by the complainant to Officer Incharge of Police Station, Tilda Neora, A-4 is First Information Report, and A-5 is final Report and A-7 is a reminder dated 02.12.2008 sent by Shri R.K. Agrawal, Chartered Accountant to the complainant.
10. In the insurance policy address of the insured is mentioned as M/s Naresh Cloth Stores, New Bus Stand, Kharora, District Raipur (C.G.) and policy was effective from 13.05.2008 to 12.05.2009 and the amount of premium of insurance was Rs.15,741/- which was collected on 13.05.2008. Document No.A-2 is letter for change of the address in // 8 // the policy document. In document A-2 no date has been mentioned by the complainant, but seal of the O.P.No.1 was affixed in the said letter, in which date was mentioned as 08.09.2008. According to the complainant, the incident took place during intervening night 28- 29/08/2008 and the complainant lodged first information report on 29.08.2008 at about 7.30 P.M. i.e. after more than 12 hours of occurrence of the incident. In first information report, the amount of stolen property and its quantity were not mentioned. The first information report was lodged after more than 12 hours of occurrence of the incident and complainant was having sufficient opportunity to find out that how much goods were stolen but no quantity or value of the stolen property was mentioned in the first information report.
11. Looking to the document A-2 and A-4 it appears that the letter A-2 was sent by the complainant after near about 10 days from the occurrence of the theft to the Insurance Company. It appears that the complainant sent the letter for change the address after theft was committed.
12. Hon'ble National Commission in the case of M/s Vijay Concerns (Supra) has observed thus :-
"8. From the material on record, it is very clear that the place where the loss has occurred was not within the knowledge of the Insurance Company. Moreover, the Bank can also not be held liable for any deficiency in service, because it was the // 9 // primary duty of the complainant/petitioner to obtain the Insurance Policy and to have knowledge about its terms and conditions.
9. The State Commission while passing the impugned order have rightly placed reliance on the orders passed by the Hon'ble Supreme Court in the case United India Insurance Co. Ltd. v. M/s Harchand Rai Chandan Lal and in the case Deokar Exports Pvt. Ltd. v. New India Assurance Co. Ltd. according to which the rights and obligations of the parties are strictly governed by the policy of Insurance and no exception or relaxation can be made on the grounds of equity. Further, a similar view has been expressed by the Hon'ble Supreme Court in the case of Suraj Mal Ram Niwas Oil Mills Private Ltd. v. United India Insurance Co. Ltd. & Anr. In which it has been observed by the Hon'ble Supreme Court as follows :-
"The Courts should always try to interpret the "words" in the insurance contract as they have been expressed by the parties. It is not open for the Court to add, delete or substitute any words. The words used in the Insurance Contract must be given paramount importance."
13. Hon'ble Supreme Court in the case of M/s Export Credit Guarantee Corporation of India Ltd. (Supra) has observed thus :-
"9. The insured 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 the same may affect the interests of the parties adversely."
// 10 //
14. Hon'ble Supreme Court in the case of M/s Harchand Rai Chandan Lal (Supra) 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."
15. Hon'ble Supreme Court in the case of Deokar Exports Pvt. Ltd. (Supra) 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 in a concluded contract in terms of the counter proposal. The third was to make a counter proposal to the counter proposal of // 11 // 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."
16. Looking to the document A-1 i.e. insurance policy, it is clear that there was no contract of insurance between the parties in respect of shop of the complainant situated at Tilda. In document A-1, the address of the insured shop has been specifically mentioned as New Bus Stand, Kharora, District Raipur. Document A-2 which is letter for correction of the address was written by the complainant to the Branch Manager, State Bank of India, Neora on 08.09.2008 i.e. after a period of 10 days of occurrence of the incident. It appears that there was no contract of insurance between the O.P.No.1/Insurance Company and the complainant in respect of shop of the complainant situated at Tilda, The complainant had obtained insurance policy in respect of shop situated at Kharora and he wants to modify in the address in respect of shop of Tilda and such proposal was sent by the complainant to the O.P.No.1 / Insurance Company after the incident of theft in the shop by unknown persons. Therefore, the document A-1 filed by the complainant is related to the premises situated at Kharora and premises situated at Tilda was not covered and the Insurance Company was not having any liability of indemnifying any loss occurred in the shop of the complainant situated at Tilda.
// 12 //
17. Looking to the facts and circumstances of the case, it is established that the insurance was done only for the shop of the complainant situated at Kharora and therefore, the Insurance Company is not liable to indemnify the loss occurred shop situated at Tilda and the Insurance Company had rightly repudiated the claim of the complainant.
18. Looking to the facts and circumstances of the cases and law laid down by Hon'ble Supreme Court and Hon'ble National Commission in the above cited judgments, the finding recorded by the learned District Forum, is erroneous and is liable to be set aside.
19. In the result, we allow the appeal No.FA/13/228 filed by the O.P. No.1/Insurance Company and order passed by the District Forum is set aside. The appeal No.FA/13/235 filed by the complainant, is liable to be dismissed and is hereby dismissed. Consequently, the complaint filed by the complainant before the District Forum also stands dismissed. No order as to the costs of these appeals.
(Justice R.S. Sharma) (Ms. Heena Thakkar)
President Member
/12/2013 /12/2013