State Consumer Disputes Redressal Commission
M/S Achal Paler Industries vs Icici Lombard General Insurance ... on 6 July, 2015
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.
Consumer Complaint No.15 of 2009
Date of Institution: 02.03.2009.
Date of Decision: 06.07.2015.
M/s Acchal Paper Industries, Dhingi, Malerkotla Road, Nabha,
District Patiala (Punjab) through its Managing Director Sh. Rakesh
Garg.
.....Complainant.
Versus
1. ICICI Lombard General Insurance Company Ltd., Zenith
House, 2nd Floor, Keshavrao Khadye Marg, Mahalaxmi,
Mumbai-400034 thorugh its Managing Director/General
Manager.
2. ICICI Lombard General Insurance Company Ltd., Chotti
Baradari, Near Narain Continental Hotel, Patiala (Punjab)
through its Branch Manager.
3. M/s Cunningham Lindsey International Private Lt., S.C.O. 16-
17, 2nd Floor, Fortune Chambers, Feroz Gandhi Market,
Ludhiana through Director Mr. Sherry Makkar.
4. The Centurion Bank of Punjab Ltd., Chotti Baradari Patiala
through its Branch Manager, (Now HDFC Bank).
....Opposite parties
Consumer complaint under Section
17(1)(a) of Consumer Protection Act, 1986
Quorum:-
Shri J. S. Klar, Presiding Judicial Member
Shri H.S. Guram, Member Present:-
For the complainant : Sh. Mukesh Garg, Advocate For opposite party nos.1&2: Ex-parte (Sh. Sandeep Suri, Advocate) For opposite party no.3 : Ex-parte For opposite party no.4 : Ex-parte (none) .............................................. Consumer Complaint No.15 of 2009 2 J. S. KLAR, PRESIDING JUDICIAL MEMBER:-
The complainant M/s Acchal Paper Industries, through its Managing Director Sh. Rakesh Garg has filed the complaint under Section 17(1) (a) of Consumer Protection Act 1986 (in short "the Act") against the OPs praying for compensation of Rs.90 lakhs alongwith interest @12% per annum from the date of incident of fire till its actual payment. The brief facts of the case are that complainant is a private limited company incorporated under the Companies Act, 1956 and has been running the business of manufacturing of Duplex Board and Mr. Rakesh Garg has been its Managing Director and has been watching the affairs of the company and is, thus, fully conversant with the facts of the case and is fully competent to file the present complaint on the basis of resolution passed by the Board of Directors of the complainant's company. The complainant availed the services of OP nos.1 and 2 i.e. ICICI Lombard General Insurance Co. Ltd., by getting general insurance of Standard Fire and Special Perils Policy (Material Damage) for the above referred Industry, vide policy no.1001/0082658 for the period from 23.06.2007 to midnight 22.06.2008. The agent of OP nos.1 and
2 physically inspected the industry of complainant and carried out the checking of the material lying in the industry and also inspected the machinery installed in its premises and also minutely scrutinized the account books, balance sheets and bills/stock record etc., and all Consumer Complaint No.15 of 2009 3 other documents with regard to the stock and machinery lying in the industry of the complainant. OP no.2 issued the cover note/policy to the complainant after receiving the settled premium from the complainant. Unfortunately, the fire broke out in the industry of the complainant on the midnight of 7/8 January, 2008 causing huge damage to the waste paper like raw material and the stock in existence. Due intimation was given forthwith to the insurance company and also reported to the local police and DDR No.12 dated 08.01.2008 was lodged by the police post Gulwati in this regard, besides contacting the office of Fire Service Patiala and also the Manager of Centurion Bank of Punjab Ltd., Chotti Baradari Patiala. OP nos.1 and 2 appointed Mr. Sherry Makkar Director/Manager of M/s Cunningham Lindsey International Pvt. Ltd. Ludhiana as surveyor to carry out the survey for assessing the loss, as caused to the industry of complainant. The above surveyor visited the industry's premises of the complainant on 08.01.2008. Thereafter, Mr. Sandeep Shukla insurance investigator from Rajdeep Consultants visited the site for investigation of the premises for finding out the cause of breaking out the fire in the industry. He investigated the premises of the complainant on 12.01.2008 and demanded the requisite documents from the complainant, which were duly supplied to him by the complainant, vide letter dated 21.01.2008, vide reference no.APIL/07-08. Vide letter dated 27th January, 2008, Mr. Sandeep Shukla demanded further documents Consumer Complaint No.15 of 2009 4 from the complainant, which were duly supplied to him, vide letter dated 25.02.2008, which was duly received by him by hand from the complainant. The complainant sent representation to the Manager of Centurion Bank of Punjab Ltd. Chotti Baradari Patiala for immediate relief, vide letter dated 21.01.2008, but to no effect. The complainant submitted the claim statement of Rs.1,11,60,000/- (One Crore Eleven Lakhs Sixty Thousand) alongwith all requisite documents, so demanded by OP no.3, vide its letter dated 28.02.2008, reference no.APIL/07-08 in favour of the surveyor, Mr. Sherry Makkar. The complainant suffered humongous loss by the incident of fire. The complainant took over the draft limit from Centurion Bank of Punjab, Branch Office Patiala and complainant demanded more financial assistance from the financial institution from the above said bank. The bank again granted T.O.D. of rupees 30 lakhs to the complainant industry after considering the genuine request of the complainant. The complainant requested OP nos.1 and 2 many times for the settlement of its claim of Rs.1,11,60,000/- already lodged with OP nos.1 and 2 by the complainant. The surveyor appointed by the insurance company failed to listen to the grouse of the complainant and OP nos.1 and 2, thus, failed to settle the genuine claim of the complainant, despite lapse of 10 months. OP nos.1 and 2 demanded full and final settlement acknowledgment from the complainant and the complainant had to issue the same to OP nos.1 and 2 under compelled circumstances, as complainant Consumer Complaint No.15 of 2009 5 suffered huge financial loss and thereby took humongous financial aid from the private firms and private financial institutions. The complainant has taken financial assistance from the Centurion Bank of Punjab for Rs.30 lakhs as a T.O.D. for few months with the condition of repayment thereof. OP nos.1 and 2 the insurer delayed the matter unnecessary of the settlement of the claim of the complainant. OP no.4 Centurion Bank of Punjab Limited intimated the complainant to deposit the amount forthwith as the complainant industry fell in the category of non-performing asset. The complainant, thus, borrowed money from the private parties on interest for repayment to the above bank for escaping the financial stringency and to avoid other legal consequences. The complainant accepted the claim of Rs.18,10,840/- on 03.11.2008, which is unjustifiable and violative of principles of natural justice. The complainant also served legal notice upon the OPs to this effect, but to no effect. OP nos.1 to 3 are, thus, deficient in service in not compensating the complainant for the loss due to eruption of fire in the industry of the complainant. The complainant has, thus, filed the complaint directing OP nos.1 to 3 to pay the amount of Rs.90 lakhs alongwith interest @12% per annum to the complainant. The complainant further prayed for the compensation of Rs.50,000/- for mental harassment and Rs.22,000/- as costs of litigation. Consumer Complaint No.15 of 2009 6
2. Upon notice, OP nos.1 and 2 filed their joint written reply and contested the complaint of the complainant vehemently by raising the preliminary objections that the jurisdiction of Punjab State Commission does not exist, as claim raised by the complainant is for an amount of beyond Rs.1 crore and hence complaint merits dismissal on this short ground. The amount had been paid to the complainant, as assessed by the independent surveyor on the basis of detailed report and hence there is no deficiency in service on the part of OP nos.1 and 2. It was further pleaded in the written reply that the settled amount for the above claim has been accepted by the complainant towards full and final settlement of the claim without any coercion or pressure. The complainant is a company and has no physical and corporeal existence and hence, there is no question of any pressure on the juristic body, as projected by the complainant in this case. The letter Annexure C-11 by the complainant clearly depicts clear application of the mind, as complainant opted for the payment of the reinstatement premium of Rs.1450/- under the policy of insurance. It indicated that the matter has been discussed in detail with the representative of the complainant company and only thereafter, it received the amount towards full and final settlement of the insurance claim. It was further pleaded that there is no evidence of loss suffered by the complainant, as projected in the complaint. The present case is a case of under-insurance and the applicable deduction with regard to same has been made. The complainant Consumer Complaint No.15 of 2009 7 company has been carrying on the business for commercial purposes and complainant's company is not a consumer of the OPs. The percentage of under-insurance so done has been calculated on the lower side by OP nos.1 and 2. The complainant has itself provided the provisional balance sheet of the company as on 7th January, 2008. As per the said balance sheet, prepared by its chartered accountant in the heading under Schedule 10, the following has been mentioned:
RAW MATERIAL Opening stock Rs.1,90,59,270.00 (A) Add : Purchases Rs.14,37,87,788.00 (B) Rs.16,28,47,058 (C=A+B) Loss of goods in fire Rs.1,11,60,000.00 (D) Less : closing Stock Rs.2,76,47,438.00 (E) Total Rs.12,40,39,620.00 (F) From the same it is evident that the complainant had a stock of raw material of D and E i.e. Rs.1,11,60,000.00 + Rs.2,76,47,438.00 = Rs.3,88,07438.00. This would constitute stock and stock in process as per the insurance policy.
Further it is provided Schedule 5 of inventories INVENTORIES (as taken, valued and certified by the management) Finished Goods (At Cost) Rs.12,54,339.00 (G) Consumer Complaint No.15 of 2009 8 Raw material (at cost) Rs.2,76,47,438.00 (H=E) Consumable Store & Spares & WIP Rs.34,50,200.00 (I) Here WIP stands for work in progress, which means raw material in process. That for argument sake, even if the whole of (I) is taken as raw material/stock in process, even then the available stocks of raw material with the complainant was of (H=E) i.e. Rs.2,76,47,438.00. There was a separate cover of Rs.1,50,00,000/- in respect of stock in process. The same is not the claim raised in the present complaint, as the loss was only of raw material. The amount available as raw material after the incident of fire, as per case of the complainant, after adding the loss, which occurred due to fire, the total stock is available as stocks/raw material was Rs.3,88,07,438.00 on 07.01.2008 (against Rs.3,16,44,144.00 taken by the surveyor). Against the same, the complainant had an insurance of Rs.1,50,00,000/- as stocks under insurance. The under- insurance was hence to the extent of 72%. The complainant is, thus, entitled only to a claim of Rs.11,19,077.68 against the amount of Rs.18,10,840/- paid by OP nos.1 and 2 to the complainant. The case involves disputed point of facts and law and the same cannot be determined by the Consumer Forum in summary proceedings under the Act. It was further pleaded in the written reply that there is arbitration clause in the contract of insurance and hence the matter can be decided by the arbitrator only. On merits, the complaint was Consumer Complaint No.15 of 2009 9 also contested by OP nos.1 and 2. It was further pleaded that the complainant company was required to take a policy which was sufficient to meet the complete coverage of the goods, as they were there in the factory, keeping into account any variations. Under the contract of insurance, it was only the complainant, who knew the value of the goods, so stored in a particular time and it was required to maintain adequate insurance coverage in respect of the same. As per the policy terms and conditions and premium receipt, the goods insured raw material stock was for Rs.1.5 crores, whereas the value of good was more with insurance company, as per the contract of insurance was required to pay the claim of the goods insured and the values of goods/property at the time of damage. The insurance company was liable only to pay the claim in ratable proportion and the loss/damage. It was further pleaded in the written reply that the appointment of surveyor and his visits are a matter of record. As per the reports of surveyor and investigator, the case of the complainant was the case of under-insurance and investigator submitted his report on 1st May, 2008. The complainant lodged the exaggerated insurance claim, which required several documents and formalities for their fulfillment for the purpose of assessing the loss for arriving at conclusion of loss. The complainant was to provide documents in support thereof. It was further pleaded by OP nos.1 and 2 that the complainant has failed to prove the loss suffered by it. The loss was assessed at the value of Rs.39,96,706/- and the report of the Consumer Complaint No.15 of 2009 10 surveyor is a detailed report to the extent of assessment of loss to the extent of Rs.39,96,706/-, which is based on the basis of evidence supplied by the complainant and scientific calculation of the loss. The affected waste paper stock was found to be 666118 kgs and it has been reported in the report of the surveyor/investigator that complainant did not support its claimed quantity with rational basis, taking into account the loss based on calculation of Rs.6 per kg and even on the basis of value of stock material available. As a result of loss suffered under-insurance clause was, thus, applicable. The complainant accepted the settled claim towards full and final settlement and is, thus, estopped from agitating the matter again. OP nos.1 and 2 denied any pressure or coercion on the complainant, when the claim was settled toward full and final settlement of it, more so, the complainant is a juristic entity, and not a living person. It was further averred that the complainant has not lodged the immediate objections raising protest towards the settlement of above claim. The story so invented by the complainant towards coercion and compelling circumstances forcing it to accept the loss towards full and final settlement is after thought version, woven by the complainant. OP nos.1 and 2, thus, prayed for the dismissal of the complaint.
3. The complainant filed rejoinder to written reply of OP nos.1 and 2. It is stated in the rejoinder that the complainant Consumer Complaint No.15 of 2009 11 accepted the amount of Rs.18,10,840/- under compelled circumstances and under coercion due to financial constraints. The insurance claim has been settled at a much less amount by OP nos.1 and 2, despite the fact that complainant suffered huge loss due to fire in its industry. The complainant controverted the averments of OP nos.1 and 2 in the rejoinder and, thus, prayed for the acceptance of the complaint.
4. OP no.3 was proceeded against ex-parte in this case. Op no.4 filed its separate written reply raising preliminary objections that complaint is not maintainable in the present Forum. The complainant has no locus standi to file the complaint. On merits, it averred that para nos.1 to 6 of the complaint needed no reply being not related to OP no.4. OP no.4 denied para no.7 of the complaint. It denied having received any representation from the complainant. It denied any deficiency in service on its part. OP no.4 prayed for the dismissal of the complaint.
5. The complainant tendered in evidence the affidavit of Sh. Rakesh Kumar, the Managing Director of M/s Acchal Paper Industries Ex.C-1 and another affidavit of Rakesh Garg Ex.CW-1/A-1 alongwith documents Ex.C-2 to Ex.C-23 and closed the evidence. As against it, OP nos.1 and 2 tendered in evidence, the affidavit of Ms. Meenu Sharma Ex.RW-1/1 alongwith other documents Ex.RW-1/1, Consumer Complaint No.15 of 2009 12 Ex.R-1 to Ex.R-4, Ex.RW-1/2, Ex.R-2/1 to R-2/3 and another affidavit of Sherry Makkar Ex.RW-1/3 and thereafter closed the evidence.
6. We have heard the learned counsel for the complainant (insured) and counsel for OP nos.1 and 2 (insurer), as OP nos.3 and 4 are ex-parte in this complaint. The first point falling for adjudication before us in this case is whether the complainant is a consumer on the basis of Standard Fire and Special Perils Policy (material damage) taken by it from OP nos.1 and 2. The affidavit of Rakesh Kumar Managing Director of complainant Ex.C-1 is on the record. Resolution authorizing him to file the complaint Ex.C-2 is also on the record. Copy of risk assumption letter with policy documents is Ex.C-3 on the record. The submission of counsel for the complainant is that complainant is consumer of OP nos.1 and 2, as it had taken the insurance policy Ex.C-3 from OP nos.1 and 2 by paying the premium. On the other hand, the submission of counsel for OP nos.1 and 2 is that the complainant is a private limited company and it has been carrying on its business for commercial purposes exclusively and as such it is not the consumer of OP nos.1 and 2 in this case. The matter is not resnova in this case. The matter has been examined by the National Commission in "Harsolia Motors Vs. National Insurance Co. Ltd." 2005(1)CLT-97/98, wherein the National Commission has peremptorily held that "when insurance policy is taken by commercial units, could it be held to be hiring of Consumer Complaint No.15 of 2009 13 services for commercial purpose and thereby excluded from the purview of the Consumer Protection Act?" After examining the controversy and discussing it in detail, the National Commission has held that a person, who takes insurance policy to cover the envisaged risk, does not take the policy for commercial purpose. The policy is only for indemnification and actual loss. It is not to generate profit. On the basis of this authoritative enunciation of the National Commission in the matter of taking insurance policy even by commercial units, it may not be said to be taken for generating profits. No contrary law has been cited before us by counsel for OP nos.1 and 2 Sh. Sandeep Suri Advocate. Consequently, on the basis of law laid by the National Commission in the above referred authority, it has held that the complainant, which is private limited company had taken the insurance policy for the purpose of indemnification of loss and not for the purpose of generating profits and hence the complainant is held to be the consumer of OP nos.1 and 2 in this case.
7. The next contention of OP nos.1 and 2 is that when there is an arbitration clause in the contract of insurance and then the consumer complaint is not maintainable on this score. Vehement argument has been raised by counsel for OP nos.1 and 2 on this point before us. The counsel for complainant argued to the contrary by contending that the insurance clause in the contract would not Consumer Complaint No.15 of 2009 14 debar it from filing the consumer complaint, as the consumer complaint is an additional remedy provided under Section 3 of the Act. We have carefully examined the law laid down by the National Commission in case "Vasalakshmi Enterprise Vs. United India Insurance Co. Ltd. and another" 2005(1) CLT78/79, wherein it has been held that "claim of arbitration is not supposed to debar the complainant from pursuing these proceedings under the Act". The complainant further relied upon law laid down in "General Manager, Telecommunication, Hoshiarpur and another Vs. Kashmir Singh" 2003(2)CLT-531, wherein it has been held by our own State Commission that "even if there is an arbitration clause in the agreement, which the subject matter of the complaint, it does not act as a bar to the entertainment of the complaint by the consumer authorities. Remedy under the Act is in addition to the provisions of any other law for the time being in force as Section 3 of the Act. Additional remedy has been provided under Section 3 of the Act and hence the mere clause of arbitration would not debar the complainant from filing the complaint. This point is, thus, decided against OP nos.1 and 2.
8. The next point for adjudication before us is whether the complainant suffered the loss much more than as assessed by the surveyor and investigator and hence the report of the surveyor is not binding on the complainant. The complainant has challenged the Consumer Complaint No.15 of 2009 15 report of Sherry Makkar, the surveyor on the ground that he was not the competent person to do so. We have to examine the evidence on the record to settle this controversy brewing between the parties in this case with the assistance of counsel for the parties. The sheet- anchor of the case of the complainant is the affidavit of Rakesh Kumar Managing Director of complainant's company Ex.C-1 on the record. The complainant has filed additional affidavit of Rakesh Kumar Managing Director vide Ex.CW-1/A-1. This fact is not in dispute between the parties in this case that complainant took the insurance policy from OP nos.1 and 2 against premium. There is also no dispute of this fact that fire broke out in the industry of the complainant on the midnight of 7/8 January, 2008, causing damage to the waste paper and stock in existence. The complainant gave intimation regarding the incident of fire to the authorities. DDR no.12 dated 08.01.2008 was recorded by Harbhajan Singh MHC/324 of police post Gulwati, which is Ex.C-4 on the record. The intimation given to the Fire Service Centre Patiala and report of Assistant Divisional Fire Officer Patiala is Ex.C-5 on the record. Ex.C-6 is the intimation regarding eruption of fire in the premises of the complainant supplied to the Manager of Centurion Bank of Punjab Ltd. Patiala on the record. Ex.C-7 is the letter from the complainant to Mr. Sandeep Shukla for surveying the factory premises of complainant and for sending the photocopies of required documents. Ex.C-8 is letter from Sandeep Shukla investigator to the complainant Consumer Complaint No.15 of 2009 16 demanding the documents, as set out in it, from the complainant. Ex.C-9 is the letter regarding supply of photocopies of documents to Sandeep Shukla by complainant. Ex.C-10 is unsigned letter addressed to the Manager of Centurion Bank of Punjab Ltd. Patiala requesting for immediate relief. Ex.C-11 is the letter sent by the complainant to the Sherry Makkar of M/s Cunningham Lindsey International Pvt. Ltd. Ludhiana regarding submission of documents. Ex.C-12 is the letter dated 01.11.2008 signed by the Managing Director of complainant's company with regard to acceptance of the amount of Rs.18,10,840/- towards full and final settlement made by the insurer with regard to the insurance claim of this fire to the complainant. This letter Ex.C-12 has proved that complainant's company has received the amount of Rs.18,10,840/- as payment against full and final settlement of the claim leaving no further claim from OP nos.1 and 2 under the above referred policy. Ex.C-12, which is the sheet-anchor document, has further established it on the record that the complainant agreed to deduct Rs.1450/- for reinstatement premium for reinstating the captioned policy by the loss amount paid in claim, by the insurer. Ex.C-13 is copy of legal notice served upon OP nos.1 and 3 by the complainant regarding compelled circumstances forcing complainant to accept the settled amount, which was less than the loss actually suffered by the complainant. Ex.C-14 to Ex.C-16, are the postal receipts thereof. Ex.C-17 is the affidavit of Satwinder Pal clerk of complainant's Consumer Complaint No.15 of 2009 17 company on the record. We have carefully examined this affidavit Ex.C-17 of Satwinder Pal clerk on behalf of the complainant. He has stated in this affidavit that the documents Ex.C-18 to C-20 regarding ledger account with regard to purchase of waste paper (containing 42 pages) and the copies of Form-IV, Excise Register are on the record. He further stated that the account books have been properly maintained by the company, as per the Rules under the Companies Act, 1956 alongwith balance sheet and bills and stock record. He further deposed that the insurance policy was taken by the complainant for the period 23.06.2007 to midnight 22.06.2008 and the agent of insurance company also physically checked the material lying in the industry of complainant and further inspected the machinery installed in the premises and also minutely scrutinized the account books and all other documents in support thereof. He further stated that Sherry Makkar Director/Manager of OP no.3 was appointed by OP nos.1 and 2 as surveyor for assessing the loss caused to the company of the complainant. He visited the spot on 08.01.2008 and thereafter Mr. Sandeep Shukla insurance investigator from Rajdeep Consultants also visited the site for investigating the premises and to find out the cause of eruption of fire in the above industry. The documents demanded by the above said investigator and surveyor were duly supplied to them by the complainant. Ex.C-18 is the copy of raw material as relied upon by the complainant. Ex.C-19 is the copy of daily stock and Ex.C-20 is Consumer Complaint No.15 of 2009 18 the record of waste paper. On the basis of Ex.C-18 to Ex.C-20, the contention of the complainant is that complainant suffered the loss, as recorded in the above documents, which was much higher in quantum and much more than as settled by OP nos.1 and 2. Ex.C-21 is the letter sent by Sherry Makkar to the complainant on 14.01.2008 for submission of the documents, as recorded in it. Ex.C-22 is the reminder dated 23.01.2008 sent by Sherry Makkar for submission of documents on the record. The submission of counsel for the complainant before us is that on the basis of the documents Ex.C-18 to C-20, as proved in the affidavit of Satwinder Pal Ex.C-17, the loss suffered by the complainant was of much higher magnitude than actual loss, as assessed by the surveyor of OP nos.1 and 2. The complainant has, thus, alleged that the amount of loss as settled by OP nos.1 and 2 on the basis of letter Ex.C-12 of Rs.18,10,840/- was forced upon the complainant against its will under the compelled circumstances only when the complainant was in financial straits and took financial aid from the financial institutions and so on.
9. On the other hand, the complaint has been contested by OP nos.1 and 2 and the evidence has been led on record by OP nos.1 and 2 the insurer in this case. We have to scrutinize the evidence of OP nos.1 and 2 as adduced on record in this case. The affidavit of Meenu Sharma Legal Manager of OP nos.1 and 2 Ex.RW-1/1 is on the record. This witness has testified on oath that Consumer Complaint No.15 of 2009 19 the amount of insurance claim has been paid to the complainant as assessed by the independent surveyor in this case. The report of the Sandeep Shukla investigator of M/s Rajdeep Consultants is Ex.R-1 and the report of Cunningham Lindsey Surveyor and Loss Assessing Agency is Ex.R-2 on the record. It is further stated in the testimony of these witnesses that both are above referred independent entities and duly registered investigator and surveyor. She further stated that the Cunningham Lindsey is a registered corporate surveyor registered with the Insurance Regulatory Development Authority (IRDA). She further deposed in her affidavit that on the basis of report of surveyor, the loss of the complainant has been assessed and complainant accepted the settled amount towards full and final settlement of the claim without any demur and protest. She further maintained that complainant has already accepted the settled amount towards full and final settlement of the insurance claim, as such the complainant is estopped from filing the complaint. She further stated that complainant is the juristic person and has no physical existence like natural human being. There is no question of any pressure on juristic body as projected by the complainant, which could wield on a natural living person. She further stated that the complainant itself produced letter Ex.C-12, which clearly exhibited the application of mind, because the complainant opted for the payment of reinstatement premium of Rs.1450/- under the policy of insurance. It indicates that the matter has been discussed in detail Consumer Complaint No.15 of 2009 20 with the representative of the complainant company and only thereafter, having been satisfied with it, the settled amount has been accepted by the complainant towards full and final settlement of the insurance claim. The standard terms and conditions of the policy are Ex.C-3 on the record as appeared in her testimony. She further deposed that challenge of the complainant to the quantum of claim, as assessed by the surveyor cannot be gone into in summary jurisdiction by the Consumer Forum. She further deposed in her statement contained in her affidavit that the copy of balance sheet, as provided by the complainant and duly audited by the chartered accountant of the complainant and it has not been denied by the complainant. As per the said balance sheet, prepared by its chartered accountant in the heading under Schedule 10, the following has been mentioned:
RAW MATERIAL Opening stock Rs.1,90,59,270.00 (A) Add : Purchases Rs.14,37,87,788.00 (B) Rs.16,28,47,058 (C=A+B) Loss of goods in fire Rs.1,11,60,000.00 (D) Less : closing Stock Rs.2,76,47,438.00 (E) Total Rs.12,40,39,620.00 (F) From the same it is evident that the complainant had a stock of raw material of D and E i.e. Rs.1,11,60,000.00 + Rs.2,76,47,438.00 Consumer Complaint No.15 of 2009 21 = Rs.3,88,07438.00. This would constitute stock and stock in process as per the insurance policy.
Further it is provided Schedule 5 of inventories INVENTORIES (as taken, valued and certified by the management) Finished Goods (At Cost) Rs.12,54,339.00 (G) Raw material (at cost) Rs.2,76,47,438.00 (H=E) Consumable Store & Spares & WIP Rs.34,50,200.00 (I) Here WIP stands for Work in progress, which means raw material in process. That for argument sake even if the whole of (I) is taken as raw material/stock in process, even then the available stocks of raw material with the complainant was of (H=E) i.e. Rs.2,76,47,438.00. There was a separate cover of Rs.1,50,00,000/- in respect of stock in process. The same is not the claim raised in the present complaint, as the loss was only of raw material. The amount available as raw material after the incident of fire, as per case of the complainant, after adding the loss, which occurred due to fire, the total stock is available as stock/raw material was Rs.3,88,07,438.00 on 07.01.2008 (against the 3,16,44,144.00 taken by the surveyor). Against the same, the complainant had an insurance of Rs.1,50,00,000/- as stocks under insurance. That the under-insurance was hence to the extent of 72%. The complainant Consumer Complaint No.15 of 2009 22 was hence entitled to only a claim of Rs.11,19,077.68 against the amount of Rs.18,10,840/- paid by OP nos.1 and 2 to the complainant. This witness further stated that as per the policy conditions and premium receipt, the goods insured (raw material/stock) was for Rs.1.5 crores. Once the value of the goods was more, the insurance company as per the contract and the insurance law had to pay the claim as per the ratio of goods insured and the value of the goods/property at the time of damage. She further stated that the claim lodged by the complainant and loss as alleged to have been suffered, has neither been proved by the complainant on the record nor has been supported by any documentary evidence. The loss as claimed by the complainant is based on imaginary figures, which is not based on any objective evidence. The calculation of the material available at the time of the loss is based on the documentation provided by the complainant to the OPs. She further stated that no immediate claim/application was lodged with OP nos.1 and 2 for accepting inadequate amount by the complainant at the time of execution of Ex.C-12. The complainant only invented the story subsequently of the compelled circumstances exercised on it.
10. The affidavit of Anil Dhingra Director of Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. Ex.RW-1/2 is also on the record. He has categorically stated in Consumer Complaint No.15 of 2009 23 his affidavit on oath that his above said surveying company is duly registered with IRDA, vide registration bearing no.72389, valid upto 26.05.2007 and renewed upto 25.05.2007, vide Ex.R2/1. He further maintained in his deposition that he is a duly licensed surveyor duly registered with the IRDA and has been working as an employee surveyor with the said company since 1st December, 2002, as Senior Executive Director and he proved the copy of licence Ex.R-2/2. He further stated that the contents of the survey report of the above surveying company are correct. He further stated that Sherry Makkar is also working with the said company and he is also a duly registered surveyor. Sherry Makkar was then assisting senior surveyors of the company, besides looking after the administrative functions of the company. He further stated that Sherry Makkar is an individual surveyor and he has not issued individual survey report and Sherry Makkar and other company employees managed the entire survey and loss assessment proceedings collectively as a team under the supervision of Anil Dhingra and the latter signed and submitted his final survey report on the record. He further stated that the copies of the letters, e-mails and the correspondences exchanged between the parties evidencing same are Ex.R2/3 on the record. He further stated that Sherry Makkar worked under his supervision and his direct control and the report of survey has been given by him as Senior Executive Director of above Survey Company. He further stated that Sherry Makkar was part of the Consumer Complaint No.15 of 2009 24 corporate team only, which was organized and directed by Anil Dhingra, who was the then Senior Executive Director of the Cunningham Lindsey International Pvt. Ltd. Company. He further deposed that Sherry Makkar, who himself happened to be an individual licensed surveyor, but he was working full time with Cunningham Lindsey Company to assist the company in survey and loss assessment proceedings and administrative functions related to the claim.
11. The affidavit of Sherry Makkar, full time employee surveyor of Cunningham Lindsey International Pvt. Ltd. is on the record, vide Ex.RW-1/3. He stated in his affidavit that he is merely an employee of the company Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. since 1st October, 2003. He further deposed that he has been working under the directions of its licensed then Sr. Executive Director Mr. Anil Dhingra under the management of the company's licensed Directors. He further stated that he assisted Mr. Anil Dhingra in the matter, including collection of information and correspondence from the insured during his visits, besides accompanying Mr. Anil Dhingra during meetings, visits and interactions with the complainant. He further testified that complaint against an individual employee does not persist as the claim was allocated to a corporate surveyor company 'Cunningham Lindsey' which have handled the assignment Consumer Complaint No.15 of 2009 25 accordingly, upon appointment by ICICI Lombard GIC Ltd. The pith of his statement is that he worked under the control and supervision of Mr. Anil Dhingra, Senior Executive Director of the above said company in this case.
12. From appraisal of above referred evidence on the record and hearing the submissions of counsel for the parties, we proceed to decide the controversy between the parties in this case. Sh. Mukesh Garg counsel for the complainant argued that Sherry Makkar Director/Manager of M/s Cunningham Lindsey Company was not a competent surveyor and he held no license for this purpose and as such no reliance whatsoever could be placed on the survey report Ex.R-2. We have examined the survey report Ex.R-2 on the record in this case. The survey report dated 13.10.2008 Ex.R-2, is the final survey report on the record. It is evident from the report of survey, which is duly signed by Anil Dhingra, Executive Director of Cunningham Lindsey Company on the record that the net loss as assessed was Rs.39,96,706/- and less: under-insurance Rs.21,74,416/-, the adjusted loss is of Rs.18,22,290/-, less: excess of Rs.10,000/- and net adjusted loss is Rs.18,12,290/-. The survey report records that accordingly a total of Rs.6 per kg was determined to be cost of stock of waste paper of different types. Surveyors were satisfied with the market rates of the commodity that ranged from Rs.6/- to Rs.10/- per kg. This report is by Anil Dhingra, Executive Consumer Complaint No.15 of 2009 26 Director of the above said company and he has also placed his affidavit Ex.RW1/2 on the record proving that the report has been prepared under his signatures and under his supervision. He requisitioned the service of many persons including Sherry Makkar Surveyor, who worked under it and is attached with the above said company, which is a corporate body. Anil Dhingra also holds a license from Insurance Regulatory Development Authority (IRDA), vide Ex.R2/2 on the record. Sherry Makkar as per his affidavit placed on the record Ex.R1/3 worked under the overall control of Senior Executive Director of above said Company and not in his individual capacity all alone. The affidavit of Anil Dhingra, Executive Director of Cunningham Lindsey Company has received due corroboration from the affidavit of Sherry Makkar, who is full time employee surveyor of Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. The affidavit of complainant Rakesh Kumar Garg is unable to make a dent in the above referred established evidence of OP nos.1 and 2 on the record. Consequently, we do not find any merit in the submission of the complainant that Sherry Makkar had motive to give the distorted and lopsided report and was not competent in this regard. The report of the surveyor carries weightage and is a valuable piece of evidence. The report of surveyor can be discarded only on the proof of strong circumstances to the contrary on the record. We also do not find any force in the argument of counsel for the complainant that no spot inspection was Consumer Complaint No.15 of 2009 27 done by the surveyor in this regard. The report of the surveyor is a valuable piece of evidence in our view and it has also been so observed by the National Commission in case "Champalal Verma Vs. Oriental Insurance Co. Ltd." 2008(III) CPJ-93(NC).
13. The complainant mainly relied upon the documents Ex.C-18 to Ex.C-20 appearing in the affidavit of Satwinder Pal clerk Ex.C-17. This witness has stated that stock of the complainant was much more and OP nos.1 and 2 have not provided due compensation for indemnification of loss to the complainant, caused by the breaking out of the sudden fire. It was also maintained that closing balance was of Rs.11,77,64,192.00 on 07.01.2008 and adequate compensation has not been provided by OP nos.1 and 2 for the above said loss suffered by the complainant. On the other hand, Sh. Sandeep Suri counsel for OP nos.1 and 2 argued that as deposed by the affidavit of Meenu Sharma, Legal Manager of OP nos.1 and 2 Ex.RW1/1 as per the balance sheet prepared by chartered accountant in the heading under Schedule 10, the total raw material was of Rs.12,40,39,620/-. The complainant had stock of raw material of D and E of Rs.1,11,60,000/- + Rs.2,76,47,438/- total in Rs.3,88,07,438/-, which would constitute stock and stock in process as per the insurance policy. Schedule 5 of inventories valued and certified by the management as finished good (at cost) Rs.1,254,339/-, raw material (at cost) is Rs.2,76,47,438/- (H=E), Consumer Complaint No.15 of 2009 28 consumable store & spares & WIP (work in progress) is Rs.34,50,200/- (I). Even if the whole of (I) is taken as raw material/stock in progress, even then the available stocks of raw material with the complainant was of Rs.2,76,47,438/-(H=E). There was a separate cover of Rs.1,50,00,000/- in respect of stock in process. The complainant had an insurance of Rs.1.50 crore as stock under insurance. The under-insurance was to the extent of 72%. The complainant was entitled to only claim of Rs.11,19,077.68 paise against the paid amount of Rs.18,10,840/-, as per the canvassed case of the OPs. We find that the matter between the parties is essentially of quantum of compensation in this case. The counsel for OP nos.1 and 2 relied upon law laid down in "Champalal Verma Vs. Oriental Insurance Co. Ltd." 2008(III) CPJ-93(NC), wherein the National Commission has held in para no.5 of the judgment that report of the surveyor has been given due weightage and since the case involved the quantum in dispute and as has been consistently held, Consumer Forum cannot go into question of quantum of dispute as it would involve a detailed investigation, which cannot be dealt with in the summary proceedings under the Act. The counsel for the complainant on the contrary relied upon law laid down by H.P. State Commission in case "Shubh Timb Steels Limited Vs. New India Assurance Company Ltd." 2008(2)CLT- 434/435, wherein it has been held that complicated question of fact- Merely at the askance of a party alleging complicated issues being Consumer Complaint No.15 of 2009 29 involved, a litigant is not always to be driven to the Civil Court. The law laid down by the National Commission in case "Champalal Verma Vs. Oriental Insurance" (Supra) would have overriding effect over law laid down by H.P. Consumer Disputes Redressal Commission in our view. Consequently, the National Commission has, thus, decided in the above referred authority that dispute regarding quantum of compensation cannot be gone into by the Consumer Forum, as it involved detailed investigation, which is not permissible under summary jurisdiction under the Act.
14. The submission of counsel for the complainant is that Sherry Makkar earlier gave separate report, but we find that the Cunningham Lindsey Company was appointed to assess the loss in this case by the Insurance Company and the surveyor is a corporate body only. As per affidavit of Anil Dhingra on the record, he is the Executive Director and his affidavit has received due corroboration from the affidavit of Sherry Makkar to the effect that Anil Dhingra Executive Director of Cunningham Lindsey was the overall incharge of the surveyor report and survey report is signed by Anil Dhingra on the record. Consequently, the submission put forth by the complainant is without any merit on this point.
15. OP nos.1 and 2 settled the claim of the complainant by applying the under-insurance clause in this case and it came to the extent of Rs.18,10,840/-. The report of the surveyor carries Consumer Complaint No.15 of 2009 30 weightage in our view and we do not find any ground to discard the report of surveyor by any contrary evidence on the record. We have to accept the report of surveyor, which is proved by Anil Dhingra, vide his affidavit Ex.R1/2 on the record. The affidavit of Sherry Makkar Ex.R1/3 also lends corroboration to it. We, thus, conclude that the report of surveyor is a valuable piece of evidence and has to be accepted by the Consumer Forum. On the basis of report of the surveyor, the claim of the complainant was settled for Rs.18,10,840/- and accordingly, the amount was released to the complainant. The complainant has challenged it as under coverage of loss. The controversy can be decided by us on the basis of document Ex.C-12 dated 01.11.2008 signed by the Managing Director of the complainant's company and he is competent person on the basis of resolution in his favour on behalf of complainant to do so. From perusal of this letter Ex.C-12, which is the document produced by the complainant itself on the record, it is evident that the complainant acknowledged the receipt of Rs.18,10,840/- towards full and final settlement of the insurance claim tendered by OP nos.1 and 2. The complainant confirmed in this letter Ex.C-12 that after having received the amount of Rs.18,10,840/- as full and final settlement of the claim, the complainant has no further claim on the matter under the above referred policy in connection with present claim of loss. This letter is dated 01.11.2008 and only after 14 days period therefrom, the complainant served legal notice Ex.C-13 on Consumer Complaint No.15 of 2009 31 15.11.2008 upon the OP nos.1 to 3, claiming that adequate compensation has not been provided to it and it accepted the amount due to compelled circumstances. The complainant is juristic person and is not a natural person and it should not have accepted this claim and rather should have returned the claim under protest to OP nos.1 and 2. Nothing has been done by the complainant in this regard and complainant willingly accepted this amount, as proved in document Ex.C-12, which is tendered by the complainant itself on the record. No protest was lodged by the complainant till after 14 days period therefrom. The counsel for the complainant alleged that the document Ex.C-12 is the result of coercion or compelled circumstances exercised upon the complainant. The complainant relied upon law laid down in "Niharika Maurya Vs. New India Assurance Company Ltd. & ors." 2011(3)CLT-418, wherein the National Commission has observed that mere execution of discharge voucher and acceptance of the insurance claim would not estop the insured from making further claim. We are of this view that the cited authority is distinguishable from the facts of the case. The complainant is a corporate body and is not a living natural being. In the cited case, the petitioner was a living individual and pressure could have been put upon the petitioner in the cited case. Herein, we do not find any coercion or any compelled circumstances on the complainant, which is a juristic person. The complainant further relied upon law laid down in "New India Assurance Company Consumer Complaint No.15 of 2009 32 Limited Vs. Polycap Industries" 2010(4)CLT-498/499, another case of the National Commission, wherein it has been held that complainant could not have accepted this much smaller payment voluntarily unless he was in dire financial difficulty due to the losses on account of the fire because of which he was left with no alternative but to accept the much smaller payment in so called full and final settlement of his claim. From perusal of the authority, we are again of this view that the cited authority is again not applicable in this case. The under-insurance clause was applied in this case by OP nos.1 and 2 stricto sensu, as per the contract of insurance. It cannot be said that the obligation of under-insurance clause was beyond the terms and conditions of the contact of insurance and was, thus, wholly unjustified. The counsel for OP nos.1 and 2 relied upon judgment of the National Commission in "Haryana State Co- operative Supply & Marketing Federation Ltd. Vs. IFFCO Tokio General Insurance and Anr." in revision petition no.4713 of 2012, decided on 05.04.2013, wherein it has been held that the complainant should not have encashed the demand draft in case the offer of full and final settlement was not acceptable and it should have written back to the respondents about the inadequacy of the offer. Rather than writing back and expressing their protest, the petitioner chose to deposit the demand draft and yet later on sent his protest against the amount and hence the National Commission observed that since the offer was accepted and amount was Consumer Complaint No.15 of 2009 33 received towards full and final settlement, hence it was held to have satisfied the claim. Merely, OP nos.1 and 2 relied upon judgment of the National Commission in case "M/s MJRJ Medichem Surgicals Vs. National Insurance Company Ltd. and others" in revision petition no.1927 of 2013, decided on 22.01.2015, wherein reliance has been placed on law laid down by Apex Court in "Bhagwati Prasad Pawan Kumar Vs. Union of India" (2006) 5 Supreme Court Cases-311 and it has been held that Section 8 of the Contract Act provides for acceptance by performing conditions of a proposal. When the offer was made by OP nos.1 and 2 to the complainant and complainant had accepted the offer by receiving the amount as settled without returning the amount and hence it was held that the offer stood unequivocally accepted. An 'offeree' cannot be permitted to change his mind after the unequivocal acceptance of the offer. We thus, find that as per the document Ex.C-12, the complainant had received the sum of Rs.18,10,840/- in full and final settlement of the claim in respect of loss due to fire and hence offer was accepted by the complainant, as envisaged under Section 8 of the Contract Act and hence the claim of the complainant stood satisfied, which estopped the complainant from challenging it again.
16. Once we have come to this conclusion that the complainant has accepted the amount of Rs.18,10,840/- towards full and final settlement and also issued the document Ex.C-12, which is Consumer Complaint No.15 of 2009 34 the document of the complainant, hence in view of Section 8 of the Contract Act, the offer of OP nos.1 and 2 stood accepted and complied with by the complainant thereby estopping the complainant from raising this claim again, which already stood satisfied.
17. The complainant filed an application to place on record the merger agreement with the Fairfax Financial Holding Limited, contending that OP nos.1 to 3 have interaction concern with each other. The complainant stated in this application that Sherry Makkar did not appear in the complaint and got himself intentionally proceeded against ex-parte. The complainant has, thus, prayed that it be allowed to place on record the documents. Upon notice, this application was contested by OP nos.1 and 2 by filing reply to it. It was averred in reply that many applications have been filed by the complainant for additional evidence previously since 2009 just to prolong the case. There are no certified copies sought to be placed on record by the complainant. Merely because the company has or could have some shares with another company does not mean that the said person of the company, who is a shareholder has a direct or indirect concern with another person. OP nos.1 and 2 prayed for the dismissal of the application.
18. The complainant cited the judgment of our own State Commission in C.C. no.59 of 2012, decided on 04.09.2014, titled as "Punjab State Power Corporation Limited & Ors. Vs. M/s ICICI Consumer Complaint No.15 of 2009 35 Lombard General Insurance Company & Ors." We have examined the matter after hearing the parties, we find that no certified copies of the documents to be placed on the record have been attached with this application. Only photocopies, which are not certified by any person, are placed on the record. The case is already quite old one and many applications have been filed and disposed of and hence no ground is made out to allow this application of complainant to further protract the proceeding of the case. Consequently, the application filed by the complainant to this effect is hereby rejected.
19. As a result of our above discussion, we have come to this conclusion that by accepting the offer of OP nos.1 and 2, the complainant has accepted the offer of OP nos.1 and 2 towards full and final settlement of the claim of Rs.18,10,840/- on the basis of survey report, which carries weightage, as surveyor is appointed under Section 64 UM of the Insurance Act. We, thus, do not find any ground to accept the complaint of the complainant in view of document Ex.C-12, which has been produced on record by the complainant itself.
20. As a sequitur of our above discussions, we do not find any merit in the complaint of the complainant and the same is dismissed without any order as to costs.
Consumer Complaint No.15 of 2009 36
21. Arguments in this complaint were heard on 01.07.2015 and the order was reserved. Now the order be communicated to the parties.
22. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(J. S. KLAR) PRESIDING JUDICIAL MEMBER (H.S. GURAM) MEMBER July 6, 2015.
(MM)