National Consumer Disputes Redressal
Oriental Insurance Co. Ltd. vs Jagdish Chand Gupta on 16 October, 2017
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL NO. 676 OF 2013 (Against the Order dated 19/03/2013 in Complaint No. 09/2010 of the State Commission Himachal Pradesh) 1. ORIENTAL INSURANCE CO. LTD. S.C.O. 40, SECTOR-7, PANCHKULA HARYANA ...........Appellant(s) Versus 1. JAGDISH CHAND GUPTA PROPRIETOR JAGDISH CHAND GUPTA, ENGINEERS A CONTRACTORS, 163, SECTOR-38-A, CHANDIGARH-160014 PUNJAB ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE D.K. JAIN,PRESIDENT
For the Appellant : Mr. S.L. Gupta, Advocate For the Respondent : Mr. Alok Kr. Aggarwal, Advocate
Dated : 16 Oct 2017 ORDER
Challenge in this First Appeal, under Section 19 of the Consumer Protection Act, 1986, by the Oriental Insurance Company Ltd. (for short "the Insurance Company") and its functionaries, the Opposite Parties in the Complaint under the Act, is to the order dated 19.03.2013, passed by the Himachal Pradesh State Consumer Disputes Redressal Commission at Shimla (for short "the State Commission") in Consumer Complaint No. 9 of 2010. By the impugned order, while accepting the Complaint filed by the Respondent, an individual, alleging deficiency in service on the part of the Insurance Company in not indemnifying the loss suffered by him on account of the floods due to heavy rains on 08.06.2000, under the Standard Fire and Special Perils Policy obtained by him in respect of the construction equipment, the shuttering material, in the second round of litigation, the State Commission has directed the Insurance Company to pay to the Complainant a sum of ₹39,53,737/-, as compensation for the loss suffered, along with interest @ 9% p.a. from the date of filing of the Complaint by him before this Commission, i.e. 10.03.2003, to the date of actual payment; ₹50,000/- as compensation for unjustified repudiation of the claim; and a sum of ₹20,000/- as costs of litigation.
2. Since the factum of the Complainant obtaining the said policy on 02.06.2000 for the assured sum of ₹42,00,000/- and as substantial quantity of the shuttering material having been washed away in the heavy floods on 08.06.2000 was not disputed by the Insurance Company in the Written Version filed on its behalf in opposition to the Complaint, I deem it unnecessary to burden the order by narration of the facts, giving rise to filing of the Complaint, in extenso. It would suffice to note that on being informed about the said incident, the Insurance Company appointed one Lt. Col. Gurbakhsh Singh (Retd.) as Investigator-cum-Surveyor, who visited different sites, including the bridge site, and recorded the statements of the Jr. Engineer, In-charge (Stores and Accounts) & some other persons, available at the site and connected with the project. Vide his detailed report dated 10.07.2000, the Surveyor, while accepting the factum of the occurrence of the incident and the insured shuttering material etc. having been washed way, only noted the total claim of ₹42,00,000/- made by the Insured. At this juncture, it is very significant to note that although in his report the Surveyor had not assessed the total loss suffered by the Complainant, the said information was obtained by the Insurance Company vide its privilege document dated 16.10.2000. In the said document, which was not disclosed to the Complainant, the Surveyor had assessed the value of the material washed away in the floods at ₹33,76,820/-. Reducing therefrom the salvage value of the said material, the Surveyor assessed the net loss of the insured material at ₹29,23,492/-.
3. Mercifully, as noted above, the said report dated 16.10.2000 was withheld by the Insurance Company from the Complainant. Since there was no response by the Insurance Company to the claim preferred by the Complainant, the Complaint came to be filed before this Commission. However, because of the lack of pecuniary jurisdiction, vide order dated 25.11.2009, the Complaint was remanded to the State Commission, with a direction for fresh adjudication, upon taking on record the Surveyor's report, assessing the loss, and by permitting the parties to adduce evidence in support of their rival stands. Hence, the order, subject matter of the present Appeal.
4. I have heard learned Counsel for the parties at some length and perused the documents on record, including the afore-noted reports by the Surveyor as also the so-called "privilege document", which saw the light of the day only on specific directions by the State Commission in this behalf. Pertinently, the said "privilege document" was neither referred to in its Written Version by the Insurance Company nor filed separately.
5. It is evident from the material on record, particularly from the averments in the Written Version filed on behalf of the Insurance Company, that the sole ground on which the Insurance Company sat over the claim of the Complainant was that the insured material was neither lying nor was stored in the open but was lying on the main road. In my opinion, apart from the stoic silence on the part of the Insurance Company on the claim preferred by the Complainant, non-communication of the Surveyor's report, assessing the loss, or its objection to the said report, as stipulated in Regulation-9 of the Insurance Regulatory and Development Authority (Protection of policy holders' interests) Regulations, 2002, framed under Sections 14 and 26 of the Insurance Regulatory and Development Authority Act, 1999, amounted to clear deficiency on the part of the Insurance Company, in not responding to the claim preferred by the Complainant. I am in complete agreement with the State Commission that the factum of the heavy floods on account of cloud burst not being in dispute, the objection that the insured material was lying on the main road and not at the site is of no consequence. Accordingly, I affirm the finding returned by the State Commission on the point.
6. Having arrived at the said conclusion, the question surviving for consideration is as to whether the State Commission was justified in directing the Insurance Company to pay to the Complainant a sum of ₹39,53,737/-, as claimed by the Complainant. Having perused the Surveyor's report, which, as noted above, was not disputed by the Insurance Company, in my opinion, the State Commission erred in awarding the amount as claimed by the Complainant and ignoring the report of its own Surveyor at ₹33,76,820/-. In so far as the question of further deduction by the Surveyor as the estimated value of the salvage is concerned, in my view, having himself adopted the old value of the material washed away, the Surveyor was not justified in making further deduction from the said value of the material as the salvage value.
7. Consequently, the Appeal is partly allowed and the order impugned in this Appeal is modified to the extent that the Insurance Company would be liable to pay to the Complainant a sum of ₹33,76,820/- as assessed by the Surveyor as the cost of the material lost in the floods as against ₹39,53,737/-, as awarded by the State Commission on the basis of the claim made in the Complaint. The other directions contained in the impugned order are maintained.
8. It is stated that the Insurance Company has already deposited a sum of ₹77,81,954/- in the State Commission, out of which a sum of ₹29,23,492/- has been released to the Complainant. If that be so, the balance amount due to the Complainant in terms of this order, if any, shall be released to him by the State Commission forthwith and the remaining amount shall be refunded to the Insurance Company, along with accrued interest, if any, on its moving appropriate application in this behalf.
9. The statutory amount deposited by the Insurance Company at the time of filing the Appeal shall stand transferred to the Consumer Welfare Fund by way of a Bank Draft drawn in favour of PAO, Ministry of Consumer Affairs, New Delhi.
10. The Appeal stands disposed of in the above terms, leaving the parties to bear their own costs.
......................J D.K. JAIN PRESIDENT