National Consumer Disputes Redressal
National Insurance Co. Ltd. vs Noli Ram & Sons on 23 May, 2017
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 2060 OF 2016 (Against the Order dated 27/04/2016 in Appeal No. 49/2016 of the State Commission Rajasthan) 1. NATIONAL INSURANCE CO. LTD. THROUGH ITS DELHI REGIONAL OFFICE AT NATIONAL INSURANCE CO. LTD., NATIONAL LEGAL VERTICAL, 2E/9, JHANDEWANAL, EXTN., NEW DELHI-110055 ...........Petitioner(s) Versus 1. NOLI RAM & SONS THROUGH ITS PARTNER MURLI DHAR SHARMA, COURT ROAD, CHURU-331001 RAJASTHAN ...........Respondent(s)
BEFORE: HON'BLE MR. PREM NARAIN,PRESIDING MEMBER
For the Petitioner : Mr. Animesh Sinha, Advocate For the Respondent : Mr. DiveshMaheshwari, Advocate
Dated : 23 May 2017 ORDER
This revision petition has been filed by the petitioner, National Insurance Company Ltd. against the impugned order dated 27.4.2016 passed by the State Consumer Disputes Redressal Commission, Rajasthan, Jaipur (for short, 'State Commission) in FA No.49 of 2016.
2. Brief facts of the case are that respondent/complainant had insured his petrol pump under the Policy No.371101/11/10/3100001134 issued by the petitioner/OP-National Insurance Company Ltd. and the insurance was valid from 20.3.2011 to 19.3.2012. The complainant's case is that on 23.7.2011 at around 11-12 p.m., the goods train of 50-60 bogeys passed from the nearby track and he felt a sudden heavy jerk and heard a loud sound due to sudden and screeching halting of goods train. The petrol pump has underground tanks and is about 100 mtrs. away from the railway track. Particularly tank no.2 got damaged due to sudden impact of the stopping of the train. This was found when readings for the two days were compared that 15,529 litres of diesel has leaked inside the soil due to this heavy yank resulting in cracks and holes in the tank. The complainant filed an insurance claim before the petitioner insurance company which was repudiated vide letter dated 9.5.2012. Aggrieved with the repudiation, the complainant filed Consumer Complaint No.188/2013 before the District Forum, Churu. The complaint was resisted by the petitioner/OP on the ground that the loss of diesel is due to holes due to rusting of the tank as confirmed by the surveyor's report. The District Forum, however, allowed the complaint and passed the following order:
"a. The respondent is ordered to pay the amount of Rs.6,33,562/- which was estimated by the surveyor, to the complainant towards the loss of diesel which was caused due to the incident dated 23.7.2011 and in addition to this, respondent should pay simple interest on that amount at the rate of 9 percent annually after exact three months from the survey report dated 15.11.2011 i.e. date 14.2.2012 to the actual payment.
(b) The respondent is also ordered to pay Rs.5,000/- to the complainant towards the cost of complaint."
3. Aggrieved with the aforesaid order, the petitioner /OP preferred First Appeal No.49/2016 before the State Commission which was dismissed vide its order dated 27.4.2016.
4. Hence, the revision petition.
5. Heard the learned counsel for both the parties and perused the record. The learned counsel for the petitioner stated that both the fora below have not gone into the details of the policy as the terms and conditions of the policy are binding on both the parties. As soon as the information was received by the insurance company, a surveyor was appointed in the matter. The surveyor has clearly submitted in his report that the damage in the diesel tank is due to rusting as the tank is about 20 years old and this damage/loss is not covered under the policy. The learned counsel further emphasized that no proof was ever filed by the complainant to prove that the damage was due to impact of the sudden stoppage of the train. First of all, it is not clear whether any goods train passed on that day or not and whether it had suddenly stopped or not. No letter or report of the Railway Authorities has been filed. In fact, before repudiation, the complainant was asked to submit certificate from the Railways in respect of the impact due to sudden stoppage of the goods train. However, the complainant never submitted the same. Accordingly, the matter was repudiated stating clearly that the certificate of Railways has not been filed and the surveyor has reported damage/loss due to rusting of the diesel tank. Moreover, the impact damage clause of the Fire snd Special Peril Policy clearly states that the damage should be due to direct contact and in this case there was no direct contact of the train with the diesel tank of the complainant. Hence, the case is not covered under the impact damage clause of the policy. Thus, the claim was repudiated and there is no deficiency on the part of the insurance company. Thus, both the fora below have erred in appreciating the evidence on record as well as the terms and conditions of the policy.
6. The learned counsel for the respondent stated that the insurance policy clearly covers stocks and the risk of earthquake, fire and shock. The fact is that the tank got damaged due to sudden stoppage of the heavy goods train carrying 50-60 bogeys. Had this been due to rusting of the tank, so much diesel could not have disappeared in one day. The leakage might have been observed on earlier days as well. The State Commission has also observed this while dismissing the appeal filed by the OP/petitioner. Both the fora below have given finding in favour of the respondent/complainant and have allowed the insurance claim. The powers under Section 21(b) of the Consumer Protection Act, 1986 are very limited.
7. I have given thoughtful consideration to the arguments advanced by both the parties and have examined the record. The repudiation letter dated 9.5.2012 reads as under:
"Thereafter we also sought your cooperation requesting you to clarify the points raised by the surveyor, most importantly to provide us the impact damage certificate from the railways to substantiate your claim as to the actual cause of loss. But you failed to make the same available to us.
After thorough physical inspection of the concerned diesel tank, papers, documents and information provided by you to the surveyor as also your failure to provide him the required railway certificate, the independent, learned and experienced surveyor is of the firm opinion that-
The Diesel Tank is fitted under the ground & there was no impact of any Rail/Road vehicle or animal as the tank is in intact condition. The tank was fitted about 20 years back & during the duration there became rusting in iron made tank resulting it got punctured at some place consequently the diesel got leaked from the punctured spot. As the cause of loss is leakage of tank from rusting and there was no impact damage therefore and said cause (due to rusting) is not covered under the policy of insurance.
In view of the above, we regret to convey to you that the competent authority denying the liability of the company has repudiated your claim which please note."
8. From the above, it is clear that no certificate from the Railways has been filed. In these circumstances, the whole basis of the complaint which is based on the impact of the sudden stoppage of train on the imbedded tank which was about 100 mtrs. away from the railway track, collapses. Moreover, the independent surveyor appointed by the insurance company has clearly denied the version of the complainant and has given a finding that hole in the tank has occurred due to rusting of the iron tank which was about 20 years old at that time. The surveyors are appointed under the provision of the Insurance Act, 1938 and their report cannot be brushed aside without any cogent reason. Hon'ble Supreme Court in the case of Sri Venkateswara Syndicate vs. Oriental Insurance Company Limited &Anr., (2009) 8 SCC 507, has observed the following:-
"31. The assessment of loss, claim settlement and relevance of survey report depends on various factors. Whenever a loss is reported by insured, a loss adjuster, popularly known as loss surveyor, is deputed who assesses the loss and issues report known as surveyor report which forms the basis for consideration or otherwise of the claim. Surveyors are appointed under the statutory provisions and they are the link between the insurer and the insured when the question of settlement of loss or damage arises. The report of the surveyor could become the basis for settlement of a claim by the insurer in respect of the loss suffered by the insured.
32. There is no disputing the fact that the surveyor/surveyors are appointed by the insurance company under the provisions of the Insurance Act and their reports are to be given due importance and one should have sufficient grounds not to agree with the assessment made by them. We also add, that, under this Section the insurance company cannot go on appointing surveyors one after another so as to get a tailor-made report to the satisfaction of the officer concerned of the insurance company; if for any reason, the report of the surveyors is not acceptable, the insurer has to give valid reason for not accepting the report."
9. Hon'ble Supreme Court in Sikka Papers Limited Vs. National Insurance Company Limited and Ors., (2009) 7 SCC 777, has observed that:-
" Insurance- Terms and conditions specified in insurance policy- Binding effect- Insurance policy not covering parts of machinery which were required to be replaced due to normal wear and tear-Held, Insurance Company while assessing claim, rightly excluded those parts-
Insurance Act, 1938,- S. 64-UM- Surveyor/Loss assessor's report- Weightage to be given- Held, Though not the last word, yet there must be legitimate reason for departing from report- No infirmity found in surveyor's report and therefore held, Insurance Company rightly admitted claim as per the report."
10. The District Forum or the State Commission did not give any forceful reason to disregard the report of the surveyor and therefore, as observed by the Hon'ble Supreme Court in the aforesaid cases, the surveyor's report cannot be disbelieved and cannot be rejected without any forceful evidence on the part of the complainant. The certificate of Railways may have worked as a strong evidence against the surveyor's report but the same has not been produced by the complainant. So there is no reason to disregard the surveyor's report.
11. Moreover, the impact damage clause of the policy reads as follows:
VII Impact Damage Loss of or visible physical damage or destruction caused to the property Insured due to impact by any Rail/Road vehicle or animal by direct contact not belonging to or owned by.
The insured or any occupier of the premises or Their employees while acting in the course of their employment."
12. From the above clause, it is evident that this would be attracted only if the damage is due to direct contact. Clearly in the present case, there cannot be any direct contact of the railway train with the diesel tank as the diesel tank is about 100 mtrs. away from the railway track and no accident has been reported. Thus, clearly this peril is not applicable in the present case.
13. Based on the above examination, I find that both the reasons given in the repudiation letter are justified. It also seeems improbable that a train passing or stopping at a distance of 100 mtrs. away from the underground tank can impact in any manner the iron tank so as to cause any damage to the tank. As no proof from the railways has been filed and the surveyor's report confirmed that the damage/loss is caused due to rusting, clearly the loss is not covered under the policy in question.
14. Based on the above discussion, the revision petition is allowed and the order dated 27.4.2016 passed by the State Commission and order dated 7.12.2015 passed by the District Forum are set aside and the complaint is also dismissed.
15. There shall be no order as to costs.
...................... PREM NARAIN PRESIDING MEMBER