State Consumer Disputes Redressal Commission
Lakhvinder Singh Bhamra vs Cholamandalam Ms General Insurance ... on 13 December, 2011
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION
PANDRI, RAIPUR
Complaint Case No.08/2010
Instituted on 02.08.2010
Lakhvinder Singh Bhamra,
S/o. Shri M.S. Bhamra,
R/o. Amaraiyapara, Korba,
Tah. & Dist. KORBA (C.G.) ... Complainant.
Vs.
1. Cholamandalam MS General Insurance Co. Ltd.,
Dare House , 2nd Floor, No.2, N.S.C. Bose Road,
CHENNAI - 600 001.
2. Indusind Bank, Branch Raipur,
Through: Branch Manager,
Babla Complex, 1st Floor, Nr. Coffey House,
G.E. Road, Raipur,
Tah. & Dist. RAIPUR (C.G.) ... Opposite Parties.
PRESENT: -
HON'BLE JUSTICE SHRI S.C. VYAS, PRESIDENT
HON'BLE SHRI V.K. PATIL, MEMBER
COUNSEL FOR THE PARTIES: -
Shri Manish Verma, for complainant.
Shri Dinesh Verma, for OP No.1.
Smt. Nupur Pal, for OP No.2.
ORDER
Dated: 13/12/2011 PER: - HON'BLE JUSTICE SHRI S. C. VYAS, PRESIDENT This complaint, under section 12 read with section 17 of the Consumer Protection Act 1986, has been filed for seeking compensation amounting to Rs.10,99,025/- on account of damages to the insured machine, Rs.19,50,000/- on account of loss of income suffered by the complainant because of inaction of the OP No.1 for a long time and Rs.80,000/- as compensation for mental agony along // 2 // with interest at a reasonable rate, from the date of filing of the complaint, till the date of payment, against OP No.1 Cholamandalam MS General Insurance Company Limited and OP No.2, Indusind Bank Ltd., Branch Raipur.
2. It is not in dispute that a machine Volvo 290 B.L.C. Excavator Model No.13196 was insured by OP No.1 for a sum of Rs.52,20,000/- on payment of premium of Rs.55,835/-, under policy No.3380/00326872/000/00 for the period between 05.10.09 to 04.10.10 and thus insurance services in respect of the machine were obtained by the complainant from OP No.1. The policy was provided under Miscellaneous and Special Type Vehicle policy.
3. Briefly stated the case of the complainant before us is that on 28.11.09, the insured machine was functioning at Vandana Power Plant, Chhuri, P.S. Katghora, Dist. Korba. During its operation, at about 1 p.m. all of a sudden, on account of some short circuiting, the machine burnt. Immediately, intimation was given to the Police as well as to the Insurance Company regarding the incident. The Insurance Company appointed surveyor, who came to the spot, made inquiry regarding the incident and took photocopy of the damaged machinery. The machinery was purchased by the complainant with the help of finance provided by OP No.2. On 28.11.09, Mr. Anand // 3 // Mohan Goswami, surveyor, conducted survey at 6:30, then on next day at 11:30, Mr. Sameer and two other surveyors came to the spot along with Higher Officers of the Company Mr. Ramani. They also took photographs, obtained necessary documents from the complainant and search report. On 28.11.09, the complainant filed his claim before the Insurance Company and claim case was registered. On the advice of surveyor, valuation of loss was estimated for repairing and it came out to Rs.10,99,025/-. With the consent of the Insurance Company, repairing work was done by M/s. Technical Earthmovers and Engineers, Kolkata, between 28.01.10 to 18.03.10. During that period also surveyors of the Insurance Company were continuously visiting the spot, on many occasions. Surveyor Mr. Sameer, Mr. Goswami and Mr. Shashank conducted survey. When the amount spent on repairing of the vehicle were demanded from the Insurance Company, then no amount was paid by the Insurance Company, till the date of filing of the complaint and thus deficiency in service has been committed. As the machine was sent for repairing very late, because the consent was given very late by the Insurance Company, so the complainant demanded compensation for the period spent by the Insurance Company in giving consent for repairing and for the other period, when the claim was kept pending. Because of inaction of the Insurance Company and because of damages to the machine, no work could be performed by the machine resulting loss to // 4 // his business. Thus, damages on different heads have been claimed by the complainant.
4. The Insurance Company in the written version raised certain preliminary objections. First objection is that this Commission has no jurisdiction to entertain the present complaint. It has also been objected that the claim is still pending before the Insurance Company and so the complaint is premature. The Insurance Company demanded some documents from the insured by letter of request dated 17.04.2010, but at the place of complying the same, the complaint has been filed before this Commission, which is not maintainable. It has also been averred that this Commission has no jurisdiction because as per case narrated in the complaint, the dispute is not a consumer dispute and it is outside the scope of Consumer Protection Act 1986. It has also been objected that the complainant has not come before this Commission with clean hands and deliberately has not disclosed all and correct facts, so also the complaint is not maintainable. As per the terms of the policy, the dispute was first to be adjudicated by Arbitrator, appointed under the policy and as the dispute has not been referred to any Arbitrator, therefore also the complaint is not maintainable. This objection has also been raised that operator of the vehicle was also not having a valid and effective driving licence, so the vehicle was being used in contravention of provisions of Motor Vehicles Act 1988 and the // 5 // policy conditions, so also the complaint is not maintainable. The allegation of the complainant has been denied parawise and it has been specified that the surveyor appointed by the Insurance Company has assessed loss of Rs.2,81,274/- but that amount also could not be paid to the complainant because he has not filed the documents which were requested by the Insurance Company by letter dated 17.04.10, to be filed by the complainant. The complainant has also not filed cash receipt of bills and discharge voucher. Other claims of the complainant for compensation on account of damages to the vehicle and the vehicle being not operative for a long time, resulting in financial loss to the complainant, have also been denied. Thus, the allegation of deficiency in service has totally been denied and the complaint has also been stated as not maintainable.
5. The financer, in its separate reply has averred that the vehicle was financed by the Bank under an agreement executed between the parties and nothing has been alleged in the complaint against the financer, amounting to deficiency in service, so the complaint is liable to be dismissed against the Financer.
6. The first question for consideration is whether the machine in question was a motor vehicle and whether licence for its operation, under the provisions of Motor Vehicles Act 1988, was necessary ?
// 6 //
7. For the purpose of consideration of this question, it is necessary to go through the documents regarding sale of the machine and the Insurance Policy itself. Document No.1 filed by the complainant is the Sale Letter of Mr. I.V.S. Raju. In this letter it has been stated that said person has sold an old and used excavator Volvo EC 290 BLC, bearing machine Serial No.13196 to the complainant. In this document, it has not been stated that the said machine is a motor vehicle. In the insurance policy issued by OP No.1, said machine has been described as Volvo excavator having a particular Engine No. It was an old machine having no registration marks and it has been insured under package policy as Miscellaneous & Special Type Vehicle. It has been insured against all damages as well as against any liability towards third party. Premium for coverage of risk of owner driver has also been collected. From this insurance policy also it is nowhere clear that the machine concerned, was a motor vehicle. As it is a machine, so may be it comes in the category of special type of vehicle, but is not covered under the term 'motor vehicle'. In the complaint, filed by the complainant before Police, also the said machine has been referred as machine Volvo 290 Excavator and not as motor vehicle. In the surveyor report also it has not been stated anywhere by the surveyor Mr. Rawani that the said machine was a motor vehicle or that it was required to be operated by a person having specific type of licence // 7 // under the provisions of Motor Vehicles Act. The surveyor has described it as an excavator machine, with make and model hydraulic excavator. In the column Driver Particulars, name of the driver has been mentioned as Mr. Raju, but nothing has been mentioned regarding driving licence etc. or regarding requirement of having a driving licence. Another surveyor Mr. Anand Mohan Goswami, in his report Annexure OP-7, has almost stated the same things and described the machine as Volvo Hydraulic Excavator and Excavator Machine to be operated by Mr. Raju. He has also not mentioned any requirement of licence of driving a motor vehicle or that it was a motor vehicle. So, from all these documents, we are convinced that the insured article was a machine, it was not a motor vehicle and for operating that machine, it was not necessary to have a licence under the provisions of Motor Vehicles Act 1988. So, objection of OP No.1, in this regard, carries no weight and this question is decided in favour of the complainant.
8. The next question for consideration is whether the complaint, in the present form, is maintainable ?
9. OP No.1, the insurance company has raised objection regarding maintainability of the complaint in different words, but in sum and substance, the objection is that as there was an arbitration clause or // 8 // that as the claim is still pending with the Insurance Company and has not been repudiated or that the dispute between the parties is not a consumer dispute, so the complaint is not maintainable. We do not find any force in any of these contentions. So far as the mention of arbitration clause in the policy document is concerned, we do not find any such arbitration clause in any of the policy document filed by the parties and if in the printed booklet, filed by OP No.1, in support of this contention. Even if there is some mention of settlement through arbitration anywhere, then also, in view of the provision of Section 3 of Consumer Protection Act 1986, it nowhere creates any bar in maintaining the present complaint, regarding claim for any damage to the insured machine, under the insurance policy, as the remedies provided under the Consumer Protection Act 1986 are in addition to and not in derogation with the provisions of any other Act. Here in the facts of the present case, the dispute has not been referred to any Arbitrator, by the parties, so there should not be any impediment in entertaining the complaint and the objection raised by the Insurance Company in this regard is not tenable, as the complainant has come with clear allegation that the OP No.1 Insurance Company committed deficiency in service in not deciding the claim in a reasonable time, even after receiving report of the Surveyor and Loss Assessor and it has unnecessarily kept the matter pending and deprived him from the amount of damages. The allegation made by the complainant in the // 9 // complaint comes in the category of allegation of deficiency in service, because as per the provisions of Consumer Protection Act 1986, if there is some "fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service" then it comes in the category of 'deficiency'. The OP No.1 in its written version has also referred a case decided by Hon'ble Supreme Court, Ravneet Singh Bagga Vs. KIM Royal Dutch Airlines, (2000) 1 SCC 66, wherein it was held that "the deficiency in service cannot be alleged without attributing fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be performed by a person in pursuance of a contract or otherwise in relation to any service". Therefore looking to the allegations made in the complaint, the complaint is definitely entertainable and the objection raised by the OP No.1 in this regard is totally unnecessary.
10. Now the main question is whether the machine insured by OP No.1 suffered any loss and whether the Insurance Company failed to pay the amount of damages to the insured under terms of the policy in a reasonable time ?
// 10 //
11. Complainant Lakhvinder Singh Bhamra in his affidavit, filed in support of contentions made in the complaint, has stated that the machine, on account of short circuiting, was damaged and then incident was immediately reported to the Insurance Company, whose surveyor immediately inspected the spot also. The Insurance Company has filed report of surveyor Mr. A.M. Goswami, who, in his report, has described in detail the cause and nature of Accident. He has stated that "as reported by the Insured, due to wiring short circuit the fire occurred in the main pump compartment and damaged the components". It has also been stated by the surveyor that "a similar cause and nature of accident is mentioned in the Police Informatory report, Claim form and service report of M/s Volvo also". He has reported that "looking to the nature of losses, the Cause and Nature of accident, as narrated by the Insured, it appears to be plausible". He has also described in detail the damages to the machine and noted that "1. Wiring loom at Main Pump compartment was burnt. 2. Main Pump body seen black with soot marks. Solenoid blocks were burnt. Switches, Sensors, Guages, Valves and Hoses fitted at Main Pump compartment seen burning marks". It has also been mentioned by him that the "said machine being highly technical and computerized, the damages if any, to electronic equipments can be seen only at the time of final survey on detail checking with electronic gadgets". This report was issued by him on 15.12.2009, whereas the date of incident // 11 // was 28.11.09. He has also mentioned that on the date of incident itself the work was allotted to him and he conducted survey on the same day and later on along with Mr. Sameer. Thus, the survey was conducted on the same day and thereafter along with Mr. Sameer on 04.12.09. Then on 15.12.09, the report was submitted to the Insurance Company. When this report was received then the Insurance Company was expected to come in action very fast, but as per allegation of the complainant, consent for sending the machine for repairing was given late and therefore the repairing work, at Kolkata, could be started only on 28.01.10. Final survey was conducted by Mr. M.A. Rawani, his report is annexure OP-5 dated 29.03.2010. He has also mentioned the date of survey as 28.11.09 entrusted to Mr. A.M. Goswami and later on he conducted survey at M/s. Gaysuddin Heavy Machinery Works. The date has not been mentioned. Ultimately he found that the machine was having heavy losses and after deducting the amount against depreciation on account of age of the machine he concluded that net liability of the Insurer is Rs.2,52,610.71p. In his report, he has not referred the Invoice of works of repairing. The Bill of repairer, which was produced before him and from which he has described, in his report, regarding the parts, their rates and the VAT tax paid on those parts, has been filed before us by the complainant and was also provided to the Insurer. Because, when this bill was provided to the surveyor, then only the surveyor could write cost of a // 12 // particular part, tax paid on that particular part and then the amount of depreciation, on age of the machine. The bill is document No.8 of the complainant. This is a Tax Invoice given by M/s. Technical Earthmovers and Engineers, P-50, Princep Street, 4th Floor, Kolkata. We find that from this bill itself, description of parts, the amount paid against those parts and the amount of VAT Tax, have been referred by the Surveyor. We find that out of 15 parts, in the bill, parts at serial Nos.1, 2, 6 & 7 namely accumulator valuing Rs.27,152.50p., Block valuing Rs.11,709/-, wire harness valuing Rs.2,45,050/- and solenoid valuing Rs.76,105/- have not been taken into consideration by the Surveyor and no reason has been assigned by the surveyor for not taking into consideration these parts. As these parts have not been taken into consideration in the report of the Surveyor and no reason has been assigned in the report, so we presume that probably by mistake these parts have been escaped from notice of the Surveyor and total cost of these parts Rs.3,60,016.50p. The machine was of the make of 2005, so its age on the date of incident was more than 4-5 years and therefore the depreciation on the parts will be @ 40%, because it has not been described by the Surveyor, as to whether these parts were of plastic make or of which material. Deducting the amount @ 40% against depreciation, the amount of damages against those parts, which were not taken into consideration by the Surveyor, comes to be Rs.2,16,009.90p. This amount was payable to the complainant along // 13 // with assessed amount of Rs.2,52,610.71p., and therefore the total amount payable by the Insurance Company to the complainant is Rs.4,68,620.61p. (i.e. Rs.216036.90 + 252610.71=468620.61). Thus the Insurance Company at the place of paying the amount which was assessed by the surveyor has delayed the payment on one pretext or another and vide letter dated 04.09.2010, Annexure OP-8, the Insurance Company informed the complainant, that the claim was settled by the Insurance Company on the figure of Rs.2,81,274/- and then vide letter dated 17.04.10 the same was communicated and some documents were requested to be filed, which were not produced by the complainant and so the claim could not be settled. Copy of letter dated 17.04.10 is also available on record as Annexure OP-2. In this letter the Insurance Company has informed the insured that his claim has been processed for Rs.2,81,274/- and then it was requested that the complainant was required to submit cash receipts of bills provided, discharge voucher duly signed by the complainant in order to enable the Insurance Company to release the claim payment and format of discharge voucher was also attached therewith. It appears that by way of that discharge voucher the Insurance Company wanted in advance duly signed discharge voucher of his claim for the purpose of getting rid from any future claim, as the Insurance Company was in commanding position at that time and was to pay the amount of compensation, so it was applying undue pressure upon the // 14 // complainant of sending its discharge voucher, duly signed in advance in settlement of claim on a particular amount. If the claimant has not provided such discharge voucher because he was not satisfied with the amount offered by the Insurance Company then there is nothing wrong on his part and he was competent to file complaint before us, so he has filed the present complaint. In this regard the case of Central Inland Water Transport Corporation Ltd. & anr. Vs. Brojo Nath Ganguli & anr., (1986) 3 SCC 165 can be fruitfully referred, wherein the Hon'ble Apex Court discussed at length the concept of coercive bargaining and held that "where a man has no choice, or rather no meaningful choice, but to give his consent to a contract or to sign on dotted line in a prescribed or other form or to accept a set of rules as part of contract, however, unfair, unreasonable and unconscionable a clause in that contract may be the Courts will not enforce and will, when called upon to do so, strike down an unfair and unreasonable contract or an unfair or unreasonable clause in a contract entered into between the parties who are not equal in bargaining power. The Court visualized different situations such as where the inequality of bargaining power is the result of the great disparity in the economic strength of the contracting parties or the inequality may be the result of circumstances whether of the creation of the parties or not. Or a situation in which the weaker party is in position in which he can obtain goods or services or means // 15 // of livelihood only upon the term imposed by the stronger party or go without them."
11(B). Learned counsel for the OP no.1 has cited the cases of Champalal Verma Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 93 (NC); New India Assurance Co. Ltd. & Anr. Vs. New Good Luck Retrading Works, III (2009) CPJ 262 (NC); Nand Kishore Jaiswal Vs. National Insurance Co. Ltd., III (2009) CPJ 194 (NC); New India Assurance Co. Ltd. Vs. Sehrawat India (P) Ltd. & Anr., III (2009) CPJ 4 (NC). In all these cases, it has been held that the report of Surveyor is an important document, which cannot be brushed aside easily without any valid justification or any report to contrary. In the facts of the present case, some parts repaired or changed have simply escaped from the notice of Surveyor, so he failed to mention about them in his report and therefore only those parts have been taken into consideration by us in addition to the report of the Surveyor.
12. Thus, on the basis of aforesaid discussion we are of the view that amount of Rs.4,68,621/- (i.e. Rs.4,68,620.61p.), on producing cash payment receipts to the repairer, is payable by the Insurance Company by way of compensation to the complainant.
// 16 //
13. Next question for consideration is whether the other losses suffered by the complainant on account of repairing of the machine late and loss suffered by the complainant on account of inaction of the machine for a long time, are also payable by the Insurance Company, as claimed by the complainant in his complaint ?
14. We have gone through the Insurance Policy, executed between the parties and the terms and conditions of insurance, as per Booklet produced by the Insurance Company. It has nowhere been accepted by the Insurance Company that apart from any damage to the machine or apart from the liabilities which have been accepted under the insurance policy, any other amount would be payable by the Insurance Company to the complainant on account of other losses suffered by him. Insurance contract is a contract like any other contract and its terms are binding upon both parties and nothing can either be added in the contract nor any term can be deleted and when there is no term to that effect, then we do not find any reason to direct the Insurance Company to pay any more amount than the amount which was payable under the terms of the insurance policy. It is worth mentioning that as per the case of the Insurance Company, the payment delayed because the insured had not provided cash receipts of payment of charges to the repairer and discharge voucher. Thus, if the payment was delayed for sometime by the Insurance Company for // 17 // want of payment receipt of the repairer then it cannot be said that any other compensation is payable by the Insurance Company. So, this question is decided in favour of the Insurance Company and against the complainant.
15. On the basis of aforesaid discussion, we find that the Insurance Company is liable to pay Rs.4,68,621/- (Rupees Four Lacs Sixty Eight Thousand Six Hundred and Twenty One only), on production of cash payment receipts to the repairer, to the insured complainant on account of damages to the insured machine within one month from the date of this order otherwise that amount will be payable along with interest @ 6% p.a. from the date of filing of the complaint, till the date of payment. In addition to it, the Insurance Company will also be liable to pay cost of litigation Rs.5,000/- to the complainant. With these directions, the complaint is disposed of.
(Justice S.C. Vyas) (V.K. Patil)
President Member
/12/2011 /12/2011