National Consumer Disputes Redressal
Monga Traders vs United India Insurance Co. Ltd & Anr on 17 July, 2019
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 2475 OF 2014 (Against the Order dated 03/02/2014 in Appeal No. 1717/2010 of the State Commission Punjab) 1. MONGA TRADERS THROUGH ITS PROP SH.AMARJIT SINGH MONGA, T.B HOSPITAL ROAD, PATIALA PUNJAB ...........Petitioner(s) Versus 1. UNITED INDIA INSURANCE CO. LTD & ANR LEELA BHAWAN , THROUGH ITS BRANCH MANAGER, PATIALA - 147001 PUNJAB 2. THE MANAGER, STATE BANK OF PATIALA DHARAMPURA BAZAR, NEAR GURUDWARA NAVIN SINGH SABHA PATIALA - 147001 PUNJAB ...........Respondent(s)
BEFORE: HON'BLE MR. PREM NARAIN,PRESIDING MEMBER
For the Petitioner : Mr. Amarjit S. Monga, Proprietor
(in person) For the Respondent : For the Respondent No.1: Mr. Rajesh K. Gupta, Advocate
For the Respondent No.2: NEMO
Dated : 17 Jul 2019 ORDER
This revision petition has been field by the petitioner Monga Traders, against the order dated 3.2.2014 of the State Consumer Disputes Redressal Commission, Punjab, (in short 'the State Commission') passed in FA No.1717 of 2010.
2. Brief facts of the case are that the petitioner/complainant purchased an insurance policy from opposite party No.1 through opposite party No.2 for his shop covering theft, fire, etc. that was valid for the period from 7.7.2005 to 6.7.2006. At that time only cover note was supplied. Neither the policy nor its terms and conditions were supplied to him. On 16.10.2005, suddenly a fire broke out in his shop, which was put off by the fire brigade from Patiala. Report was also published in "Danik Jagran" on 17.10.2005 with photographs, about this fire. Intimation was given to the Divisional Manager of opposite party No.1 on telephone on 16.10.2005. Thereupon, Sh. Rajiv Goyal, surveyor-cum-CA, conducted the survey on 17.10.2005 and took the photographs on the spot. The complainant handed over all the requisite documents as demanded by the surveyor on 28.12.2005. The estimate of loss to the goods was worked out as Rs.92,431/-. But opposite party No.1 rejected his claim vide letter No.2305 dated 3.7.2006. The petitioner was informed that the surveyor had assessed the loss to the tune of Rs.4,663/- only. Finally, on 25.8.2006, opposite party No.1 issued a cheque No.00926 dated 23.8.2006 drawn on Centurian Bank of Punjab for an amount of Rs.10,550/-, which was received by him under protest. No reason was assigned for not considering the full claim as estimated by him. In a complaint filed before the District Forum, he sought directions to the opposite parties to pay the balance amount of Rs.81,881/- along with compensation of Rs.50,000/- on account of damages. Upon notice, opposite party No.1 filed written reply admitting that the complainant purchased the insurance policy from it which was subject to its terms and conditions. It was, however, denied that only the cover note was supplied and that policy document or its terms and conditions were not supplied. It pleaded that the complainant was fully aware of every aspect of the policy. False and baseless allegations were levelled by him in order to wriggle out of the terms and conditions of the policy. Upon intimation, the competent authority deputed Sh. Rajiv Goyal, Surveyor and Loss Assessor for conducting final survey, who initially recommended the payment of Rs.4,663/- only subject to the excess clause as the complainant did not provide him the complete claim bills and other documents. Notices dated 17.1.2006 and 14.2.2006 were issued to him and finally, vide letter dated 3.7.2006, the claim file was closed as "no claim". The file was again opened on the request of the complainant for the purpose of reassessment. A supplementary report was submitted by the surveyor in which loss of Rs.20,568/- was assessed which excluded the excess clause. After applying the excess clause, the claim was settled for Rs.10,550/- which was paid to the complainant on 23.8.2006. it was explained to the complainant that he took the policy for Rs.2,50,000/- but on date of loss his stock was found to be Rs.6,78,431/-, out of which, loss was assessed as Rs.69,769.40. Since the total stock exceeded the sum assured, average clause, as per policy condition No.9, was applied and amount payable to the complainant was reduced to Rs.20,568/-. Thus, there was no deficiency on its part. The District Forum vide its order dated 26.7.2010 dismissed the complaint.
3. The complainant filed an appeal bearing No.1717 of 2010 before the State Commission. The State Commission vide its order dated 3.2.2014 dismissed the appeal of the complainant.
4. Hence the present revision petition.
5. Heard the petitioner in person as well as learned counsel for the respondent No.1. Respondent No.2 was served dasti by the petitioner. This Commission vide its order dated 6.4.2017 accepted the dasti service on the respondent No.2. However, none appeared on the day of final hearing.
6. It was argued by the petitioner that the petitioner mentioned in the original complaint before the District Forum that no policy or terms and conditions of the policy were supplied to the petitioner. It was answered before State Commission on their specific query "from where the petitioner had come to know the policy No", that policy No. was disclosed to petitioner by the surveyor on his first visit to petitioner's shop and also from the correspondence with the Insurance Company. But the State Commission has not taken this plea into consideration. It was argued that when the policy alongwith its terms and conditions has not been supplied to the petitioner, how its terms or conditions can be applied to settle the claim of the insurance. To support his contention, the petitioner relied upon the following judgments:-
(1) RP No.3165-3166 of 2013, The Oriental Insurance Co. Ltd. Vs. Satpal Singh & anr, decided on 01.04.2014 (NC). It has been held that:-
"9. We are of considered view that, onus of proof lies upon OP Nos. 1 to 3 to prove that policy, along with terms and conditions, was supplied to the Complainant. OPs had not produced any cogent evidence in this regard. The Counsel for the Petitioner drew our attention to the relevant portion of the cover note, which reads as :- "The insurance under this policy is subject to conditions, clauses, warranties, exclusions, IMTs and OIC endorsements, mentioned herein above, which are available on Company website: www.orientalinsurance.org.in or on demand from the policy issuing office."
10. It a ridiculous attempt, made by the Counsel for the OP. It seems every driver/insured is a computer savvy..!! It proves that OP-1, did not supply the terms and conditions, with cover note."
(2) RP No.2708 of 2013, Ashok Sharma Vs, National Insurance Co. Ltd., decided on 19.02.2016. It has been held that:-
"12. Similarly in the matter of Modern Insulators Ltd. vs. Oriental Insurance Co. Ltd. (2000) 2 SCC 734 Hon'ble Supreme Court observed as under: -
"The appellant also urged before the National Commission that only the cover note and the schedule of insurance policy were supplied and other terms and conditions including the exclusion clause were not communicated. According to the appellant the above document supplied did not contain the exclusion clause. The said exclusion clause runs as follows:
"In the case of second hand/used property the insurance hereunder shall, however, cease immediately on the commencement of the test"
The National Commission asked the parties to file affidavits to prove that the exclusion clause was duly communicated to the appellant. We have been taken through the affidavits filed and we find in the affidavit of the appellant the letter received by the appellant from the Branch Manager of the respondent was referred to wherein it was confirmed that appellant was supplied only with a cover note and the schedule of the policy. So the other terms and conditions containing the above exclusion clause were not communicated. In the reply affidavit filed by the respondent it was not specifically mentioned that the exclusion clause was also communicated to the appellant..
The National Commission was of the view that "it is equally responsibility of the respondent to call for these terms and conditions even if they were not sent by the appellant as alleged, to understand the extent of risks covered under the policy and the associated aspects."
It is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the lads which the parties known. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose .ill material facts in their knowledge since obligation of good faith applies to both equally.
In view of the above settled position of law we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant respondent cannot claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law."
13. From the above-said enunciation of law it is clear that the obligation of good faith applies to both the parties to the contract and it is not only the duty of the insured but also the duty of the insurance company and its agent to disclose all material facts in their knowledge to the insured. We have already held that condition No.1 relied upon by the insurance company for repudiation of claim was never brought to the knowledge of the insured. Therefore, the respondent insurance company was not justified in repudiating the insurance claim on the basis of said condition No.1."
7. Petitioner stated that on 16.10.2005 suddenly fire broke out in the shop of petitioner for which the petitioner informed the Divisional Manager of Respondent No.1 who appointed Sh. Rajiv Goyal as surveyor who conducted the survey & gave the estimate of loss of goods as Rs.92,431/-. But the respondent No.1 rejected the claim on flimsy grounds and when the petitioner protested than respondent No.1 again opened the case and gave to petitioner a cheque of Rs.10550/- which was received by the petitioner under protest.
8. On the other hand, learned counsel for the respondents reiterated the same arguments, which were mentioned in the written statement. Learned counsel mentioned that the report of the surveyor is an important document and forms the basis for the settlement of the insurance claim. The report of the surveyor cannot be brushed aside without any cogent reason. In standard policies, the terms and conditions are also standard and are available on the website of the Insurance Company. In this regard, learned counsel relied upon the judgment of Hon'ble Supreme Court in General Assurance Society Ltd. Vs.Chandmull Jain, [1966 ] 3 SCR 500, wherein the Apex Court has held as under:-
"The attempt of the assured in this case, therefore, has been to establish that the cover notes having expired, did not bind the parties and the reference to the policy being in the cover notes and not in the letters of acceptance, the terms and conditions of the policy were not attracted. We are satisfied that this is not the true position. The letters of acceptance expressly mentioned the cover notes and the cover notes expressly mentioned the policy. Therefore both during the period of 30 days when the cover notes operated and also thereafter, the terms and conditions of the policy governed the relationship between the parties. We have already held that as there was only one standard fire-policy, the use of the plural word 'policies' made no difference and the delay in sending the cover notes, if any, was also immaterial. The terms and conditions of the usual policy accordingly governed the relations of the parties, and made condition 10 applicable."
9. Learned counsel for the Insurance Company further argued that on representation of the complainant the surveyor reassessed the loss and it was found that the loss was for Rs.69,769/- . However, it was seen that the total stocks available with the complainant was for Rs.6,78,431/-, whereas the stocks were insured only for Rs.2.50 lacs and on the application of average clause, the loss comes to Rs.25,710/-. The surveyor has deducted 20% as the salvage value and after deduction of salvage value the total claim becomes Rs.20,568/-. After deduction of the policy excess, amount of Rs.10,550/-, was paid to the complainant. No ambiguity or shortcoming has been pointed out by the complainant in the report of the surveyor. Both the fora below have dismissed the complaint of the petitioner and scope under the revision petition is quite limited. Facts cannot be reassessed by this Commission in the revision petitioner against the concurrent finding of fact given by the fora below. No legal point has been raised in the revision petition and therefore, the revision petition deserves to be dismissed.
10. I have given a thoughtful consideration to the arguments advanced by both the sides and have examined the material on record. It is true that both the fora below have dismissed the complaint and scope under the revision petition is quite limited against the concurrent finding of facts by the fora below. The fact is that the surveyor has assessed the loss to the tune of Rs.69,769/- against the claim amount of Rs.92,431/-. However, as the stocks maintained by the complainant were to the tune of Rs.6,78,431/- and the insurance amount for the stock was only Rs.2.50 lacs, therefore, after applying the average clause, the surveyor has assessed net loss to the tune of Rs.25,710/- and after deducting the salvage value @20% and policy excess, amount of Rs.10,550/- has already been paid by the Insurance Company to the complainant. In the revision petition, no plea has been taken by the petitioner/complainant in respect of any shortcoming in the surveyor report. Thus, if the surveyor report is not challenged, it has to be accepted for settling the insurance claim.
11. The only important point that has been raised by the petitioner is that the policy as well as its terms and conditions were not supplied to the petitioner and only cover note was supplied. In this regard, it is seen that at the bottom of the policy cover note "as per conditions and claims attached" is mentioned. This gives an indication that term and conditions of the policy were supplied along with the cover note. The State Commission has also observed the following:-
"Moreover he himself alleged in para No.2 of his complaint that he purchased policy No.111006/48/05/0098, which is no other policy than Ex R-5 which is a complete booklet containing all terms and conditions."
12. Moreover, if the same were not found attached with the policy cover note, the complainant should have asked the same from the Insurance Company. In RP No.2708 of 2013, Ashok Sharma Vs. National Insurance Co. Ltd.(supra), this commission has relied upon the judgment of the Hon'ble Supreme Court in Modern Insulators Ltd. Vs. Oriental Insurance Co. Ltd. (supra). The fact is that in Modern Insulators Ltd. Vs. Oriental Insurance Co. (supra), the condition that was not supplied to complainant was a special one and not general condition like "average clause or under insurance'. These are general principles used for settlement of insurance claims. So far as the other judgment relied upon by the learned counsel for the petitioner is concerned, this Commission in RP No.3165-3166 of 2013 The Oriental Insurance Co. Ltd. Vs. Satpal Singh & Anr. (supra), has put the onus on the Insurance Company to prove that they supplied the policy along with terms and conditions. In the present case, the fora below have not accepted this plea of the complainant and therefore, against the concurrent finding of fact, this Commission cannot reassess the fact and it is thus clear that the terms and conditions were supplied by the Insurance Company to the complainant. In taking this view, I am supported by the decision of the Hon'ble Supreme Court in Lourdes Society Snehanjali Girls Hostel and Ors. Vs. H&R Johnson (India) Ltd. and others, (2016) 8 Supreme Court Cases 286 wherein the following has been observed:
"23. The National Commission has to exercise the jurisdiction vested in it only if the State Commission or the District Forum has either failed to exercise their jurisdiction or exercised when the same was not vested in them or exceeded their jurisdiction by acting illegally or with material irregularity. In the instant case, the National Commission has certainly exceeded its jurisdiction by setting aside the concurrent finding of fact recorded in the order passed by the State Commission which is based upon valid and cogent reasons."
13. From the above examination, it is clear that raising of the plea by the petitioner at the stage of the revision petition that the petitioner was not supplied with the copy of the policy and its terms and condition is not tenable in the facts of the present case. The petitioner has not uttered a word in respect of any shortcoming in the surveyor's report in the revision petition. The claim has already been settled by the Insurance Company on the basis of the report of the surveyor. Hence, the same cannot be reopened without any reasons having been pointed out by the petitioner against the surveyor's report.
14. Based on the above discussion, I do not find any illegality, material irregularity or jurisdictional error in the order dated 03.02.2014 of the State Commission which calls for any interference from this Commission. Accordingly, the revision petition No.2475 of 2014 is dismissed.
...................... PREM NARAIN PRESIDING MEMBER