State Consumer Disputes Redressal Commission
New India Assurance Co. Ltd. vs Sh. Kamal Kumar. on 9 April, 2019
H. P. STATE CONSUMER DISPUTES REDRESSAL
COMMISSION SHIMLA
First Appeal No. : 203/2018
Date of Presentation: 03.08.2018
Order Reserved on : 05.12.2018
Date of Order : 09.04.2019
......
The New India Assurance Company Limited Kotwali Bazar
Dharamshala through its Divisional Incharge (Officiating) The
New India Assurance Company Limited Divisional Office
3rd Floor Block No.7 SDA Complex Shimla H.P. -171009
...... Appellant/Opposite party
Versus
Shri Kamal Kumar Son of Shri Bir Singh Resident of Village
Kharota Post Office and Tehsil Jawali District Kangra H.P.
......Respondent/Complainant
Coram
Hon'ble Justice P.S. Rana (R) President
Hon'ble Mr. Vijay Pal Khachi Member
Hon'ble Ms. Sunita Sharma Member
Whether approved for reporting?1 Yes.
For Appellant : Mr. Jagdish Thakur Advocate.
For Respondent : Mr. Vinay Soni Advocate.
JUSTICE P.S. RANA (R) PRESIDENT:
O R D E R :-
1. Present appeal is filed under section 15 of Consumer Protection Act 1986 against order dated 29.06.2018 passed by Learned District Forum in consumer complaint No.04/2018 titled Kamal Kumar Versus The New India Assurance Company Ltd.
1 Whether reporters of the local papers may be allowed to see the order? Yes.
New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) Brief facts of Matter:
2. Complainant filed consumer complaint under Section 12 of Consumer Protection Act 1986 pleaded therein that complainant insured his residential house with opposite party and purchased Standard Fire and Special Perils Policy from opposite party w.e.f. 24.10.2007 to 23.10.2017 for sum of Rs.630000/- (Six lac thirty thousand). It is pleaded that on dated 24.04.2017 due to heavy winds, lighting and thunder mango tree was uprooted and fell on the building of complainant and building of complainant sustained damage.
It is further pleaded that report was also filed in the Revenue Department. It is further pleaded that information was also given to Insurance company and Insurance company deputed Surveyor-cum-loss assessor to assess the damage caused to the building.
3. It is further pleaded that Executive Engineer HPPWD Jawali Division inspected the damaged building in question and assessed the loss to the tune of Rs.172600/- (One lac seventy two thousand six hundred). It is further pleaded that Insurance company only paid Rs.16000/- (Sixteen thousand) to the complainant and transfer the said amount on dated 24.11.2017 in the payee account of complainant. It is further pleaded that on dated 30.11.2017 complainant requested opposite party to supply the report of 2 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) Surveyor-cum-loss assessor but Insurance company did not supply the report of Surveyor-cum-loss assessor to the insured. It is further pleaded that opposite party committed deficiency in service. Complainant sought relief of payment of Rs.156000/- (One lac fifty six thousand) alongwith interest @18% per annum w.e.f. 24.04.2017 till actual payment. In addition complainant sought relief of payment of litigation costs to the tune of Rs.25000/- (Twenty five thousand). In addition complainant sought relief of payment of Rs.25000/- (Twenty five thousand) for mental agony and harassment. Prayer for acceptance of consumer complaint sought.
4. Per contra version filed on behalf of opposite party pleaded therein that immediately after receiving intimation Insurance Company hired services of Sanjeev Gupta & Associates IRDA approved independent Surveyors and Loss Assessors. It is pleaded that Surveyor-cum-loss assessor submitted report and recommended payment to the tune of Rs.26145.37/- (Twenty six thousand one hundred forty five rupees and thirty seven paisa). It is further pleaded that final Surveyor had taken into consideration the age of building which is 10 years old and deducted the amount on the basis of average clause mentioned in the policy. It is further pleaded that sum of Rs.26000/- (Twenty six thousand) already stood paid to complainant after deduction of Rs.145/- (One 3 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) hundred forty five) as reinstatement premium vide two different transactions dated 24.11.2017 and 29.12.2017 by way of NEFT payment mode. It is further pleaded that Insurance company did not commit any deficiency in service. Prayer for dismissal of consumer complaint sought.
5. Complainant filed rejoinder and reasserted the allegations mentioned in the complaint.
6. Learned District Forum partly allowed the complaint and ordered opposite party to pay Rs.146600/- (One lac forty six thousand six hundred) to complainant alongwith interest @ 9% per annum from the date of complaint till actual payment. In addition learned District Forum ordered that opposite party would pay compensation to the tune of Rs.15000/- (Fifteen thousand) for mental harassment to the complainant. In addition learned District Forum ordered that opposite party would also pay litigation costs to the tune of Rs.3000/- (Three thousand) to the complainant.
7. Feeling aggrieved against order passed by learned District Forum Insurance company filed present appeal before State Commission.
8. We have heard learned Advocates appearing on behalf of parties and we have also perused entire record carefully.
4
New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018)
9. Following points arise for determination in present appeal.
1. Whether appeal filed by Insurance company is liable to be accepted as mentioned in memorandum of grounds of appeal and whether benefit of exclusion clause could be claimed by Insurance Company without explaining the terms and conditions of exclusion clause to the insured and whether sending report of Surveyor-cum-loss assessor appointed under Insurance Act 1938 to insured is essential?
2. Final order.
Findings upon point No.1 with reasons:
10. Complainant filed affidavit Ext.CW-1 in evidence.
There is recital in affidavit that deponent is owner in possession of residential building situated at Village Kharota Tehsil Jawali District Kangra H.P. There is further recital in affidavit that deponent insured his residential house in question with opposite party and purchased Standard Fire and Special Perils Policy from opposite party w.e.f. 24.10.2007 to 23.10.2017 for sum of Rs.630000/- (Six lac thirty thousand). There is further recital in affidavit that on dated 24.04.2017 due to heavy winds, lighting and thunder mango tree was uprooted and fell on the building of complainant and building of complainant sustained damage. There is further recital in affidavit that report was also filed in 5 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) the Revenue Department. There is further recital in affidavit that Executive Engineer HPPWD Jawali Division inspected the damaged building in question and assessed the loss to the tune of Rs.172600/- (One lac seventy two thousand six hundred). There is further recital in affidavit that Insurance company did not pay the amount as assessed by the Executive Engineer HPPWD Jawali Division District Kangra H.P. There is further recital in affidavit that Insurance company only paid Rs.26000/- (Twenty Six thousand) by way of NEFT payment in the Saving Bank Account of complainant kept in Kangra Central Cooperative Bank Ltd. Branch Chalwara on dated 24.11.2017. State Commission has carefully perused all the annexures filed by complainant.
11. Opposite party filed affidavit of B.S. Kapoor working as Divisional Incharge New India Assurance Company Limited Ext. OPW-1 in evidence. There is recital in the affidavit that Insurance company appointed IRDA approved independent Surveyor-cum-Loss Assessor and he has submitted report and recommended the payment to the tune of Rs.26145.37/- (Twenty six thousand one hundred forty five rupees and thirty seven paisa). There is further recital in affidavit that Surveyor-cum-loss assessor has also considered report of Assistant Engineer Jawali HPPWD supplied by complainant for the purpose of evaluation of loss. 6
New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) There is further recital in affidavit that building in question was 10 years old and Surveyor-cum-loss assessor has applied average clause mentioned in the policy and reduced the amount by 73.90%. There is further recital in affidavit that amount of Rs.26000/- (Twenty six thousand) was duly paid to the complainant after deduction of Rs.145/- (One hundred forty five) as reinstatement premium vide two different transactions dated 24.11.2017 and 29.12.2017 by way of NEFT payment. There is further recital in affidavit that complainant is estopped to file the present consumer complaint due his own act and conduct.
12. Opposite party also filed affidavit of Sanjeev Gupta Ext. OPW-2 in evidence. There is recital in the affidavit that deponent is qualified Surveyor-cum-loss assessor vide licence No.34015. There is further recital in affidavit that Insurance company hired the services of deponent to conduct the survey of alleged loss of complainant in respect of his residential house. There is further recital in affidavit that deponent has assessed the loss to the tune of Rs.26145.37/- (Twenty six thousand one hundred forty five rupees and thirty seven paisa). State Commission has carefully perused all the annexures filed by opposite party.
13. Learned District Forum also recorded oral statement of Mohit Rana J.E. HPPWD Jawali Tehsil Jawali 7 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) District Kangra H.P. under Section 13 (4)(i) of Consumer Protection Act 1986. Shri Mohit Rana has specifically stated on oath that he is B. Tech in Civil Engineering and he has prepared the estimate of damage to the residential house of complainant in question in the presence of complainant and in the presence of Surveyor of Insurance Company. He has specifically stated that damaged portion could not be repaired. He has stated that total area of damaged slab was 91.22 Sq. Meters. He has denied the suggestion that he has prepared the damage assessment report at the instance of complainant.
14. Submission of learned Advocate appearing on behalf of Insurance company that complainant has accepted amount of Rs.26000/- (Twenty six thousand) as full and final settlement inter se parties and on this ground appeal filed by Insurance Company be allowed is decided accordingly. Insurance company did not place on record any receipt/document signed by complainant relating to full and final settlement at Rs.26000/- (Twenty six thousand) inter se parties. It is proved on record that amount of Rs.26000/- (Twenty six thousand) was transferred by Insurance company in the payee account of complainant kept with Kangra Central Cooperative Bank by way of NEFT payment unilaterally. It is well settled law that NEFT payment is online payment mode. 8
New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) Insurance company did not adduce any corroborative evidence on record in order to prove that complainant has received amount of Rs.26000/- (Twenty six thousand) as full and final settlement. It is held that plea of Insurance company that complainant has received amount of Rs.26000/- (Twenty six thousand) as full and final settlement is defeated on the concept of ipse-dixit (An Assertion made without proof). On the contrary complainant has filed consumer complaint against Insurance company and refuted the payment of Rs.26000/- (Twenty six thousand) as full and final settlement.
15. Submission of learned Advocate appearing on behalf of Insurance company that amount of Rs.172600/- (One lac seventy two thousand six hundred) as damaged of residential house is not proved as per Section 13(4) of Consumer Protection Act 1986 and on this ground appeal filed by Insurance Company be allowed is decided accordingly. State Commission is of the opinion that as per Section 13(4) of Consumer Protection Act 1986 evidence could be received by way of examining the witness on oath or by way of reception of evidence on affidavit. In the present matter learned District Forum has examined Mohit Rana J.E. HPPWD Jawali District Kangra on oath on dated 17.04.2018. It is proved on record that report was forwarded to the District 9 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) Forum by Executive Engineer vide Annexure C-3 dated 06.07.2017 vide letter No.PWJ/DB/ Assessment/2017-18- 7711-12. It is also proved on record that Assistant Engineer vide certificate dated 28.06.2017 has given certificate that damage to the RCC slab of house of complainant in question could not be repaired and it should be re-laid after dismantling. State Commission is of the opinion that Executive Engineer Jawali Division and Assistant Engineer Jawali Sub Division HPPWD are public servants and their reports could be perused for corroborative purpose as per Consumer Protection Act 1986. Insurance company did not send any interrogatories to Executive Engineer and Assistant Engineer as required under Consumer Protection Act 1986 relating to assessment report. Hence adverse inference is drawn against Insurance Company for not sending interrogatories to the Executive Engineer and Assistant Engineer who has submitted the report to the District Forum.
16. Submission of learned Advocate appearing on behalf of Insurance company that house was under estimated by the complainant to the tune of Rs.650000/- (Six lac fifty thousand) despite the fact that factual value of house in question was Rs.2413813.50/- (Twenty four lac thirteen thousand eight hundred thirteen rupees and fifty paisa) and on this ground appeal filed by Insurance Company be allowed 10 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) is decided accordingly. State Commission is of the opinion that Insurance company was under legal obligation to assess the factual value of house prior to issuance of insurance policy relating to house in question. No reason assigned by Insurance company as to why Insurance company did not personally inspect the house in question prior to issuance of Insurance policy relating to valuation of house. It is well settled law that party could not be allowed to take benefit of its own wrongs and laxity as per law. It is held that it is not expedient in the ends of justice and on the principles of natural justice to allow the Insurance Company to take benefit of its own wrongs and laxity.
17. Submission of learned Advocate appearing on behalf of Insurance company that Surveyor-cum-loss Assessor namely Sanjeev Gupta appointed under Section 64UM of Insurance Act 1938 had invoked the average clause of reduction by 73.90% and on this ground appeal filed by Insurance Company be allowed is decided accordingly. There is no evidence on record that report submitted by Surveyor- cum-loss assessor namely Sanjeev Gupta was sent to the complainant for filing representation against the report of Surveyor-cum-loss assessor. There is no evidence on record in order to prove that average clause was read over and explained to the insured by Insurance company. Insurance 11 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) company did not disclose the name of official who had explained the average clause and exclusion clause to the insured. It is well settled law that when exclusion clause was not explained to the insured then Insurance company is not legally competent to take benefit of exclusion clause. See 2000 (2) SCC 734 titled Modern Insulators Ltd. Versus Oriental Insurance Company Limited. See 2007 (3) CPJ 34 NC National Insurance Company Limited Versus D.P. Jain. See 2018 (2) CLT NC 516 titled Khatau Haji Ibrahim Rumi & Anr. Versus New India Assurance Co. & Ors.
18. Surveyor-cum-loss assessor appointed under the Insurance Act 1938 has assessed the loss to the tune of Rs.145004/- (One lac forty five thousand four). State Commission is of the opinion that insured is legally entitled to the amount as assessed by Surveyor-cum-loss assessor appointed by Insurance company under Section 64UM of the Insurance Act 1938 minus amount already paid to the insured by the Insurance company to the tune of Rs.26000/- (Twenty six thousand).
19. Submission of learned Advocate appearing on behalf of Insurance company that excessive rate of interest has been granted by learned District Forum to the complainant @ 9% per annum and same be reduced to 7% is decided accordingly. State Commission is of the opinion that 12 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) to grant interest rate is the discretion of District Forum/State Commission. As per Insurance Regulatory and Development Authority Regulations 2002 Insurance company is under legal obligation to pay interest 2% above the bank rate prevalent at the beginning of financial year in which the claim was paid. State Commission is of the opinion that in view of above regulation of IRDA it is not expedient in the ends of justice and on the principles of natural justice to reduce the rate of interest as prayed by Insurance company.
20. Submission of learned Advocate appearing on behalf of Insurance company that learned District Forum has granted excessive compensation to the tune of Rs.15000/- (Fifteen thousand) to complainant and on this ground appeal be allowed is decided accordingly. State Commission is of the opinion that Insurance company did not pay the amount as assessed by Surveyor-cum-loss assessor appointed by Insurance company to the tune of Rs.145004/-(One lac forty five thousand four) and committed deficiency in service and complainant has sustained mental agony. It is held that Consumer Protection Act 1986 has been enacted by parliament of India in order to protect the interest of consumers as per law. State Commission is of the opinion that it is not expedient in the ends of justice and on the 13 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) principles of natural justice to reduce compensation amount as ordered by learned District Forum.
21. Submission of learned Advocate appearing on behalf of Insurance company that excessive litigation costs to the tune of Rs.3000/- (Three thousand) has been granted by learned District Forum to the complainant and on this ground appeal be allowed is decided accordingly. State Commission is of the opinion that it is not expedient in the ends of justice and on the principles of natural justice to reduce the litigation costs because complainant engaged Advocate before learned District Forum and has also incurred litigation expenses before District Forum.
22. Submission of learned Advocate appearing on behalf of complainant that Learned District Forum has rightly assessed the damage to the residential house of complainant to the tune of Rs.172600/- (One lac seventy two thousand six hundred) as assessed by Executive Engineer HPPWD and on this ground appeal filed by Insurance company be dismissed is decided accordingly. State Commission is of the opinion that Insurance Act 1938 is Special Act and Insurance company is governed under the Insurance Act 1938. It is well settled that Special Act always prevails over the General Act. Surveyor-cum-loss assessor appointed under Insurance Act 1938 has assessed the loss to the residential house of 14 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) complainant to the tune of Rs.145004/- (One lac forty five thousand four). State Commission is of the opinion that complainant is legally entitled for sum of Rs.145004/- (One lac forty five thousand four) as assessed by Surveyor-cum- loss assessor appointed under the Statutory Insurance Act 1938 minus amount already paid by Insurance company to insured to the tune of Rs.26000/- (Twenty six thousand) by way of NEFT payment mode. Hence complainant is legally entitled to remaining amount to the tune of Rs.119004/- (One lac nineteen thousand four) on account of loss caused to the residential house of complainant. Point No.1 is decided accordingly.
Point No.2: Final Order
23. In view of findings upon point No.1 above appeal is partly allowed. It is ordered that Insurance company shall pay remaining amount of Rs.119004/- (One lac nineteen thousand four) alongwith interest @ 9% per annum from the date of institution of complaint till actual payment to the complainant as damage caused to the residential house of complainant.
24. Order of learned District Forum that opposite party would pay compensation to the tune of Rs.15000/- (Fifteen thousand) for mental harassment to the complainant 15 New India Assurance Company Ltd. Versus Kamal Kumar (F.A. No.203/2018) is affirmed. Order of learned District Forum that opposite party would pay litigation costs to the tune of Rs.3000/- (Three thousand) to the complainant is also affirmed. Insurance company shall pay entire amount to the complainant within thirty days after receipt of copy of order. Order of learned District Forum is modified accordingly. Parties are left to bear their own litigation costs before State Commission.
25. File of learned District Forum alongwith certified copy of order be sent back forthwith and file of State Commission be consigned to record room after due completion forthwith. Certified copy of order be transmitted to parties forthwith free of costs strictly as per rules. Appeal is disposed of. Pending application(s) if any also disposed of.
Justice P.S. Rana (R) President Vijay Pal Khachi Member Sunita Sharma Member 09.04.2019.
*GUPTA* 16