State Consumer Disputes Redressal Commission
Mr. Prasad Bapat vs The New India Assurance Co. Ltd. on 1 March, 2012
Daily Order
BEFORE THE
HON'BLE STATE CONSUMER DISPUTES REDRESSAL
COMMISSION, MAHARASHTRA, MUMBAI
First Appeal
No. A/04/1055
(Arisen out
of Order Dated 06/03/2004 in Case No. 202/2003 of District Thane)
Mr. Prasad Bapat
D-104, Shree Anand Nagar,
M. S. Road,
Raghunath Nagar,
Thane 400 602.
...........Appellant(s)
Versus
The New India Assurance Co. Ltd.
Through its Sr. Divisional Manager,
Regd. Office at
Shivkrupa Complex, Gokhale Road,
Navpada, Thane 400 602.
...........Respondent(s)
BEFORE:
Hon'ble Mr. S.R. Khanzode PRESIDING MEMBER
Hon'ble Mr. Narendra Kawde MEMBER
PRESENT:
Adv. Anand Patwardhan for the Complainant
Adv. Kalpana Trivedi for the Respondent
ORDER
Per - Hon'ble Mr. S. R. Khanzode,
Presiding Judicial Member This appeal takes an exception to an impugned order dated 6/3/2004 passed by District Consumer Disputes Redressal Forum, Thane (hereinafter referred to as 'the Forum' for the sake of brevity) in Consumer Complaint No.202 of 2003, Mr. Prasad Bapat Vs. The New India Assurance Co. Ltd.
It is a case of partially repudiating the insurance claim in respect of an oil tanker which was carrying inflammable liquid benzene which met with an accident on 14/1/2003 near Village Chikali, District Valsad (GujaratState). Insurance cover was up to `4,00,000/-
and since the insured vehicle was gutted completely to the fire, an insurance claim to its fullest extent of the insurance cover was made. Insurance company ultimately agreed to pay `1,97,000/- as compensation on 'Net Salvage Basis' but, the same was not acceptable to the Complainant and he filed a consumer complaint. The Forum awarded claim to the extent of `1,97,000/- together with interest. However, not satisfied with the quantum of compensation awarded, original Complainant preferred this appeal.
[2] Heard Adv. Anand Patwardhan on behalf of the Appellant/original Complainant (hereinafter referred to as 'the Complainant' for the sake of brevity) and Adv. Kalpana Trivedi on behalf of the Respondent/original Opponent, namely - The New India Assurance Company Ltd. (hereinafter referred to as 'the insurance company' for the sake of brevity) [3] In the instant case, the vehicle which was insured at the relevant time with the insurance company met with an accident. Insured vehicle got turtled and felled into a ditch and as a result of which caught fire and got completely burnt. A report was immediately given. Insurance company appointed Mr. Devang B. Shah, as the surveyor, who visited the spot and recorded the damage sustained in his report dated 14/2/2003. His report shows that the entire insured vehicle was gutted to the fire. He does not report any missing part from the insured vehicle. Thereafter, another surveyor was appointed since apparently the first surveyor, namely - Mr. Devang B. Shah only carried out spot inspection and did not asses the loss. Mr. R. R. Sheth was another surveyor. He, after taking into consideration the quotation for repairs and relevant material, assessed the loss and submitted his report dated 8/4/2003. According to him, liability on 'Repair Basis' without tax comes to `2,67,800/- and adjusting from said amount of salvage estimated at `7,800/- and excess of `13,000/-, Mr. R. R. Sheth, Surveyor, assessed the loss at `2,47,000/-. He further deducted from the said amount `61,750/- towards 'Less margine for cash less 25%' and thus, recommended amount of `1,85,000/- as a loss. Insurance company initially offered to the Complainant `1,85,000/- as per its letter dated 10/4/2003 and subsequently raised this amount to `2,10,000/- less compulsory excess of `13,000/- and offered `1,97,000/-, supra and intimated accordingly to the Complainant by its letter dated 21/5/2003. However, the insurance company insisted the Complainant accepting the same by giving a consent letter. The Complainant did not agree with it and filed a consumer complaint as narrated earlier.
[4] There is no affidavit of either of the surveyors. The Complainant relies upon estimated repair costs which comes to `5,19,014/- excluding taxes payable at 22% as per the estimate submitted by Broad Way Automobiles, a TELCO certified garage. Therefore, this estimation cannot be faulted with.
In fact, the surveyor also took into consideration the price of the parts but deducted from them 25% amount towards depreciation value. We find Insured Declared Value in the relevant year of the accident involved vehicle was of `4,00,000/- as per the insurance policy. It already considered the depreciated value of the insured vehicle at that point of time and, therefore, to deduct again depreciation would not be proper while sanctioning the insurance claim.
Besides that report of Mr. R. R. Sheth deducted a substantial amount towards some missing parts mentioned at internal page (04) of his report. As already pointed out, there were no missing parts as per first spot inspection report of Mr. Devang B. Shah. Furthermore, the insured vehicle was in a running condition and it was gutted completely in the fire. Therefore, missing of parts such as Radiator assembly with frame, starter and alternator, fuel injection pump, gear box assembly, both propeller shafts and air-tank with valve cannot be presumed as articles missing when the accident had taken place and the claim arose. Deduction on this ground, therefore, is unjustified and amounts to arbitrary action on the part of the insurance surveyor.
Since there is no affidavit of the surveyor, the surveyor also could not be questioned about propriety of his estimation.
[5] Total estimated cost as mentioned in the survey report of Mr. R. R. Sheth is to the extent of `6,62,413/-. Insurance claim is made only to the extent of `4,00,000/-
viz. insurable interest in the policy. Insurance policy by itself as per insurance contract offers an indemnity to the insured to indemnify or compensate the loss caused.
Since the loss is more than `6,00,000/- and odd and it confined to the insured value of `4,00,000/-, which is in fact, the Insured Declared Value of the vehicle at the relevant time, we find that the insurance company is under an obligation to compensate and indemnify the Complainant to the extent of `4,00,000/- without any deduction even for salvage but adjusting from it compulsory excess of `13,000/-. The Forum did not consider these aspects inter-alia including the fact that `1,97,000/- was already offered by the insurance company but not paid since the Complainant did not agree to it and, therefore, it was necessary for the Forum to consider as to why the Complainant did not accept the same.
The Forum failed to address itself accordingly and committed error in law.
[6] For the reasons stated above, we find that the Complainant is entitled to compensation of `4,00,000/- less compulsory excess of `13,000/- for the deficiency in service on the part of the insurance company not to sanction the claim as made and arbitrary rejecting part of it.
We hold accordingly and pass the following order:-
ORDER
1. The appeal is partly allowed.
2. Impugned order dated 06/March/2004 passed by the District Consumer Disputes Redressal Forum, Thane in Consumer Complaint No.202 of 2003 is partly modified.
3. In paragraph (02) of the operative part of the order, the figure 'Rs.1,97,000/-' shall be replaced with figure '`3,87,000/-' and the amount in words accordingly be read as 'Rupees Three Lacs Eighty Seven Thousand Only'. Except for this modification rest of the order stands confirmed.
4. Respondent/original Opponent to bear its own costs and shall pay `25,000/- as costs of this appeal to the Appellant/original Complainant.
Appeal stands disposed of accordingly.
Pronounced and dictated on 1st March, 2012 [Hon'ble Mr. S.R. Khanzode] PRESIDING MEMBER [Hon'ble Mr. Narendra Kawde] MEMBER kvs