State Consumer Disputes Redressal Commission
Manik Bhai Jewellers vs United India Insurance Co. Ltd on 14 September, 2007
IN THE STATE COMMISSION : DELHI IN THE STATE COMMISSION : DELHI (Constituted under Section 9 clause (b)of the Consumer Protection Act, 1986 ) Date of Decision: 14-09-2007 Complaint Case No. C-85/1998 M/s Manik Bhai Jewellers, Complainant 5, Karan Place, Through Behind Hotel Sofital Surya, Ms. Sunita Harish, New Friends Colony, Advocate. New Delhi-110065. Through Proprietor. Versus 1. United India Insurance Co. Ltd., Opposite Party No.1 Having Regd. & Head Office at 24, Whites Road, Cehnnai-600 014. Through Chairman & Managing Director. 2. United India Insurance Co. Ltd. Opposite Party No.2 Having Branch Office No.1 at 2/27, Sarai Julena, Okhla Road, Opp. Hotel Sofital Surya, New Delhi-110025. Through Branch Manager. CORAM : Justice J.D. Kapoor- President Ms. Rumnita Mittal - Member
1. Whether reporters of local newspapers be allowed to see the judgment?
2. To be referred to the Reporter or not?
JUSTICE J.D. KAPOOR, PRESIDENT (ORAL) The complainants claim against burglary of jewellery, kept in a bag which was being put into the dickey of the car, by miscreants at gunpoint, was repudiated by the OP/Insurance Co. on the premise that it was not a burglary. Hence this complaint praying for compensation of Rs.5,93,933/- with interest @ of 12% p.a and cost of proceedings.
2. Briefly stated, the relevant facts are that the complainant had taken Jewellers Block Policy No.041201/46/45/11/261/96-97 commencing at midnight on 30.10.1996 and ending at midnight on 30.10.1997 against a premium of Rs.15,488/-. On 15.2.1997 at about 8.00 p.m. when one Mr. Lalit, an employee of complainant was keeping brief case containing jewellery in the dickey of the car, two persons suddenly came, pushed Mr. Lalit, snatched the bag containing jewellery and escaped at gun-point. Mr. Rakesh Makkar of complainant without any loss of time promptly lodged an F.I.R at Srinivas Puri Police Station. Within fourteen days of theft the complainant delivered to OP No.2 detailed statement in writing of the loss in theft with estimate of actual value of the articles lost and the amount of damage sustained and fulfilled all other formalities required of him.
3. That vide letter dt. 6.1.1998, OP No.2 illegally repudiated the claim of the complainant which has no reference and has no relevance with the conditions of the policy under which the insurance was made.
4. The repudiation has been challenged by the complainant on the following premises:-
(i) That the complainant obtained policy covering risk against burglary of jewellery handled by partners, servants, agents or representatives of the complainant. The thieves took bag containing jewellery while it was being handled by employee of the complainant. The insurance policy is to be read as a whole. The purpose was to insure the risk of jewellery, which was being dealt with by the complainant in the usual course of its business. The purpose of carrying bag containing jewellery was to show it to the customer for sale. It was still in the custody of the complainant. Jewellery could not be kept in safe at all times. Business hours for sale of jewellery are flexible depending upon the convenience of prospective customers. If it is to show to them after closure of shop it means not that it is beyond business hours.
(ii) That the OPs cannot be permitted to raise technical or flimsy grounds to deny the claim, more so when the ground has no relevance to the claim. When employees, agents, representatives of a jewellery firm are dealing with jewellery it cannot reasonably be expected to be kept in safe at all times. It is wrong to say that the jewellery kept in the safe only was covered.
(iii) That the contract of insurance cannot be segregated into parts to suit the Insurance Company and the terms of insurance policy are to be so construed that object of the insurance policy is achieved not that on flimsy ground, the insurance policy is rendered redundant. The jewellary was not in transit but in the hand/custody of an employee of the complainant at the time of theft and in the usual course of business of complainant and that employee was accompanied by others also.
(iv) That handling of jewellery bag by a regular employee in the facts and circumstances of the case can by no stretch of imagination be termed lack of due care, caution and due deligence. The employee was accompanied by other four persons of complainant.
Simply because he was in front in the direction from where the robbers struck is o ground for rejection of claim. It was a pure and simple accident.
Insurance policy was obtained to cover the accidental loss of property/jewellery even if it occurred because of negligence or inadvertence though denied here. Otherwise the very purpose of taking policy is defeated.
(v) That the custody of the jewellery at the time of theft was with the employee of the complainant and is deemed custody of Mr. Makkar and is even otherwise covered under the policy.
(vi) That the allegations of involvement of employees of complainant in the robbery apart from being defamatory is not supported by any proof. On the contrary, the two thieves who snatched the bag and their one more accomplice were arrested bythe Police and they admitted having committed the robbery by their own plan and selling the jewellery and spending the money. If any employee of complainant was their informer/accomplice, it would have come on record. Simply because the Op decided to deny the claim of complainant, it is ridiculous on its part to allege connivance between the robbers and the employees of the complainant.
5. While justifying the repudiation of the complainants claim, the defence of O.P is that the policy issued by the company is policy of jewellers block policy and the claim of the complainant does not at all come within the purview of the policy and is not tenable.
6. As per section II of schedule B attached to the policy, the complainants are to maintain a burglary safe proof to keep the jewellery items inside when the value of the jewellery exceeds Rs.2 lakh at any time. The complainant did not maintain the burglary safe proof to secure the jewellery items after business hours. Non-observance of the security guards while taking such jewellery which exceeds the value of Rs.2 lakh by the complainant is a clear cut case of negligence on the part of the complainant and does not come under the purview of the policy issued by the OPs.
7. That the jewellery in transit has not been insured at all by the complainant and the company is not liable for any loss that may occur during the transit period. Also due care as envisaged has not been maintained by the complainant while carrying jewellery items exceeding Rs.2 lakh. Jewellery bag has been stolen allegedly from outside the shop premises and does not come at all within the policy conditions and as such the complaint deserves to be dismissed.
8. That there is absolutely no deficiency of service on the OP insurance company and the insurance company has fully discharged its services towards the complainant in the most effective manner.
9. In order to appreciate rival contentions of the parties particularly the ground of repudiation the contents of letter dated 06-01-1998 sent by the OP-Insurance Company need to be reproduced and are as under:-
Dated : 06-01-1998 To M/s Manik Bhai Jewellers, through their Proprietor/Partner concerned, 8 Karan Palace Behind New Hotel Sofil Surya, New Friends Colony, New Delhi-110065.
Sub.: Validity of Jewellery claim lodged upon us by you in relation to Policy NO. 041201/46/45/261/96-97, claim No. 041201/46/48/7/156/97. Date of robbery :
15-02-1997.
Dear Sir/Madam, We draw your kind attention to the Jewellery Loss Claim lodged upon us by you, which is reported by you to have taken place on 15-02-1997.
1.
We have carefully gone through the proofs, letters, documents gathered, collected by us from various and also the documents intimating us the Loss of Jewellery by means of Robbery having allegedly taken place on 15-02-1997.
2. After perusing the material available with us and strictly adhereing, observing the terms, conditions of the Insurance Policy in which we had granted you the Indemnity, we have reached the conclusion that the Claim lodged by you is not tenable and the same does not fall within the purview of the Policy of Jewellers Block Policy issued by us to you. Consequently we have rejected/repudiated your claim today and following are the grounds for repudiating your claim ldoged for Rs. 5,93,933/-.
(a) In your letter dated 18-02-1997 intimating us the Jewellery having been robbed from your shop at Gun Point, while in the Police Report lodged by Shri Rakesh Makar with Police authorities, he has stated the theft having taken place in the Car which was parked at the other side of the road, when the Black Colour Bag was being kept in the Dickey of the car by your employee/servant Shri Lalit. Your these two statements prima facie, ex-facie show that no incident of theft or robbery had taken place within your shop premises.
(b) As per the Policy Schedule B attached to the Policy Bond jewellery insured with us your shop No.5, Karan Palace referred above and there is no other premises got insured from us by you for placing or displaying or storing the jewellery items.
(c) As per Section 11 of the Schedule B attached to the Policy Terms and Conditions, you are to maintain a Burglary Safe Proof to keep the jewellery inside when the value of the jewellery exceeds Rs. Two lacs at any time. You have not maintained the said Burglary Safe Proof to secure the jewellery after business hours.
(d) As per your statement to the Police Authorities of Police Station Shri Niwas Puri, New Delhi, the jewellery had been kept in the bag after the close of the shop, which you had handed over to your employee Mr. Lalit for placing the same in the Dickey of the car. Your this statement prima facie shows that the shop was closed after taking the jewellery from the shop for carrying the same to some of your customers in Model Town or C.C. colony, Delhi where you with your wife are residing. So the theft or robbery which has taken place is after the usual business hours and that too after the closure of the shop, at a place which is not insured with us.
(e) You had not got the Jewellery in transit insured with us when the same is reported to be lost by your employees in Transit, robbed or theft committed by any miscreant.
(f) As per terms and conditions of the Policy, you were required to maintain due care and caution and have deligence to the safety of the jewellery. You had entrusted the bag to your employee in such an irresponsible way that there was no security guard available with him at the time and the place where the alleged robbery or theft had taken place.
(g) Even you have had not maintained any security guard at your premises and the guard which you are claiming to be keeping at your shop is without security gun.
(h) The jewellery insured with us and allegedly robbed by the miscreants from your employee while placing the Bag in the Dickey of the car was not in your custody as well as your employee or servant Shri Lalit in the shop premises or in display windows or in locked safe on the premises.
(i) You have violated the warranties and the terms not to admit your claim as falling with the terms and conditions of the Policy as well as the warranties granted by us. We have therefore on careful examination of all the materials available with us, repudiated your claim today.
(j) The robbery which is alleged to have taken place with the help of and connivance of your employee, who has/would have in advance conveyed the inside information to the miscreants. Without the conveying of inside information, such type of robbery normally cannot take place. Hence the hand of your employees cannot be ruled out.
We hope that you would find ourselves in agreement without you that the claim lodged upon us by you is not admissible within the purview of the policy of Jewellers Block Policy issued by us in your favour. This disposes of your asking us the fate of your claim in respect of the visit made by you to us.
Thanking you and assuring you of our best services.
Yours faithfully, Sd./ Branch Manager.
10. In our view the main kernel of the issue is whether the loss of jewellery at the time of theft or its perils is covered under the Insurance Policy or not. The relevant terms of the policy contained in the proviso are as under:-
Provided always that the Company shall not be liable under this policy in respect of:-
(i) Loss of and/or damage to the property insured which may be sustained whilst the same is being actually worked upon or from any process of cleaning, repairing or restoring and directly resulting therefrom.
(j) Property missing at stock taking in respect of which no claim has been previously notified, unless the loss be proved by the insured to be due to a peril covered by the policy.
(k) Loss of and/or damage to the property hereby insured whilst the same is being worn or used by the insured or any principal director or partner of the insured or their wives, members of their families, relatives or friends, or whilst in their custody for this purpose.
(l) Loss of and/or damage to the property hereby insured whilst at any Public Exhibition whether promoted or financially assisted by any public authority or by trade association or otherwise.
(m) Theft or disappearance of property hereby insured from road vehicles of every description owned or hired by or under the control of the insured and or their partners, servants, agents or representatives where such vehicles are left unattended.
(n) Loss or damage caused by or arising from depreciation gradual deterioration wear and tear, moth vermin and mildew.
11. Sections II and III deal with the terms and conditions and are as under:-
Section II Loss or damage to the property insured under items
(a) and (b) if Section II of the Schedule and carried outside the specified premises for the purpose of insureds business by any cause whatsoever except as hereinafter provided.
Section III Loss or damage in the property insured whilst in transit as specified in terms (a), (b) and (c) of Section III of the Schedule within the geographical area specified in the Schedule by any cause whatsoever except as hereinafter.
12. Relevant provisions of section II of the Schedule which is as under:-
Section II Limit for any one loss
(a) Property Insured whilst in the custody of the
-Rs. 6,00,000/-
Insured is partners or his employees.
(b) Property Insured excluding cash and - Rs.
2,00,000/-
currency notes whilst in the custody of persons not in regular employment of the Insured such as brokers or cutters or goldsmiths.
(I) WARRANTED THAT IF STOCK WITH ANY ONE PERSON SPECIFIED IN SECTION II OF THE SCHEDULE EXCEEDS Rs. 2 LAKHS IT SHALL BE SECURED IN A BURGLAR PROOF SAFE AFTER BUSINESS HOURS AT ALL TIMES.
(II) WARRANTED THAT THE SUM INSURED UNDER THIS SECTION UNDER THIS SECTION SHOULD NOT EXCEED THE GROSS SUM INSURED UNDER SECTION I.
13. Combined reading of the aforesaid provisions lead us to the conclusion that repudiation was wrongful and not justified for the following reasons:-
(i) That at the time of theft the jewellery was being handled by the employee of the complainant. The complainant himself and other employees of the insured-complainant were accompanying him.
(ii) The purpose of carrying the jewellery was to show it to the customer for sale.
(iii) The business hours of sale of jewellery depend upon the convenience of the prospective customers.
(iv) When the employee or the representative of the complainant are dealing with jewellery it cannot be reasonably expected to be kept in safe at all times.
(v) The jewellery was not in transit but in the hand/custody of the employee of the complainant at the time of theft and in usual course of business of the complainant. The reason is simple because he was in front direction from where the robbers came.
It was not a ground for rejection of claim as it was pure and simple accident.
(vi) The two thieves who snatched the packet and one more accomplice were arrested by the police and they admitted that they had committed the robbery on their own.
(vii) That the vehicle was not unattended. It was just across the road and Rakesh Makkar as well as four other employees were there and therefore proviso of clauses 4 and 5 of the Insurance Policy was not invokable.
14. As regards the fact that the Surveyor has not given any finding as to the loss, we therefore assess the claim filed by the complainant in terms of affidavit filed by the complainant as well as the list of items lost.
15. In view of the foregoing reasons, we allow the complaint in the following terms:-
(i) OP shall pay Rs. 5,93,933/- being the cost of the lost jewellery.
(ii) OP shall also pay Rs. 50,000/- as lumpsum compensation which include cost of litigation.
16. Aforesaid payment shall be made within one month from the date of receipt of this order.
17. Complaint is allowed and disposed of in aforesaid terms.
18. A copy of this order as per the statutory requirements, be forwarded to the parties free of charge and thereafter the file be consigned to Record Room.
19. Copy of this order be also sent to all the Presidents of the District Forums.
20. Announced on the 14th September, 2007.
(Justice J.D. Kapoor) President (Rumnita Mittal) Member jj