State Consumer Disputes Redressal Commission
Damodar Agrotech vs The Riental Ins. Co.Ltd on 25 February, 2021
Details DD MM YY
Date of Judgment 25 02 2021
Date of filing 14 03 2014
Duration 11 11 06
days months years
BEFORE THE CONSUMER DISPUTES REDRESSAL COMMISSION
GUJARAT STATE, AHMEDABAD.
COURT NO: 01
Appeal No. 409 of 2014
Damodar Agrotech
(Through its Partner Dineshbhai
Narsabhai Patel) PO. Chitroda
Ta. Idar, Dist. Sabarkantha. ... Appellant
V/s.
1. The Oriental Insurance Co. Ltd.
Through its Divisional Manager
1st Floor, Bhagwati Avenue,
Motipura, Himmatnagar.
2. The Oriental Insurance Co. Ltd.
Through its Regional Manager
3rd Floor, Navjeevan Trust Building
Behind Gujarat Vidhyapith
Ashram Road, Ahmadabad. ... Respondents
Appeal No. 410 of 2014
Shreeji Bio Seeds Ginning and processing
(Through its Partner Mohanbhai
Narsabhai Patel) PO. Laloda
Ta. Idar, Dist. Sabarkantha. ... Appellant
V/s.
Page 1 of 15
R.I. DESAI A/14/409 & A/14/410
1. The Oriental Insurance Co. Ltd.
Through its Divisional Manager
1st Floor, Bhagwati Avenue,
Motipura, Himmatnagar.
2. The Oriental Insurance Co. Ltd.
Through its Regional Manager
3rd Floor, Navjeevan Trust Building
Behind Gujarat Vidhyapith
Ashram Road, Ahmadabad. ... Respondents
CORAM: Mr. Justice V.P. Patel, President.
Dr. J.G. Mecwan, Member.
APPEARANCE: Mr. M.K. Dudhiya, ld. Advocate for the appellant.
Mr. M.J. Shelat, ld. Advocate for the respondents. Order by Dr. J.G. Mecwan, Member.
Judgment
1. Being aggrieved by and dissatisfied with the judgment and order rendered by the Consumer Disputes Redressal Forum, Himmatnagar on 10.12.2013 in Complaint No. 170 of 2012 and 171 of 2012 the original complainants have filed the present appeals under Section 15 of the Consumer Protection Act, 1986 before this Commission. For the sake of the convenience, parties are hereinafter referred to by their original nomenclature. Page 2 of 15
R.I. DESAI A/14/409 & A/14/410 1.1 In this matter two appeals have been filed against the order of the
learned District Commission, Himmatnagar in Compliant No. 170&171/2012. In both the appeals opponents are same whereas appellants/complainants are different. As in both the appeals facts and arguments and law points are same, this Commission has decided to dispose of these two appeals by common judgment. Case of the complainant:
2. To dispose of these appeals, few relevant facts are required to be mentioned: In the Appeal No. 409/2014, the complainant is engaged in building of Ginning and Processing of the cotton, where after processing of the cotton they separates the raw cotton and seeds and to make bales of raw cotton and sends the raw cotton to Murlidhar Ginning & Processing. It is the submission of the complainant that such processing of the cotton taking place mostly in season of cotton crop and the appellant was covering the risk of such process by taking insurance from opponents. It is further submitted by the complainant that in January, 2011 the partner of the complainant firm has filled the proposal form for obtaining insurance coverage for the period of 12.01.2011 to 10.2.2011 for the face value of Rs. 2,00,00,000/-. Further the submission of the complainant is that while filling the proposal as Page 3 of 15 R.I. DESAI A/14/409 & A/14/410 usual it was mentioned in the proposal form that "Open Compound, Under Shed, Godown cum Pala House and Press House of Murlidhar Ginning and Processing, Opposite Sadatpura Bus Stop, Idar, Himmatnagar". It is further submitted by the complainant that in proposal form it was also mentioned that "the Stock of the Damodar Agrotech, kept at open compound, shed, godown, godown cum Pala house, press houses for the amount up to Rs. 2,00,00,000/- for one month, and also noted that the stock belongs to various farmers of various villages." 2.1 It is further submitted by the complainant that after submitting the proposal form with the premium amount the opponent company has issued policy to the appellant, but in policy they have failed to mention that the stock belongs to various farmers of various villages. It is the further submission of the complainant that on 25.01.2011 around 1:30 p.m. fire was broke out in the stock of the complainant which was kept at Murlidhar Ginning & Processing and stock of almost Rs. 25,00,000/- was gutted in the fire and therefore the complainant has lodged the claim with the opponents Insurance Company and opponent Insurance Company has appointed M/s. Krij Consultants as a surveyor to assess the loss and surveyor has assessed the loss to the tune of Rs. Page 4 of 15
R.I. DESAI A/14/409 & A/14/410 19,26,005/-. It is further submitted by the complainant that after assessment made by surveyor the opponent Insurance Company has repudiated the claim vide later dated 31.10.2011. 2.2 The Appeal No. 410/14 has almost the same facts and legal issues as narrated above. In this case Rs. 50,00,000/- was insured amount and the policy period was from 04.01.2011 to 03.02.2011 and the assessment of damages made by the surveyor was Rs.
3,77,012/-.
3 Being dissatisfied with the repudiation letter of the Insurance Company, the complainants have filed aforesaid consumer complaints before the learned District Commission at Sabarkantha for deficiency in service and unfair trade practices of the opponent Insurance Company.
Order under Challenge:
3.1 After hearing learned advocates for both the parties and after considering the documents and evidences, the learned District Commission dismissed the complaint of the complainant. 3.2 Being aggrieved by the impugned order of the learned District Commission, Sabarkantha the original complainants have filed the present appeals against the original opponent before this Commission on the ground stated in the appeal memo. Page 5 of 15
R.I. DESAI A/14/409 & A/14/410
3.3 We have Heard learned Advocate Mr. M.K. Dudhiya for the
appellants and learned Advocate Mr. M.J. Shelat for the
respondent at length. Perused the record, judgments produced by both the parties and order of the learned District Commission.
Arguments of the appellant:
4 First of all learned Advocate Mr. M.K. Dudhiya argued out that the learned District Commission has failed to consider the fact that damaged goods were burnt to ashes at the place which is already covered under the policy and also the learned District Commission has not considered that in proposal form, complainants have specifically asked coverage for goods held in trust but opponent insurance company has not issued the policy in accordance with the proposal made by the complainants. Learned Advocate Mr. Dudhiya further argued out that the learned District Commission ought to have considered the fact that when the coverage was specifically asked in the proposal form, the opponent insurance company should issue the policy as per proposal and due to gross mistake made by the insurance company, the complainants should not be punished. Ld. Advocate Mr. Dudhiya further submitted that the learned District Commission has also failed to consider that the proposal form is integral part of the policy and Page 6 of 15 R.I. DESAI A/14/409 & A/14/410 while deciding the complaint the proposal form is also required to be considered. Further the submission of the ld. Advocate for the appellant Mr. Dudhiya that learned District Commission has also failed to consider the fact that complainants were taking such type of policy from opponent from number of years and they have trusted opponent insurance company and stayed assured but opponent insurance company has committed breach of trust with the complainants and by this way also committed unfair trade practice. Learned Advocate for the appellant further argued out that the policies were issued for the period of one month only and the Fire accident has took place on 25.01.2011 and the opponent Insurance Company has not produced any single documentary evidence to show that the policy with terms and conditions was reached/received by the complainants on same day or prior to 15 days of the incident. It is further submission of the ld. Advocate for the appellant Mr. Dudhiya that if the policy with terms and conditions were not reached or provided to the complainants the clause of 15 days free look period or any other condition is not at all applicable to the present case and therefore also, order passed by the learned District Commission is bad in the eyes of law and required to be quashed and set aside.
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R.I. DESAI A/14/409 & A/14/410 In support of his arguments ld. Advocate Mr. Dudhiya has submitted following judgments:
1. I(2007) CPJ 138 (NC)
2. I (2009) CPJ 47 (NC) In the above judgments Hon'ble Apex Court has observed as under:
I(2007) CPJ 138 (NC) :- Exclusion clause is not part of the fire insurance and therefore insurer is liable to pay for loss. I(2009) CPJ 47 (NC):- Due to technical fault committed by the insured allowing the proposal form to be filled up by the over- zealous Inspector of the Insurance Company the claim can at least be considered on non-standard basis.
4.1 Learned Advocate Mr. M.K. Dudhiya concluded that the learned District Commission has grossly erred in taking into considering the relevant facts and therefore the judgment and order passed by the learned District Commission is required to be quashed and set aside by allowing this appeal.
Arguments of the respondent:
5 Upon service of the notice ld. Advocate Mr. M.J. Shelat appeared on behalf of the respondent and vehemently argue out that as per survey report, goods which were damaged in fire belongs to third Page 8 of 15 R.I. DESAI A/14/409 & A/14/410 party and complainant/insured had possession of such goods in trust i.e. Goods held in trust. Ld. Advocate Mr. Shelat further argued out that it is not even a case of complainant that goods which are damaged in fire were of it's ownership and therefore the surveyor has specifically observed in its report at page No. 136. Ld. Advocate Mr. Shelat further argued out that the respondent as per exclusion no. 05 of the policy condition specifically excludes any damage or loss or destruction to goods held in trust.
In support of his arguments ld. Advocate Mr. Shelat has submitted following judgment:
I. (2005) 9 SCC, Civil Appeal No. 4366 of 1999 II. I(2009) CPJ 6 (SC) III. AIR 2010 SC (Supp) 23 (2) In the above judgments Hon'ble Apex Court has observed as under:
(2005) 9 SCC Civil Appeal No. 4366 of 1999:- When terms of contract have been reduced to writing it cannot be changed without the mutual agreement of both the parties.
I(2009) CPJ 6 (SC) :- In contract of insurance rights and obligation strictly governed by policy of insurance.
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R.I. DESAI A/14/409 & A/14/410 AIR 2010 SC (Supp) 23 (2) :- Terms of the contract of insurance have to be strictly construed and any exception can be made in the ground of equity.
5.1 Learned Advocate Mr. Shelat concluded that there is no error committed by learned District Commission while rejecting complaints and having not found respondent deficiency in its service and therefore the order of learned District Commission is just and proper and it should be confirmed by dismissing this appeal.
Merits of the case:
6 In the present case it is the averment of the complainants that in the proposal form it has been specifically asked for the coverage of goods held in trust but opponent Insurance company has not issued policy in accordance with the proposal form. It is also the submission of the complainant that the proposal form is integral part of the policy and therefore when complainant has specifically asked for the coverage then it is to be considered that risk is covered. Copy of the proposal form is submitted in this case which is on record at page no. 113-118 and wherein in column no.23 for the risk coverage following has been mentioned as note "The stock belongs to various farmer of various villages." Page 10 of 15
R.I. DESAI A/14/409 & A/14/410 6.1 In the judgment of Vikram Greentech (I) Ltd. & Anr Vs. New India Assurance Co. Ltd. in Civil Appeal No. 2080 of 2002 regarding proposal form Hon'ble Supreme Court of India has observed as under:
"Document like proposal form is a commercial document and being an integral part of policy, reference to proposal form may not only be appropriate but rather essential."
6.2 Considering above observation of the Hon'ble Supreme Court this Commission is in the considered opinion that proposal form is integral part of the policy and therefore in the instant cases when complainants have specifically asked for the coverage for goods held in trust in proposal forms then deciding the compliant, the proposal form is also required to be considered.
6.3 It is also an averment of complainants that the policy terms and conditions was not reached/received by the complainants and therefore 15 days free look period or any other condition is not applicable to the complainants.
6.4 We have gone through the record. In Appeal No. 409/2014 policy duration is 12.01.2011 to 10.02.2011 and in Appeal No. 410/2014 policy duration is 04.01.2011 to 03.02.2011 while fire was broke out on date 25.01.2011 just after 12 days/21 days of issuing of Page 11 of 15 R.I. DESAI A/14/409 & A/14/410 policy but not any single documentary evidence is produced by the opponent Insurance Company that policy terms and conditions has reached/received by the complainants. Therefore in the considered opinion of this Commission, conditions of Insurance Company are not applicable to the present case.
6.5 It is the submission of the appellants that opponent Insurance Company has not provided the copy of the proposal form with the specific malafide intention and to obtain the proposal form they have filed RTI application.
6.6 We have gone through the IRDA notification dated 16.10.2012 and as per Section (4) of IRDA notification it is the duty of the insurer to provide copy of the proposal form free of charge within 30 days of acceptance of the proposal and therefore in the opinion of this Commission by not providing the copy of the proposal form to the complainants, opponent Insurance Company has shown deficiency in service.
6.7 In the present case surveyor has assessed Rs. 19,26,005/- loss in Appeal No. 409/2014 and Rs. 3,77,012/- in Appeal No. 410/2014. Hence when surveyor is appointed under Section 64 UM of Insurance Act, 1938 then Surveyor's report has significant value and therefore considering the assessment made by surveyor it is the Page 12 of 15 R.I. DESAI A/14/409 & A/14/410 opinion of this Commission that complainants are entitled to get claim amount as assessed by surveyor.
7 In view of the above discussion it is the opinion of this Commission that the order passed by the learned District Commission in Complaint No. 170/2012 and 171/2012 is not just and proper and hence it should be required interference by this Commission. Therefore the following final order is passed.
ORDER Appeal 409/2014
1. Appeal no. 409/2014 is partly allowed.
2. The judgment and order passed by the learned District Commission, Himmatnagar dated 10.12.2013 in Consumer complaint No. 171 of 2012 is hereby dismissed.
3. Opponent Insurance Company is ordered to pay Rs.
19,26,005/- (Rupees nineteen lakh twenty six thousand and five only) to the appellant/original complainant with interest at the rate of 9% from the date of filing of the compliant till its realization.
4. Opponent Insurance Company is ordered to pay Rs.
10,000/- (Rupees ten thousand only) to the
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R.I. DESAI A/14/409 & A/14/410
appellant/complainant as costs of the complaint/Appeal and shall bear its own cost if any.
5. Opponent Insurance Company shall comply with this order within 60 days from the date of this order.
Appeal 410/2014
1. Appeal no. 410/2014 is partly allowed.
2. The judgment and order passed by the learned District Commission, Himmatnagar dated 10.12.2013 in Consumer complaint No. 170 of 2012 is hereby dismissed.
3. Opponent Insurance Company is ordered to pay Rs.
3,77,012/- (Rupees three lakh seventy seven thousand and twelve only) to the appellant/original complainant with interest at the rate of 9% from the date of filing of the compliant till its realization.
4. Opponent Insurance Company is ordered to pay Rs.
10,000/- (Rupees ten thousand only) to the appellant/complainant as costs of the complaint/Appeal and shall bear its own cost if any.
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R.I. DESAI A/14/409 & A/14/410
5. Opponent Insurance Company shall comply with this order within 60 days from the date of this order.
A) Copy of this judgment is to be placed in the file of Appeal No. 409/2014 and 410/2014.
B) Office is directed to forward a free of cost certified copy of this judgment and order to the respective parties. Pronounced in the open Court today on 25th February, 2021.
[V.P. Patel]
[Dr. J.G. Mecwan] President
Member
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