State Consumer Disputes Redressal Commission
M/S Malu Bardana Having Rented Godown vs D.M. National Insurance Co.Ltd & Anr. on 2 January, 2018
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G.)
Complaint Case No.CC/2017/38
Instituted on : 29.05.2017
M/s Malu Bardana
Having Rented Godown in the premises of
Bharat Rice Mill, Old Ganj Mandi, Rajnandgaon,
Post and District Rajnandgaon 491441 (C.G.)
Acting Through Its Proprietor Shiv Kumar Malu,
S/o Late Nandkishore Malu,
Resident of Nandai Chowk, Rajnandgaon,
Post & District Rajnandgaon - 491441 (C.G.) ... Complainant.
Vs.
(1) Divisional Manager,
National Insurance Company Limited,
Kamptee Line, Rajnandgaon,
Post and District Rajnandgaon 491441 (C.G.)
(2) Chairman Cum Managing Director,
National Insurance Company Limited,
Registered and Head Office at
3, Middleton Street,
Kolkata 700071 (W.B.). ... Opposite Parties
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE SHRI D.K. PODDAR, MEMBER
HON'BLE SHRI NARENDRA GUPTA, MEMBER
COUNSEL FOR THE PARTIES:
Shri Nikhil Agrawal, Advocate for the complainant.
Shri Shishir Bhandarkar, Advocate for the OPs.
ORDER
Dated : 02/January/2018 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT. The complainant has filed this consumer complaint under Section 17 of the Consumer Protection Act, 1986 against the OPs seeking following reliefs :-
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(a) To direct the Opposite Parties to indemnify complainant's loss of the insured items in the extent of Rs.52,53,000/-
(Rupees Fifty Two Lakhs Fifty Three Thousand Only) which also includes amount of Rs.57,228/- (Rs. Fifty Seven Thousand Two Hundred Twenty Eight Only) paid to Municipal Corporation, Rajnandgaon and Rs.49,885/- (Rupees Forty Nine Thousand Eight Hundred and Eighty Five only) to Bhilai Iron Steel for using Fire-Brigade vehicles to control the fire on 13.11.2015.
(b) To direct the Opposite Parties to pay interest @ 18% p.a. on the above amount from the date of submission of claim form to the date of actual payment.
(c) To direct the Opposite Parties to pay compensation amount of Rs.15,00,000/- (Rupees Fifteen Lakhs Only) towards mental, physical and financial loss.
(d) Saddle cost of litigation expenses, lawyer's fees amounting to Rs.50,000/- (Rupees Fifty Thousand only) on the Opposite Parties for instituting the instant complaint and approaching before this Hon'ble Commission.
(e) Grant any other relief, which this Hon'ble Commission deems fit and just under the circumstances of the case and in the interest of justice.
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2. Briefly stated the facts of the complaint of the complainant are that the complainant is a proprietorship firm acting through its proprietor, as mentioned in the cause title. The complainant is having business of sale, purchase and stocking of used Bardanas (Jute Bags), sewing of Bardanas from the rented godown as mentioned in the cause title. The OPs are one of the oldest Insurance Company in India and the O.P. No.2 is the head office of the Company which handles and manages business of whole of India and also at the Overseas. The O.P. No.1 is Divisional Office at Rajnandgaon (C.G.) managed by Divisional Manager, who provided service of insurance and all other activities related to it to the complainant. The complainant had availed an insurance policy under Standard Fire and Special Perils Policy for the insured items situated at above mentioned address for risk coverage from Fire Solids which are moderately or slightly combustible for the sum insured vide policy No.285202/11/15/31000000 for the period 20.5.2015 till 19.05.2016. On 13.11.2015 around morning at 09:30 A.M. got a message over his mobile phone that insured items are burning in the above mentioned rented godown and Fire Brigade was called immediately from Municipal Corporation, Rajnandgaon and Bhilai Steel Plant to control fire and all the concerned persons present at the place of incident took all their best of efforts to control fire and minimize the loss but even then they could not able to stop fire for more than 06 hours and more and after that somehow it was possible to cover the fire but till that // 4 // time all the stack of insured item were burnt completely. The complainant intimated the O.P. No.1 over telephone on the same day i.e. 13.11.2015 and Surveyor was duly appointed to assess the loss. The complainant made written intimation of the incident on 23.11.2015. The intimation about the incident was also given to Police Station Kotwali, Rajnandgaon on the same date. The O.P. No.1 upon receiving aforesaid intimation from complainant appointed Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. as Surveyor for the above incident. In due course of time, more specifically on 25.03.2016 Surveyor vide its Letter bearing Reference No.20/403/00524/LOR2, dated 25.03.2016 raised certain queries and asked complainant to submit all the relevant documents and complainant replied the above letter, dated 25.03.2016 and submitted all the relevant documents. Again Surveyor vide its Letter, dated 06.10.2016 asked complainant to submit more documents and complainant vide his reply letter , dated 08.11.2016 replied the letter of Surveyor, dated 06.10.2016 and submitted all the necessary and relevant documents. In the meantime, all the relevant papers and documents, as required by the Surveyor were given in time for processing and settling the claim. The complainant's appropriate loss of insured item is Rs.52,53,000/- (Fifty Two Lakhs Fifty Three Thousand Only), which opposite parties jointly and severally are liable to compensate to the complainant. Too much surprise and utter shock for complainant and for the reasons best known to the opposite // 5 // parties, O.P. No.1 vide Letter N.280700/Tech/Claim/16-17, dated 30- 12-2016 intimated to the complainant that complainant's aforesaid claim is not accepted and the same can be considered only for settlement on non-standard basis and offered Rs.4,14,424/- to which complainant sent a reply vide letter, dated 10.01.2017 questioned and reasoning for the same. Further, O.P. No.1 vide its letter, dated 11-01-2017 rejected the claim of complainant for non-submission of the documents, which not only amounts to deficiency in services on the part of ops, but also a clear cut case of fraud, misrepresentation and unfair trade practice. Furthermore, the O.P. No.1 issued a letter, dated 09.03.2017 to complainant wherein they indirectly compelled complainant to settle the aforesaid claim only at Rs.4,14,224/- (Rupees TFour Lakhs Fourteen Thousand Two Hundred and Twenty Four only) and threatened complainant to close the claim file on account of "Non-submission of required documents"). Complainant replied the said letter vide its letter, dated 21.03.2017. The act of the OPs amounts to deficiency in services on its parts and as such the complainant is a consumer within the purview of Section 2(1)(g) of the Consumer Protection Act, 1986. The complainant on innumerable occasions and more specifically on 09.02.2016, 28.09.2016 and 22.12.2016 requested contacted OPs vide his letters to disburse his aforesaid claim amount but OPs failed to reply any of the aforesaid letters or gave any sufficient reason for not settling the claim for more than a year. Hence, the complainant filed the instant complaint.
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3. The OPs filed their written statement and raised preliminary objection that as the complainant is a big commercial organization involved in business activity on large scale, is not a consumer as defined under Section 2(1)(d) of the Consumer Protection Act, 1986 and as such the present complaint is not maintainable and deserves to be dismissed on this ground alone. The complainant has mainly raised quantum dispute against the OPs which is not a consumer dispute to be adjudicated by a consumer fora. The OPs have acted in accordance with the terms of the contract of indemnity and as such it cannot be termed as deficiency in service, in absence of which the complainant has not accrued any cause of action to maintain the present complaint. The OPs in their parawise reply averred that the complainant is not a partnership firm acting through its proprietor namely Shive Kumar Malu. In fact it is an industrial organization involved in big commercial activity and as such is not a consumer. Said Shiv Kumar Malu is not an authorised person to act on behalf of the complainant, the present complaint, therefore, has been filed by an unauthorised person and as such it deserves to be dismissed summarily without going into the merits of the case, which otherwise is based on an agreement, terms of which were conditioned precedence which cannot be made point of any dispute under the present consumer complaint before this Commission. The complainant had availed a Standard Fire and Special Perils Policy No.285202/11/15/3100000073 for the period from 20.05.2015 to 19.05.2016 for the insured sum of Rs.51,00,000/-, but // 7 // the same was issued under certain terms, conditions and exclusions contained therein. Complete observation of which was condition precedence to get any relief thereunder. All the insured items kept in the godown were not burnt in a fire incidence on 13.11.2015 despite best efforts. The fire brigade of Municipal Corporation, Rajnandgaon and Bhilai Steel Plant, was not called immediately to control the fire. The fact on the other hand is that the alleged fire incidence had occurred solely due to negligence on the part of the complainant to safeguard the insured items. The insured as per the terms of policy was under obligation to take all the reasonable steps to safeguard the stock from getting damaged. In the present case however no such precautions were taken by the complainant, the fire brigade was also informed very late about the incidence, the loss as a result was out of the scope under the policy. The complainant's approximate loss of insured item was not Rs.52,53,000/-. The complainant has not submitted all the necessary documents to the Surveyor or the Insurance Company. The OPs are not jointly and severally liable to compensate the complainant. The OPs infact are not liable to pay any amount to the complainant as no deficiency in service has been committed by the OPs as it has acted completely in accordance with the terms of policy as well as prescribed guideline for settlement of fire claim under Standard Fire and Special Peril Policy. The intimation of the alleged incidence of fire accident dated 13.11.2015 was given to the OPs quite belatedly on 23.11.2015 i.e. almost after 10 days from the // 8 // date of alleged incidence, whereas the insured as per terms of policy was under obligation to give immediate intimation to the company about the happening of any event, to enable the company to take necessary steps in time to enquire about the exact cause and nature of damage and probable amount of loss, if any. But as in the present case, the intimation was given late, the OPs could not take immediate steps to ascertain the actual cause of incidence, which was essential for possible settlement of claim. After belated intimation the OPs, as part of procedure, got the incidence surveyed preliminary by Shri Hitesh Kumar Chitalia and then appointed Cunninghum Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. to carry out final survey for actual assessment of loss. The said Surveyor on receipt of instruction on 25.11.2015 visited the site on that date itself and carried out the survey in presence of one Mr. Shiv Kumar Malu. The said Surveyor after inspection of the site immediately requested the insured to submit required documents vide its letter dated 28/11/2015. The complainant however did not furnish all the relevant documents in time. The Surveyor had asked the insured to provide Fire Brigade Report, purchase and sale invoices and stock registers of Gunny Bags to enable the Surveyor to ascertain the quantity of stock available on the date of loss. The insured however did not produce purchase and sale invoices and Fire Brigade Report. The Surveyor had also sought the details of inward Challan / lorry receipts and outward Challan at the time of removal of stocks from // 9 // the premises to ascertain the quantity of stock available on the alleged date incidence. The insured however in spite of repeated reminders did not respond to the Surveyor's letters. Further the insured did not submit any purchase invoices of the damaged gunny bags to confirm the rate and transactions. The complainant has infact suppressed material facts from the OPs. The Surveyor therefore was constrained to consider the quantity on the basis of the physical verification by volumetric measurement; and assessed the loss to the tune of Rs.8,28,889 after deduction of 5% policy excesses vide, its final survey report dated 23.11.2016. The complainant has not suffered loss to the tune of Rs.52,53,000/-. The complainant thus has been guilty of suppression of material facts and has claimed compensation which is highly exaggerated as against the assessment done by the qualified and licensed Surveyor. The OPs have not committed any deficiency in service, fraud, misrepresentation and unfair trade practice towards rejecting the claim for non-submission of documents. Firstly the intimation was given late and then required documents were not submitted by the complainant to the Surveyor or the company despite repeated reminders. Non submission of documents has infact amounted to breach of policy condition on part of the complainant. As per General Condition No.06 of the policy the insured was under
obligation to produce, procure and give to the company on its own expenses, all the documents, particulars, plans, specification books, vouchers, invoices, investigation report, proof of cause of loss and any // 10 // other matter touching the liability of the company, but since the insured had not submitted any purchase invoices to substantiate the stock on the day of loss and also the fact that the complainant's bank transaction did not include any business transactions; and whatever assessment was made by the Surveyor, was based on volumetric analysis of the stock left in the debris, the competent authority of OPs in good gesture, considered the claim settlement on non-standard basis and offered a sum of Rs.4,14,214/- as final amount vide its letter dated 30.12.2016. The OPs along with the said letter also sent settlement voucher to the complainant seeking consent on the voucher within a fortnight, to settle the claim. But the complainant did not give its consent by sending the voucher duly signed. The OPs therefore again on 11.01.2017 sent a reminder to the complainant, but this time also the complainant did not yield to the requirement of the OPs. Failing which the OPs again sent a reminder dated 09.03.2017, this time making it clear that if the duly signed claim discharge voucher for the agreed amount of Rs.4,14,214 /- was not received within 15 days, the claim shall be closed due to non submission of required documents.
The complainant despite receipt of this letter has not sent duly signed discharge voucher to the OPs till date. The claim as a result has been deemed to be closed for non submission of documents. The OPs have acted in accordance with the terms of the policy as well as standard guidelines of the IRDA for settlement of such claims and as such have not committed an deficiency in service. The amount offered by the // 11 // OPs is based on thorough consideration of Surveyor Report and also the facts and circumstances of the claim. By sending discharge voucher to the complainant, but the complainant by refusing to give consent has himself denied the amount being inadequate. The dispute of quantum thus cannot be adjudicated by the Consumer Fora as consumer dispute. Such dispute can only be decided by relegating the same to the Civil Court. The complaint is liable to be dismissed.
4. The complainant has filed documents. Annexure C-1 is Copy of TIN Number of the complainant firm, Annexure C-2 is Copy of insurance policy dated 20.05.2016, Annexure C-3 is copy of rent agreement dated 28.03.2015, Annexure C-4 is Copy of Certificate of Fire extinguisher by Municipal Corporation, Rajnandgaon dated 14.01.2016,, Annexure C-5 is copy of letter of Fire Extinguisher by Bhilai Steel Plant dated 16.02.2016, Annexure C-6 is copy of intimation letter to OPs dated 23.11.2015, Annexure C-7 are intimation to Police Station Kotwali and all related documents, Annexure C-8 is copy of letter of Surveyor dated 25.03.2016, Annexure C-9 is copy of letter of complainant, Annexure C-10 is copy of letter of Surveyor dated 06.10.2016, Annexure C-11 is copy of letter of complainant, Annexure C-12 are copies of all documents submitted to Surveyor with respect to claim, Annexure C-13 is copy of letter by O.P. No.1 dated 30.12.2016, Annexure C-14 is copy of reply by complainant dated 10.01.2017, Annexure C-15 is copy of letter by O.P.No.1 dated 11.01.2017, Annexure C-16 is copy of letter by O.P. No.1 dated 09.03.2017, // 12 // Annexure C-17 is copy of reply by complainant dated 21.03.2017, Annexure C-18 is copy of complainant's letter dated 08.02.2016, Annexure C-19 is copy of complainant's letter dated 28.09.2016, Annexure C-20 is copy of complainant's letter dated 21.12.2016.
5. The OPs filed documents. Annexure OP-1 is Standard Fire and Special Perils Policy, Annexure OP-2 is intimation letter dated 23.11.2015, Annexure OP-3 is Claim Form, dated 23.11.2015, Annexure OP-4 is letter dated 28.11.2015, Annexure OP 5 is letter dated 25.03.2016 sent by the Surveyor to the complainant, Annexure OP 6 is letter dated 25.03.2016 sent by the Insurance Company to the complainant, Annexure OP 7 is letter dated 04.10.2016, Annexure OP 8 is Final Survey Report dated 23.11.2016 with photographs, Annexure OP 9 is letter dated 28.12.2016 and approval letter, Annexure OP 10 is letter dated 30.12.2016, Annexure OP 11 is Discharge Voucher, Annexure OP 12 is letter dated 11.01.2017, Annexure OP 13 is letter dated 09.03.2017, Annexure OP-9 is Preliminary Survey Report dated 27.11.2015 of Hitesh Kumar Chitalia, Insurance Surveyor, Loss Assessor and Valuer.
6. Shri Nikhil Agrawal, learned counsel appearing for the complainant has argued that the complainant is a proprietorship firm and Shiv Kumar Malu, is proprietor of the above firm, therefore, he is competent to file the instant complaint. The complainant is doing business of sale, purchase and stocking of used bardanas (Jute Bags), sewing of bardanas in the rented godown. The complainant obtained // 13 // Standard Fire and Special Perils Policy from the OPs for the insured item for risk coverage from Fire Solids which are moderately or slightly combustible for the sum insured Rs.51,00,000/-. On 13.11.2015 at near about 09:30 A.M., the complainant got a message through mobile that the godown caught fire and Fire Brigade was called immediately from Municipal Corporation, Rajnandgaon and Bhilai Steel Plant, to extinguish the fire. The Fire Brigade extinguished the fire. The intimation regarding the incident was given to the OPs immediately and Surveyor was appointed. The complainant suffered loss of Rs.52,53,000/- as against which the OPs only sent intimation to the complainant that the claim of the complainant is settled on non- standard to the tune of Rs.4,14,224/-, which was not accepted by the complainant. Thus, the OPs committed deficiency in service. The complainant is entitled to get the reliefs, as mentioned by the complainant in the relief clause of the complaint.
7. Shri Shishir Bhandarkar, learned counsel appearing for the OPs has argued that the complainant is a commercial organization and is doing business in large scale and the insurance policy has been obtained for commercial purpose, therefore, the complainant is not consumer under Section 2(1)(d) of the Consumer Protection Act, 1986. Shiv Kumar Malu, is not competent to file the instant complaint, therefore, the complaint is liable to be dismissed without going into merits of the case. The dispute is a quantum dispute, therefore, this Commission has no jurisdiction to entertain the instant complaint. The // 14 // complainant had availed a Standard Fire and Special Perils Policy from the OPs for the period from 20.05.2015 to 19.05.2016 for the insured sum of Rs.51,00,000/-, but the same was issued under certain terms, conditions and exclusions. The complainant has not submitted the relevant and necessary documents before the Surveyor and Insurance Company. The OPs appointed Hitesh Kumar Chitalia as Preliminary Surveyor, who did not determine the loss of bags, therefore, Cunninghum Lindsey International Insurance Surveyors and Loss Assessors was appointed as Surveyor, who gave his report. On the basis of Surveyor's Report, the complainant was intimated that he is only entitled for Rs.4,14,224/-, but the complainant himself did not give his consent for the same, therefore, the OPs did not commit any deficiency in service. The complaint is liable to be dismissed. He place reliance on Shri Ganesh Spinners Vs. United India Insurance Co. Ltd. III (1996) CPJ 183 (NC); Baij Nath Vs. Lucknow Development Authority, II (2010) CPJ 1 (NC); Haryana Urban Development Authority Vs. Bhisham Kumar, II (2010) CPJ 237 (NC); Bhagirathi Godawari Aqua Pure Pvt. Ltd. Vs. United India Insurance Co. Ltd. I (2017) CPJ 187 (NC); National Insurance Company Limited Vs. Arvind Kumar Ojha, III (2016) CPJ 643 (NC); Rahul Furniture House Vs. New India Assurance Company Limited, II (2016) CPJ 589 (NC); and Champalal Verma Vs. Oriental Insurance Company Limited, III (2008) CPJ 93 (NC).
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8. We have heard learned counsels appearing for both the parties and have also perused the documents filed by both the parties in the complaint case.
9. Firstly, we shall consider whether the complainant is consumer "?
10. The OPs have raised objection that Shiv Kumar Malu, is not competent to file the instant complaint and the complainant is a big commercial organization, therefore, is not a consumer. The above contention of the OPs, is not acceptable.
11. Shiv Kumar Malu has filed his affidavit dated 05-10-2017 in which he has stated that he is proprietor of small firm named and styledas M/s. Maloo Bardana, having business of purchase of used Bardanas (Jute Bags) ("insured items") from unregistered sellers in cash and stocking them at his rented godown. The complainant has filed copy of insurance policy (Annexure C-2). In the insurance policy, the insured's name is mentioned as Malu Bardana, Prop. Shiv Kumar Malu, Nandai Chowk, Rajnandgaon, Chhattisgarh. The complainant has also filed copy of Rent Agreement dated 28.03.2015 (Annexure C-
3), which was executed between Vimal Kumar, resident of Bharat Rice Mill, Old Ganj Chowk, Rajnandgaon (C.G.) and Shiv kumar Malu resident of Nandai Chowk, Rajnandgaon (C.G.). The complainant has also filed Certificate of Extinguishing of Fire issued by Commissioner, Municipal Corporation, Rajnandgaon (C.G.) (Annexure C-4). Looking // 16 // to the above documents, mainly insurance policy, it is established that Shiv Kumar Malu is Proprietor of Maloo Bardana and insurance policy was issued by the OPs for Maloo Bardana mentioning Shiv Kumar Malu as it's Proprietor, therefore, the objection raised by the OPs that Shiv Kumar Malu is not competent to file the instant complaint, is rejected.
12. According to the OPs, the complainant is doing business at large scale and the insurance policy has been obtained by the complainant for commercial purpose, therefore, the complainant is not consumer. The above contention of the OPs is also not acceptable.
13. In Ashish Vishwakarma Vs. National Insurance Company Limited & Others, II (2012) CPJ 169 (NC), Hon'ble National Commission has observed that "Contract of insurance is a contract of indemnity and therefore, there is no question of commercial purpose in obtaining insurance coverage. It has also been held that the insured could not trade or carry out any commercial activity with regard to the insurance policy, being barred to do so under Section 3 of the Insurance Act, 1938."
14. In The Divisional Manager, L.I.C. vs. Shri Bhavanam Srinivas Reddy, 1991 (2) CPR 144 (NC), Hon'ble National Commission, observed thus :-
"3. The first point of objection raised by the Insurance Company before the State Commission and reiterated before us namely is that no dispute arising out of a contract of insurance can be made subject matter of adjudication under the Consumer Protection Act. This // 17 // contention cannot be sustained in view of decision of this Commission dated July 28, 1989 in Shri Umedilal Aggarwal v. United India Assurance Company Ltd., F.A. Nos.3 and 4 of 1989 (Reported in I (1991) CPJ-3, 1991 (1) CPR 217 (NC), wherein we have held as follows :-
"We find no merit in the contention put forward by the insurance company that a complaint relating to the failure on the part of the insurer to settle the claim of the insured within a reasonable time and the prayer for the grant of compensation in respect of such delay will not fall within the jurisdiction of the Redressal Forums constituted under the Consumer Protection Act. The provision of facilities in connection with insurance has been specifically included within the scope of the express 'service' by the definition of the said word contained in Section 2(i)(o) of the Act. Our attention was invited by Mr. Malhotra, learned counsel for the Insurance Company to the decision of the Queen's Bench in National Transit Insurance Company Ltd. vs. Customs and Central Excise Commissioner, (1975) (1) all England Reports Page 303) The observations contained in the said judgment relating to the scope of the expression 'insurance' occurring the schedule of the enactment referred to therein are of no assistance at all to us in this case because the context in which the expression is used in the English enactment considered in the case is entirely different. Having regard to the philosophy of the Consumer Protection Act and its avowed object of providing cheap and speedy redressal to consumers affected by the failure on the part of persons providing "service" for a consideration, we do not find it possible to hold that the settlement of insurance claims will not be covered by the expression "insurance" occurring in Section 2(1)(d). Whenever there is a default or negligence in regard to such settlement of an insurance claim that will constitute a 'deficiency' in the service on the part of the Insurance company // 18 // and it will be perfectly open to the concerned aggrieved consumer to approach the Redressal Forums under the Act seeking appropriate relief. We, accordingly over the objection raised by the Insurance Company regarding the jurisdiction of the State Commission to adjudicate upon the complaint."
15. In The Divisional Manager, L.I.C. vs. Uma Devi, 1991 (1) CPR 662 (NC), Hon'ble National Commission, observed thus :-
"8. The very fact that the Insurance Act provides for a machinery for remedy for grievances arising out of repudiation of a claim under section 45 leads to show that the Corporation has to satisfy a Court that the repudiation was justified. Accordingly, it is for the consumer to choose a forum convenient to him to seek remedy for the loss suffered because of deficiency in service. As the provisions of this Act are in addition to and not in derogation of any other law for the time being in force, the State Commission has the jurisdiction to entertain the complaint and to investigate whether the repudiation was justified or not and to grant such relief as deems fit if it is satisfied that there was deficiency in service. We therefore, cannot uphold this contention in view of the decision of this Commission in Revision Petition No.12 of 1990 (New India Assurance Co. Ltd. v. Vipro Electronics Pvt. Ltd., 1991 (1) C.P.R. (NC) 531, where the identical point has been elaborately discussed".
16. In The New India Assurance Co. Ltd. vs. M/s Vipro Electronics Pvt. Ltd., 1991 (1) C.P.R. (N.C.) 531, the Hon'ble National Commission, observed thus :
"We are not impressed with the contention raised by Shri S.K. Paul, learned counsel appearing on behalf of the Petitioner that merely because of Insurer had totally repudiated his liability in respect of the claim, no proceedings could be validly initiated under the Consumer Protection Act by the insurer. This contention squarely falls within // 19 // the ruling given by this Commission in Ummedilal Agrawal v. United India Assurance Co. Ltd. (O.P.No.3 & 4 of 1989, decided on 28.7.1989". In that decision this Commission has observed that it is not possible to hold that settlement of a disputed insurance claim will not be covered by the expression "service" occurring in Section 2(d) of the Act. It was laid down that whenever there is default or negligence in regard to service that will constitute "deficiency in service" on the part of the insurer and it is perfectly open to the aggrieved party for seeking appropriate relief under the Act.
In the result, the Revision Petition has no merits and it is accordingly dismissed".
17. In M/s. Harsolia Motors vs. M/s. National Insurance Co. Ltd. & Ors. 2005 (1) CPR 1 (NC), Hon'ble National Commission, has observed thus :-
"13. In Halabury's Laws of England Vol. 25, 4th Edition, the origin and common principles of insurance is discussed and in paragraph 3 it has been discussed and in paragraph 3 it has been mentioned that it is based on principle of indemnity. Thereafter, relevant discussion is to the effect that most of contract of insurance belong to general category of contracts of indemnity. In the sense that insurers' liability is limited to the actual loss which is , in fact, proved. The contract is one of indemnity and, therefore, insured can recover the actual amount of loss and no more.
14. In this view of the matter, taking of the insurance policy is for protection of the interest of the assured in the articles or goods and not for making any profit or trading for carrying on commercial purpose.
16. We would refer to few relevant judgments :
// 20 // In Regional Provident Fund Commissioner vs. Shiv Kumar Joshi, (2000) 1 SCC 98, the Court elaborately considered the provisions of Sections 2(1)(d) and 2(1)(o) as well as earlier decisions and held that :-
"The combined reading of the definitions of 'consumer' and 'service' under the Act and looking at the aims and object for which the Act was enacted, it is imperative that the words "consumer" and "service" as defined under the Act should be construed to comprehend consumer and services of commercial and trade-oriented nature only. Thus any person who is found to have hired services for consideration shall 'be deemed to be a consumer notwithstanding that the services were in connection with any goods or their user. Such services may be for any connected commercial activity and may also relate to the services as indicated in Section 2(1)(o) of the Act."
The aforesaid ratio makes it abundantly clear that the services may be for any connected commercial activity, yet it would be within the purview of the Act."
18. The insurance policy has been taken by the complainant for protection of his property and not for making any profit, therefore, the complainant is a "consumer" and dispute between the parties comes within purview of "consumer dispute".
19. Now we shall consider whether the dispute between the parties is quantum dispute ?
20. The OPs have raised objection that the dispute between the parties, is quantum dispute. The above contention is also not acceptable. It is admitted fact that the complainant has obtained Standard Fire and Special Perils Policy from the OPs. The complainant // 21 // pleaded that on 13.11.2015, the godown where the insured items were kept, caught fire and Fire Brigade from Municipal Corporation, Rajnandgaon and Bhilai Steel Plant reached at the place of occurrence and extinguished the fire. The complainant filed Certificate dated 14.01.2016 issued by Commissioner, Municipal Corporation, Rajnandgaon (Annexure C-4), in which it is mentioned thus :-
"AA vkx cq>kbZ izek.k&i=AA Dzekad 636@eks-izfr-@2015&16 jktukanxkao fnukad 14-01-2016 izekf.kr fd;k tkrk gS fd fnukad 13-11-2015 dks lqcg vkosnd Jh f'ko dqekj ekyw ds xksnke QeZ ekyw ckjnkuk] uanbZ pkSd] jktukanxkao¼N-x-½ esa vkx yxus dh lwpuk izkIr gksus ij uxj ikfyd fuxe jktukanxkao }kjk Qk;j fczxsM ds ek/;e ls vkx cq>kbZ xbZA bl gsrq vkosnd }kjk jlhn dz- 491@07 fnukad 07-01-2016 dks jkf'k 57228- 00¼lUrkou gtkj nks lkS vV~~Bkbl :i;s½ fuxe dks"k esa tek fd;k x;kA vr% ;g izek.k i= iznk; fd;k tkrk gSA vk;qDr uxj ikfyd fuxe jktukanxako¼N-x-½ "
21. The complainant has also filed copy of Rojnamcha Sanha dated 14.11.2015, Spot Map and Nuskani Panchnama. The OPs have filed document Annexure OP-9, which is Preliminary Survey Report dated 27.11.2015 given by Hitesh Kumar Chitalia. The Surveyor reached to the conclusion that "In my opinion, it is a genuine claim of Fire spread due to Fire crackers which badly burnt all stock of gunny bags bundles, stored inside the involved godown." Looking to the above documents, it appears that the godown where insured items were // 22 // kept, caught fire and due to fire stock of gunny bags, bundles, stored inside the involved godown, were burnt. It shows that the incident of fire took place in the godown.
22. According to the complainant, he suffered loss to the tune of Rs.52,53,000/-. The OPs pleaded the claim of the complainant was considered on non-standard basis and proposal for payment of Rs.4,14,224/- was sent to the complainant. It shows that the incident of fire took place in the godown of the complainant. The OPs appointed Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., who assessed the loss to the tune of Rs.8,72,514.71/-, but the OPs again reassessed the loss as assessed by the Surveyors and made proposal to pay only Rs.4,14,224/- to the complainant, therefore, the complainant refused to receive the above amount. Hence, it cannot be held that the dispute between the parties comes within quantum dispute.
23. According to the complainant he suffered loss of Rs.52,53,000/-. The OPs appointed Surveyor, who assessed the loss to the tune of Rs.8,72,515/-. The complainant cross-examined Shri J.K. Patra, Deputy General Manager, Cunningham Lindsay International Insurance Surveyors and Loss Assessors Pvt. Ltd. and he gave answers to the questions asked, in the form of his affidavit. In reply to the question no.3, he specifically stated that "the photographs of the affected bardanas may be referred to ascertain the nature and extent of damage, which was evidenced at the time of our inspection. It may be // 23 // noted that 50% of the gunny bags are of Kaki (Brown) colour, while the remaining 50% are blackened after the occurrence due to the fire. It is clarified that, the Gunny Bags were stored in Bundles of 50 Nos. of bags. In our understanding the bundles of 50 Nos. of bags cannot be completely burnt in the absence of oxygen and presence of CO2 (Carbon-di-Oxide). In our opinion, no gunny bag was completely burnt to ashes and thus, the loss has been quantified accordingly." In reply to question No.4, he stated that "we believe, General Condition No.6, of Terms & Conditions of Standard Fire and Special Perils Policy."
24. The complainant cross-examined Shri J. Ekka, Deputy General Manager, National Insurance Company Limited, Divisional Office, Raipur and gave reply to the questions asked, in the form of his affidavit. In reply to question No.3 he stated that "The Policy is issued on the basis of information given in the proposal form by the insured on the principle of Ubberima Fides i.e. utmost good faith." In reply to question No.5, he stated that "Insured place i.e. the Godown is inspected only after the occurrence of any event giving rise to claim." In reply to question No.7, he stated that "It is reiterated that the Policy is issued on the basis of information given in Proposal Form by the Insured on the principle of Ubberima Fides i.e. utmost good faith." In reply to question No.8 he stated that "Yest Hitesh Chitalia was appointed by the Company to conduct the Preliminary Survey. Rest of the contents are part of Shri Chitalia's Report, which being contents of // 24 // document needs no reply. It is however stated that Shri Chitalia has not mentioned any quantity of gunny-bags in his report.'
25. Now we shall examine whether the survey report given by Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., is reliable ?
26. Surveyor Cunningham Lindsay International Insurance Surveyors and Loss Assessors Pvt. Ltd. has specifically mentioned in his report that the complainant has only suffered loss to the tune of Rs.8,72,515/- and after deducting Policy Excess @ 5% Rs.43,626/- assessed net adjusted loss to the tune of Rs.8,28,889/-.
27. The Surveyor mentioned in his report that the storage godown was constructed of brick wall, floor is pucca with CGI roofing. The storage godown shed admeasuring 180' x 85' and faces west. The entrance was 8 feet wide. There was no electricity supply inside the godown. The Surveyor further mentioned that "we again visited the affected premise on 29.12.2015 for final quantification of the damaged bags. During our survey we had quantified the stock on the basis of volumetric measurement in the presence of the insured. The Surveyor mentioned the volume of the bags at page 5 of his report and also gave details reasons for the assessment of the loss. After quantification the Surveyor prepared a Joint Inspection Report, wherein the insured had refused to sign on the same without submitting any reason. The Surveyor mentioned that according to the complainant approx 6 lacs // 25 // gunny bags kept inside the godown, which were completely burnt to ashes and swept away by the water used for fire fighting. During the verification of the godown, it was observed that the color of majority bags were not changed to black as the Stock could not be burnt completely and converted to ashes due to reduced oxygen level. In the Final Survey Report it is mentioned thus :-
"Assessment :
In our opinion all the above documents submitted by the Insured indicates towards presence of the book Stocks in Records while no supporting documents like Purchase Invoices, Sales Invoices, Inward/Outward Challans were submitted evidencing the insurable interest of the Insured in the Stocks. In view of the above we were constrained to consider the quantity based on the physical verification by volumetric measurement as under :-
Description Qty Rate Amount
Gunny Bags 90,587 9.00 8,15,286.71
Loss Minimization Expenses 57,228.00
Gross Assessed Loss 8,72,514.71
It appears that the Surveyor has prepared his report on Methodical manner and he assessed the loss according to measurement of godown and capacity of godown.
// 26 //
28. In Rohtas & Ors. Vs. United India Insurance Co. Ltd. & Ors., IV (2017) CPJ 501 (NC), Hon'ble National Commission has observed thus :-
"11. ....The surveyor further stated that they had based their conclusions and assessment on physical inspection, accounting, volumetric analysis, remnants of burnt items etc. It is clear from above that the report made by the surveyor is based on methodical assessment done in a professional manner. The petitioners have not been able to pin-point any irregularity or shortcoming in the said report. The case of the petitioner is that the bank statements of stock etc. reflect a different picture. However, it is made out from the report of the Surveyor that he has taken into consideration the stock statements as well, while making his report...."
"12. It is a settled legal proposition that the report made by a surveyor in the discharge of his professional duty should be accepted unless some serious discrepancies / shortcomings are pointed out in the same. This view has been expressed by the Hon'ble Supreme Court in their judgment in Sri Venkateswara Syndicate v. Oriental Insurance Company Limited & Anr., II (2010) SLT 664 = II (2010) CPJ 1 (SC) = 2009, 8 SCC 507, in which it has been held as under :-
"Scheme of Section 64-UM, particularly of Sub-sections (2), (3) and (4) would show that the insurer cannot appoint a second surveyor just as a matter of course. If for any valid reason the report of the surveyor is not acceptable to the insurer may be for the reason if there are inherent defects, if it is found to be arbitrary, excessive, exaggerated, etc., it must specify cogent reasons, without which it is not free to appoint second surveyor or surveyors till it gets a report which would satisfy its interest. Alternatively, it can be stated that there must be sufficient ground to disagree with the findings of surveyor/surveyors. There is no prohibition in the Insurance // 27 // Act for appointment of second surveyor by the insurance company, but while doing so, the insurance company has to give satisfactory reasons for not accepting the report of the first surveyor and the need to appoint second surveyor."
29. In Devendra Malhotra Vs. United India Insurance Co. Ltd. & Anr. 2016 (3) CLT 525 (NC), Hon'ble National Commission, has observed thus :- "Consumer Protection Act, 1986, Sections 2 (1)
(g), 19 & 21 (a) (ii)- Insurance claim Surveyor report Held It is a established legal proposition that the report made by the surveyor, who is a professional in his field, cannot disbelieved, unless there are cogent and convincing reasons to do so."
30. In Oriental Insurance Co. Ltd. Vs. Pavan Enterprises & Anr. I (2016) CPJ 503 (NC), Hon'ble National Commission has observed thus :-
"12. I see no reason to discard the report of the Surveyor. He appears to be a guideless witness. No motive was ever attributed to him. There must be some reasonable ground or doubt to reject his report. The report of the Surveyor carries infinite significance as was held in Roshan Lal Oil Mills Ltd. & Ors., 2014 (SLT Soft) 1 = 2014 (CPJ Soft) 1 = (2000) 10 Supreme Court Cases 19 and in D.N. Badoni v. Oriental Insurance Co. Ltd., I (2012) C.P.J. 272 (NC)."
31. In New India Assurance Co. Ltd., vs. Pave Infrastructures Pvt. Ltd., 2015 (3) CPR 577 (NC), Hon'ble National Commission has // 28 // observed that "Loss of assessment by approved Surveyor can be discarded only on cogent reasons".
32. In Garg Acrylics Ltd., Through Sh. Anish Bansal G.M. (G.M.) Authorised Representative vs. United India Insurance Co. Ltd., 2015 (1) CPR 273 (NC), Hon'ble National Commission has observed thus :-
"11.................. This is settled Law that the report of the surveyor is to be given much more weightage than any other piece of evidence. See the Law laid down in United India Insurance Co. Ltd. & Others Versus Roshan Lal Oil Mills Ltd. & Ors. (2000) 10 Supreme Court Cases 19 & in D.N. Badoni Vs. Oriental Insurance Co. Ltd. I (2012) C.P.J. 272 (NC)".
33. In The Oriental Insurance Co. Ltd., Through its Regional Manager vs. Ishwar Singh, 2015 (1) CPR 157 (NC), Hon'ble National Commission has observed thus :-
"17. Counsel for the petitioner has also drawn our attention to the Apex Court Judgment in the case Sri Venkateswara Syndicate vs. Oriental Insurance Company Ltd., and Another, (2009) 8 Supreme Court Cases 507 wherein the Apex Court has held as under :-
"There is no disputing the fact that the surveyor/surveyors are appointed by the insurance company under the provisions of the Insurance Act and their reports are to be given due importance and one should have sufficient grounds not to agree with the assessment made by them".
// 29 //
34. The Surveyor's Report is reliable document and the complainant has not filed any document to prove that the Surveyor's report is doubtful, therefore, the Surveyor's Report is dependable and reliable for assessment of loss, and according to the Surveyor's Report, the complainant is only entitled for the amount, which was assessed by the Surveyor i.e. Rs.8,72,515/- (Rupees Eight Lakhs Seventy Two Thousand Five Hundred Fifteen)..
35. Therefore, we partly allow the complaint of the complainant and it is directed that :-
(i) The OPs will pay a sum of Rs.8,72,515/- (Rs. Eight Lakhs Seventy Two Thousand Five Hundred Fifteen) to the complainant within 45 days from the date of this order.
(ii) The OPs will pay interest @ 9% p.a. on the above amount of Rs.8,72,515/- from the date of filing of the complaint i.e. 29.05.2017 till realization.
(iii) The OPs will also pay a sum of Rs.10,000/- (Rupees Ten Thousand) towards cost of litigation to the complainant.
(Justice R.S. Sharma) (D.K. Poddar) (Narendra Gupta)
President Member Member
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