State Consumer Disputes Redressal Commission
Gopal Singhal(Director) vs Deputy Manager Karnataka Bank & Anr. on 24 July, 2018
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G.)
Complaint Case No.CC/2018/08
Instituted on : 15.03.2018
Mr. Gopal Singhal (Director),
M/s CLRK Extractions and Exports Pvt. Ltd.
Shop No.05, Dhillon Complex, Jawahar Nagar,
Raipur (Chhattisgarh) ... Complainant.
Vs.
1. The Deputy General Manager,
Karnataka Bank Limited,
Registered and Head Office, P.B. No.599,
Mahavera Circle,
Kankanady, Mangluru - 575002. ... O.P. No.1.
2. The Branch Manager,
Universal Sompo General Insurance Company Ltd.
House No.461, 2nd Floor, Gugnani Heights,
Levis Road, Gautam Nagar,
Bhubneshwar, Odissa - 751014 .... O.P. No.2
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE SHRI D.K. PODDAR, MEMBER
HON'BLE SHRI NARENDRA GUPTA, MEMBER
HON'BLE SMT. RUCHI GOEL, MEMBER
COUNSEL FOR THE PARTIES:
Smt. Divya Chandrakar, Advocate for the complainant.
Shri Dipesh Thawait, Advocate for the O.P. No.1.
Shri Manaynath Thakur and Shri Rajat Khatri, Advocates for the O.P. No.2.
ORDER
DATED : 24/JULY/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 :-
// 2 // (1) Order the OPs to pay interest @ 18% p.a. from the date of loss as compensation and Rs.10,000/- (Rupees Ten Thousand) as costs with the actual amount Rs.62,73,750/- (Sixty Two Lakhs Seventy Three Thousand Seven Hundred Fifty).
(2) Order the OPs to pay Rs.25,000/- (Rupees Twenty Five Thousand) for the irreparable loss and injury due to deprivation, harassment and mental agony.
(3) Pass any such order, as this Hon'ble Commission may deem fir and proper in the interest of justice.
2. Briefly stated the facts of the complaint of the complainant are, that the O.P. No.1 is an agent of the O.P. No.2, who earns commission also as defined in the IRDA Rules and Regulations of an Agent /Intermediary. The O.P. No.2 is a joint venture of Allahabad Bank, Karnataka Bank, Dabur Investment Corporation, Sompo Japan Nipponkoa Insurance Inc., here, O.P. No.1 is one of the Joint Partner of O.P. No.2. The O.P. No.1 is having a business / service of Banking in the territory of India and an Agent of O.P. No.2, who sales general insurance products to their own banking customers. The complainant is having an account with O.P. No.1 branch and do his transaction from this account for the business purpose. The complainant is having good reputation as per the financial transaction with O.P. No.1. The O.P. No.1 played a role of Banking and an Insurance Agent and placed a mandatory obligation that every type of general insurance has to be placed through him, otherwise any sought of banking loan will not be disbursed. As the complainant had taken a business loan from the O.P. No.1, so the O.P. No.1 did not took any approval or consent debit the insurance amount from // 3 // his account and transfer to O.P. No.2. The amount in terms of premium amount of insurance for the Factory based at Khasra No.247/1, Village Lalpur, PH No.95/12, RIC - Dharsiwa, District Raipur (C.G.). The worth of the factory is Rs.10,00,00,000/-, which required a proper inspection before any working of the insurance premium. Here after transferring the amount by O.P. No.1 to O.P. No.2, on that basis O.P. No.2 issued the Standard Fire and Special Perils Policy. The complainant is under obligation to do insurance from the O.P. No.1 as the complainant is having a loan from the said Bank, whenever the complainant raised a query about the insurance, the reply is on very satisfactory manner that the Bank has given money for the plant (factory) so the complainant need not to worry on the insurance part. The assurance had also been given by the O.P. No.1 that the insurance had been done on a correct measure and in any calamity or loss O.P. No.1 will take care. The O.P. No.1 had finally handed over the policy to the complainant vide policy No.2114/55789863/00/000 dated 19.01.2016 to 18.01.2017 of the sum insured Rs.4,85,71,000/- with a debited prmium of Rs.59,038/-. After receiving the said insurance policy from the O.P. No.1, the complainant has raised a question on the para of "Location wise sum insured break up" on this location code mention 197800075, on occupancy it has mentioned "Rice Mills" on building Sum Insured Column it has mentioned Rs.00/- on Stock Sum Insured, it has mentioned Rs.00/- and in other sum insured column, it has mentioned Rs.4,85,71,000/-. After the endorsement has been passed to increase in sum insured on stock of Rs.4,00,00,000/- with a premium of Rs.55,876/- that again a without consent form the complainant, the prmium amount has been debited by the O.P. No.1 to O.P. No.2. Again the endorsement schedule has been handed over // 4 // to the complainant by the O.P. No.1. Again the question has been raised by the complainant that why the consent has not been taken before the insurance of the stock, as with a reply from the banker (O.P. No.1) stated again the same thing that the complainant is the borrower and it is mandatory that the insurance shall be with the bankers' knowledge and the banker only do the insurance for the amount financed. On 26.06.2016, there was a huge loss occurred in the plant (factory) of the complainant and the loss happened due to storm and rain. Immediately the complainant contacted O.P. No.1, they have directed the complainant to contact O.P. No.2 for loss inspection. Thereafter the complainant had called O.P. No.2 and provided information which has been asked by the O.P. No.2 and provided claim No.CL16017158. After a call has received by the complainant stated that he was from Cunningham Lindsay Insurance Surveyor appointed by O.P. No.2 and visited complainant's spot of loss (factory). To clear the confusion, the complainant had called the O.P. No.1 (Bank/Agent), they assured that not to worry about that they were very much updated by the O.P. No.2 and asked to co-operate with the said Surveyor. The complete plant was shut dowh due to the loss and not to face further loss, the complainant had requested to the O.P. No.1 (Bank/Agent) to release 25% to 30% of the loss as financial loss is touching approx Rs.62,63,750/- and for the complainant it is become heavy amount on the part of rapir and day by ay production loss was also on the head of the complainant. Thereafter the O.P. No.1 (Bank / Agent) has suggested that he will talk to the O.P. No.2 (Insurance Company) as they are the partner in business and an agent also. The O.P. No.1 suggested to provide the bills first to the O.P. No.2 or the Surveyor who has been appointed and on the basis of the bills 30% of the // 5 // amount, will be disbursed and then start reconstruction of the loss by paying same amount to the seller of the parts. The complainant on the instruction of the O.P. No.1, he provided the bills to the Surveyor and it has been told to the Surveyor that as per the instruction of the O.P. No.1 he is providing the bills so that the complainant can get the financial support to reinstate the damage parts. After approx for months from the date of loss the complainant had inquired with O.P. No.1 and O.P. No.2 for the partial claim amount so that the complainant can pay the amount to the vendor and take the material to reinstate the loss. All the communication gets stopped from O.P. No.1 and O.P. No.2, the complainant made several request to release the amount so the complainant can reinstate the loss. On a strange visit by Pro Claim Risk and Allied Services Pvt. Ltd., who had a meeting with complainant in presence of the Surveyor and raised an objection in the process. The complainant has requested the O.P. No.1 to attend the meeting but they are not present in the meeting. The complainant stated that on the instruction of the O.P. No.1 (Bank / Agent) the process had been followed and due to delay in approach by the O.P. No.2, the complainant had managed to start the operation of the plant. On 07.04.2017, the O.P. No.2, a repudiation letter had been sent to complainant stating that the plant had not been reinstated soon and on that ground the claim will not be paid to the complainant. The complainant had contacted O.P. No.1 and had a discussion on the said point after this problem what the complainant had shared the O.P. No.1 has kept his hand back and did not respond, as they only stated that they are the bank, not the Insurance Company. Due to lethargic approach and intention not to pay the claim, the complainant has suffered irreparable loss and injury due to deprivation, harassment, mental // 6 // agony and loss of professional practice, for which he is entitled to compensation. Hence, the complainant has filed the instant complaint and prayed for granting reliefs, as prayed by him im prayer clause of the complaint.
3. The O.P. No.1 filed its written statement and averred that the O.P. No.1 is working as agent as per law, for the O.P. No.2. The O.P. 1 is doing banking work and is legally doing work as commercial agent of the O.P. No.2. The O.P. No.1 paid the premium amount after survey to the O.P. No.2 for obtaining Standard Fire and Special Perils Policy. The O.P. No.1 provided loan amount to the complainant and the plant (factory) of the complainant was got insured from O.P. No.2 through O.P. No.1 as per tems and conditions of the insurance policy. According to the terms and conditions of the insurance policy, the plant (factory) was got insured for saving the plant (factory) from the calamity or loss, so that the complainant can received the insured amount as per rules towards probable loss to the plant (factory). The complainant obtained Stanard Fire and Special Perils Policy No.2114/55789863/00/000 from the O.P. No.2 which was effective for the period from 19.01.2016 to 18.01.2017 as per terms and conditions of the insurance policy. The premium in respect of the insurance policy was provided by the complainant to the O.P. No.2 through O.P. No.1 an thereafter the endorsement was made by the complainant in the insurance policy as instructions. Accordingly for the endorsement, the premium was provided by the complainant to O.P. No.2 through O.P. 1. On 26.06.2016, in the insured plant of the complainant, damaged was caused due to storm and rain, as informed by the complainant to the O.P. No.1. On being intimation // 7 // given by the complainant to the O.P. No.1 regarding damaged caused to the insured factory of the complainant due to storm and rain, then the O.P. No.1 asked the complainant to contact the O.P. No.2. The O.P. No.1 gave intimation regarding the above damages / loss to the O.P. No.2 After receiving the intimation, the O.P. No.2 registered the claim of the complainant as Claim No.CL16017158. The O.P. No.2 appointed Cunningham Lindsay Insurance Surveyor, as Surveyor for assessment of the loss. The O.P. provided the information and documents given by the complainant to it from time to time, to the O.P. No.1. From the act of the O.P. No.1, the complainant did not suffer mental agony. The O.P. No.1 did not commit any deficiency in service or unfair trade practice. The O.P. No.1 is not liable to pay any compensation to the complainant. If this Commission comes to the conclusion that the complainant is entitled to get the assessed amount, then the O.P. No.2 to be directed to pay the same to the complainant. The O.P.No.1 did not commit any deficiency in service or unfair trade practice, therefore, the O.P. No.1 be exonerated from its liability. According to the insurance policy filed by the complainant, the O.P. No.2 is legally liable to pay the compensation for the loss caused to the insured factory of the complainant. The O.P. No.1 did not commit any deficiency in service and unfair trade practie, therefore, the instant complaint is not maintainable against the O.P. No.1. The complainant is not entitled to get any compensation from the O.P. No.1. The complaint is liable to be dismissed with cost against the O.P. No.1
4. The O.P. No.2 filed its written statement and averred that the complainant reported the matter to the O.P. No.2 and immediately upon // 8 // receiving information, the O.P. No.2 appointed an IRDA licenced Surveyor on 27.05.2016, namely Cunningham Lindsey International Insurance Surveyors and Loss Assssors Private Limited to conduct the Survey and assessment of the loss and accordingly the Surveyor visited the affected site on the same day. The complainant had alleged that due to collapse of the Parboiling Elevator, Silo, Ladders, Structure, Dryer Piplelines and Roof Shed of plant and machinery section got damaged. The complainant had claimed for Rs.71,87,824/-, Rs.19,98,750 and Rs.17,50,000/- towards the loss on account of plant and machinery and stock respectively. The Surveyor after carrying out a detailed investigation and Survey of the loss of the complainant observed several discrepancies and hence recommended to appoint an independent investigator for further verification at the site. Resultantly, M/s Pro Claim Risk and Allied Services Private Limited were appointed as Investigator to go deeper into the matter and verify the facts of the case. Upon investigation, it was found that the complainant, though had alleged to have suffered a loss, the extent of loss and the reinstatement of loss projected and claimed by him are concoted and misrepresented. The complainant had portrayed before the Surveyer that post loss, he had to construct a new 90 feet elevator. However, the Surveyor and Investigator, upon spot inspect and detailed investigation discovered that no new elevator of 90 feet, as claimed by the complainant was actually installed or reinstated. The complainant had portrayed that for the purpose of installation and re-instatement of the alleged damaged elevator, M/s Bharat Sales had supplied material after doing fabrication work and the complainant had thereafter carried out the erection work itself. The complainant without submitting any estimate of loss for the stocks, plant // 9 // and machinery, simply forwarded the Surveyor a re-instatement bill dated 25.06.2016, purportedly issud by M/s Bharat Sales, by way of which the complainant has claimd towards the alleged damage to plant and machinery and several items claiming the same to have been re-instated by him. The Surveyor and Investigator upon checking th reinstatement bill provided by the complainant and carrying out physical inspection at the site observed several discrepancies in the complainant's claim. It was observed that the alleged damaged elevator had never been reinstated after being dismantled by the complainant. Further, the actual supply of the material for reinstatement as stated in the said invoice dated 25.06.2016 was found unreliable, since neither the items could be shown to the Surveyor by the complainant nor any entry of the items in the complainant's premises could be verified by way of any contemporaneous records maintained by the complainant. The Surveyor and Investigator also noted that the complainant failed to show them the salvage of the alleged damaged machinery during the physical verification at the site, rather the complainant tried to misled the Surveyor and Investigator by showing an earlier existing nelevator as the newly reinstated one. The Surveyor and Investigator called for a Joint Meeting with the complainant and the said meeting took place on 19.01.2017. During the course of the said meeting various issues relating to the alleged loss were discussed with the complainant and various descrepancies as observed by the Surveyor and Investigator were pointed out to the complainant, who failed to provide any satisfactory answer towards the same. In order to verify the authenticity of the invoice dated 25.06.2016, payment proof and supply of the material, the Surveyor and Investigator called for a Joint Meeting with M/s Bharat Sales and the said meeting took // 10 // place on 20.01.2017. During the course of the said meeting M/s Bharat Sales informed that the materials as mentioned in the said invoice dated 25.06.2016 were not fabricated by them but by some other sources. Despite the Surveyor and Investigator's specific request, M/s Bharat Sales did not share the list / true identity of the alleged fabricators, who allegedly fabricated the material as mentioned in the invoice dated 25.06.2016 and purportedly supplied to the complainan. Further, despite the Surveyor and Investigator's repeated request, M/s Bharat Sales has till date failed to provide supporting documents for the supply f the alleged materials as mentioned in the Invoice dated 25.06.2016. During the Surveyor's second site visit dated 31.05.2016, the Surveyor observed that the complainant was in process of emptying the Silo and therefore the Surveyor instructed the complainant to inform them about the same and also carry out segregation so as to minimize loss, if any. During the Surveyor's visit in August, 2016, the complainant informed that it had started processing the alleged damaged paddy. However, despite specific instructions from the Surveyor, the complainant never got the stock verified. The entire claim made by the complainant is completely baseless, fraudulent and concoted. By way of the present complaint, the complainant has claimed only a loss of Rs.62,37,750/-, the same being towards the alleged supply of material towards the alleged reinstatement of elevator. Pertinently, the complainant has not made any claim towards the loss of building and stock. Both the complainant and the alleged supplier, M/s Bharat Sales have failed to provide requisite documents to substantiate the said invoice. Therefore, in view f the several discrepancies as pointd above and in absence of any supporting documents to substantiate and authenticate the veracity of Invoice dated 25.06.2016, // 11 // proof of delivery of material, the said invoice dated 25.06.2016 is nothing more than a mere book entry rather than actual physical transfer and thus the present claim lodged on the basis of the same does not stand substantiated / verified. Therefore, in view of the aforementioned facts and circumstances and evidence available on record, the present claim appears more to be fabricated rather than being a genuine claim as portrayed /claimed by the complainant. The complaint filed by the complainant be dismissed with cost against the O.P. No.2.
5. The complainant has filed documents. Annexure 1 is Survey Report dated 23.02.2017 of Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., Annexure 2 is letter dated 17.11.2017 sent by the O.P. No.2 to the complainant, Annexure 3 is letter dated 07.04.2017 sent by the O.P. No.2 to the complainant, Annexure 4 is letter dated 31.10.2017 sent by the complainant to the Administrator, Universal Sompo General Insurance Co. Lt., Raipur (C.G.), Annexure 5 is letter dated 07.04.2017 sent by the O.P. No.2 to the complainant, Annexure 6 is Joint Inspection Report dated 19th January, 2017 issued by Pro Claim Risk and Allied Services P. Ltd., Annexure 7 is Cash/Credit Memo No.0211 dated 25.06.2016 issued by Bharat Sales, Raipur (C.G.) to the complainant, Annexure 8 is letter dated 06.01.2017 sent by the complainant to the Surveyor, Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., Annexure 9 is Endorsement Schedule on Fire Large Risk Policy, Annexure 10 is BNurglary Policy Schedule, Annexure 11 is Standard Fire and Special Perils Policy Schedule, Annexure 12 is letter dated 12.02.2016 sent by Credit Monitoring Department - Statement Cell of Karnataka Banbk Ltd. to the // 12 // Branch Head, Raipur (659) Branch, Annexure 13 is Machinery Breakdown Policy Schedule with terms and conditions, Annexure 14 is letter dated 14.10.2016 sent by the complainant to the Claims Manager, Univeral Sompo General Insurance Co. Ltd., Annexure 15 is Form A - Revenue Order Sheet dated 26.09.2016 passed by Nayab Tahsildar, Dharsiwa on 26.09.20916 in Case No.132 Year 2015-16, Order sheet dated 13.10.2016 passed by Tahsildar, Raipur in Revenue Case No.03/B-121/Year 2015-16, Annexure 16 are photocopy of the photographs and paper cutting.
6. The O.P. No.2 has filed documents. Annexure R-1 is true copy of the Policy Schedule, Endorsement Schedule and Terms and Conditions, Annexure R/2 is Joint Inspection Report dated 19th January, 2017 issued by Pro Claim Risk and Allied Services Pvt. Ltd., Annexure R/3 is Joint Minutes of Meeting dated 20th January, 2017 issued by Pro Claim Risk & Allied Services Pvt. Ltd., Annexure R/4 is Fact Finding Report dated 05th February, 2017 issued by Pro Claim Risk and Allied Services Pvt. Ltd,, Annexure R/5 is Survey Report dated 23.02.2017 of Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., Annexure R/6 is letter dated 07.04.2017 sent by the O.P. No.2 to the complainant.
7. Smt. Divya Chandrakar, learned counsel appearing for the complainant has argued that the O.P. No.1 is working as an agent of the O.P. No.2. The O.P. No.2 is a General Insurance Company. The O.P. No.2 is a Joint Venture of Allahabad Bank, Karnataka Bank, Dabur Investment Corporation, Sompo Japan Nipponkoa Insurance Inc. The complainant had taken business loan from the O.P. No.1, so the O.P. No.1 did not take any approval or consent to debit the insurance amount from his account and to // 13 // transfer in the account of the O.P. No.2. The premium amount was deposited for the factory based based at Khasra No.247/1, Village Lalpur, PH No.95/12, Revenue Circle Dharsiva, District Raipur (Chhattisgarh). As the complainant is loanee of the O.P. No.1 (Bank), therefore, the complainant is duty bound to obtain insurance policy from the O.P. No.2 through O.P. No.1. The complainant obtained Insurance Policy No.2114/55789863/00/000 from the O.P. No.2 for the period from 19.01.2016 to 18.01.2017, for the sum insured Rs.4,85,71,000/-. The premium of Rs.59,038/- was debited in the account of the complainant. On 26.06.2016, there was storm and rain in Raipur City. The complainant suffered loss due to storm and rain. The complainant immediately gave intimation regarding the incident to the O.P. No.1. The O.P. No.1 directed the complainant to contact the O.P. No.2 for loss inspection. The complainant contacted the O.P. No.2. The O.P. No.2 appointed Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. for conducting survey, who visited the spot. At the time of inspection, the complainant had called the O.P. No.1 (Bank) also and requested the O.P. No.1 (Bank) to release 25% to 30% of the financial loss suffered by the complainant which comes to Rs.62,73,750/-, but the same was not given by the O.P. No.1 to the complainant. On the instructions give by the O.P. No.1, the complainant provided the bills to the Surveyor. The complainant, has told the Surveyor that as per the instruction of the O.P. No.1, he is providing the bills, so that the complainant can get the financial support to reinstate the damaged parts. The complainant had called the O.P. No.1, who assured the complainant not to worry about that they were very much updated by the O.P. No.2 and asked to co-operate with the said Surveyor. The complainant suffered financial loss of near about // 14 // Rs.62,73,750/-. The O.P. No.1 did not co-operate with the complainant and the O.P. No.2 did not settle the claim of the complainant and repudiated the claim of the complainant withut any sufficient reason. Therefore, the complainant is entitled to get compensation, as prayed by the complainant in the prayer clause of the complaint. The complaint filed by the complainant may be allowed.
8. Shri Dipesh Thawait, learned counsel appearing for the O.P. No.1 (Bank) has argued that the O.P. No.1 is only acting as an agent of the O.P. No.2. The complainant has obtained insurance policy for his factory from the O.P. No.2 The O.P. No.1 has only made endorsement in the insurance policy. The plant (factory) of the complainant was insured with the O.P. No.2. When the O.P. No.1 received the intimation regarding the loss suffered by the complainant due to storm and rain, the same was intimated by the O.P. No.1 to the O.P. No.2. If any loss was suffered by the complainant due to storm and rain, then being a insurer, the O.P. No.2 is liable to pay compensation to the complainant. The O.P. No.1 did not commit any deficiency in service or unfair trade practice. The complaint is liable to be dismissed against the O.P. No.1.
9. Shri Manaynath Thakur and Shri Rajat Khatri, learned counsel appearing for the O.P. No.2 have argued that when the O.P. No.2 received the intimation regarding the incident, then the O.P. No.2 immediately appointed Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., as Surveyor to conduct the survey and assessment of the loss. The Surveyor visited the affected site on the same day. The complainant had alledged that due to collapse of the Parboiling Elevator, // 15 // Silo, Ladders, Structure, Dryer Pipelines and Roof Shed of plant and machinery sector got damaged. The Surveyor after carrying out a detailed investigation and survey of the loss of the complainant observed that that there is several discrepancies and the loss suffered by the complainant is suspicious, therefore, he recommended to appoint an independent investigator for further verification at the site. Then the O.P. No.2 appointed M/s Pro Claim Risk and Allied Services Pvt. Ltd. as Investigator, who visited the place of occurrence and met with the complainant and M/s Bharat Sales. The complainant without submitting any estimate of loss for the stocks, plant and machinery, simply forwarded the Surveyor a re-instatement bill dated 25.06.2016, purportedly issued by M/s Bharat Sales, by way of which the complainant has claimed towards the alleged damage to plant and machinery and several items claiming the same to have been re- instated by him. The Surveyor and Investigator upon checking the reinstatement bill of M/s Bharat Sales provided by the complainant, found that the bill is not genuine and it was observed that the alleged damaged elevator had never been reinstated after being dismantled by the complainant. The actual supply of the material for reinstatement as stated in the invoice dated 25.06.2016 was found unreliable, since neither the items could be shown to the Surveyor by the complainant nor any entry of the items in the complainant's premises could be verified by way of any contemporaneous record records maintained by the complainant. During the Surveyor's second site visit dated 31.05.2016, the Surveyor observed that the complainant was in process of emptying the Silo and therefore the Surveyor instructed the complainant to inform them about the same and also carry out segregation so as to minimize loss, if any. During the Surveyor's visit in // 16 // August, 2016, the complainant informed that it had started processing the alleged damaged paddy. However, despite specific instructions from the Surveyor, the complainant never got the stock verified. The Investigator found that the incident is suspicious. The O.P. No.2 has rightly repudiated the claim of the complainant. The complaint filed by the complainant is dismissed against the O.P. No.2. They placed reliance on State Bank of Travancore Vs. Kingston Computers India Private Limited, (2011) 11 Supreme Court Cases 524; General Assurance Society Ltd. Vs. Chandumull Jain and Anr. 1996 ACJ 267, AIR 1966 SC 1644; Oriental Insurance Company Ltd. Vs. Sony Cheriyan AIR 1999 SC 3252, II (1999) CPJ 13 (SC); United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal, IV (2004) CPJ 15 (SC); Suraj Mal Ram Niwas Oil Miss (P) Ltd. VS. United India Insurance Co. Ltd. and Anr. 2011 ACJ 418, (2010) 10 SCC 567; Vikram Greentech India Limited and Another Vs. New India Assurance Co. Ltd., (2009) 5 Supreme Court Cases 599; Jaisri Mines Products Pvt. Ltd. Vs. New India Assurance Co. Ltd. and Ors.. 2009 (2) CPC 266, II (2009) CPJ 123 (NC); Md. Hafizuddin Vs. United India Insurance Company Ltd. IV (2005) CPJ 147 (NC); Raj P.U. Foam Industries Vs. National Insurance Company Ltd. and Ors., II (2016) CPJ 277 (NC); Shree Gulab Trading Co. Vs. Oriental Insurance Company Ltd. and Ors., Consumer Case No.254 of 2011, decided by Hon'ble National Commission on 26.03.2018; Manjappa M. Mogera Vs. New India Assurance Company Ltd. and Ors. 2010(3) CPC 259, III (2010) CPJ 193 (NC); Revision Petition No.3405 of 2017 and IA/17325/2017, IA/17326/2017 - Prem Kumar Chhabra Vs. Life Insurance Corporation Ltd. decided by Hon'ble National Commission vide order dated 04.12.2017; Satwant Kaur Sandhu Vs. New India Assurance // 17 // Company Ltd. (2009) 8 SCC 316, IV (2009) CPJ 8 (SC); The United India Insurance Co. Ltd. Vs. M.K.J. Corporation with M.K.J. Corporation Vs. The United India Insurance Co. Ltd. AIR 1997 SC 408, III (1996) CPJ 8 (SC); Garg Acrylics Ltd. Vs. United India Insurance Co. I (2015) CPJ 185 (NC); The Oriental Insurance Company Ltd. Vs. Ishwar Singh I (2015) CPJ 462 (NC); New India Assurance Company Ltd. Vs. Pave Infrastructures Pvt. Ltd. IV (2015) CPJ 524 (NC) and Sri Venkateswara Syndicate Vs. Oriental Insurance Company Ltd. and Anr. (2009) 8 SCC 507, II (2010) CPJ 1 (SC); III (2009) CPJ 81 (SC).
10. We have heard learned counsels appearing for both the parties and have also perused the documents filed by them in the complaint.
11. It is admitted fact that the complainant had obtained loan from the O.P. No.1 (Bank) and also obtained Insurance Policy from the O.P. No.2 (Insurance Company), which was effective for the period from 19.01.2016 to 18.01.2017 for the sum insured Rs.4,85,71,000/- ?
12. Now we shall examine whether the complainant has suffered the loss, as mentioned in the complaint ?
13. The complainant himself pleaded that the intimation regarding the incident was given by the complainant to the O.P. No.1 immediately and the O.P. No.1 intimated regarding the incident to the O.P. No.2. The O.P. No.2 immediately appointed Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. as Surveyor.
// 18 //
14. The complainant and the O.P. No.2 (Insurance Company) both have filed Final Survey Report dated 23.02.2017 of the Surveyor Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd. in which it is mentioned thus :-
"WEATHER REPORT :
The Insured could not submit the weather report from meteorological Department, as the affected area is not covered under meteorological survelliance. However, the insured had submitted letter issued by Tehsildar describing the incidence which is enclosed herewith.
OUR VERIFICATIONS During our visit to the Insured's premises in the first week of August, 2016, the Insured stated that they had already started processing the reportedly damaged paddy. However the quantity was not got verified by them to us which we had specifically advised to them. Thus the actual quantity and extent of damage, if any, to the quantity could not verified by us.
The processing was initiated by the Insured with their own decision without getting it verified for event of damage sustained if any.
Further on checking the reinstatement bills provided by the Insured, we observed several discrepancies in the supporting bills submitted and actual situation in their premises it regards to the claimed reinstatement having been carried out.
In fact it was observed that the affected damaged elevator tower had never been reinstated after being dismantled by the insured. Thus the actual supply of the material for the reinstatement as stated in the invoice No.0221 dated 25tjh June, 2016 were indicatively unreliable since the items could not be shown to us by the insured physically nor entry of the items in their premises by way of records could be verified by them. Moreover, the Insured were also unable to get verified the salvage old parts of the claim damaged machinery, silo lid etc. during our physical verification at their site.
// 19 // Apart from the above, we also observed discrepancies in the invoice No.0221 dated 25th June, 2016 submitted by the insured claiming reinstatement of the material. This was also highlighted with suspicion since the actual physical availability of the such stated to be supplied material could not be shown by them.
We had thus immediately hightlighted the discrepancies and facts of the situation at the Insured's premises and brought them into the notice of the insurers for the verification at the site by an independent Investigation agency.
Based on the observation forwarded to the insurers, the insurers appointed agency i.e. M/s Pro Claim Risk and Allied Services P. Lt. to go deeper into the matter and verify the facts of the case."
Joint Meeting with CLRK Extractions and Exports Pvt. Ltd.
Date : 19th January, 2017
Venue : CLRK Extraction and Exports Pvt. Ltd.
KH. No.247/1 Village - Lalpur,
PH No.95/12, RIC - Dharsiwa,
District Raipur (C.G.)
Person available :-
1. Mr. Gopal Singhal - CLRK Extractions (Raipur) - Insured.
2. Mr. Girdhari Agrawal - CLRK Extractions (Raipur) - Insured.
3. Mr. Siddhartha Arora - Pro Claim Risk & Allied Services Pvt. Ltd.
4. Mr. Yash Arora - Pro Claim Risk & Allied Services Pvt. Ltd.
5. Mr. J. K. Patra - Cunningham Lindsey (Insurance Surveyor).
6. Mr. Anil Adil - Cunningham Lindsey (Insurance Surveyor). ..............................
From the above report of Pro Claim Risk and Allied Services Pvt. Ltd., it is evident that the reinstatement of the elevator claimed by the insured at a new place is misleading and fraudulent as the reportedly reinstated elevator was present prior to the loss. And prior to the reinstatement.
Joint Meeting with Bharat Sales
Date : 20th January, 2017
Venue : Bharat Sales,
Opp. Hotel Grand International,
// 20 //
Sanjay Gandhi Chowk, Station Road,
Raipur .
Person Available:-
7. Mr. Manish Agrawal - Bharat Sales
8. Mr. Siddhartha Arora - Pro Claim Risk and Allied Services Pvt. Limited.
9. Mr. Yash Arora - Pro Claim Risk and Allied Services Pvt. Ltd.
10. Mr. J.K. Patra - Cunningham Lindsey Insurance Surveyor. As on date Bharat Sales have not been able to provide supporting documents for the supply of the material under bill No.0211 dated 25.06.2016 issued to M/s CLRK Extractions and Exports Pvt. which they had used to raise an insurance claim for supply of material.
From the above investigation, it was confirmed that the damaged elevator was not reinstated by the insured. Further the stocks claimed also remained unverified unsubstantiated for the extent of damage, if any sustained by the stocks. By unauthorised reported disposal of the stocks without facilitating verification from the surveyors also rendered the claim for damages to the stocks as unreliable and unverified.
ADEQUACY OF INSURANCE - PLANT AND MACHINERY Machinery of the mill was started during October, 2015. The insured had submitted the copy of the investment declaration on 24.03.2016 duly certified by the CA. To arrive at the cost of Plant & Machinery we have considered the value of the Plant and Machinery, Electrical Installation and Miscellaneous Fixed Assets as under :-
............
In view of the breach of policy condition, we are however closing the case file of the Insured as No Claim at our end and leave the final decision in the matter on the insurers.".
15. On the basis of the Survey Report of Surveyor M/s Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., the O.P. No. 2 appointed M/s Pro Claim Risk and Allied Services Pvt. Ltd. as Investigator. The O.P. No.2 has filed Investigation Report of M/s Pro Claim // 21 // Risk and Allied Services Pvt. Ltd. dated 05th February, 2017, (Annexure R-4) in which it is mentioned thus :-
"BACKGROUND UNDERSTANDING :
We first discussed with the dealing Surveyors of Cunningham Lindsey to understand the background of loss particulars in detail including the verifications done by them and further details of claim presented to them by the insured.
FACT FINDING STEPS Our team visited the Insured's premises on 19th January, 2017, discussed the relevant aspect of business of Insured with its Proprietor Shri Gopal Singhal and Mr. Girdhari Agrawal. Both of them narrated to us that they regularly procure paddy from Government Agencies as well as from open market, for converting it to rice and for sending back to Government agencies. The paddy stock purchased from open market is also converted to rice and same sold in open market."
ANALYSIS / OUTCOME :
In view of the circumstances and the sequence of restoration as projected under the claim and the physical facts observed by us during our investigation, we felt that the Insured was misrepresenting in as much as that a New Paddy Elevator of 90 Feet was erected, post loss. It was so since the Invoiced material did not tally with replaced items shown to us. We, accordingly cross tallied the pre-loss existing equipment and found that the 90 Feet Paddy Elevator existed, before the loss. The confirmed misrepresentation by the insured.
1. The photographs taken by Surveyor, during his physical inspection during 27th May, 2016 to 29th May, 2016, does confirm that the 90 Feet paddy elevator so projected as new erection after accident, actually existed at that location.
// 22 //
2. The conduct of the insured, that despite a letter of Surveyor asking insured to give prior information of the repair work, the same has not intimation to the Surveyor.
3. The suspicion that M/s Bharat Sales and the insured are in league for the said misrepresentation of facts, is apparent from invoice of Bharat Sales also. A single invoice of Bharat Sales dated 25th June, 2016 of Rs.62,73,750/- bearing details of 6 different nature of supplied items. Moreover, the price of the items are too high when compared with prevailing market rate. Item No.1 of the invoice i.e. the bucket elevator for loading paddy. It should have shown approximately 300 PVC buckets and our market survey showed that each of these bucket cost is around Rs.200/-. But against thus arrived estimated cost of Rs.60,000/-, the bill shows the cost of this items as Rs.15.5 lacs.
4. Besides it is relevant to note that the technical report dated 30th June, 2016 of SL Engineering Services suggests the insured to procure the requisite material from Bharat Sales. On the contrary, Bharat Sales had arranged for fabrication of material as per specific requirement, delivered and issued invoice even prior to the advices of SL Engineering Services. This clearly points towards fabrication of documents only and no material was otherwise delivered by Bharat Sales to the Insured.
5. In case the said bill if is issued in normal course, should be supported with transportation documents such as GR/LR/Consignment Note / Delivery Challan etc. Receipt of this material should be properly reflected in the record of the plant showing entry of material in their premises. But both the supplier and the Insured did cooperated and rather refused to share details of their sub suppliers.
6. The material retrieved from the damaged paddy elevator of 70 Feet height was actually reused to the extent of 35 Feet, as admitted by the Insured. This fact should have revealed to the Surveyors and hence misrepresentation is confirmed. (Refer MOM).
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7. Further, the Silos being intact as evident in the photographs, the reported loss to the stock of paddy inside the Silo is minor and not as reported.
8. During our inspection of the plant, it is found that the plant is under electronic surveillance of numbers of CCTV Camera also. But the required footage of the same was declined by the Insured for reason best known to him.
CONCLUSION :
It can be concluded, from the facts analysed above, that the Insured had, though reportedly suffered a loss but the reasons, the extent of loss, and the reinstatement of the loss as projected and claimed by him, are concocted and misrepresented, in as much as no new elevator of 90 Feet was actually made after the incidence and the useable parts of the damaged elevator were utilized elsewhere and minor damage occurred to the Silo and the stock of paddy inside the Silo due to failing down of the elevator. The insured had attempted to use fraudulent document to extract benefit of the policy which is violation of the policy condition No.6 & 8."
16. Initially the complainant submitted an application before Tahsildar, Raipur for compensation, which was registered as Revenue Case No.03/B-
121/Year 2015-16. The same was sent to Nayab Tahsildar, Dharsiwa for necessary action. Nayab Tahsildar, Dharsiwa recorded finding that the case of the complainant, does not come within purview of Revenue Book Circular 6-4 and rejected the application.
17. M/s Pro Claim Risk and Allied Services Pvt. Ltd. is an independent Investigator and M/s Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Limited, is duly licenced Surveyors of // 24 // Insurance Regulatory and Development Authority (IRDA) and their reports are reliable.
18. 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."
19. 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)."
20. In New India Assurance Co. Ltd., vs. Pave Infrastructures Pvt. Ltd., 2015 (3) CPR 577 (NC), Hon'ble National Commission has observed that "Loss of assessment by approved Surveyor can be discarded only on cogent reasons".
21. 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 :-
// 25 // "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)".
22. 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".
23. The Surveyors M/s Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., mentioned in their report that "in view of the breach of policy conditions we are however closing the case file of the Insured as NO CLAIM at our end and leave the final decision in the matter on the Insurers." The Investigator M/s Pro Claim Risk and Allied Services Pvt. Ltd. mentioned in their report that "It can be concluded, from the facts analysed above, that the Insured had, though reportedly suffered a loss but the reasons, the extent of loss, and the reinstatement of the loss as projected and claimed by him, are concocted and misrepresented, in as much as no new elevator of 90 Feet was actually made after the incidence and the // 26 // useable parts of the damaged elevator were utilized elsewhere and minor damage occurred to the Silo and the stock of paddy inside the Silo due to failing down of the elevator. The insured had attempted to use fraudulent document to extract benefit of the policy which is violation of the policy condition No.6 & 8."
24. But in the instant case, M/s Bharat Sales has not provided the particulars demanded by the Surveyors. Looking to the Survey Report of the Surveyors and Investigation Report of the Investigator, the claim of the complainant, is doubtful. The complainant has not filed any documents to discard the Reports of the Surveyors and Investigators, therefore, on the basis of the Investigator's report, the O.P. No.2 (Insurance Company), has rightly repudiated the claim of the complainant and the complainant is not entitled to get any amount under the insurance policy from the O.P. No.2.
25. Therefore, the complaint of the complainant against the OPs, is liable to be and is hereby dismissed. No order as to the cost of this complaint.
(Justice R.S. Sharma) (D.K. Poddar) (Narendra Gupta) (Smt. Ruchi Goel)
President Member Member Member
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