State Consumer Disputes Redressal Commission
The New India Assurance Company Limited vs M/S New Horizon Knitwears on 18 December, 2013
FIRST ADDITIONAL BENCH
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB
SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.
First Appeal No.1182 of 2010.
Date of Institution: 06.07.2010.
Date of Decision: 18.12.2013.
1. The New India Assurance Company Limited, New India
Assurance Building, 87, M.G. Road, Fort, Mumbai-400001
through its Principal Officer.
2. The New India Assurance Company Limited, Campa Cola
Chowk, Ludhiana, through Senior Manager.
(Both through its Manager, New India Assurance Company
Limited, Regional Office SCO 36-37, Sector 17-A, Chandigarh).
.....Appellants.
Versus
M/s New Horizon Knitwears, 1357, Kashmir Nagar, opp. Goyal Yarn
Godown, Ludhiana through Prop. Sh. Amitoj Singh S/o Sh. Mandhir
Singh, 1357, Kashmir Nagar, opp. Goyal Yarn, Ludhiana.
...Respondent.
First Appeal against the order dated
01.06.2010 passed by the District
Consumer Disputes Redressal Forum,
Ludhiana.
Before:-
Shri Inderjit Kaushik, Presiding Judicial Member.
Shri Vinod Kumar Gupta, Member.
...................................
Present:- Ms Jaimini Tiwari, Advocate for Sh. Rajneesh Malhotra, Advocate, counsel for the appellants.
Sh. Vishal Gupta, Advocate, counsel for the respondent.
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First Appeal No.1182 of 2010 2INDERJIT KAUSHIK, PRESIDING JUDICIAL MEMBER:-
The New India Assurance Company Limited and another, appellants/opposite parties (In short "the appellants") have filed this appeal against the order dated 01.06.2010 passed by the learned District Consumer Disputes Redressal Forum, Ludhiana (in short "the District Forum").
2. Facts in brief are that M/s New Horizon Knitwears, respondent/complainant (hereinafter called as "the respondent") filed a complaint under section 12 of the Consumer Protection Act, 1986 (in short, "the Act") against the appellants, pleading that the respondent firm is carrying on the business of manufacturing of knitted cloth and other material and took a policy of Burglary vide policy No.360201/46/07/04/00000491 dated 11.07.2007 for the period 11.07.2007 to 10.07.2008 for the sum insured of Rs.13.00 lacs for the stock and trade. Theft took place in the insured premises in the intervening night of 27.02.2008 and 28.02.2008 and FIR was lodged with the police, bearing No.72 of 2008 at P.S. Divn. No.6, Ludhiana.
3. The respondent intimated the appellants about the theft and the appellants appointed Mittal Surveyors Pvt. Ltd. to survey the loss. The respondent supplied all the documents to the said surveyor, including the list of stolen items, purchase bills as well as rates, stock tally, list of closing stock, cost sheet of knitted cloth and claim bills were also supplied. The respondent claimed the loss of Rs.6,89,212/-, but the appellants did not settle the claim in spite of reminders and requests. The report of the surveyor was not given to the respondent. The appellants again asked the same surveyor to re-assess the loss and such direction is illegal. The respondent received a letter dated First Appeal No.1182 of 2010 3 27.07.2007 as per which survey and the investigation was got done thrice and an amount of Rs.45,864/- was offered to the respondent for the loss suffered. The offer was protested being unjustified and unfair. The appellants are deficient in service and the respondent suffered a loss of Rs.6,89,212/- because of theft. The respondent wrote a number of letters, including to the IRDA, but no payment was made. The value of the goods in the market was more than Rs.7.00 lacs on the date of theft. The respondent suffered lot of harassment and is entitled to compensation.
4. It was prayed that the appellants may be directed to pay Rs.6,89,212/- towards the loss arising out of theft, Rs.50,000/- as compensation for pain and agony and Rs.10,000/- as litigation expenses, along with interest @ 18% p.a.
5. In the written version filed on behalf of the appellants, preliminary objections were taken that the complaint is barred U/s 26 of the Act. The District Forum has no jurisdiction and there is no deficiency in service on the part of the appellants. After the receipt of investigation report of Sh. Dharam Pal and survey report of M/s Mittal Surveyors Pvt. Ltd., Bathinda, the claim file was duly scrutinized and the same was approved for Rs.45,864/- in full and final settlement of the claim and the respondent was asked vide letter dated 27.07.2009 to submit the consent letter, but the respondent failed to submit the consent letter. The complaint is not maintainable. As per the investigator, only 35-40 thans of clothes were stolen from the premises of the respondent, out of which six thans were recovered. There was no information regarding the remaining stolen goods in the police record. The Untraced Report was not filed. The appellants asked M/s Mittal Surveyors Pvt. Ltd., Bathinda vide letter dated 31.12.2008, to re-assess the loss as per the First Appeal No.1182 of 2010 4 investigation report and Untraceable Report and re-assessment report dated 09.01.2009, assessing the loss to the tune of Rs.45,864/-, was submitted. The respondent is estopped by his act and conduct from filing the complaint. Complicated questions of law and facts are involved and the civil court is competent. Criminal cases are pending and the respondent is not a consumer.
6. On merits, obtaining of the insurance policy was admitted. It was further submitted that the insurance is a contract in itself and the said policy contains the details of the risks of the premises covered. Other similar pleas as taken in preliminary objections were repeated and denying allegations of the complaint, it was prayed that the complaint may be dismissed with costs.
7. Parties led evidence in support of their respective contentions by way of affidavits and documents.
8. After going through the documents and material placed on file and after hearing the learned counsel for the parties, the learned District Forum observed that as per first survey report of M/s Mittal Surveyors Ex.R-14, quantity of stolen goods was 4941 kgs. and rate per kg. was Rs.125.50 and loss of Rs.6,20,025/- was assessed and after applying average clause, total loss of Rs.3,33,255/- was assessed. The average clause was rightly applied, as the collective value of the entire stock was in excess of the insurance amount. There was no ground for the surveyor to reduce the quantity of stolen goods from 4941 kgs. to 680 kgs. and report Ex.R-2 is not acceptable. The complaint was allowed and the appellants were directed to pay a sum of Rs.6,20,095/- to the respondent with interest @ 9% p.a. from July, 2007 till realization and Rs.2,000/- as costs of litigation. First Appeal No.1182 of 2010 5
9. Aggrieved by the impugned order dated 01.06.2010, the appellants have come up in appeal.
10. We have gone through the pleadings of the parties, perused the record of the learned District Forum and have heard the arguments advanced by the learned counsel for the parties.
11. The appeal was filed on the grounds that the District Forum observed that the average clause was rightly applied, but still allowed the entire claim. The surveyor re-assessed the claim, applying average clause to the tune of Rs.45,864/- which was the amount payable. The District Forum has given no reasons for accepting the report Ex.R-14 and the re-assessment report cannot be ignored. The order passed by the District Forum is not sustainable.
12. It was contended on behalf of the appellant that the surveyor initially assessed the loss of Rs.3.30 lacs, but when the accused were apprehended, then they made the statement that only 35 to 40 rolls were stolen, whereas the previous assessment was made on the basis of 250 rolls. Average clause has to be applied and the re- assessment was made as per the statement of accounts in the criminal case. The order passed by the District Forum is not sustainable and the same is liable to be set aside.
13. On behalf of the respondent, it was argued that the average clause is not applicable and the report made by the surveyor first time assessed the actual loss, but later on the statement of the accused, he re-assessed the loss, but the re-assessment report is not reliable. The impugned order passed by the District Forum is legal and valid and there is no ground to interfere with the same and the appeal may be dismissed.
First Appeal No.1182 of 2010 6
14. We have considered the respective submissions advanced on behalf of the parties and have thoroughly scanned the entire record and other material placed on the file.
15. The policy was taken by the respondent from the appellants and during the subsistence of the policy, the theft took place in the intervening night of 27/28th February, 2008 and FIR Ex.C-2 was lodged at P.S. Divn. No.6, Ludhiana. The appellant insurance company deputed M/s Mittal Surveyors Pvt. Ltd., who assessed the loss vide report Ex.R-14 to the tune of Rs.6,20,095/- and after applying the average clause, assessed the loss payable to the tune of Rs.3,33,257/-. The version of the appellant that in the criminal case, one of the accused got recovered six rolls of cloth and on the basis of that, re- assessment was made, is not tenable because in the criminal case, from one of the accused, six rolls of cloth were recovered but other rolls were not recovered and investigator himself observed that the other co- accused have sold their part of stolen rolls/Thans of cloth to stranger persons, which were not recovered. This recovery of six rolls from one of the accused is no basis for re-assessment and it was only done to favour the appellant insurance company. The District Forum observed that the average clause was rightly applied by the valuer as the value of the entire stock was in excess of the insurance amount. We have perused the average clause mentioned in the insurance policy Annexure-55 and it is reproduced as follows:-
"Average:- If the property hereby insured shall, at the time of any loss or damage, be collectively of greater value than the sum insured thereon, then the insured shall be considered as being his own insurer for the difference and shall bear a retable First Appeal No.1182 of 2010 7 proportion of the loss or damage accordingly. Every item, if more than one, in the Policy, shall be separately subject to this condition."
16. As per survey report Ex.R-14, which is detailed and reasoned, the insured was having stock of Rs.24,18,926/- as against the sum insured of Rs.13.00 lacs and after applying the average clause, the loss payable comes to Rs.3,33,257/-. The District Forum while observing that the average clause was applicable, still allowed the entire loss assessed by the surveyor, ignoring the average clause. The order to that extent is required to be modified.
17. Accordingly, the appeal filed by the appellants is partly accepted and the impugned order under appeal dated 01.06.2010 is modified to the extent that the appellants are liable to pay Rs.3,33,257/- to the respondent with 9% interest p.a. from July, 2007 till realization as well as costs as assessed by the District Forum. With this modification, the appeal stands disposed of.
18. The appellants had deposited an amount of Rs.25,000/- with this Commission at the time of filing of the appeal. This amount with interest accrued thereon, if any, be remitted by the registry to the respondent/complainant by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and to the appellants.
19. Remaining amount as per this order shall be paid by the appellants to the respondent/complainant within 45 days of the receipt of copy of the order.
First Appeal No.1182 of 2010 8
20. The arguments in this appeal were heard on 05.12.2013 and the order was reserved. Now the order be communicated to the parties.
21. The appeal could not be decided within the stipulated timeframe due to heavy pendency of court cases.
(Inderjit Kaushik) Presiding Judicial Member (Vinod Kumar Gupta) Member December 18, 2013.
(Gurmeet S)