State Consumer Disputes Redressal Commission
Opg Energy (P) Limited,No.117, P.S. ... vs Iffco Tokio General Insurance Old ... on 22 August, 2013
BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI Hon'ble Justice Thiru R. Regupathi PRESIDENT Thiru J. Jayaram, M.A., M.L. JUDICIAL MEMBER
C.C. No. 20 / 2011 Dated this the 22nd day of AUGUST, 2013 OPG Energy (P) Limited, ] Represented by its General Manager, ] No.117, P.S. Sivasamy Salai, ] Complainant St. Ebbas Avenue, ] Mylapore, ] Chennai 600 004 ] Vs. IFFCO TOKIO General Insurance ] Co. Ltd, ] Represented by its Senior Manager, ] Old No.195, New No.28, ] Opposite Party North Usman Road, ] T. Nagar, ] Chennai 600 017 ] This case coming before us for final hearing on 24-07-2013 and on hearing the arguments of both sides and upon perusing the material records, this Commission made the following Order:
Counsel for Complainant : Mr. K. Ramasamy Counsel for Opposite Party : Mrs. R. Rathna Thara J. JAYARAM, JUDICIAL MEMBER The case of the complainant is as follows:
The complainant had insured their DG#3 Turbo Charger with the opposite party against loss / damage caused by break down for a total insured sum of Rs.44 Crores. The policy covered the period from 15-03-2008 to 14-03-2009 and during the subsistence of the policy, the Turbo Charger suddenly stopped functioning which was duly reported to the opposite party. The opposite party deputed a Surveyor who conducted on the spot survey and assessed the damage to the insured machinery and submitted preliminary survey report to the insurer pending finalization of the survey report. On the advice of the surveyor, the complainant submitted his claim form on 25-08-2009 to the opposite party with an estimated amount of Rs.58,01,571/- for replacement of spare parts for the damaged machinery along with the purchase bills and invoices. The assessment of loss was completed in the year 2009. On 3-3-2010 the complainant received E-Mail message from the opposite party stating that the claim had been approved for Rs.25,50,582/- by their competent authority and advising the complainant to discharge the loss voucher in full and final settlement of claim, without enclosing the details of loss assed by the surveyor and not explaining as to how the assessment of loss was arrived at Rs.25,50,582/- and thereafter the complainant wrote a letter on 4-3-2010 to the opposite party to furnish the assessment of loss as assessed by the surveyor, but the opposite party did not disclose the entire survey report of the surveyor. Finding the attitude of the opposite party to be harassing, the complainant signed the loss voucher and received a sum of Rs.25,50,582/- on 31-3-2010 against the Gross Assessed Loss of Rs.50,20,385/-, due to financial constraints and to avoid further delay in getting the admitted amount. Immediately on the following day i.e. on 1-4-2010 the complainant wrote a letter to the opposite party stating that the claim amount was accepted under protest reserving their right to claim the balance amount of the claim due under the policy; and on receipt of this letter, the opposite party forwarded the details of assessment of loss assessed by the surveyor to the complainant. It was found that the gross Assessed Loss is Rs.50,20,385/- from which salvage of Rs.15,385/- and under-insurance of Rs.19,52,589/- and policy excess of Rs.5 Lac and reinstatement premium of Rs.1,829/- were deducted from the Gross Assessed Loss and the net amount payable is only Rs.25,50,582/-. The deductions are arbitrary and unjustified, except the deductions for salvage Rs. 15,385/- and reinstatement premium of Rs.1,829/-. Therefore, the complainant addressed a letter to the opposite party on 7-4-2010 demanding further sum of Rs.24,52,589/- which is the balance amount due under the policy, and there was no response from the opposite party. The opposite party did not settle the claim of the insured in terms of the finding of the surveyor and as per the terms and conditions of the insurance policy which amounts to deficiency in service on the part of the opposite party. Hence the complaint praying for direction to the opposite party to settle the balance amount of claim of Rs.24,52,589/- with interest @ 18% p.a. from the date of complaint till the date of realization, and a sum of Rs.25,000/- as compensation for harassment and mental agony.
2. The opposite party filed version stating as follows:
The complaint is barred by limitation and hit by Sec 24-A of the Consumer Protection Act, and the complainant being a commercial institution, cannot claim any compensation for harassment and mental agony. As per Clause 12 of the policy, any dispute between the parties on the point of quantum to be paid under the policy is to be referred to Arbitration. The policy availed by the complainant is Industrial All Risk Insurance Policy. The claim was settled at Rs.25,52,411/- as per the assessment of the surveyor, deductions made were: Rs.1,829/- towards reinstatement of premium, 5 % of the claim amount subject to a minimum of Rs.5 Lac and a maximum of Rs.50 Lac, a sum of Rs.5 Lac was deducted as policy excess and a sum of Rs.19,52,589/- was deducted for under- insurance at the rate of 39.01 %. The claim was settled as per the findings of the surveyor and there is no deficiency in service on their part.
3. 7 documents were filed and marked as Ex A1 to A7 on the side of the complainant; one document was filed and marked as Ex. B1 on the side of the opposite party.
4. The points for consideration are:
(1) Whether there is deficiency in service on the part of the opposite party as alleged in the complaint;
(2) If so, to what relief the complainant is entitled.
5. Point No.1: The only contention of the opposite party is that the complainant has received a sum of Rs.25,50,582/- in full and final settlement and so this complaint claiming further compensation is not maintainable. Per contra, the complainant would contend that the amount of Rs.25,50,582/- was received by him not in full and final settlement of the claim but it was received under protest against his claim for Rs.58,01,571/-.
6. It is further contended by the complainant that the complainant suddenly received an E-mail from the opposite party stating that his claim had been approved for Rs.25,50,582/- by the competent authority and requesting the complainant to discharge the loss voucher in full and final settlement of his claim, without enclosing the details of loss assessed by their surveyor and without explaining as to how the assessment was arrived at Rs.25,50,582/- and that he wrote a letter immediately on the next day urging the opposite party to furnish the details of assessment of loss as assessed by the surveyor and he sent the loss voucher and received a sum of Rs.25,50,582/- on 31-3-2010 against his claim of Rs.58,01,571/- and against the Gross Assessed Loss of Rs.50,20,385/- due to financial constraints and to avoid further delay in getting the final amount and on the very next day he immediately wrote a letter on 1.4.2010 to the opposite party stating that the amount was accepted by him on protest reserving their rights to claim the balance amount due under the policy. Thus, it is clear that the complainant received the amount under protest and immediately after receiving the amount he informed the opposite party that he accepted the amount under protest reserving his right to claim the balance due under the policy.
7. It is further contended by the complainant that the amount was received by him due to financial constraints and to avoid further delay in getting the amount. It is pertinent to note that the loss voucher signed by the complainant is not produced before the Commission. In this regard, both the parties have submitted certain rulings of the Honble National Commission.
8. The opposite party submitted the following citations:
(1) Ankur Surana vs. United India Insurance Co. Ltd.
& Ors 1 (2013) CPJ 440 (NC) (2) Upendra Kumar vs. New India Assurance Co. Ltd & another 1-(2013)-CPJ 595 (NC)
9. The complainant submitted the following citations:
Niharika Maurya vs New India Assurance & Ors II (2011) CPJ 241 (NC), where it is held as follows:
The first question to be considered is as to whether the mere execution of Discharge Voucher and acceptance of the insurance claim would estop the insured from making further claim from the Insurance Company. Honble Supreme Court of India in United India Insurance v. Ajmer Singh Cotton and General Mills & Ors, VI (1999) SLT 590 = II (1999) CPJ 10 (SC) = 1999 (6) SCC 400, has observed that mere execution of the Discharge Voucher and acceptance of the insurance claim would not estop the insured from making further claim from the insurer.
Admittedly, in the discharge voucher it is not mentioned that the petitioner had accepted the amount under protest. On realization that the claim had not been finally settled, he lodged his protest by filing the complaint. Mere execution of the discharge voucher and acceptance of insurance claim would not estop the insured from making further claim. The petitioner immediately after accepting the amount filed the complaint which shows that when he had accepted the amount on misrepresentation or due to misunderstanding, because he needed the money.
(2) The National Insurance co. Ltd. vs. New Bharath Rice Mills II (1997) CPJ 77 (NC) The insurance company will not disburse the amount unless discharge voucher in full and final settlement without protest is given by the insured. The complainant may have no option but to accept the amount offered due to financial constraints or other compelling reasons. The insured may lodge protest immediately on receipt or soon thereafter.
10. The rulings cited by the complainant, squarely apply to the instant case before us. Therefore, placing reliance on the above decisions, we hold that the discharge voucher in full and final settlement issued by the complainant is not a bar to claim more compensation in terms of the amount claimed in the claim form. Therefore, the contention of the opposite party in that the complainant cannot make any further claim is untenable.
11. It is to be further noted that the opposite party did not urge any other point but even then we are bound to decide the other issues raised in the version.
12. A point raised in the version is that the complaint is barred by limitation. We find that the complainant has filed the complaint on 8-4-2011 within two years of repudiation of the claim by the opposite party, which is well within the statutory period of limitation as contemplated under Sec 24-A of the Consumer Protection Act and therefore, the contention that the complaint is barred by limitation is unsustainable.
13. The further contention of the opposite party is that as per Clause 12 of the policy, disputes should be referred to Arbitration and the complaint is not maintainable under the Consumer Protection Act.
Section 3 of the Consumer Protection Act reads as follows:
Act not in derogation of any other law. The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.
In view of Sec 3 of the Act, law is well settled that the complaint is very well maintainable before the Consumer Forum and the contention of the opposite party in this regard cannot be sustained.
14. Therefore we hold that the failure of the opposite party to settle the legitimate and reasonable claim of the complainant amounts to deficiency in service on the part of the opposite party and accordingly the complainant is entitled to compensation.
15. We find that the Gross Assessed Loss is Rs.50,20,385/-. The deductions are as follows:
Salvage ..
15,385/-
Under insurance @ 39.01% .. 19,52,589/-
Policy excess .. 5,00,000/-
Premium reinstatement .. 1,829/-
16. It is relevant to note that in the final survey report filed by the opposite party (Ex.B1) it is stated that vide the claim form submitted by the insured their claim is: Rs.61,62,423/- being the actual cost incurred by them during the restoration of Turbo Charger (b), affected generating set and they also submitted various documents like invoices, bills, proof of payments etc. for the values claimed by them.
17. It is mentioned in the final report that the Gross Assessed Loss is Rs.59,66,636/-
and the assessed loss is Rs.50,05,000-00; and the adjusted loss is Rs.25,52,411-00; But it is significant to note that there is no proper reasoning and no reasons are furnished as to how the loss was assessed by the surveyor.
18. Therefore, having regard to the relevant facts and the peculiar circumstances of the case, and in the interests of justice and equity, we are inclined to allow the salvage of Rs.15,385/- and reinstatement of premium of Rs.1829/- to be deducted from the Gross Assessed Loss and we are not inclined to allow the under insurance and the policy excess in view of the fact that the machinery is insured for Rs.44 crores and that the deductions are arbitrary and unjustified.
19. Considering all the relevant factors, we hold that in addition to the amount already received by the complainant viz. Rs.25,50,582/-, the complainant is further entitled to the deducted amounts towards under insurance of Rs.19,52,589/- and Policy excess of Rs.5 Lac and the complainant being a company we are not inclined to award compensation for mental agony.
20. In the result, the complaint is allowed directing the opposite party to pay a sum of Rs. 24,52,589/- (Rupees Twenty Four Lac Fifty Two Thousand Five hundred and Eighty Nine only) with interest at the rate of 6% p.a. from the date of filing of the complaint i.e. 8-4-2011 till realization as compensation for deficiency in service and to pay costs of Rs.10,000/-; Time for compliance: Two months from the date of receiving the copy of this order.
J. JAYARAM (R. REGUPATHI) JUDICIAL MEMBER PRESIDENT Exhibits filed on the side of the complainant:
Ex A1 Industrial All Risk insurance Policy No.91/1AR/0708/ CS/000001 Period of insurance/15-03-2008 to 14-03-2009 (original with insurer/banker) Ex A2 25-08-2009 Claim form filed with estimated amount of loss supported by bills (Original claim form with Insurer) Ex A3 03-03-2010 Email message from opposite party to the Complainant to the effect that claim has been approved for Rs.25,50,582/-
Ex A4 04-03-2010 Letter from complainant to opposite party demanding survey report (Original with insurer) Ex A5 31-03-2010 Claim settled for Rs.25,50,582/- by cheque No.103758, dated 31-03-2010 Ex A6 01-04-2010 Letter from the complainant to the opposite party that claim has been received under protest.
(Original with insurer) Ex A7 07-04-2010 Letter from the complainant to the opposite party demanding balance amount of claim Rs.24,52,589/-
Exhibits filed on the side of the opposite party:
Ex B1 27-11-2009 Final Survey Report.
J. JAYARAM (R. REGUPATHI) JUDICIAL MEMBER PRESIDENT