National Consumer Disputes Redressal
National Insurance Co. Ltd. vs Pratap Textile Mills Pvt. Ltd. on 29 September, 2003
Equivalent citations: I(2004)CPJ50(NC)
ORDER
Rajyalakshmi Rao, Member
1. This Revision Petition arises out of the order in Appeal passed by Rajasthan State Commission on 31.7.2000 in Appeal No. 377/96. The brief facts are as follows:
The Respondent/Complainant Pratap Textile Mills Pvt. Ltd. has set up a weaving mill after obtaining loan from the Rajasthan Financial Corporation, Banswara. A fire policy was obtained in the name of Rajasthan Financial Corporation, Banswara A/C Pratap Textiles and during the subsistence of the policy, a fire broke out and the Surveyors appointed by the Revision Petitioner assessed the net loss to be paid by the Insurance Co. of Rs. 1,92,286/-. The Insurance Co. settled the claim with insured viz., Rajasthan Financial Corporation (RFC) for the above said Rs. 1,92,286 on 20.9.1994 and the said RFC gave the full discharge. However, not satisfied with this, M/s. Pratap Textile Mills approached the District Forum wherein they claimed that the Insurance Co. ought to have paid it a total amount of Rs. 7,19,000/- towards loss from fire. However, they mentioned that after deducting an amount of Rs. 1,92,770/- paid to the RFC, they should receive the remaining amount of Rs. 4,99,000/-. The District Forum held that the Surveyor appointed by the Insurer actually estimated the total loss due to fire suffered by the Complainant at Rs. 4,21,294/- comprising of Rs. 62,728/- towards damage to the building and Rs. 3,58,566/- towards damage to plant and machinery.
2. The District Forum upheld the contention of the Complainant that the deductions made by the Surveyor for depreciation and for under insurance from the amount of Rs. 4,21,294/- are not justified. Therefore, it held that the amount of total loss arrived at by the Surveyor at Rs. 4,21,294/- less the amount of Rs. 1,92,770/- paid to RFC, should be paid to the Complainant. Adding interest at 18% and Rs. 10,000/- towards physical and mental agony and Rs. 1,000/- towards cost it assessed that Insurance Co. should further pay a sum of Rs. 4,27,810/- to the Complainant.
3. In Appeal to State Commission, the National Insurance Company argued that the payment of Rs. 1,92,770/- received and accepted by RFC is in full and final settlement of the claim advanced by the Complainant and hence the Complainant is stopped from agitating the matter again. Secondly, they argued that the dispute being about the quantum of the compensation (SIC) cannot be entertained by the Consumer Forum. The State Commission held both these points against the Insurance Company and upheld the Lower Court's decision. The present Revision Petition is against the above order.
4. At this stage we would like to refer to some very relevant facts of this case. The sum assured under the Insurance Policy is Rs. 29,64,000/-. The fire took place on 21.6.1992 and a proper claim for reimbursement of Rs. 9,11,153/- was made on 21.7.1992. The Insurance Company appointed a Surveyor who gave a report on 15.10.1992 i.e. within a reasonable period of 3 months from the date of the fire. The Rajasthan Financial Corporation (RFC) is only a financer of the Respondent Company. RFC's interest in the entire matter should be interpreted to be limited to protecting its own loans granted to the Respondent Company. It is in that context that the fire policy was obtained in the name of Rajasthan Financial Corporation, Banswara A/C Pratap Textiles. The RFC did not prefer the insurance claim nor did it have any documents in its possession relating to the loss that was suffered by the Respondent Company due to fire.
5. However, the Insurance Company chose to settle the matter directly with the RFC without involving the Respondent Company after a period of two years and three months as stated above. The Insurance Company paid an amount of Rs. 1,92,770/- to the RFC and obtained a receipt in September, 1994 as full discharge of the insurance claim. In fact, there is some confusion about the date of the receipt given by the RFC. One receipt is dated 17.9.1994 which mentions that advance receipt for Rs. 1,92,770/- is issued in triplicate. It is difficult to understand why there should be so many receipts. However, issuing receipts in advance or otherwise with a few days difference by itself is not of any consequence and no adverse notice need to be taken of it. But when viewed in the context of the Insurance Company's averment to have settled this claim, by paying a very small sum to the RFC behind the back of the Respondent Company, one has to draw an adverse notice about the various receipts.
6. Even though the Respondent Company preferred Initially a claim of Rs. 9,11,153/- after having come to know that the Surveyor appointed by the Insurance Company assessed the claim only at Rs. 4,21,294/-, the Respondent restricted his claim to this amount only. We do not see anything wrong in this change he made in the claim.
7. As regards the three legal points raised by the Revision Petitioner, namely (1) that the consumer Fora cannot entertain the complaint in view of existence of an arbitration Clause (xiii) incorporated in the policy; (2) that the payment of Rs. 1,92,770/- received and accepted by the RFC should be deemed to be full and final settlement of the claim advance by the Respondent Company and would act as an estoppel and (3) that the alleged "Agreed Bank Clause" as given under Part-II Fire Policies, Endorsements, Clauses and Warranties of the All India Fire Tariff, constitutes a term agreed to between the insurer and the insured, and the further argument that RFC is an agent of insured company, have been dealt within great detail and with clarity by the Learned State Commission, Rajasthan.
8. As correctly observed by the Learned State Commission, there is no evidence whatsoever in the case to show that the "Agreed Bank Clause" forms part of the Insurance Policy. Similarly, there is no evidence to show that the RFC acted as an agent of the insured company. As regards the question whether the receipt or discharge voucher issued by the RFC would act as estoppel, the matter has been finally settled by the judgment of the Supreme Court in the case of United Indian Insurance v. Ajmer Singh Cotton and General Mills reported in NCJ (1999); 453 (SC). Similarly, the question whether an arbitration clause in the Insurance Policy, debars the jurisdiction of the Consumer Courts has been finally decided by the Supreme Courts in the case of Sky pack Couriers Limited v. Jatin Chemicals Limited report in CTJ (2000), 321 (SC) (CP) wherein the Hon'ble Apex Court held that the jurisdiction of Consumer Courts is not debarred.
9. In the light of the above discussion, we see no reason to interfere with the (SIC) Rajasthan State (SIC). rather on the higher side and we reduce it to 10% and Rs. 10,000/- as cost be paid to the Respondent within four weeks from the receipt of this order with this modification above, the order dated 31.7.2000 of the State Commission is confirmed.