State Consumer Disputes Redressal Commission
M/S Balaji Enterprises vs The National Insurance Co. Ltd. on 22 November, 2024
C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024
IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Date of Institution : 01.06.2015
Date of Reserving the order : 14.10.2024
Date of Decision : 22.11.2024
CC No. 366/2015
IN THE MATTER OF
M/s Balaji Enterprises
306/1-A, Rang Rasayan Apartment,
Sector-13, Rohini, Delhi-110085
(Through: Mr. S.M. Tripathi, Advocate)
.....Complainant
VERSUS
M/s National Insurance Co. Ltd.
Through its Branch Manager
Branch Office:
74/31, Main G.T. Karnal Road,
Opp. Swami Shardhanand College (New Building)
Alipur, Delhi-110036
(Through: Manoj Ranjan Sinha, Advocate)
.....Opposite Party
CORAM:
HON‟BLE MS. MS. PINKI, MEMBER (JUDICIAL)
HON‟BLE MS. BIMLA KUMARI, MEMBER (FEMALE)
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Present: Mr. Suresh Kumar Singh, Ld. counsel for Complainant
Mr Ld. Counsel for Opposite Party
PER: Hon‟ble MS.BIMLA KUMARI, MEMBER (FEMALE)
JUDGMENT
1. Brief facts of the case are that the complainant purchased a „Special Contingency Floater Insurance Policy‟ bearing no.360804/46/12/9500000129 from the opposite party in respect of the Electronic Sensor Pavervogle for a sum insured of Rs.1,25,00,000/- for the period w.e.f. 04.09.2012 to 03.09.2013. The insurance policy covered the risk of burglary, theft, fire & Allied Perils, Accidental Damage, Transit risk, Larceny, Housebreaking and Robbery.
2. It is the case of the complainant that in the early morning on 29.05.2013, the operator was preparing the machine for operation. At about 04:00 A.M, suddenly an overhead High Tension live wire, crossing the road, snapped and fell down on earth. It came into contact with the steel wire string on the LHS of the road. The High tension electrical charge caused damage to all electronic sensors, connecting cables, connectors and control consoles motherboard. The complainant lodged a police report at Chandrapur on 30.05.013. The police arranged a Panchanama to record the observations on the same day. The OEM service engineer also carried out the detailed inspection of the machine and identified the apparent damage and submitted his report on 30.05.2013.
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3. It is the further case of the complainant that the intimation of the occurrence was given to the opposite party on 29.05.2013 itself, which appointed the surveyor, who visited the site on 30.05.2013 and noted the damaged items but the extent of damaged items was not known unless the damaged sensors and other electronic control items were replaced. The surveyor had the detailed discussion with the service engineer and consented for the repairs of the equipment and directed the complainant to retain the damaged components needing total replacements. Thereafter, the surveyor submitted his first status report dated 17.06.2013, wherein it was submitted as under:
"Damages are caused by electrical surge caused by sudden snapping of conductor of overhead HT transmission line, the damages are unforeseen and accidental in nature and the insured's claim was admissible".
4. It is the further case of the complainant that as per the consent and permission of surveyor, the repairs to the machine were completed by M/s Writegen India Private Limited, Pune, which submitted the text invoices to the tune of Rs.43,43,897/-. The complainant also sent all the documents and records, which were required by the surveyor vide letter dated 31.07.2013. Subsequently, the surveyor also asked for the suppliers quotations for the new machine of the same make. The complainant obtained the quotation on 26.05.2014 and submitted the same to the surveyor. That, surprisingly the surveyor changed the stand and vide its email dated 22.10.2013 stated that since the damage was Allowed PAGE 3 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 due to "electrical breakdown failure" the claim lodged by the complainant was not admissible.
5. It is the further case of the complainant that on 27.10.2013, the complainant drew the attention of the surveyor to the fact that the claim was not falling under the exclusion clause and they should reconsider its decision and recommend his claim. Since, there was no response to his letter dated 27.10.2013, the complainant wrote to the opposite party on 13.12.2013 that the surveyor had backtracked from his earlier findings, without any reason and requested the opposite party to look into and settle the matter, as the complainant was suffering due to delay, caused by the opposite party. Thereafter, the complainant also sent a legal notice dated 16.01.2014 to the Electricity Authorities, as per the advise of opposite party and called upon them to pay the compensation for the loss suffered by the him. But, the Electricity Authorities did not respond to the notice. Thereafter, the complainant reminded the opposite party for early settlement of his claim and the opposite party assured the complainant that the claim would be settled shortly. However, the opposite party vide its letter dated 23.03.2015 stated that the complainant did not suffer any loss as the loss was due to electrical breakdown.
6. It is the case of the complainant that his claim was well within the scope of insurance policy but the opposite party arbitrarily and wrongfully denied the claim and there is deficiency in service and complainant is entitled to his claim for a sum of Rs.43,43,897/- along with interest as well as compensation for harassment.
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7. The opposite party has filed the written
statement where in it has prayed for dismissal of the complaint with costs by submitting that the complaint is not maintainable as the same is based on incorrect facts, conjuctures and surmises. The complainant is not a „consumer‟. The complainant has failed to show any deficiency in service or adoption of any unfair trade practices on the part of the opposite party. The claim of the complainant has been processed after getting the claim fully investigated and considering all the material facts and documents, which were made available to the insurance company. The claim of the complainant was duly investigated by the surveyor, who submitted the report dated 29.10.2013 and as per the report submitted by the surveyor the claim was not admissible under the policy. The complaint involves disputed question of facts, which cannot be decided by way of summary procedure. On merits, the opposite party has denied the allegations of the complainant.
8. Complainant has filed the rejoinder to the written statement of the opposite party and denied the facts submitted by the opposite party in the written statement and recapitulated the facts stated by the complainant in his complaint.
9. The complainant has filed evidence by way of affidavit of Shri Pradeep Gupta, the partner of the firm.
10. The opposite party has also filed the evidence by way of affidavit of Shri Rakesh Kumar, Deputy Manager of the opposite party.
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11. Complainant as well as the opposite party have filed their respective written synopsis.
12. We have heard the arguments from Ld. counsel for the parties. We have also gone through the material on record.
13. First of all, we would like to deal with the preliminary objections taken by the opposite party.
14. Whether the complainant is not a „consumer‟.
15. To deal with this issue, we would like to refer Section 2 (1)(d) of the Consumer Protection Act 1986, which is reproduced here for ready reference :-
(d) "consumer" means any person who,--
(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of Allowed PAGE 6 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purpose;
16. Further, Hon‟ble National Commission in Harsolia Motors Vs National Insurance Company ltd, MANU/CE/0083/2004; 1(2005) CPJ 27(NC) has held as under:-
"In Regional Provident Fund Commissioner Vs. Shiv Kumar Joshi, (2000) 1 SCC 98, the Court elaborately considered the provisions of Section 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."
17. In the present case, the complainant has hired the services of the insurance company by purchasing the „Special contingency floater insurance policy‟ which covered the risk of Burglary, Theft, Fire & Allied Perils, Accidental damage, Transit risks, Larceny, Housebreaking and Robbery for a consideration of Rs.1,25,00,000/- in respect of Electronic Sensor Pavervogle Machine, which was used for construction of road. Since, the complainant has hired the services of the opposite party for a consideration of Rs.1,25,00,000/- and was paying the premium of Rs.49,158/- to the opposite party and the opposite Allowed PAGE 7 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 party did not place on record any material to show as to how the complainant was not a consumer and only levelled bald allegations in this record, we are of the considered view that complainant is a consumer in view of settled law referred above and this contention of the opposite party is answered in favour of the complainant.
18. Whether the complaint involves disputed question of facts and law.
To deal with this issue, we would like to refer the judgment of J.J. Merchant Verus Shrinath Chaturvedi (2002) 6 SCC 635 wherein it was inter alia held by the Hon‟ble Supreme Court as under:-
"Under the Act the National Commission is required to be headed by a retired Judge of this court and the State Commission is required to be headed by a retired High Court Judge. They are competent to decide complicated issues of law or facts. Hence, it would not be proper to hold that in cases where negligence of experts is alleged, consumers should be directed to approach the civil court.
It was further held that merely because it is mentioned that the Commission or Forum is required to have summary trial would hardly be a ground for directing consumer to approach the civil court. For the trial to be just and reasonable, long-drawn delayed procedure, giving ample opportunity to the litigant to harass the aggrieved other side, is not necessary. It should be kept in mind that the legislature has provided alternative, efficacious, simple, inexpensive and speedy remedy to the consumers and that should not be curtailed on such ground. It would also be a totally wrong assumption that because summary trial is provided, justice cannot be done when some questions of Allowed PAGE 8 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 facts are required to be dealt with or decided. The Act provides sufficient safeguards."
19. In the present case the complainant has purchased the „Special contingency floater insurance policy‟ bearing no.360804/46/12/9500000129 For a sum of Rs.1,25,00,000/- for a period w.e.f. 04.09.2012 to 03.09.2013 in respect of the machine in question, which suffered damage on 29.05.2013, during the validity insurance policy. The complainant lodged the claim with the opposite party, but the opposite party denied the claim of the complainant. Since, the complainant has filed the present complaint for directions to the opposite party to pay the repair charges incurred by the complainant on the damages, caused to the insured machine, we are of the considered view that the complaint does not involves any disputed or complicated question of facts, which cannot be decided by this commission. Hence, this contention of the opposite party is also answered in negative.
20. Whether there is any deficiency in service the part of the opposite party.
To deal with this issue, we would like to refer Section 2 (1) (g) of the CP Act 1986 which runs as under:
(g) "deficiency" means any fault, imperfection.
shortcoming or inadequacy in the quality, nature and manner of performance, which is required to be maintained by or under any law for the time being in force or has been undertaken to Allowed PAGE 9 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 be performed by a person in pursuance of a contract or otherwise in relation to any service.
21. In the present case, it is the case of the opposite party that there is no deficiency in service on the part of the opposite party as the claim of the complainant has been processed after considering all the material and documents submitted by the complainant to the surveyor, who found the claim as not admissible under the policy.
22. On the other hand, it is the case of the complainant that after the incident, the complainant immediately lodged the police report Annexure C-4 (page 17 of the complaint) at Chandrapur, Maharashtra on 30.05.2012. The police arranged/prepared a Panchnama of spot. A perusal of this Panchnama prepared by ASI Champat Sucche, Police Station Bhadrawati shows that the incident happened on the highway road of Chandrapur, Nagpur due to falling of electrical wire on the insured machine, which was meant for construction of road and due to falling of wire, all the articles of the machine got burnt and reduced to ashes. The Panchnama was prepared by the police in the presence of Panchas, who admitted the same to be correct.
23. Further, the OEM service engineer also carried out the detailed inspection of the machine on 30.05.2013 and submitted his report Annexure C-5 (page 24 of the complaint). A perusal of this report also shows that the machine in question stopped working, as the high voltage cable fell on the machine.
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24. Further, the complainant also gave
intimation of the occurrence to the opposite party immediately on 29.05.2013 itself, which appointed the surveyor. The surveyor had detailed discussion with the service engineer and consented for the repairs of the equipment and directed the complainant to retain damaged components, which needed total replacements. The copies of emails dated 05.06.2013, 06.06.2013, 11.06.2013 and 14.06.013, exchanged within the surveyor are Annexure C-8 (colly). It is worth noting that the surveyor submitted his first status report dated 17.06.2013. A perusal of this report submitted by the surveyor also depicts the cause of damage due to sudden falling of overhead high tension transmission wire on the insured machine. It is significant to note that as per this first report of surveyor the damages to machine were unforeseen and accidental in nature and the claim of the complainant was found admissible by the surveyor. Further, the surveyor after having discussion with the OEM service engineer and his past experience with similar claim also assessed the loss to the tune of Rs.45 to 50 Lakhs.
25. Further, after carrying out the repairs to the machine, the repairers M/s Writegen India Private Limited, Pune submitted certain invoices to the tune of Rs.43,43,897/- Annexure- C10 (page 45 to page 55 of the complaint). Thereafter, the surveyor asked several documents and records for verification and the complainant submitted all those documents and records including the invoices for a sum of Rs.43,43,897/- vide letter dated 31.07.2013. The complainant also submitted the quotation for the new machine to the surveyor. But, surprisingly, the surveyor, after Allowed PAGE 11 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 4 months of its submitting the first report dated 17.06.2013 changed his stand and informed the complainant vide email dated 22.10.2013 that the claim was not admissible as the damage was caused to the machine due to electrical breakdown.
26. It is worth noting that in the first report the server has categorically mentioned the cause of damage as electrical surge which was caused by sudden falling of overhead HT transmission wire. He has categorically stated in the report that the damages were unforeseen and accidental in nature and the insured's claim was admissible. But, surprisingly, in its second report dated 22.10.2013, the surveyor took a U-Turn by stating that the claim of the complainant came under the exception clause to the insurance policy and company was not liable to process the claim as the damage to the machine was caused due electrical breakdown.
27. Now, a perusal of the „Special Contingency Floater Insurance Policy‟ Annexure C3 (page 15 of the complaint) shows that policy covered the risk of Burglary, Theft, Fire & Allied Perils, Accidental damage, Transit risks, Larceny, Housebreaking and Robbery.
28. In the present case, from the perusal of Panchnama prepared by Police, the report submitted by OEM Service Engineer and the first report submitted by the surveyor dated 17.06.2013 make it crystal clear that the cause of damage to the machine was sudden falling of high voltage cable on the machine due to which certain parts of machine got burnt and the Allowed PAGE 12 OF 15 C-366/2015 M/S BALAJI ENTERPRISES VS NATIONAL INSURANCE CO. D.O.D.: 22.11.2024 machine stopped working. All these reports show that the damages were unforeseen and accidental in nature. Since, the policy in question covered the risk on account of accidental damages, we are of the considered view that view taken by the surveyor in its second report that damage occurred to the machine on account of electrical breakdown was not correct. We are not able to understand as to why the surveyor submitted the second report as no reasons have been given by the surveyor for taking U turn from his previous report. Since, the policy covered the risk on account of accidental damage and the damage to the insured machine was caused on account of sudden fall of overhead high tension live wire during the validity of the insurance policy, we are of the considered view that there is deficiency in service on the part of the opposite party and insurance company was not justified in repudiating the claim of the complainant.
29. We would also like to refer the judgment of the Hon'ble Supreme Court in Oriental Insurance Co. Ltd. vs M/S Ozma Shipping Company & Anr Civil appeal no.6289 of 2001 decided on 25.08.2009, wherein it was inter-alia held as under:
"The insurance companies in genuine and bona fide claims of the insured, should not adopt the attitude of avoiding payments on one pretext or the other. This attitude avoiding puts a serious question mark on their credibility and trustworthiness of the insurance companies.
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Incidentally, by adopting honest approach and attitude, the insurance companies would be able to save enormous litigation costs and the interest liability."
30. Accordingly, the complaint filed by the complainant is allowed.
31. The Opposite Party is directed to pay a sum of Rs.43,43,897/-, to the Complainant along with interest as per the following arrangement:-
A. An interest @ 6% p.a. calculated from the date 29.05.2013, i.e. the date of incident till 22.11.2024 (being the date of present judgment);
B. The rate of interest payable as per the aforesaid clause (A) is subject to the condition that the Opposite Parties pays the entire amount on or before. 21.01.2025;
C. Being guided by the principles as discussed above, in case the Opposite Party fails to pay the amount as per the aforesaid clause (A) on or before 21.01.2025, the entire amount is to be paid along with an interest @ 9% p.a.
32. In addition to the aforesaid and taking into consideration the facts of the present case, the Opposite Party is directed to pay a sum of:
A. Rs.1,00,000/- as cost for mental agony and harassment to the Complainant; and B. The litigation cost to the extent of Rs.50,000/-.
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33. Applications pending, if any, stand disposed of in terms of the aforesaid judgment.
34. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
35. File be consigned to record room along with a copy of this Judgment.
(PINKI) Member (Judicial) (BIMLA KUMARI) Member (Female) PRONOUNCED ON 22.11.2024 Allowed PAGE 15 OF 15