National Consumer Disputes Redressal
M/S. Life Style vs Universal Sompo General Insurance Co. ... on 19 January, 2026
IN THE NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
NEW DELHI
RESERVED ON : 06.10.2025
PRONOUNCED ON : 19.01.2026
FIRST APPEAL NO.582 OF 2017
(Against the order dated 09.03.2017 in Consumer Complaint No.73 of 2016
of the State Consumer Disputes Redressal Commission, Chhattisgarh)
M/s Life Style,Through : Proprietor - Narendra Giripunje,
S/o Late Laxman Giripunje,
Banjari Road, Raipur (C.G.)
R/o : Om Society, Sunder Nagar, Raipur,
Tehsil and District Raipur (C.G.) Appellant
Versus
Universal Sompo General Insurance Co. Ltd.,
Through: Manager,
Address : Near T.V. Tower, Shankar Nagar,
Raipur (C.G.)
Head Office - A-201, Crystal Plaza,
Second Floor, Infinity Mall, Oshiwara,
Link Road, Andheri (West),
Mumbai 400 058 (Maharashtra) Respondent
BEFORE:
HON'BLE DR. INDER JIT SINGH, PRESIDING MEMBER
HON'BLE DR. JUSTICE SUDHIR KUMAR JAIN, MEMBER
For the Appellant (s) : Mohd. Anis UR Rehman, Advocate (V.C) &
Mr. Rajesh Kumar Bhawnani, Advocate (V.C)
For the Respondent(s): Mr. D. Varadarajan, Advocate (V.C)
ORDER
DR. INDER JIT SINGH, PRESIDING MEMBER
1. The present First Appeal (FA) has been filed by the Appellant against Respondent as detailed above, under section 19 of Consumer Protection Act 1986, against the order dated 09.03.2017 of the State Consumer Disputes Redressal Commission, Chhattisgarh (hereinafter referred to as the 'State Commission'), in FA/582/2O17 Page 1 of 19 Consumer Complaint (CC) No. 73/2016 inter alia praying for setting aside the impugned order dated 09.03.2017 passed by the State Commission.
2. While the Appellant was Complainant before the State Commission, the Respondent was Opposite Party in the said CC/73/2016 before the State Commission. Notice was issued to the Respondent on 08.12.2017. Parties filed their Written Arguments/Synopsis on 10.10.2022 (Appellant) and 28.03.2025 and 13.10.2025 (Respondents). For the sake of convenience, parties will also be referred to as they were arrayed before the State Commission.
3. Brief facts of the case as presented by the complainant and as emerged from the First Appeal, Order of the State Commission and other case records are that: -
3.1 The complainant availed insurance coverage for the stock of cosmetic items and cash retained in the business premises, under Insurance Policy No. 2939/51536360/03/000 issued by the Opposite Party (O.P.) for the period commencing 21.07.2014 and expiring on 20.07.2015. The said insurance contract was facilitated via Karnataka Bank, Raipur (Chhattisgarh) where the complainant maintained a cash credit facility. The policy schedule provides for coverage in distinct segments: Schedule A insures cosmetic stock for Rs.52,00,000, Schedule B covers burglary and robbery for Rs.53,00,000, Schedule C stipulates a sum assured for monetary loss of Rs. 1,00,000, while Schedule J sets the sum assured for public liability at Rs. 10,000, with premiums paid commensurate to the aggregate risk insured.
3.2 On 29.11.2014, a fire broke out in the shop premises of the complainant, resulting in destruction of goods, including insured cosmetic items and burning of cash aggregating Rs.55,000. The incident was reported to the O.P., which deputed a Surveyor from Delhi to assess the quantum of the loss. Statutory intimation was given by the complainant to the Fire Brigade, Karnataka Bank, and the local police authorities.
3.3 The complainant had submitted a claim form reflecting the loss:
Rs.39,55,000 for cosmetic stock and Rs.55,000 for cash. Subsequently, the O.P. FA/582/2017 Page 2 of 19 tendered a discharge voucher for Rs.7,63,106 as full and final settlement of the claim. The complainant registered his protest and lack of consent, Subsequently the O.P. deposited the sum in the Karnataka Bank account via NEFT, whereupon the bank adjusted the funds against the complainant's cash credit.
3.4 The complainant, through legal correspondence dated 13.11.2015, objected to unilateral disbursement of the settlement amount without explicit or informed consent, and offered restitution of the sum should the O.P. so desire. The complainant filed complaint before the State Commission, for the recovery of the actual loss and compensation for consequential mental hardship and distress suffered due to the O.P.'s deficient and unfair conduct. The State Commission Vide Order dated 09.03.2017, dismissed the complaint.
4. Appellant has challenged the Order dated 09.03.2017 of the State Commission mainly on following grounds:
i) The State Commission failed to observe that the appellant did not violate any terms or conditions of the insurance policy in question. As detailed in Schedule A of the policy, the cosmetic stock was insured for Rs. 52,00,000/-;
according to Schedule B, the sum assured for burglary and robbery was Rs. 53,00,000/-; as per Schedule C, the money was insured for Rs. 1,00,000/-; and according to Schedule J, the sum assured for public liability was Rs. 10,000/-. The appellant furnished all requisite documents, including evidence of sale and purchase transactions, expense records, the bank stock statement, bank account statements, rent agreement, and balance sheet etc. Despite production of these documents, the respondent failed to settle the entire insurance claim of the appellant/complainant, which amounts to deficiency in service and constitutes an unfair trade practice under the law.
ii) The State Commission failed to take cognizance of the fact that, when the fire incident occurred in the appellant's shop on 29.11.2014, the entire stock of goods and cosmetic items kept within the premises was completely damaged, and cash amounting to Rs. 55,000/- was also destroyed, both of which items were duly covered under the valid insurance policy. Since the occurrence of fire FA/582/2017 Page 3 of 19 is not a disputed fact and stands admitted, the respondent is legally obligated to compensate the appellant/complainant for the full extent of the loss suffered, as the quantum of loss falls well within the overall limits of the sum assured under the terms of the insurance coverage.
iii) The State Commission failed to take note that the respondent committed a deficiency in service by not allowing the entire claim of the appellant for the losses suffered, even though the Surveyor had specifically observed pertinent facts supporting the claim in his report.
iv) The State Commission erred in disregarding the fact that when the respondent failed to disburse the entire claim or loss amount due to the appellant/complainant and expressed willingness to pay only Rs.7,63,106/-, the appellant unequivocally objected to such partial payment by explicitly marking the note as "Under Protest." Notwithstanding the appellant's protest, the respondent deposited the aforesaid amount in the appellant's bank account through NEFT, and Karnataka Bank further adjusted this amount in the cash credit account without obtaining any consent from the appellant. The remittance of this amount by the respondent cannot, under any circumstances, be construed as full and final settlement of the appellant's legitimate claim.
y) State Commission erred in relying upon the report prepared by the Surveyor, which assessed the loss suffered by the appellant due to the fire incident in his shop at Rs. 7,63,105.70. The said report is erroneous, unreliable, and contrary to the evidence on record, as the Surveyor failed to consider the documents and materials furnished by the appellant that clearly established the actual loss to the extent of Rs. 39,55,000. The findings of the Surveyor, having been based on incorrect assumptions and incomplete verification, could not form a valid basis for determining the quantum of loss. The appellant had duly paid the insurance premium to the opposite party in accordance with the total sum assured, and as such, at the time of the fire incident, the entire stock and cash available in the shop stood insured. In the absence of any breach of policy FA/582/2017 Page 4 of 19 conditions on the part of the appellant, he is lawfully entitled to receive the full insurance amount as per the terms of the policy.
vi) The State Commission failed to appreciate that the respondent committed a deficiency in service by mechanically adopting the surveyor's report without independently assessing the appellant's claim. In this regard, reference may be made to the judgment of the Hon'ble Supreme Court of India in New India Assurance Company Limited v. Pradeep Kumar (2009) 7 SCC 787, wherein the Court considered Section 64 UM(2) of the Insurance Act, 1938, and categorically observed that "while the assessment made by an approved surveyor is certainly important, such a report does not constitute the last and final word on the subject. The surveyor's report is neither conclusive nor binding upon the parties, and the insurer is expected to consider it as a basis or foundation for settlement of the claim, but must also take into account the other evidence and material placed on record". By failing to exercise independent judgment and simply relying upon the surveyor's report, the respondent has acted in clear disregard of its legal obligations, resulting in deficiency in service as contemplated under law.
vii) The National Commission in Oriental Insurance Co. Ltd. Vs. Shishir Khandelwal 2009 NO - 502 (NC) has held that when a survey report is based upon conjectures and probabilities, it cannot be accepted as conclusive evidence. Furthermore, in United India Insurance Co. Ltd. Vs. Sona Spice Pvt. Ltd. IV (2010) CPJ 95 (NC), it was reaffirmed that the surveyor's report, while important, must be scrutinized in light of all other evidence presented and cannot be treated as the sole determinant of the claim. Such reports, if found to be speculative or not supported by credible proof, should not be relied upon to deny or reduce the insurance claim.
5. Heard counsels for both the sides, Appellant broadly repeated his contentions as given under grounds in (para 4). The respondent on the other hand contended that the State Commission, after considering all aspects and records agreed with the FA/582/2017 Page 5 of 19 assessment of the loss made by Surveyor in the sum of Rs. 7,63,105.70/-. It is now settled law that an independent surveyor's report commissioned pursuant to Section 64UM of the Insurance Act, 1938, carries significant evidentiary weight and presumptive value. This presumption operates unless and until it is conclusively rebutted by the Appellant through cogent evidence, typically by leading an alternative expert report. The Appellant's mere castigation of the surveyor's findings, absent the tender of sufficient documentary evidence and records as demanded by the surveyor to verify the alleged loss, fails to command any credibility.
5.1 It is a well-settled principle of law that a bona fide decision taken by the insurer, based on the report of the independent surveyor appointed under Section 64UM of the Insurance Act, 1938, and construed in light of the policy's terms, conditions, exceptions, and exclusions, cannot be construed as falling within the purview of 'deficiency in service'.
5.2 The insured cannot claim anything beyond the scope of coverage provided by the insurance policy, which is subject to its terms, conditions, exceptions, exclusions, and warranties, and is contingent upon proof of loss via credible non fabricated evidence. The respondent has relied on Oriental Insurance Co. Ltd. Vs. Sony Cheriyan (1999) 6 SCC 451; United India Insurance Co. Ltd. Vs. Marchand Rai Chandan Lal (2004) 8 SCC 644; Vikram Greentech (I) Ltd. & Anr. Vs. New India Assurance Co. Ltd. IT (2009) 5 SCC 599; Suraj Mai Ram Niwas Oil Mills Vs. United India Insurance Co. Ltd.(2010)10 SCC
567. In the instant case, the Learned State Commission correctly relied upon the credible surveyor's report, having rightly discarded the Appellant's unsubstantiated averments. The surveyor's report is entitled to be treated as sacrosanct, absent proof to the contrary.
6. The State Commission has considered the rival contentions of the parties at length in its order. Extract of relevant paras of the State Commission's order is reproduced below:
FA/582/2017 Page 6 of 199. l/l/e have heard learned counsel appearing for both the parties and have also perused the documents filed by them in the complaint case.
10. It is admitted that the complainant has obtained insurance policy from the O.P. The policy obtained by the complainant is Shopkeepers Package Policy, which was effective for the period from 21.07.2014 to 20.07.2015. According to the policy, Fire & Allied Perils Building and/ or contents are insured for Rs.52,00,000/-, for Burglary and Robbery sum insured is Rs.53,00,000/-, for money the sum insured is Rs.1,00,000/- and for public liability the sum insured is Rs.10,000/-. Thus total sum insured is Rs.1,06,10,000/-.
11. The complainant pleaded that on 29.11.2014, the incident of fire occurred in the shop of the complainant due to which entire goods kept in the shop were damaged. The complainant has filed a written report dated 01.12.2014(document A-2) made to Station House Officer, Police Station, Goie Bazar, Raipur (C.G.) regarding incident of fire in the shop of the complainant. The complainant also sent intimation to Municipal Corporation, Raipur regarding the incident. The complainant deposit a sum of Rs.9890/-
with Fire Brigade Department of Municipal Corporation, Raipur in respect of charges of extinguishing fire in the shop of the complainant.
12. The O.P. has filed copy of Survey Report dated 30.07.2015 of Shri Sanjeev Soni, S. Son! & Co., Surveyors, Loss Assessors and Investigator. In para 6.0 of the interna! page No.3, there is mention regarding the incident in para 10.0 of the Survey Report, the Surveyor mentioned:
"The probable cause of fire as per different sources and as per our X observations has been summarized as under:-
As per fire brigade report: As per fire brigade report, the cause of loss was due to short circuit.
As per witness statement: As per witness statement, the cause of loss was due to short circuit.FA/582/2017 Page 7 of 19
As per our observations: During the course of survey, it has been noticed that the wiring of the ground floor had been got melted. Considering the same we are of the opinion that the cause of toss might be due to short circuit which is accidental in nature and well covered under the policy."
13. Looking to the report of the Surveyor, it appears that the incident of fire in the shop of the complainant took place due to short circuit, which is accidental in nature. The incident was duly covered under the policy.
14. The complainant has pleaded that due to incident of fire in the shop, he suffered loss of Rs.39,55,000/-. The complainant has filed Audit Reports of M/s. Life Style for Financial Year 2011-2012 (document A-12), for Financial Year 2012-13 (document A-13) and for Financial Year 2013-14 (document A-14). The complainant has also filed copy of Income Tax Return Verification forms for Assessment Year 2013-14 (document A-15) and Income Tax Return Acknowledgement for Assessment Year 2014-15 (document A-16). The Surveyor mentioned in his report that he verified the records, physical inventory of stock, current year verification, opening stock, purchases, direct expenses, sales, vat return etc.' and assessed the loss to the tune of Rs.7,63,105.70.
15. The report of the Surveyor, is reliable evidence, therefore, the Surveyor's report is genuine and dependable. The report of the Surveyor can be given due weightage and it cannot be discarded lightly. The report of Surveyor is acceptable. We do not find any reason to discard the report of Surveyor.
16. In National Insurance Company Limited Vs. M/s. Krishna Industries, 2017 fl) CPR 102(NO Hon'b/e National Commission, has observed that "Report of Surveyor or Investigator cannot be discriminated."
17. In Devendra Malhotra Vs. United India Insurance Co. Ltd. & Anr. 2016 (3) CLT525(NO, Hon'b/e National Commission, has observed thus:-
FA/582/2017 Page 8 of 19"Consumer Protection Act, 1986, Sections 2 (1) (g), 19 & 21 (a) (ii)- Insurance claim Surveyor report Heid 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."
18. In Oriental Insurance Co. Ltd. Vs..Pavan Enterprises & Anr. I (2016) CPJ 503 (NO, Hon'bie National Commission has observed thus:-
"12. I see no reason to discard the report of the Surveyor. He appears to be a guideiess 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 Lai OH Mills Ltd. & Ors., 2014 (SLT Soft) 1- 2024(CPJ) Soft) 1 (2000) 10 Supreme Court Cases 19 and in D.N. Badoni v. Oriental Insurance Co. Ltd.,1(2012) C.P.J272(NC):"
19. In New India Assurance Co. Ltd., vs. Pave Infrastructures Pvt. Ltd., 2015(3) CPR 577(NO, Hon'bie National Commission has observed that "Loss of assessment by approved Surveyor can be discarded only on cogent reasons"
20. In Garg Acrylics Ltd.. Through Sh. Anish Bansa! G.M.CGM.) Authorised Representative ys. United India Insurance Co. Ltd.. 2015 (1) CPR 273 (NO, Hon'ble National Commission has observed thus-
"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 Lai Oil Mills Ltd. & Ors. (2000) 10 Supreme Court Cases 19 & in D.N. Badoni Vs. Oriental Insurance Co. Ltd. 1(2012) C.P.J. 272(NC)".
21. In The Oriental Insurance Co. Ltd., Through its Regional Manager vs. Ishwar Singh, 2015 (1) CPR 157 (NO Hon'bie 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 FA/582/2017 Page 9 of 19 one should have sufficient grounds not to agree with the assessment made by them"
22. The Surveyor assessed the loss on the basis of verification of records, physical inventory of stock, bank account statement, current year trading account etc. On the basis of above records, the Surveyor reached to the conclusion that the complainant has suffered loss only to the tune of Rs.7,63,105.70. The Surveyor gave detailed reasons in his Survey Report for assessing the loss. The report of the Surveyor is genuine and acceptable. The complainant has not filed any evidence, on the basis of which Surveyor's report can be discarded or doubted, therefore, the Surveyor Report is acceptable. Therefore, on the basis of the Survey Report of the Surveyor, the complainant is only entitled for Rs.7,63,105.70 (Rupees Seven Lakhs Sixty Three Thousand One Hundred Five and Seventy Raise) and the sum of Rs.7,63,106/- was already deposited by the O.P. in the bank account of the complainant through N.E.F.T. and the complainant has signed the Discharge Voucher(document A-24), therefore, the complainant is not entitled to get any more amount than Rs.7,63,106/
23. Therefore, the complaint filed by the complainant against O.P., is liable to be dismissed, hence the same is dismissed. Parties shall bear their own costs 7„ In the present case, against a claim of Rs.39,50,000/-, the Surveyor, as per his report dated 30.03.2015, has assessed the loss as Rs.7,36,105/-. As per the report, the sum insured is as follows:
TYPE OF POLICY SHOPKEEPER PACKAGE INSURANCE POLICY Fire and Allied Perils stock Rs.52,00,000.00 in trade SUM INSURED Burglary/House Breaking Rs.53,00,000.00 Money Insurance Rs. 1,00,000.00 Public liability Rs.10,000.00 Some of the Important observations of Surveyor in the Report are as follows:
• As per fire brigade report, the cause of loss was due to short circuit.FA/582/2017 Page 10 of 19
• As per police intimation given by the insured on 01.12.2014, the stock of around 70 to 75 lakh and furniture & fixture of around 25-30 lakhs had got damaged.
• The firm is maintaining its books and records such as purchase and sales ledger, party ledgers etc. on computerized method, the books and records of the firm are audited every year. The insured had provided copy of audited balance sheets for the last 3 years i.e. 2011-12, 2012-13 and 2013-14, insured is submitting stock statement to Karnataka Bank on monthly basis and has been enjoying a bank limit, the annual turnover of the firm is around Rs.4.5 crore.
The extract of relevant paras of the Surveyor's report are reproduced below:
"12.0 PHYSICAL INVENTORY OF STOCKS:
After our appointment, we visited the insured's premises on 04.12.2014 to 05.12.2014 and conducted the survey. During the course of survey we have arranged photographs of the damaged premises. On inspection of the premises it had been noticed that the complete stock of cosmetics store at ground floor and stock of sweets stored at first floor had been got damaged due to fire and heat of the fire. The cosmetics stocks glass bottles had been got busted due heat of fire. The tubes of cosmetics also got melted. The sweets i.e. chocolates and other sweets products had been got damaged due to heat and water used extinguishing the fire. Forjoint physical verification of the damaged stock asked the insured to arrange the labour who segregate the damaged bottles and tubes of cosmetics from the buried debris and the same was arranged by the insured and joint physical inventory of the damaged stock was carried out.
13.0 CURRENT YEAR VERIFICATIONS:
We conducted the following current year verifications for preparing Trading Account for the current period till the loss date i.e. from 01.04.2014 to 29.11.2014 12.1 OPENING STOCK:
The insured has provided us the copy of Audited Balance Sheet of the previous year ending 31.03.2014. On verifying the same we have found the amount of dosing stock to be Rs.8423205.00 FA/582/2017 Page 11 of 19 122 PURCHASES:
The insured provided us the ledger accounts prepared on computerized format for the current period up to the date of loss i.e. 29.11.2014 along with the duplicate purchase bills. We have verified the purchase ledger accounts with the purchase bills and found that the purchases have been entered in the purchase ledger account properly. On verification it has been noticed that the purchases as per ledger comes to Rs.26896695.88 and but on comparing the purchases with the bank account statements for the last six months it has been noticed that no payment had been made through bank.
12.3 DIRECT EXPENSES:
The direct expenses of the current period which includes, freight, saiar/shop & godown rent, transporting and repair and maintenance expenses which comes to Rs.1727797.99 as per ledger and the same has been considered for preparing the Trading Account.
12.4 SALES The insured provided us the Sales Ledger Account for the current period upto the date of loss i.e. from 01.04.2014 to 29.11.2014 but failed to provide the sales bills and insured declared that as the laptop which have sales data had been got burnt in the fire. Hence the same could not be verified. On verification of sales ledger and comparing the same with bank account statement it has been noticed that no payment was received from the creditors in the bank account statements. As the insured failed to provide the sale bills hence the authenticity of the purchase could not be verified.
12.5 VAT RETURNS We asked the insured to provide us the copies of VAT returns and the same has been provided by the insured. On verification of the same it has been noticed that VAT returns had been filed on online on dated 27.02.2015 i.e. after the date of loss and the same has been detailed as under:
VA Treturn for the period 01.04.2014 to 30.06.2014 Turnover 2868588.00 VA T returns for the period 01.07.2014 to 30.09.2014 1436417.00 VA Treturn for the period 01.10.2014 to 31.12.2014 22692089.00 From above it has been noticed that there is huge difference between the turnover of first two quarters and third quarter. The same has been got clarified from the insured and in this regard the insured clarified that in that quarter sales gone on higher due to festival season i.e. Diwali etc. FA/582/2017 Page 12 of 19 Further to this as explained above it has been explained that the VA T returns of all the quarters had been filed after approximately three months of loss, hence the same could not considered as authentic.
12.6 BANKACCOUNT STA TEMENT We asked the insured to provide us the bank account statements for the last six months and the same have been provided by the insured. On verification of the bank account statements i.e. Punjab National Bank and State Bank of India it has been noticed that the both accounts opened in the name of Mr. Narendera Girepunje. No account had been opened in the name of M/s Life Style.
Further on verification of the bank account statements it has been noticed that no payments against purchase had been made to the purchasers and no payments had been received from the creditors.
14.0 CURRENT YEAR TRADING ACCOUNT:
From above verifications of records, it has been verified that the books and records provided by the insured could not be considered as authentic. Further to this on verification of the policy it has been noticed that risk coverage of stock has been taken for the stock of Cosmetics only but during the course of survey it has been noticed that the insured is also in the business of Trading sweet and stationary also. The same aspect has been also verified from the purchase bills, as some of the purchase bills pertains to sweets products and some ofpapers, hence considering this the calculation of stock pertaining to cosmetics could not be identified/calculated on the basis of books and records and the toss could not be calculated on Trading account method.
15.0 BANK STOCK STATEMENT The insured is submitting Bank Stock statement with the Bank regularly and provided us the stock statements for the period 01.04.2014 to 30.06.2014 and from 01.08.2014 to 30.10.2014 which has been detailed as under:
Month Opening Sales in Purchase Closing
stock in iacs in iacs stock in
iacs iacs
April, 2014 94.00 41.00 45.00 98.00
May, 2014 98.00 38.00 30.00 90.00
June, 2014 90.00 40.00 45.00 95.00
FA/582/2017 Page 13 of 19
Aug, 2014 75.00 36.00 55.00 94.00
Sep, 2014 94.00 24.00 45.00 105.00
Oct, 2014 75.00 35.00 55.00 95.00
From above details it has been noticed that the bank stock statements had been submitted hypothetically basis which has been proved by comparing the dosing stock of stock statement of Sep, 2014 in which dosing stock is of 105 iacs whereas in the statement of Od, 2014 the opening stock has been shown as75.00iacs.
Further to this on verification of the audited balance sheet the dosing stock is 8423205.00 but on verification of the statement of April, 2014 it has been declared as Rs.94.00/acs which also proves that the Bank Stock Statements submitted on hypothetically basis Further to this on comparing the sales as bank stock statement with sales as per VAT returns it proves that sales of first quarter as per bank stock statement is 119.00 iacs whereas as per VAT return of first quarter the sale is 2868588.00 From above verifications it proves that the bank stock statements submitted with the bank are not authentic, hence loss on the basis of Bank Stock Statement basis could not be considered.
16.0 ASSESSMENT OF LOSS We asked the insured to provide us the stock register but insured declared that he is not maintaining any stock records.
As explained above that the books and records maintained and provided by the insured are not authentic, hence we have only one option to calculate the loss on joint physical verification method.
17.0 BASIS OF VALUA TION OF DAMAGED STOCK:
For valuation of the damaged stocks, we have considered the purchase bills provided by the insured and we calculated weighted average rates itemwise of the damaged items which could be identified physically on the basis of purchase bills which has been detailed as per annexure IA For calculation of quantity of Damaged Stocks, we carried out joint physical verification of the damaged stock. During the physical verification of the damaged it has been noticed that some of perfume bottles have perfume but on spraying the same it has been noticed that essence of the perfume had been vanished by the heat of the fire. Hence the same had been declared as damaged.FA/582/2017 Page 14 of 19
For quantification we asked the insured to segregate the nozzles and pumps of the broken perfume bottles and plastic tubes of the cosmetics and then the same has been counted for the quantification of the damaged stock.
Further to this we have calculated the loss against identified items i.e. Deo and Perfume and added 10% value for the quantity which could not be verified physically in the value calculated physically. The calculation has been detailed as per annexure-IB which come to Rs.868148.20.
Further on verification of the debris it has been noticed that some of the items had been burnt completely and could not be identified. Hence for the calculation of the loss against the items could not be identified we have calculated the total purchase of the items for the period 01.10.2014 to 29.11.2014 which could be identified upto 90% during physical verification i. e.
empty bottles of Deo and Perfume and calculated the percentage of the quantity found physically as compared to the considered period. Further we added 10% of the quantity of those items which we identified 90% during our physical verification and calculated the 100% quantity damaged.
Further for calculating the damaged quantity of other items we against calculated the total purchase quantity of those items for the period 01.10.2014 to 29.11.2014 which could not be identified physically i.e. completely burnt and mix in debris. Then we multiplied the total purchase with the percentage quantity found physically and calculated the loss against the items which could not identified physically. The calculation has been detailed as per annexure-IC and the value of the same comes to Rs.673720.00.
Now we summarized the loss of cosmetics as under:
Loss of Deo and Perfume found physically 868148.20 Loss of other cosmetics on prorata basis 673762.30 Total loss of cosmetics 1541911.50 Further on verification of the policy it has been noticed that the policy taken from United India Insurance Co. Ltd. Covers the stock of confectionery and stationary etc. Hence the loss against confectionery has been calculated separately which has been detailed as per annexure-II which comes to Rs.417861.60 Considering we summarize the loss against stock as under:FA/582/2017 Page 15 of 19
Loss against cosmetics 1541911.50
Loss of other cosmetics on prorata basis 417861.60
Total loss of cosmetics 1959772.10
OTHER INSURANCE PARTICULARS
We asked the insured whether he have some other insurance policy covering the affected premises and in this regard the insured declared that the under subject premises has been also covered under the policy no 190501/48/13/34/00000532 for the period 05.12.2013 to 04.12.2014 of United India Insurance Co. Ltd. and the copy of the same has been provided by the insured. On verification of same it has been noticed that coverage of stock has been taken for the sum insured of Rs.50,00,000.00. Further on verification the coverage of stock is for the cosmetics, confectionery and other items, hence considering the same we have assessed the loss on prorate basis which has been detailed as under:
Sum Insured of Universal Sompo for cosmetics Rs.52,00,000.00 Sum Insured of United India for cosmetics, Rs.50,00,000.00 confectionery and stationary etc. Sum Insured of United India for cosmetics only Rs.5000000- 417861. 60=4582138.40 Therefore ratio of coinsurance against cosmetics 52: 45.82 stock is Therefore the Loss coshare of universal would 819662.40 be The co share loss of united would be 722248.60 18.0 DEAD AND SLOW MOVING FACTOR:
As the insured has been dealing in trading in whole sale hence considering the nature and type of business and fast moving the stock we have deducted 2% as deadstock and variation factor which is a reasonable deduction considering the nature of business of the insured.FA/582/2017 Page 16 of 19
19.0 SALVAGE:
Due to fire the entire stock of cosmetics and sweets had been got damaged. The glass bottles got busted and tubes got melted, hence in this case there is no salvage value.
20.0 CALCULA TION OF VALUE AT RISK:
As explained above it has been verified that the records maintained by the insured are unauthentic and the loss has been calculated on the basis ofjoint physical inventory conducted during the course of survey, hence for calculating Value at Risk we considered the value of damaged stock calculated as per annexure-1 i.e. Rs.962460.70. Further as there was no safe stock, hence Value at Risk has been calculated considering only the value of damaged stock which has been detailed as under:
Value of damaged stock as per annexure-I 819662.40 Less: Dead stock and Stow Moving factor @ 2% 16393.25 Value at Risk 803269.15 Sum Insured :Rs.52,00,000:00 Value at Risk :Rs.803269.15 Average Clause Nil 21.0 ASSESSMENT OF LOSS:
Gross Dead Stock & Salvage Value Average Net Loss
Loss Slow Moving Clause Assessed
Factor @2%
819662.40 16393.25 NIL NIL 803269.15
Less excess clause 40163.45
NET LOSS 736105.70
22.0 OUR OPINION:
In our opinion a loss of Rs.763105.70 is the fair indemnity to the insured and the same may be paid to the insured subject to terms and conditions of the policy and hypothecation clause.
This report is issued without prejudice."
FA/582/2017 Page 17 of 198. A perusal of the Surveyor's report, relevant extracts of which have been reproduced above, shows that the Surveyor has done a very detailed exercise in assessing the loss after due verification of the books of account produced by the insured. He has given very valid reasons for not accepting various books of accounts on face value. It is important to note the observations of the Surveyor that the purchases as per ledger comes to Rs.2,68,96,695/- but on comparing with bank statements for the last six months, it has been noticed that no payment had been made through bank. Similarly, on verification of sales ledger and comparing the same with bank account statement it has been noticed that no payment was received from the creditors in the bank account statements. The insured could not provide the sale bills, hence the Surveyor could not verify the authenticity. Surveyor also observed that the bank stock account statements had been submitted hypothetically, are not authentic, hence, loss on the basis of bank stock statements basis could not be considered. It is to be noted that the total loss assessed by the Surveyor is Rs. 15,41,911/-. It is because of insured having another policy with United India, which covers cosmetics as well in addition to chocolates/sweets etc. not covered in the present policy that the Surveyor has calculated the ratio of Co-insurance and loss Co-share of Universal Sompo as Rs.8,19,662/-, which after adjustments for dead stock 8i slow moving factor and excess clause comes to RS.7,36,105/-. Hence, in our considered opinion, Surveyor has done a very detailed exercise in assessing the loss in an objective manner and there is no reason to reject Surveyor's observations/recommendations. Hence, the State Commission was justified in accepting the Surveyor's report and coming to a finding of no deficiency in service on the part of Insurance Company and consequently dismissed the Complaint.
9. The surveyor's report is cogent and well-reasoned and the Appellant has not brought on record any material sufficient to discredit the said report. The documents relied upon by the appellant merely seek to establish that a loss has occurred and do not, in any manner; satisfactorily quantify the extent of the loss sustained. In these circumstances, the surveyor's report assumes evidentiary value FA/582/2017 Page 18 of 19 and can safely be treated as a credible and reliable basis for assessment of the loss. In this regard reference can be made to Khatema Fibres Ltd. Vs New India Assurance company Ltd.& Anr.(2021) SCC Online SC 818, that -
Consumer forum which is primarily concerned with an allegation of deficiency in service cannot subject the surveyor's report to forensic examination of its anatomy, just as civil court could do. Once it is found that there was no in adequacy in quality, nature and manner of performance of the duties and responsibilities of the surveyor, in a manner prescribed by the regulations as to their code of conduct and once it is found that the report is not based on adhocism or vitiated by arbitrariness, then the jurisdiction of the consumer Forum to go further would stop."
10. After careful consideration of the orders of the State Commission, other relevant records and the contentions of the Appellant Insurance Company, we are of the considered view that State Commission has passed a well-reasoned order and we do not see any reason to interfere with its findings. Accordingly, order of the State Commission is upheld and FA/582/2017 is dismissed.
11. The pending IAs in the case, if any, also stand disposed off.
Sd/- I
I
( DR. INDER JIT SINGH )
PRESIDING MEMBER
Sd/-
( DR. SUDHIR KUMAR JAIN, J.)
MEMBER
Shubhendra/jr/Court-3/AB
FA/582/2017 Page 19 of 19