State Consumer Disputes Redressal Commission
M/S Kunal Rice Mills vs The New India Assurance Co. Ltd. & Ors. on 8 May, 2015
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH.
Consumer Complaint No.145 of 2013
Date of Institution: 06.12.2013
Date of Decision: 08.05.2015
M/s Kunal Rice Mills, Julka Nagar, Batala Road, Qadian, District
Gurdaspur through its sole proprietor Mr. Ukesh Kumar son of Sh. Brij
Mohan.
.......Complainant
Versus
1. The New India Assurance Company Limited through its National
Manager, Registered & Head Office, New India Assurance
Building, 87, M.G. Road, Fort, Mumbai- 400 001
2. The Regional Manager, The New India Assurance Company
Limited, Division Office, 80, Court Road, Amritsar- 143 001
3. The Branch Manager, The New India Assurance Company
Limited, Branch Office, SCF 179-180, Jalandhar Road, Batala-
143 505.
........Opposite Parties
Consumer Compliant U/s 17 of the
Consumer Protection Act.
Quorum:-
Hon'ble Mr. Justice Gurdev Singh, President
Shri Baldev Singh Sekhon, Member
Present:-
For the complainant : Sh. Vishal Aggarwal, Advocate For the opposite parties : Sh. R.C.Gupta, Advocate .............................................. BALDEV SINGH SEKHON, MEMBER This complaint has been filed by the complaint M/s Kunal Rice Mills, through its sole proprietor Sh. Ukesh Kumar son of Sh. Brij Mohan, under Section 17 of the Consumer Protection Act, 1986 on the 2 CC No. 145 of 2013 averments that the complainant had taken two Insurance Policies i.e. one against 'Standard Fire and Special Perils' and second against Burglary, from opposite parties (in short 'OPs') vide Policy No.360503/11/10/11/00000178 and Policy No. 360503/46/10/04/00000129, which were valid for the period 2.11.2010 to 1.11.2011, for a total sum insured of Rs.6,00,00,000/- (Rs. Six Crore) against payment of premium of Rs.66,180/- and Rs.23,163/-, respectively. It was explicitly mentioned in the policy cover note under the Head "Description of Risk" that the policy covers the risk upto Rs.6,00,00,000/- on stock of paddy of all kinds, either for self or of Govt. agencies, lying in open compound belonging to the Insured, under lien of the OP No.3- Bank situated at the back side of Truck Union Batala Road, Qadian. It was pleaded that on 7.2.2011, the paddy stock of the complainant got rain affected, damaged and discoloured due to heavy rain & storm, which also damaged new bags containing paddy. He intimated the loss to OP No.3 through telephonic message and even through Registered Letter dated 14.2.2011 and submitted Certificate issued by the Sarpanch of the concerned area. Thereafter, he received a letter dated 17.2.2011 from OP No.3 asking him to submit estimated loss. Subsequently, he received another letter dated 26.2.2011 from OP No.3 asking him to submit the Certificate of Storm & Heavy Rain from the Meteorological Department confirming that the storm & heavy rain occurred on the date of loss, alongwith newspaper cuttings confirming the same. No surveyor was appointed till 28.2.2011 to assess the loss. Rather OP sent one letter after another in order to delay or confuse the claim. As OP was well aware that goods, which were insured, were of 3 CC No. 145 of 2013 perishable in nature, especially when these were in-undated in water for long period. Finally, after a gap of about 27 days, OP appointed a Surveyor, who visited his premises on 3.3.2011. He inspected the site and verified the loss caused to the stock of paddy. On being satisfied, the Surveyor asked complainant to submit the claim form alongwith other documents, which were duly submitted by him. When his claim was not settled, inspite of submitting all the relevant documents, he served a legal notice dated 12.5.2011 upon the OPs to sanction the claim to the tune of Rs.89,70,640/-. In reply, OP rejected his claim vide letter dated 20.6.2011, being premature. In the meanwhile complainant again suffered a loss on account of heavy rain and storm that occurred during the night of 16.6.2011, and the custom milling paddy of Markfed was damaged. He submitted a Certificate from the Sarpanch of the concerned area and asked OPs to appoint a Surveyor to ascertain the fresh loss, vide letter dated 17.6.2011. Thereafter, vide letter dated 17.6.2011, he informed OPs about the estimated loss suffered by it on account of the heavy rain and storm that occurred on 7.2.2011 as well as on 16.6.2011. Further, vide its letter dated 17.6.2011, he asked Markfed to lift the remaining paddy so that further damage could be avoided. OPs appointed Aditi Consultant Pvt. Ltd. as Surveyor to assess the loss/damage to the stock of paddy due to storm and rain that occurred on 16.6.2011. The said agency, through its letter dated 20.6.2011, asked him to furnish certain documents, alongwith claim form. The complainant, vide its letter dated Nil, submitted claim form and gave para-wise reply to the queries raised by surveyor. He also informed OPs about the sale of remaining paddy, vide letter dated 4 CC No. 145 of 2013 25.6.2011 as the segregation of paddy become impracticable. The same could not even be delivered to FCI, being of lower quality than the minimum standard. The risk of perishing of the remaining paddy getting higher with each passing day, it cautioned the FCI. The surveyor admitted the loss to the tune of Rs.77.28 lacs, vide its letter dated
2.7.2011. The complainant further provided all the documents pertaining to the loss including report obtained from Regional Research Centre (PAU) Gurdaspur, Balance Sheet for the financial year 2011- 2012, Profit & Loss Account as on 31.03.2012 and Manufacturing & Trading Account, including List of Sundry Creditors as on 31.3.2012. He even got 'No Objection Certificate' from the Markfed after making good the loss suffered by Markfed from his own pocket. However, OPs pressurized him to accept an amount of Rs.13,45,220/- + Rs.9,86,041/- = 23,32,261/- as full and final settlement. But, he refused to accept this amount and requested OPs to pay the full claim. No discharge voucher was signed by him nor any consent was given to accept the lesser payment as full and final settlement. After that, OPs transferred the amount of Rs.23,32,261/- unilaterally in his account through RTGS. Thereafter, the complainant approached OPs time and again to make the payment of remaining amount of claim, but it kept on making false excuses and ultimately refused to make the payment of the remaining amount. Another legal notice dated 18.7.2013 was got served upon the OPs to release the remaining amount. OPs, repudiated the remaining claim, vide reply to the notice dated 20.8.2013. Complainant sought directions to the OPs to release the amount of Rs.85,30,311/-, alongwith penal interest from the date it had fallen due till realization. 5 CC No. 145 of 2013 Compensation to the tune of Rs.50,000/- was also prayed for litigation expenses, mental agony and harassment.
2. Upon notice, OPs contested the complaint and filed joint written reply taking the preliminary objections that the matter involves complicated questions of law besides disputed facts and hence the same cannot be decided in summary proceedings under the Consumer Protection Act. It was also pleaded that the complainant is a commercial entity and therefore, does not fall under the definition of "Consumer" as provided under the act. The complainant himself delayed the proceedings by not submitting the documents in time. As per the assessment made by the independent and experienced Surveyor and Loss Assessor, the competent authority on the basis of consent letter executed by the insured, made payment of the agreed sum and remitted the amount to the account of the complainant, which stood accepted by him in full and final settlement of his claim for both the occasions. Hence, the present complaint is not tenable and liable to be dismissed. As per the law laid down by Hon'ble Supreme Court in case of Ajmer Singh Cotton Mills to maintain the complaint, the insured has to establish that the insurance company committed fraud, mis- representation etc. to make them agree for the amount as full and final settlement. There is no such allegation either in the complaint or in the documents. The complainant has set up his case of two different losses on account of flood/rain and different stocks was said to be have damaged thereof. Hence a common complaint for the two alleged cause of actions cannot be maintained. It was further pleaded that in case it is proved on record that there exist any other policy of insurance 6 CC No. 145 of 2013 with respect to the complainant and the damaged articles, then their liability cannot be more than its share of pro-rata apportionment to be contributed by all the insurers as per the coverage granted subject to the terms and conditions and exceptions of the same. It was admitted that a standard fire and special perils policy was subscribed by complainant. The terms and conditions of the contract were conveyed to the insured and the same was understood by him. He himself was responsible for delayed submission of estimates and other inputs, due to which, appointment of Surveyor, as per the financial limits prescribed by the head office duly provided by IRDA and the provisions of Insurance Act, 1938, was delayed. It was admitted that intimation letter regarding both the losses was received but the same was subject to the assessment of Surveyor and acceptance of the liability by the insurance company. After obtaining reports from Surveyors, appointed in both the incidents of loss, an amount of Rs.23,32,261/- was found payable towards both the events and nothing more is to be paid. There is nothing on record to show that the insured submitted his dissent. Rather the consent letter had been executed happily with his free will while admitting the said amount as full and final settlement. No harassment whatsoever was caused by them to the complainant in any manner. Denying all other allegations, dismissal of the complaint was prayed.
3. In support of his contentions, the complainant tendered into evidence affidavit of Ukesh Kumar, Sole Proprietor of M/s Kunal Rice Mills, Gurdaspur as Ex.C-A alongwith documents i.e. copies of insurance policies as Ex.C-1 and Ex.C-2. Copy of intimation of loss dated 14.2.2011 as Ex.C-3, copy of certificate dated 8.2.2011 as Ex.C- 7 CC No. 145 of 2013 4, copies of letters from Ex.C-5 to Ex.C-7, copy of letter dated 5.3.2011 as Ex.C-8, copy of legal notice dated 12.5.2011 as Ex.C-9, copy of reply to legal notice dated 20.6.2011 as Ex.C-10, copy of intimation of second loss dated 17.6.2011 as Ex.C-11, copy of certificate as Ex.C-12, copies of letters from Ex.C-13 to Ex.C-17, copy of balance sheet dated 25.8.2012 as Ex.C-18, copy of profit and loss account dated 25.8.2012 as Ex.C-19, copy of trading account dated 25.8.2012 as Ex.C-20, copy of legal notice dated 18.7.2013 as Ex.C-21, copy of reply to the legal notice dated 20.8.2013 as Ex.C-22, copy of detail qua the paddy received as Ex.C-23, copies of site plans as Ex.C-24 and Ex.C-25, copy of weather report dated 7.2.2011 as Ex.C-26, copy of report and affidavit as Ex.C-27 (colly), copy of chart of delivery of rice as Ex.C-28, copies of bills as Ex.C-29 (54 bills), copy of letter dated 27.10.2011 as Ex.C-30 and closed the evidence.
4. The opposite parties tendered into evidence affidavit of Sh. A.L.Madan, Manager, New Indian Assurance Company Ltd., Chandigarh Ex.OP-A, affidavit of Mr. Sumant Sood, Surveyor dated 28.7.2014 Ex.OP-B, consent letter dated 22.9.2012 Ex.OP-1, disbursement payment voucher dated 4.1.2013 Ex.OP-2, RTGS Forum dated 28.1.2013 Ex.OP-3, Policy of Insurance Ex. OP-4, Survey Report dated 22.9.2012 Ex.OP-5, Survey Report dated 24.9.2012 Ex.OP-6, affidavit of Sh. Sanjay Kumar Narang, Director on behalf of Aditi Insurance Surveyors and Loss Assessors Ex.OP-C and closed the evidence.
8CC No. 145 of 2013
5. We have thoroughly gone through the pleadings of the parties and have carefully perused the evidence on the record and heard the learned counsel for the parties at length.
6. The admitted facts of the case are that the complainant took two Insurance Policies Ex.C-1 and Ex.C-2 from the OPs, which were valid for the period 2.11.2010 to 1.11.2011. While the first policy was a 'Standard Fire and Special Perils Policy', in which the sum insured was Rs.6,00,00,000/- covering the building stocks/contents while the second policy was against burglary for Rs.6,00,00,000/- The complainant has contended that during the subsistence of these policies, his stocks of paddy lying on the plinths in the open was damaged on two occassions due to heavy rains and storms that occurred firstly on 7.2.2011 and again on 16.6.2011. Intimation regarding the first loss was given to the OPs on 14.2.2011 vide letter Ex.C-3 and various documents in support of the claim, confirming that the paddy stocks of the complainant firm, stacked on the plinths were damaged on account of rain and heavy storm due to which the tarpaulins were damaged. Thereafter, OPs demanded various documents from the complainant vide letters Ex.C-5, C-6, C-7. Sh. Sumant Sood, Surveyor and Loss Assessor was appointed to assess the loss caused due to rains on 7.2.2011. He also asked the complainant to supply number of documents, vide his letter dated 5.3.2011 Ex.C-8; which were subsequently supplied. In the legal notice dated 12.5.2011 (Ex.C-9), served upon by the complainant through his counsel Sh. I.D.Singla, Advocate, upon the OPs, it was conveyed that 1,79,088 bags of paddy/rice were insured under the policy and due to heavy rain and inclement weather, 16926 bags were 9 CC No. 145 of 2013 damaged and further that he suffered a loss of Rs.82,93,610/- @ 1400/- per quintel. An amount of Rs.6,75,040/- was also claimed as loss to the Bardana (Gunny bags). Intimation about the damage caused to paddy belonging to Markfed Custom Milling was given to the OPs, vide letter dated 17.6.2011, Ex.C-11 and OPs appointed M/s Aditi Consultants Pvt. Ltd. as Surveyor to assess the loss/damage.
7. After conducting survey upon receipt of relevant documents, M/s Sumant Sood submitted the detailed survey report dated 22.9.2012, Ex.OP-5, assessing the loss caused to the complainant firm on 7.2.2011 as Rs.13,91,222/-. Similarly, M/s Aditi Consultants & Surveyor Loss Assessor Pvt. Ltd. submitted its final survey report dated 24.9.2012, Ex.R-6, in respect of the loss caused on account of rains on 17.6.2011, in which, the loss was assessed as 10,08,057/-.
8. The only dispute that remains to be settled between the parties is about the quantum of loss caused to complainant on two occasions. While the complainant claimed a loss of Rs.89,70,640/- vide legal notice dated 12.5.2011 (Ex.C-P) for the incidence dated 7.2.2011, the survey assessed the loss to the tune of Rs.13,91,222/-. Similarly for the incidence dated 11.6.2011, complainant filed a claim for Rs.1,71,70,337/- whereas, surveyor assigned the loss to the tune of Rs.10,08,057/-. Sh. Sumant Sood, in his detailed survey report (Ex.OP-
5) mentioned under the heading 'inspection' as under :
"INSPECTION : On first inspection of the Insured premises on 3.3.2011 it was observed that the Insured were storing paddy received from Markfed in the open rented Kacha land opposite 10 CC No. 145 of 2013 to their factory. The Paddy was seen to be stored on wooden crates with no under lining of tarpaulin, Only the top tarpaulin cover was reported to be provided. The land was reported to be rented (no rent deed provided). Tarpaulins were seen to be loosely lying on the stacks and some of the tarpaulins were also moved to side thereby exposing the stacks. The partial exposure of paddy stacks is carried out for airing the stocks. Some of the exposed sides of stacks were showing water marks and sprouting. The top layer was showing partial sprouting. This indicated that direct rainfall had fallen there-on; secondly, the weather reports does not indicate the storm conditions which can harm the normally covered stack. Weather reports of the Gurdaspur and Amritsar were taken to get an idea of Qadian as it falls in between. This leads us to the surmise that probably the Insured had partially exposed the stacks for airing and the rain had taken place unexpectedly causing the upper exposed area to get soaked leading to sprouting."
He has given detailed reasons for working out the loss so assessed by him.
9. M/s Aditi Consultants Pvt. Ltd, in its detailed Survey Report, Ex.R-6, pointed out that during visual inspection, it was noticed that lower layers of stacks had been wet and affected. He discussed the insured claim of Rs.1,71,70,337/- and finally assed the loss at Rs.10,08,057/-. It is further noted that Sh. Sumant Sood, in his survey report, has specifically mentioned that Mr. B.M.Julka, Manager of the 11 CC No. 145 of 2013 insured, visited their office on 22.9.2012 and gave his consent for both the losses (copy enclosed). The consent letter, which is given by complainant on the letter head of the insured, is proved as Ex.R-1, in which, B.M.Julka has accepted the net loss due to inundation at their open storage on 7.2.2011 and 16.6.2011 for Rs.23,99,279/- and details of the accepted amount is also mentioned under various headings.
10. It has been contended by the complainant that OPs pressurized him to accept the amount as full and final settlement but he refused to accept the said amount and requested the OPs to pay the full claim. Thereafter, the OPs transferred the said amount of Rs.23,31,262/- in his accounts through RTGS. Thus, same cannot be considered as full and final settlement.
11. Even though the complainant has stressed that the amount released by the OPs was not acceptable to him, yet he has not challenged the detailed survey reports Ex.OP R-5 and R-6. No grounds have been made out to dispute the amount so assessed by the surveyors. It is a settled law that the survey report, prepared by qualified surveyor duly approved by IRDA Surveyor, is an important piece of evidence and same cannot be ignored without any cogent reason. The complainant is merely stressing that he did not execute the discharge voucher to accept the released amount as full and final settlement. In the absence of any specific and cogent ground to challenge the surveyor's reports, same are to be relied upon. Accordingly, we find no reason to enhance the compensation released by OPs on the basis of the said survey reports.
12CC No. 145 of 2013
12. In view of the above discussions and findings, the complaint of the complainant is dismissed. No order as to costs.
13. The arguments in this complaint were heard on 23.04.2015 and the order was reserved. Now, the order be communicated to the parties.
14. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE GURDEV SINGH) PRESIDENT (BALDEV SINGH SEKHON) MEMBER May 08, 2015 KK 13 CC No. 145 of 2013