State Consumer Disputes Redressal Commission
B. Sundararajan, S/O.V.Balu ... vs The Divisional Manager, New India ... on 27 November, 2013
BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI BEFORE : THIRU.A.K.ANNAMALAI PRESIDING JUDICIAL MEMBER
THIRU.S.SAMBANDAM MEMBER C.C.NO.11/2011 DATED THIS THE 27th DAY OF NOVEMBER 2013 Date of complaint : 29.10.2003 Date of order : 27.11.2013 B. Sundararajan, S/o.V.Balu Chettiyar, Proprietor, Door No.95 & 96 Car Street, M/s.R.Rajarajan Thiruvannamalai Town & District. Counsel for Complainant
-vs-
The Divisional Manager, New India Assurance Co.Ltd, No.106, Big Street, M/s.Elveera Ravindran Ist Floor, Thiruvannamalai 606 601.
Counsel for Opposite party The complainant filed a complaint before this Commission against the opposite party praying for a direction to the opposite party to pay a sum of Rs.75,35,710/- as failed to indemnify the losses suffered by the complainant and to pay Rs.22,00,000/-towards business loss to the complainant. This complaint coming before us for final hearing on 03.09.2013 and heard the arguments on either side this Commission made the following order:
A.K.ANNAMALAI, PRESIDING JUDICIAL MEMBER The complaint under Section 17 of the Consumer Protection Act.
1. The complainant filed this complaint claiming damages of Rs.97,35,710/- towards the value of the burglary jewels caused to complainant.
2. The brief fact of the complainant is as follows:-2-
The complainant is a sole proprietor of VBC Jewellers at Thiruvannamalai. The complainant has insured the jewels in the shop with the respondent insurance company since 1995. The policy has periodically renewed from time to time without any lapse. The policy taken by the complainant is classified as special perils policy and burglary policy.
3. The policy was renewed by the complainant for the period from 25.06.2009 to 24.06.2010 under policy No.713000/46/09/04/000/00015 and paid the premium of Rs.17,736/-
and the total value of the jewels insured by the opposite party for Rs.1,60,00,000/- and the opposite party issued receipt in this regard.
4. When the policy in force a burglary was committed in the complainants shop on 13.12.2009 and the complainant came to know about the burglary when the shop was opened on 14.12.2009 and the matter was intimated to the opposite party at 2.00pm on 14.12.2009 itself and intimated to the Town Police Station, Thiruvannamalai and a case was registered in Crime No.660/2009. The investigation was still pending and the case was pending in the Judicial Magistrate I, Thiruvannamalai. The complainant sent details about the burglary to the opposite party and the opposite party sent an assessor and taken the assessment of the jewels. The assessor of the opposite party had estimated the loss of the stolen jewels at Rs.75,35,710/-, but the opposite party failed to indemnify the losses suffered by the complainant which is clearly deficiency in service. The complainant sent notice on 10.1.2011. Inspite of repeated legal notices and reminders sent by -3- the complainant to the opposite party, but the opposite party failed to discharge the obligations. The complainant sent a legal notice on 19.10.2010, but the opposite party instructed the advocate to send a reply notice in order to wriggle out of the obligations. When the opposite party failed to indemnify the losses suffered by the complainant causing business losses to the complainant due to deficiency in service on the part of the opposite party. Hence, the complainant filed this complaint praying for a sum of Rs.97,35,710/- as damages caused to the complainant by the opposite party.
5. Version filed by the opposite party stating that the complainant has to prove that he had availed Special Perils Policy with the opposite party and the policy was renewed for the period from 25.06.2009 to 24.06.2010 for the sum assured of Rs.1,60,00,000/-. The opposite party has issued a policy for the period from 25.06.2009 to 24.06.2010 covering the stock of gold and silver jewels and gift items for a sum assured of Rs.1,60,00,000/-. The complainant did not informed the opposite party on the occurrence of the alleged burglary which was said to have occurred on 13.12.2009, but intimated the opposite party only 15.12.2009. Thus the complainant had violated the terms and conditions of the policy. However, an independent surveyor was appointed and issued the status report on 23.12.2009 and submitted the net assessed loss for Rs.8,72,550/-. The complainant had miserably failed to submit the documents called for by the independent surveyor and the police Investigation Report and Charge sheet and the Non traceable Certificate without which the opposite party was unable to process the claim.
-4-7. One Raj Mohan Chandra who was one of the witnesses to the First Information Report subsequently intimated the police authorities that the claim form dated 15.12.2009 submitted to the opposite party and sent a letter on 2.2.11 and 25.3.2011 and telegram on 27.12.2010 and sent to the police authorities and others stating that he was acquainted with the complainant and his son and the claim made them was false. Hence, there is no deficiency in service on the part of the opposite party. The opposite party sent reply notice on 17.11.2010. The opposite party cannot violate the rules laid down by the IRDA for the sake of the complainant and hence the claim cannot be processed without the relevant and necessary documents. There is no cause of action to maintain the complaint. The complainant is not entitled to any sum less the sum of Rs.75,35,710/- towards losses and Rs.22,00,000/- towards business loss, without any basis. Further, the complaint is to be dismissed for non joinder of necessary parties being the State Bank of India, Tiruvannamalai. Hence prayed for to dismiss the complaint with exemplary costs.
8. In the enquiry on the side of the complainant documents Ex.A1 to A14 and on the side of the opposite parties Ex.B1 to B17 were marked
9. The points for consideration are:
1.
Whether the complainant is entitled for the claim of Rs.97,35,710/- towards loss of value of jewels due to burglary ?
2. Is there any negligence and deficiency of service by the opposite party in not allowing the claim of the complainant under the policy coverage?
3. To what relief ?
-5-10. POINT NOS.1 & 2 :
The complainant having business in jewellery in the name of VBC Jewellers in Thiruvannamalai availed the Special Perils and burglary policy for the period from 25.6.2009 to 24.6.2010 under the policy for the value of Rs.1,60,00,000/- and by paying a premium of Rs.17,736/- and during the course of policy in force burglary was took place on 13.12.2009 in his shop which was reported to the opposite party on 15.12.2009 and it was intimated to the Town Police Station, Thiruvannamalai which was registered in Crime No.660/2009 and the case is still pending before the Judicial Magistrate I, Thiruvannamalai. After the occurrence, the opposite party appointed an investigator /Individual Surveyor who had submitted an Interim Survey Report by ascertaining the net loss of Rs.8,72,550/-. The opposite party inspite of the same did not entertain the claim of the complainant and closed the same under Ex.B13 dated 11.1.2011 in which stating that they cannot keep the file open indefinitely and close the file as No claim. If they do not receive police report and the Non-traceable Certificate etc within 15 days from the date of this letter and also alleged that in view of one letter received from Raj Mohan Chandra, Thiruvannamalai, dated 16.3.2011 under Ex.B9 who was said to be the witness at the time of giving complaint by the complainant as per FIR copy under Ex.A10 & A11 the same witness sent a telegram under Ex.B11 alleging that the complainant had given false claim, claiming 4394 grams of gold jewels instead of actual theft of 800 grams of gold jewels which is one of the reasons for not accepting the claim of the complainant as per the policy report. From these details it -6- is clear that the opposite party somehow evading the claim of the complainant when the burglary taken place which is not disputed and proved since the police have also arrested some of the accused and recovered jewels to the extent of 1.870 kg of gold ornaments from the accused as per the Interim Survey Report under Ex.B17 and even though the police have originally closed the case without filing any charge sheet and in view of the Crl.OP.No. filed before the Honble High Court as per Ex.A14 for re-investigation and thereby still the matter is pending before the Criminal court. The opposite party contended that unless final report or non traceable certificate issued from the police the claim cannot be entertained as against the terms and conditions of the policy. But on perusal of the policy under Ex.A1and A2, no such specific terms are found in the policy covered and the policy is taken for Rs.1,60,00,000/- on stock / stock in trade of all kinds of Gold & silver jewels and Gift and paid premium of Rs.17,736/- subject to BP clause as attached and the insurance under the policy is subject to warranties & clauses (as per forms attached) is extended to cover risks of as per forms attached. Description of Risk on stock of Gold & silver ornaments items. As per Ex.B3 terms and conditions of the policy under Exclusion clause, the complainant not entitled for Gold or Silver articles if not specifically insured. In their case the complainant specifically insured Gold and Silver articles. Regarding the claim procedure under the head of Fraud it is stated if any claim under this policy shall be in any respect fraudulent means or device are used by the insured or any one acting on the insureds behalf to obtain any benefit -7- under this Policy, all benefits and rights under the policy shall be forfeited. No where it is mentioned that only on production of final report and non traceable certificate from the police which is not applicable in this case since the police have arrested some person and part of the stolen jewels were recovered and investigation is still pending and thereby the complainant is entitled for the claim. It is clear that further the complainant has already filed the newspaper advertisement relating to the rebel witness Raj Mohan Chandra under Ex.A12 and in which newspaper same persons who is said to have acted as false advocate by impersonation threatened the Magistrate in the Magistrate Court at Thiruvannamalai and it seems that the witness in order to get some monetary benefits or otherwise by way of blackmail claiming some benefits acted adversely. But the complainant seems to have sent a telegram and letter under Exs.B10 & B11 and the contents of the letters are not proved by the opposite party with supporting materials when the Interim Survey report is based under Ex.B17 after having Ex.B6 dated 23.12.2009 as status report in which estimate of loss estimated for Rs.67,33,181/-. Further since the value of jewels for insured for Rs.1,60,00,000/- at the time of loss, but actual value worked out at risk for Rs.6,82,60,473/- and thereby there was under
valuation to the extent of 76.56%. As per the Interim Survey report under Ex.B17 the Loss due to burglary of jewellery 4.182.100 gms recovered by the police shown as 1,870.000 grams and thereby the net loss was shown as 2,312.100 grams and which was worked out at book stock of silver as on 13.12.2009 for 4,92,548 Gms and value for the same rate per gram Rs.1,610/- per gram which was worked out for Rs.5,33,85,523/- and -8- including total value for the jewellery at risk with silver articles as for Rs.6,82,60,473/-. But the insurance was made only for Rs.1,60,00,000/- and thereby Value of jewellery Lost was assessed for Rs.37,22,481/- for which under insurance of 76.56% worked for Rs.28,49,931/- and thereby the net assessed loss for Rs.8,72,550/- arrived at which is to be considered as claim amount payable by the opposite party on the basis of the policy. The surveyor report also stated that there was a similar burglary taken place during the year 2004 to the extent of 4.5.kgs gold for which the case is pending with the Human Rights Commission which is supported by the complainants document under Ex.A13 order passed by the Human Rights Commission in which against the certain police officers the complainant made allegations relating to the previous in the year 2004 in which the misdeeds and harassment human violation are all alleged by the complainant and the Human Rights Commission recommended certain reliefs to the complainant including compensation of Rs.10,00,000/- payable by the Government to the complainant. When such are the facts and materials available in view of the complainant except the allegations of violation of insurance policy in other respects nothing was elicited by the opposite party and simply with the bald reasons the claim was not entertained, even though the complainant claimed a sum of Rs.97,35,710/- towards alleged loss of jewellery in view of the surveyor report under Ex.B17 such loss was estimated to the value of the jewellery of the stock as on the date of burglary for Rs.5,33,85,523/- for which under value of 76.56% was worked out which come to Rs.37,22,481/- and after deducting the value of gold recovered -9- by the police and total net assessed was worked out for Rs.8,72,550/- which is payable to the complainant on the basis of policy coverage. The opposite party relied upon the ruling in this regard reported in III (2009) CPJ 90 (SC) in the case of Sikka Papers Limited vs- National Insurance Company Ltd & Ors in which it is observe as follows :
(ii) Insurance under-insurance Machinery purchased for Rs.45,25,000/- insured for Rs.35,00,000 Under-insurance of machinery proved-Contention, under insurance, if any, must be calculated at time of issuance of policy-Contention not acceptable-Value of item declared by insured at time of issuance of policy Element of under insurance calculated by insurer at time of assessment of loss-Sum assured, if less than amount required to be insured, insurer will pay in such proportion as sum insured bears to amount insured Prorate formula applied by Surveyor 25.71% deducted from loss assess as under insurance Deduction justified No relief entitled.
But the above ruling is not applicable to the case on hand. Since the opposite party failed to settle even that amount as the claim within the reasonable time and even after more than two years from the date of claim and the same is amounts to negligence and deficiency of service and thereby the complainant is entitled for the justifiable compensation also for the same. Accordingly these points are answered.
11. POINT NO.3 : In view of the findings in Point Nos 1 & 2 in favour of the complainant and the complainant is entitled for Rs.8,72,550/- as insurance claim amount towards the burglary of jewellery from the shop and since the claim is not -10- entertained by the opposite party and the same shall be paid with 6% interest from the date of complaint and as far as the compensation is concerned for the deficiency of service in view of the facts and circumstances of the case, since the complainant was unnecessarily harassed in settling the claim and we are inclined to award a sum of Rs.75,000/- as compensation for mental agony due to deficiency of service and another sum of Rs.10,000/- towards costs and answer this point accordingly.
13. In the result, the complaint is allowed. The opposite party is directed
1. to pay a sum of Rs.8,72,550/- to the complainant towards the claim under the Special perils and burglary policy with 6% interest from the date of complaint till the date of realisation. Further the opposite party is entitled to obtain necessary documents like Indemnity bond , undertaking if any in this regard from the complainant.
2. Opposite party is directed to pay a sum of Rs.75,000/- as compensation to the complainant for mental agony and for deficiency of service by the opposite party and
3. to pay a sum of Rs.10,000/-
as costs to the complainant.
4. The above directions shall be complied within a period of 2 months from the date of this order.
S.SAMBANDAM A.K.ANNAMALAI MEMBER PRESIDING JUDICIAL MEMBER -11- LIST OF DOCUMENTS FILED BY THE COMPLAINANT:
Sl.No Date Description Ex.A1 24.06.2009 Photo copy of the Insurance policy taken by the complainant with the opposite party Ex.A2 24.06.2009 Photo copy of the Insurance policy taken by the complainant with the opposite party Ex.A3 15.12.2009 Photo copy of the covering letter addressed to the opposite party by the complainant Ex.A4 15.12.2009 Photo copy of the claim form Ex.A5 19.10.2009 Office copy of the notice issued by the complainant to the opposite party Ex.A6 13.11.2010 Office copy of the rejoinder issued by the complainant to the opposite party Ex.A7 17.11.2010 Photo copy of the reply notice of the opposite party Ex.A8 10.01.2011 Photo copy of the second legal notice issued to the opposite party Ex.A9 13.01.2011 Photo copy of the acknowledgement card Ex.A10 14.12.2009 Copy of FIR Ex.A11 20.01.2011 Copy of the FIR Ex.A12 03.06.2011 Copy of the News paper Ex.A13 27.07.2009 Copy of the order made by the Human Rights commission Ex.A14 09.09.2009 Copy of the order passed by the Honble High Court, Madras LIST OF DOCUMENTS FILED BY THE OPPOSITE PARTY:
Ex.B1 26.06.2009 Copy of Policy of Insurance Ex.B2 26.06.2009 Copy of Policy of Insurance Ex.B3 Copy of Terms and conditions of the policy Ex.B4 15.12.2009 Copy of Claim Form Ex.B5 17.12.2009 Copy of letter sent by the Investigator to the complainant Ex.B6 23.12.2009 Copy of Status Report Ex.B7 17.11.2010 Copy of Reply notice Ex.B8 02.02.2011 Copy of letter sent by Raj Mohan Chandra -12- Ex.B9 16.03.2011 Copy of letter sent by Raj Mohan Chandra Ex.B10 25.03.2011 Copy of letter sent by Raj Mohan Chandra Ex.B11 27.12.2010 Copy of Telegram sent by Raj Mohan Chandra Ex.B12 24.08.2010 Copy of Letter sent by OP to complainant Ex.B13 11.01.2011 Copy of letter sent by OP to complainant Ex.B14 Copy of Acknowledgement for Documents No.13 Ex.B15 30.03.2011 Copy of letter sent to Inspector of Police & Superintendent of Police Ex.B16 Copy of Acknowledgement cards Ex.B17 23.05.2011 Copy of Interim Survey Report S.SAMBANDAM A.K.ANNAMALAI MEMBER PRESIDING JUDICIAL MEMBER INDEX ; YES / NO VL/D/PJM/ORDERS