State Consumer Disputes Redressal Commission
M/S. Satyam Traders vs National Insurance Co. Ltd. on 12 January, 2011
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION
PANDRI, RAIPUR
Complaint Case No.74/2009
Instituted on 23.07.09
M/s Satyam Traders,
Pro. Shri Ramnarayan Agrawal,
Add. Nr. Mahesh Cold Storage,
Ruprella Compoundment, Bhanpuri,
RAIPUR (C.G.) ... Complainant.
Vs.
1. National Insurance Co. Ltd.,
Through Managing Director,
Registered Head Office, Midilton Street, Post Box No.9229,
KOLKATA
2. National Insurance Co. Ltd., Through : Branch Manager,
City Branch, 1 Naveen Market, G.E. Road,
RAIPUR (C.G.) ... Opposite Parties.
Complaint Case No.75/2009
Instituted on 23.07.09
M/s Shivam Jute Udyog,
Pro. Smt. Parwati Bai, W/o Shri Ramnarayan Agrawal,
Add. Nr. Mahesh Cold Storage,
Ruprella Compoundment, Bhanpuri, Raipur (C.G.),
Through : Power of Attorney Holder, Shri Akhilesh Agrawal,
S/o Shri Ramnarayan Agrawal, Samta Colony,
RAIPUR (C.G.) ... Complainant.
Vs.
1. National Insurance Co. Ltd.,
Through Managing Director,
Registered Head Office, Midilton Street, Post Box No.9229,
KOLKATA
2. National Insurance Co. Ltd., Through : Branch Manager,
City Branch, 1 Naveen Market, G.E. Road,
RAIPUR (C.G.) ... Opposite Parties.
Complaint Case No.76/2009
Instituted on 23.07.09
M/s Goyal Jute Udyog,
Pro. Shri Akhilesh Agrawal,
Add. Nr. Mahesh Cold Storage,
Ruprella Compoundment, Bhanpuri,
RAIPUR (C.G.) ... Complainant.
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Vs.
1. National Insurance Co. Ltd.,
Through Managing Director,
Registered Head Office, Midilton Street, Post Box No.9229,
KOLKATA
2. National Insurance Co. Ltd., Through : Branch Manager,
City Branch, 1 Naveen Market, G.E. Road,
RAIPUR (C.G.) ... Opposite Parties.
PRESENT: -
HON'BLE JUSTICE SHRI S.C. VYAS, PRESIDENT
HON'BLE SMT. VEENA MISRA, MEMBER
HON'BLE SHRI V.K. PATIL, MEMBER
COUNSEL FOR THE PARTIES IN ALL THREE COMPLAINTS: -
Shri S. P. Upadhyay, for complainant.
Shri Harshad Vyas with Shri R.D.S. Kashyap, for OPs.
ORDER
Dated: 12 /01/2011 PER: - HON'BLE SMT. VEENA MISRA, MEMBER This order will govern disposal of Complaint No. 74/2009 between M/s. Satyam Jute Udyog Vs. National Insurance Co. (the No. of earlier Complaint 20/2006); Complaint No. 75/2009 between M/s. Shivam Jute Udyog Vs. National Insurance Co. (the No. of Earlier Complaint 19/2006) and Complaint No. 76/2009 between M/s. Goyal Jute Udyog Vs. National Insurance Co. (the No. of Earlier Complaint 21/2006) because the dispute involved in all the aforesaid complaints is similar in nature and the surveyor also has given one report as all the claimant firms belong to one single family, and the stock of all the firms allegedly damaged was stored in one single godown. In this order facts of Complaint No.74/2009 are being mentioned.
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2. Complainant has filed present complaint under Section 17 (1) of Consumer Protection Act, 1986, seeking relief of compensation of Rs.49,99,800/- against OPs together with interest @ 18% p.a. from the date of claim till final payment.
3. It is worthwhile to mention that earlier this Commission dismissed the complaint on the principle of res judicata. The complainant had approached National Commission and the National Commission vide order dated 12.01.2010 allowed the appeal and directed this Commission to deal with the complaint in accordance with law. It was stated in the order that the respondents shall ensure that the investigator-cum-surveyor submits the report in 4 months and the same is filed before the State Commission. It was also stipulated that the complainants shall cooperate with investigator-cum-surveyor.
4. In the present complaint, the complainant has stated that the order passed by this Commission dated 31.03.2009 stipulated that after submission of claim form within one month from the date of order, the insurer was required to decide the claim within a period of two months from the date of submission of claim form. After appointment of Shri S.K. Kansal as surveyor he tried to delay the matter on some pretext or the other. Earlier, when he was informed on phone that the complainant would not be able to arrange for survey because the // 4 // Proprietor was sick and has gone for treatment to Nagpur, the surveyor stated that he is investigator and he would conduct the survey secretly and there is no need to make any enquiry from the complainant. He also told on phone that he had received all necessary information from Shri S. K. Sur and has inspected the godown and would file his report within the stipulated period. But subsequently, surveyor wrote a letter dated 20.06.2009, which was received by the complainant on 29.06.2009 that the complainant is not cooperating in investigation. The complainant suitably replied the letter on 30.06.2009 referring to the conversation between the surveyor and the complainant on telephone. It is stated in the complaint that as even after the stipulated period, the surveyor has not submitted his report. Hence the complainant has approached this Commission once again. It is further stated in the complaint that regarding the incident under claim, the complainant had given intimation in writing on 22.09.2006 and Surveyor / Valuer was appointed, who had assessed the loss, but during pendency of earlier Complaint No.20/2006, the insurer denied to have appointed the surveyor. It is alleged in the complaint that if the surveyor Shri S. K. Sur, was not appointed by the Insurance Company, the insurer had failed to follow the instructions of the Insurance Regulatory & Development Authority (Protection of Policyholders' Interests) Regulations, 2002, Section-9 relating to Claim Procedure in respect of general insurance policy, wherein it is stipulated that within // 5 // 72 hours the insurer is required to appoint surveyor but the insurer failed to follow the aforesaid provision. Now after order dated 31.03.2009 passed in Complaint Case No.20/2006 also the surveyor has failed to follow the directions of this commission and has not submitted the report. On the basis of aforesaid allegation, the complainant has claimed relief of compensation of Rs.49,99,800/- together with interest @ 18% p.a. from the date of claim.
5. During pendency of present complaint, the complainant moved an application for seeking permission to delete the name of OP no.3 i.e. the Bank as the complainant had arrived at amicable settlement with the bank and no grievance against the Bank was left, hence the application was allowed and the name of OP no.3 was deleted from the array of the OPs.
6. In the written version, the insurer has raised preliminary objection regarding delay in filing the complaint as well as the plea of res judicata. They had further taken the plea that this complaint is not maintainable because if there was non-compliance of the order dated 31.03.2009 passed in earlier Complaint No.20/2006, the complainant ought to have filed execution application instead of filing the present complaint. Objection regarding the matter being complicated has also been taken. In parawise reply, the allegations made by the // 6 // complainant, have been denied. It is stated in the written version that as the complainant had neither submitted the claim form nor had submitted the estimate of loss, the claim file was closed and the complainant was informed about the decision vide letter dated 09.10.2006. Closure of claim file does not amount to repudiation of claim. It is further stated in the written version that in pursuance to the order of this Commission dated 31.03.2009 in Complaint Case No.20/2006, the insurer has appointed Shri S. K. Kansal, Surveyor to survey and investigate the claim of the complainant. The complainant was duly intimated and contacted several times, but the complainant failed to cooperate with the surveyor. Repeated correspondences were made, but the complainant tried to delay the matter and tried to complicate the same. It is further stated that the OPs had filed application before this Commission to give proper directions, in view of non-cooperation of the OPs, but due to technical reasons, the said application was dismissed. It is further stated that the complainant has made allegations against an independent person like surveyor and the said allegations cannot be decided without affording an opportunity to the said person as it would be against the rules of natural justice. The insurer has further stated that to fulfill necessary formalities regarding claim is the responsibility of the insurer and this is abundantly clear from the provisions of Section - 9 of the Insurance Regulatory and Development Authority referred by the complainant, but the // 7 // complainant had failed to do so. In additional pleading, the insurer had stated that under Section 64 UM of Insurance Act, any claim, above the limit of Rs.20,000/- cannot be decided without proper investigation and survey, and complainant is not cooperating with the surveyor, hence it is not possible to decide the claim.
7. Affidavit of Proprietor, Shri Ram Narayan Agrawal, has been filed in support of complaint and that of Shri Vishnu Prasad Biswal has been filed in support of the written version. Complainant has also filed affidavit of Pramod Maine and Ankit Kumar Mishra. Several documents as per list have also been placed on record by the parties.
8. The correspondence between the parties and that between the surveyor and complainant has also been placed on record which shows that each party was making allegation of non cooperation against the other for conducting survey, hence finally this Commission had directed the counsel of both parties to remain present at the time of survey on 08.08.2010 at 12.00 noon. After this direction dated 21.07.2010, survey was conducted and finally the report was filed on 05.10.2010. After submission of survey report, affidavit of Shri Ram Narayan Agrawal was filed by the complainant and in rebuttal OPs filed affidavit of the surveyor, Shri S. K. Kansal.
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9. Final arguments were heard. Complainant's counsel also filed written synopsis of arguments.
10. During course of arguments learned counsel for the complainant again harped upon the facts as detailed in earlier Complaint Case No.20/2006 decided by 31.03.2009. He reiterated time and again that Shri S.K.Sur is a qualified surveyor and the insurer has only disputed the appointment of said surveyor but has not disputed his report regarding estimate of loss. Learned counsel submitted that Shri Sur had assessed the loss after proper investigation and so the complainant is entitled to receive compensation as per his report. So far as the report of subsequent surveyor Shri Kansal is concerned the sole aim of the report appears to be to frustrate the claim of the complainant. Learned counsel submitted that Shri Kansal failed to properly understand the Report of earlier surveyor who had made physical verification and had found the stock of 1282 bundle and had also found that there was flood and inundation. He had mentioned it in his report but Shri Kansal has tried to show that there was no flooding. The complainant has filed several photographs of damp jute bags. Learned counsel submitted that Shri Kansal has raised suspicion on the ground of - all the three firms belonging to Agrawal family; there was no flooding and also that the complainant had got the damaged jute bags thrown away by his own truck. Learned counsel for // 9 // complainant submitted that all the firms had paid separate premium for coverage of risk and had been taking insurance from the OP since the year 2001, the fact of flood has been mentioned in the report of Shri Sur and is also apparent from the newspapers filed by the Ops which show that there was heavy rain at Raipur between 13.8.2006 to 22.09.2001. He further submitted that the number of the truck through which the damaged bags were thrown was given by the complainant and in case there was any intention to suppress the fact the complainant would not have mentioned the number. He further submitted that the surveyor repeatedly demanded original documents but as at the time of earlier survey the documents were wet and it was not possible get the same photocopied the surveyor had taken the original documents with him so the complainant was not able to produce the same. Learned counsel submitted that the report of Shri Kansal is malafide. The complainant has suffered actual irreparable loss and is entitled for compensation.
11. In view of the fact that the complaint was remanded back by National Commission for consideration by this Commission learned counsel for the OPs submitted that he does not wish to press the preliminary objections raised by the Ops in written version. Learned counsel submitted that the surveyor Shri Kansal has considered every aspect and has also submitted affidavit in support of the report. He is // 10 // an independent person and his report should be given proper weightage. Referring to various documents filed with the survey report he submitted that it clearly appears that the rainfall on 21.9.2006 was not so much as to cause inundation in the godown resulting in loss as has been alleged. Learned counsel further submitted that earlier the complainant as well as all firms of Agrawal family used to take policy from the Ops without coverage of risk of flood and inundation. On 12 /13.8.2006 there was heavy rain and flooding of water and the group had made two claims under policy No. 320803/05/3100000605 and 320803/05/3100000730 respectively and had submitted claim forms as well as estimate of loss. Thereafter the insurer had appointed Shri Ashok Motiyani to conduct the survey under earlier mentioned policy. The surveyor in his report assessed the loss but found that it was not payable as the policy did not contain coverage for STFI perils. After intimation the group withdrew claim under the other policy as the risk was not covered. Thereafter before expiry of the previous policy the group had purchased new policy for all the three firms with coverage of risk of STFI perils and short time after purchasing the policy on 04.09.2006, requested for change of location on 20.09.2006 and only after one day of endorsement of change of location loss was reported. Learned counsel submitted that all this was planned with a view to make good the loss suffered a few days prior to obtaining coverage of STFI perils. The group is well aware about the procedure // 11 // of claim as they had filed claim earlier also complying the procedure but when they filed claims under subsequently purchased policies they did not file claim form and estimate of loss. As surveyor can only be appointed after receiving duly filled claim form and estimate surveyor could not be appointed. It was only in compliance of order dated 31.3.2009 passed by this commission disposing the earlier complaints that the complainants had given filled claim form and thereafter Shri Kansal was appointed as surveyor. There was delay in filing the report of the surveyor only due to non-co-operation of the complainants. The report of the surveyor is duly supported by documents and affidavit. The surveyor has assessed the loss but has stated in his report, referring to the information obtained from meteorological department that on 21.09.2009 there was only nominal rainfall. So the claim of the complainant being false, is not payable. Learned counsel submitted that the allegations of deficiency in service on the Ops are totally false and baseless hence the complaint be dismissed.
12. While deciding earlier complaint bearing No.20/06 vide order dated 31.3.2009 we had made detailed observations regarding facts of the case after considering the material on record. As we found that duly filled claim form and estimate of loss was not given to the insurer as stipulated under General Condition No.6 of the policy, the insurer could not appoint surveyor and process the claim hence the insurer // 12 // cannot be held guilty of deficiency in service for closing the claim of the complainant. We had also observed that Shri S.K. Sur, Surveyor was neither appointed by the insurer nor was competent to conduct the survey. So we had directed the complainant to file duly filled claim form before the insurer together with a copy of report of Shri S.K. Sur and the insurer was directed to consider the amount mentioned in the report of Shri Sur as estimate of loss and to appoint investigator and take other necessary steps to consider and decide the claim of the complainant. So in this order we would consider the subsequent events only.
13. The plea of learned counsel for the complainant that the insurer has disputed only the appointment of Shri S.K.Sur but has not disputed the contents of his report is not at all tenable because in our earlier order itself we had observed that the said surveyor was not competent to conduct the survey and assess the loss resulting from inundation. When he was not competent, at the best his report can be considered as an estimate of loss and that is why we had directed the insurer to consider it to be estimate filed by the complainant. More importance cannot at all be attached to the said report.
14. Learned counsel for complainant vehemently took the plea of delay in filing survey report. It is apparent from record and also the // 13 // details mentioned in the survey report itself that the complainant did not co-operate with the surveyor. Though the surveyor who is from Indore visited Raipur twice or thrice and remained here for a few days yet inspection of godown could not be possible. It could be possible only after this Commission directed the counsel for parties to be present on the given date and time so that the survey could be done. In view of the aforesaid facts and circumstances we ignore the delay as it cannot be attributed solely to the surveyor or the Ops.
15. The surveyor has submitted a very detailed report and has taken every aspect into consideration ranging from names and history of various firms of the family, history of previous claims made by the firms, report of earlier surveyors Shri Ashok Motiyani, Shri S.K. Kesarwani and Shri S. K. Sur and so on and so forth. It appears from the report that Shri Kansal also had discussion with previous surveyors. Besides considering the report of earlier surveyors he also considered stock statement submitted to Bank of India. He also enquired about the price of Hessian Bags and jute cloth bales from the market.
16. Shri Kansal found that there was vast difference between the price of jute cloth bales mentioned in the report of Shri Motiyani i.e. Rs.50,000/- per bale, and that mentioned in the report of Shri Sur i.e. // 14 // Rs.9,800/- per bale and further the one that was mentioned in the stock statement i.e. between Rs.9,500/- to Rs.11,520/-. On survey, market price was found to be much lesser than that mentioned in the aforesaid documents. Same was the case with Hessian bags. The firm was declaring cost of Hessian bags at Rs.12/- per bag whereas in August /September, 2006 the cost of the said bags ranged between 8.7 to maximum of Rs.10.05 per bag. On this ground Shri Kansal has stated in his report that the claimant companies had provided cooked-up documents / information to the surveyors Shri Motiyani otherwise there would not have been such vast variation in market price of these commodities. Shri Kansal has further stated in his report that this probably was the reason for not providing documents for inspection despite repeated requests.
17. Shri Kansal had written letter dated 10.06.2010 (Annexure -M 62-65) to the claimants for inquiring whether they are agreeable to the rates mentioned in the report of Shri Sur. Shri Kansal wrote that in case the claimants were not in agreement with the rates of various items mentioned in the report by Shri Sur they may provide evidence in that regard at the office of the surveyor immediately after receipt of the letter otherwise the surveyor will consider that they are in agreement with the rates mentioned in the report and would proceed further. No objection was made by the claimants regarding the rates.
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18. However during investigation on 8.8.2010, the surveyor found that the quality of stock was very poor and the bags stored in the godown were not fresh but repaired ones. He wrote a letter to the complainant that as per his market survey price of such repaired bags was only Rs.3/- per bag at the relevant time so he would not be able to consider the unit price of such bags as considered by Shri Sur. He further wrote that in case the claimants do not agree with the aforesaid price he may visit Indore and after opening sealed samples, the sample can be shown to Hessian bag traders to ascertain about its quality and market rate of such material on the relevant date as well as presently. He had further written that in case the surveyor does not receive any letter from the claimant expressing such desire he would presume that the claimant was agreeable to the quality and rate mentioned by the surveyor in the letter. It is mentioned in the report that he received no letter from the claimants objecting to the price till submission of report, so he considered the price at Rs.3/- per bag in his assessment.
19. For deciding the loss the surveyor had to take into consideration the actual size of godown where the material in question was stored at the time of loss. On the basis of calculation of actual dimensions and the height of water inundation the surveyor has assessed the quantity of bags and consequent loss. The surveyor calculated the volume of affected area to be 7508.65 cu. Ft. and accordingly the total number of // 16 // bundles in this volume was worked out to be 1315 bundles or 65750 number of bags to the maximum. Further in order to eliminate any possibility of errors and omissions, and damage to some more bags due to capillary action he considered the total number of bags at Rs.1,31,500/-. The surveyor worked out the aggregate loss of all the three firms to be Rs.3,94,500/- and after deducting the amount of salvage net amount of loss was worked out to be Rs.3,15,600/-. After working out aggregate loss the surveyor apportioned the same in relation to the sum insured under policy of the three firms. However we do not feel it necessary to mentions details of loss caused to individual firms.
20. Though the surveyor had assed the loss yet he has stated that there were no heavy rains on the relevant date and time of loss and no water inundation had taken place in entire city of Raipur hence the loss assessed by him is not payable under the terms of policy.
21. For proving that there ware no heavy rains at Raipur on 21.9.2006 the surveyor has collected data of rainfall from Regional Meteorological Centre, Nagpur and placed copy of the same as Annexure K1-K3.
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22. The surveyor has further observed that there was only one godown at Ruprela compound and the Agrawal family maintains it as junk yard for jute bags in a manner so that it may be given an appearance of damage to these bags on account of flood and preferring claim again and again on the said stock, which does not have any commercial value. Shri Kansal has observed that Hessian bags lying there were giving appearance as decayed Hessian bags, decayed on account of remaining submerged in water for very long time. On the basis of report and photographs obtained from earlier surveyors / investigators Shri Kansal has expressed his opinion that the said photographs appeared to relate to the same material stored in the godown at the time of his inspection.
23. During his investigation the surveyor also took note of the affidavits filed by the driver Pradeep Maine and Ankit Kumar Mishra. He wished to record their statements but they were not made available before the surveyor Shri Kansal for the purpose of recording their statements. However he has observed in his report that Ankit Kumar has not mentioned any date of rains due to which inundation was caused, he has simply mentioned the month of September. Regarding the statement of the said deponent regarding damage to bags stored in the godown of M/s. Goyal Jute Udyog due to water inundation and consequent spreading of foul stinking smell in the area, the surveyor // 18 // has observed that ' Hessian bags is not a commodity like foodgrains or beans, which starts stinking within a few days from getting damaged. The Hessian bags can be compared with the cotton cloth, which gets wet due to water and on drying it gets dried.' He has further observed that 'During the course of my various surveys in the past, I have observed that the Hessian bags do not start stinking even after a month of its storage in water damaged condition. My this contention further gets established, when I inspected the said godowns on 08.08.2010 i.e. after passing almost 4 years of the said reported loss. In the said godowns I remained for about four hours, but I did not find any such unbearable stinking smell, otherwise I could not have remained in the said godowns for about four hours.'
24. The surveyor noted that in his affidavit driver Pramod Maine has simply stated that he is a driver by profession and at the instruction of owner of the godown of M/s. Goyal Jute Udyog he had thrown away the damaged bags by truck number CG04-Z3-2408. The said bags were stinking very badly due to being damaged on account of flood water entering the godown on 21.9.2006 and as local labour was not ready, hence he brought labour from outside and managed to throw the Hessian bags in an open area near the ring road. In this regard the surveyor observed that normally the drivers are concerned with the job allotted to them and not with the date but this driver has // 19 // very specifically mentioned the date. He has further observed that normally it is the obligation of the owner whose work is to be done to arrange for labour and not of the driver of the truck. Though he mentioned the date of water inundation as well as the number of truck but he did not mention the name of owner of truck. At the request of the surveyor the insurer collected details of the aforesaid truck from RTO, Raipur. It was revealed that at the relevant point of time Shri Ramnarayan Agrawal was owner of the said truck and subsequently the truck was sold to Shri Rupak Chandrawanshi on finance from M/s. Goyal Jute Udyog. The surveyor has stated that in the circumstances the driver could have been easily be made available for recording of statement but the claimants failed to do so despite repeated requests from the surveyor. The deponent had deliberately not disclosed the name of the owner of the truck.
25. As noted earlier the surveyor had obtained rain data from Nagpur. It appears from documents K-2 and K-3 that though there were very heavy rains in the intervening night of 29-30. 9.2006 and moderate rains on 30.6.2006 and total rainfall on that day was recorded as 297 m.m. Subsequently there was heavy rainfall on 13.8.2006 also which was 142 m.m. On 21.9.2006 when claimants have alleged loss, rainfall was recorded to be only 1.10 m.m. which does not appear to be so much as to cause loss by inundation as has been alleged. On the // 20 // basis of various observations made by the surveyor he has tried to show that the loss was not suffered on 21.9.2006 but earlier in the month of June when the reported loss was found to be not covered as coverage for STFI peril was not obtained by the claimants. The surveyor has tried to suggest that it was the material damaged due to heavy rains in the month of June that was stored in the godown inspected by the surveyor Shri Kansal and on the basis of same stock claims were made earlier also to other insurers as well.
26. We find the report of the surveyor to be very detailed, well reasoned and supported by various documents. It is apparent that as per plea of the complainants they had got the damaged material thrown but when the surveyor visited the godown he found that Hessian bags lying there were giving appearance as decayed Hessian bags, decayed on account of remaining submerged in water for very long time. On the basis of report and photographs obtained from earlier surveyors / investigators Shri Kansal has observed that the said photographs appeared to relate to the same material stored in the godown at the time of his inspection.
27. It is abundantly clear from report of Meteorological Department that there was only 1.10 m.m. rainfall on 21.09.2006 when allegedly water inundation was caused. Such rainfall is not sufficient to cause // 21 // water inundation in the godown of the complainant and the more so upto the height alleged in the complaint and causing huge damage. Moreover the averment of the complainant that he got the damaged goods thrown away due to foul smell also raises doubt. As per settled practice the insured is not authorized to throw away the damaged material prior to survey being conducted by surveyor duly appointed by the insurer. The truck used for throwing away the damaged stock is ultimately found to be that of the claimants' family. The tactics of non- cooperation adopted by the claimant in not providing documents and not facilitating survey despite repeated correspondence and requests by the surveyor speaks volumes. So we find that though the surveyor has assessed the loss yet the claim is not payable as the allegation of heavy rains on 21.9.2006 is not supported by the report of the meteorological department. The complaints being without substance are dismissed.
28. Original of this order be retained in Complaint Case No.74/2009 and its copy be placed in the file of Complaint Case Nos.75/2009 and 76/2009.
(Justice S.C. Vyas) (Smt. Veena Misra) (V.K. Patil)
President Member Member
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