National Consumer Disputes Redressal
Oriental Insurance Co. Ltd., Hisar vs Ishwar Singh on 9 January, 2015
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION No. 660 of 2013 (From the order dated 05.09.2012 of the Haryana State Consumer Disputes Redressal Commission, Panchkula in Appeal no. 105 of 2005) With IA Nos. 1214, 1215, 1216, 4081 & 6850 of 2013 (Stay, Delay, Exemption from filing certified copy, release of amount and placing record) The Oriental Insurance Co. Ltd., Hisar Through its: Regional Manager LIC Building, 2nd Floor Jagadhri Road, Ambala Cantt. Petitioner Versus Ishwar Singh Son of Shri Rameshwar Dayal Sole Proprietor of Haryana Handloom Shop Respondent Opposite TCP I Hisar Cantt., Hisar BEFORE: HONBLE MR JUSTICE AJIT BHARIHOKE PRESIDING MEMBER HONBLE MRS REKHA GUPTA MEMBER For the Petitioner Mr Rajesh K Gupta, Advocate For the Respondent Mr Man Mohan, Advocate Pronounced on 9th January 2015 ORDER
REKHA GUPTA Revision petition no. 660 of 2013 has been filed against the order dated 05.09.2013 of the Haryana State Consumer Disputes Redressal Commission, Panchkula (the State Commission) in Appeal no. 1055 of 2005.
2. The facts of the case as per the respondent/ complainant are that the respondent is the sole proprietor of firm styled Haryana Handloom Shop, Hisar Cantt. Hisar. The respondents firm deals in the purchase and sale of handloom material suitings, shirting such as bed sheets, bed cover, curtain cloth, velvet, Belgium, khes, material, TV and fridge and table cloth, pillows etc. The respondent got the material of the shop along with fitting of furniture insured from the petitioner/ opposite party Oriental Insurance Company Ltd., Hisar, vide cover note no. 040048 dated 18.01.2002 for a period of one year by paying the premium amount.
3. On the intervening night of 5/6.06.2002 a fire broke out due to short-circuit in the shop/ showroom of the respondent and the entire material along with the furniture worth Rs.15 lakh was burnt and destroyed in the said fire. There was also an extensive damage to the shop of the respondent due to fire. Matter was reported to the police as well as the fire brigade. Insurance Company was also informed about the damage of the material in the fire. The insurance company appointed M/s Duggal Gupta and Associates, Surveyor and Loss Assessor, Chandigarh who came to the showroom of the respondent and inspected the shop. The said surveyor required some documents from the respondent which were duly supplied by the respondent. The respondent completed all the formalities as required by the insurance company and the surveyor appointed by the petitioner. The respondent also supplied all the documents as required. However, the petitioner company did not settle the claim despite the entire satisfaction and the respondent kept on visiting the office of the insurance company in order to get the claim.
4. The respondent received a telephonic message from M/s Duggal Gupta and Associates, Chandigarh on 10.03.203 and they called the respondent to come on the same day. The respondent approached the said surveyor at Chandigarh on the same day. On reaching the office of the Surveyor, the surveyor started bargaining with the respondent. The said surveyor informed the respondent that he would recommend the total claim of the respondent provided that the respondent pays 25% of the said claim amount to him. The respondent showed his inability in given such a huge amount to the surveyor. This annoyed the surveyor who threatened the respondent that in case he failed to pay the commission, the surveyor would cause heavy loss to the respondent. The respondent wrote letters dated 11.03.2003 and 13.03.2003 to the petitioner insurance company, D O Oriental Insurance Company Ltd, Hisar, its office at Ambala and New Delhi and sent the same through courier.
5. Aggrieved by the complaint made by the respondent against the surveyor and the petitioner, the petitioner- insurance company passed the claim of Rs.4,72,748/- only to the respondent vide its letter dated 31.03.2003. The respondent was shocked to receive this letter and he again approached the petitioner and requested its official not to do any injustice to him and to reconsider the claim case. The officials of the petitioner company refused to hear the respondent and informed him that this was the result of the complaint made by the respondent against the surveyor and the officials of the petitioner to its higher officials. The petitioner asked the respondent to put his signatures on a blank form and on the revenue stamp in order to get the claim passed by it. The respondent affixed the revenue stamp and rubber stamp of its shop. However, when the respondent started reading the contents of the receipts, the officials of the petitioner company did not allow him to read the same and told that the amount to be paid to the respondent in full and final settlement of his claim and the respondent would not file any case in this behalf. The respondent requested the officials of the petitioner company to fill up the receipt but they refused to do so. On the contrary, the officials of the petitioner company told that in case the blank receipt was not signed and they would not give any cheque of any amount to him.
6. Decreasing the claim amount of the respondent by the petitioner was wrong, incorrect and illegal and not based on any reasons. The respondent suffered a loss to the extent of more than Rs.14 lakhs. The respondent also kept the salvage (burned material) in a godown taken on rent. The respondent has been getting insurance of his shop, material undertaken since 1997 and the respondent has never claimed any amount of insurance from the petitioner company because the respondent did not suffer any damage earlier. The respondent is maintaining his account and stock for the last more than two years and he was maintaining and keeping the stock of more than Rs.14 lakh at his show room/ shop. Non-settlement of full claim is a patent deficiency in service on the part of the petitioner insurance company.
7. Respondent has prayed that the petitioner insurance company be directed to pay Rs.14.00 lakh to the respondent along with interest at the rate of 18% per annum from 06.06.2002 till payment on account of the loss suffered by the respondent due to fire in the shop of the insured vide cover note no. 040048 dated 18.01.2002. The petitioner may also be directed to pay Rs. 1.00 lakh as damages with cost.
8. The petitioner/ opposite party insurance company in their reply before the District Consumer Disputes Redressal Forum, Hisar (the District Forum) stated that the petitioner insurance company had already settled the claim of the respondent as per the survey report and as per the terms and conditions of the insurance policy. The petitioner appointed M/s Duggal Gupta and Associates, Surveyor and Loss Assessor to assess the loss. The said surveyor visited the premises of the insured and thoroughly inspected the said premises and after considering all the factors submitted his report dated 13.03.2003 with the insurance company. The said surveyor observed the following facts in his report:
(i) Verifiable burnt stocks, physically verified by us were of low rate items;
(ii) From analysis of old sale bill books, it is evident that the insured deals in low value items;
(iii) From the purchase bill it is evident that the purchases of high rate items were on a very low side whereas the claim of the high rate items is about 38% (about Rs.5.29 lakh out of the total claim for Rs.13.64 lakh). Moreover, out of these items worth about Rs.3.10 lakh were old stocks for which no reference of purchase bills was given in the claim bill.
(iv) Uncertainty/ lack of evidence about the amount of initial investment in the business;
(v) Various cash loans stated to have been taken by the insured stocks of other firm taken over on 31.03.2000 and for which no payment were made to them and for which no interest is being paid;
(vi) Claim of old stocks by the insured for which no purchase bills are submitted and which is about 45% of the total claim.
(vii) Insured claimed the stocks at full capacity of the storage space;
(viii) No supplier of the insured has replied in response to our registered letters;
(ix) No basis explained as to how the estimated financial statements were prepared in the absence of records etc., as the insured has reported that all the records have been burnt in the fire;
(x) No basis for stocks worth Rs.10,65,000/-
taken as opening balance as on 01.04.2000 in the trading account submitted by the insured. This figure is unjustified and is on a very high side and in our opinion had been taken so as to value the stocks in the estimated trading accounts in such a manner so as to depict the stock value to be above the value of sum insured;
(xi) Claim has been prepared on bill to bill basis and the bills, were submitted after a long gap by the insured;
(xii) The insured is not an income tax/ sales tax assesse and the huge investment in the stocks worth about Rs.13.64 lakh (as per the list) and Rs.13.16 lakh (as per the estimated trading account) is not justified by the stated sales turn-over of about Rs.13.22 lakh during 2001-2002;
(xiii) Withdrawals for household expenses of about Rs.24,000/- and Rs.36,000/- only in 2000-201 and 2001-2002 is not justified;
(xiv) The profits of Rs.66,492/-
depicted by the insured in 2001-2002 does not justify the huge investment of Rs.5.76 lakh as capital plus Rs.5.15 lakh as interest free loan.
9. The said surveyor after considering all the facts assessed the loss to the tune of Rs.4,83,682/-. As there was an excess clause in the policy, i.e., the insurance company was not liable to make any payment upto the claim of Rs.10,000/- and after deducting the said amount, net loss payable to the petitioner was Rs.4,73,682/-. The insurance company processed the claim on the basis of survey report and other documents on the file and the settled the claim to the tune of Rs.4,72,748/- in full and final settlement of the claim and an intimation to this effect was also sent through letter dated 31.03.2003 but even then the respondent did not come forward to complete the requisite formalities. Hence, there was no negligence and deficiency in service on the part of the petitioner insurance company in processing the claim.
10. The District Forum vide order dated 03.05.2003 has held as under:
From the evidence adduced by the complainant, it is overwhelming proved on record that the complainant suffered the loss of more that Rs.14 lakh in the fire which broke out on 05/06/2002. The act and conduct of the respondent company has caused great mental torture, harassment and humiliation to the complainant. The respondent company has wrongly and illegally settled the claim of the complainant for Rs.4,72,748/-. This is high-handedness on the part of the respondent company by decreasing the claim of more than Rs.14 lakh to Rs.4,72,748/- only. The assertions made in the complaint are fully proved on record by way of documentary evidence. The respondent company is held guilty of rendering deficient and negligent services to the complainant as provided under Section 2 (1) (g) and 2 (1) (o) of the Consumer Protection Act. The fire broke out on the night between 5/6/2002 and the complainant immediately reported the matter to the police as well as to the fire brigade. The complainant has also reported the matter to the respondent company immediately. In our view a period of three months is quite reasonable for settling such type of cases. So we order for the payment of interest after three months from the date of intimation, i.e., from 06.09.2002 till its payment.
As a result of above detailed discussion, we are of the considered view that it is clear case of gross deficiency in service as well as negligence on the part of the respondent company. What to talk deficiency in service and negligence on the part of the respondent company, it is also a case of high-handedness on the part of the respondent company. Therefore, there is merit in this complaint and the complaint is hereby accepted. The respondent is hereby directed to make the payment of remaining amount of Rs.9,27,252/- to the complainant (Rs.14,00,000 minus Rs.4,72,748/-) along with interest @ 10% per annum from 06.09.2002 till its payment. The respondent company is further directed to pay interest @ 10% per annum on the amount of Rs.4,72,748/- from 06.09.2002 till 12.08.2003. The respondent company is further burdened with cost of litigation which we quantify of Rs.2200/-.
11. Aggrieved by the order of the District Forum, the petitioner filed an appeal before the State Commission. The State Commission in their order dated 05.09.2012 while dismissing the appeal observed as under:
Having considered the facts and circumstances of the case and the rival contentions raised on behalf of the parties, we feel that the appellant-opposite party has failed to adduce even an iota of evidence that the complainants claim was settled at Rs.4,72,748/- in full and final settlement and the same was received by the complainant without any protest. The complainant has produced the copies of receipts Annexure C 18 to Annexure C 24 vide which various documents were sent to the surveyor. Annexures C 25 and C 26 copies of the claim bill submitted by the complainant to the opposite party wherein the details of the loss suffered by him were mentioned in Annexure C 27 is the copy of the first insurance claim from which was submitted by the complainant to the opposite party. Annexures C 29 to C 32 are with respect to the estimated trading account, estimated profit and loss account, estimated capital account. Estimated balance sheet and list of sundry creditors as on 31.03.2001, 31.03.2002 and 05.06.2002 and the details of material kept in the shop/ showroom of the complainant. The evidence led by the complainant has sufficiently proved that he had suffered the loss as claimed by him from the opposite party, on the other hand the opposite party has failed to produce any cogent and convincing evidence except the report of the surveyor that the loss suffered by the complainant was of Rs.4,72,748/-. The report of the surveyor is contrary to the bills submitted by the complainant in support of his claim.
As a sequel to our aforesaid discussion, we do not find any illegality in the impugned order whereby direction as noticed in the opening paragraph of his order has been issued to the appellant- opposite party.
Hence, finding no merit in this appeal, it is dismissed.
12. Hence, the present revision petition.
13. We have heard the Counsels for the parties and have carefully gone through the records of the case. Counsel for the petitioner argued that the insured had submitted an affidavit that he was maintaining books of accounts by himself and the same were lying in the shop at the time of fire and have been burnt in the said fire along with other records like sale and purchase bills etc., The insured was not an income tax assesse and was not having the sales tax registration number. This has effectively precluded the petitioner from verifying and cross checking the information supplied piecemeal by the respondent.
14. Our attention was drawn to the survey report from where it is seen that even the purchase bills/ statement of accounts supplied by the respondent did not tally with the trading account of the respective parties to which the purchase pertains. Further the purchase bills given by the respondent did not have the description of the items purchased. As per the survey report paragraph 8.4 that out of the total purchase bills submitted by the insured, certain bills appeared to be katcha bills which were annexed with the statement of account issued by the supplier. The surveyor thereafter wrote registered letters to various suppliers of the insured requesting them to confirm the sales made by them to the insured. However, no supplier replied in response to the registered letters in fact one of the letters was returned back by the postal department stating that no such firm exists at the mailing address (which was taken from the purchase bill submitted) and the said firm has been shifted without giving the new address.
15. It is also seen from the survey report that as against the transactions of Rs. 3.00 to 4.00 lakh made through the current account in the Bank, the petitioner has stated the total sale purchase to be of about Rs.11 -12 lakh during the period 01.04.1998 to 31.03.2002 without giving any details thereof. The insured had also failed to provide the basis of opening stock of Rs.10,65,000/- taken by him on 01.04.2000 and also the basis on which figures for various items viz., expenses, creditors, sales and purchase etc., were made in the financial statements. In fact, he himself has stated that the financial statements were on estimated basis. Counsel for the respondent drew our attention to paragraph 6 of the District Forums order from which it appears that the estimate of Rs.15 lakh was on the basis of fire brigade report and the news items in the Punjab Kesari on 07.06.2002, where the loss was mentioned at Rs.15-20 lakh. Though the District Forum in their order have clearly indicated that Annexure C 29, 30, 31 and 32 were the copies of the estimated trading account, estimated profit and loss account, estimated capital account, estimated balance sheet and list of sundry creditors as on 31.03.2001, 31.03.2002 and 05.06.2002, they have stated that the complainant had already submitted all the relevant documents and he clearly proved that he suffered a loss of more than Rs.14 lakh. The District Forum has further stated that from the evidence adduced by the complainant, it is overwhelmingly proved on record that the complainant had suffered a loss of more than Rs.14 lakh in the fire which broke out on 05/06.06.2002. The District Forum has also not given any details of the evidence adduced and the documents produced which overwhelmingly proved on record the respondents claim for Rs.14 lakh.
16. The State Commission in their order has also not given any cogent and convincing argument to support their contention that the report of the surveyor is contrary to the bills submitted by the complainant in support of his claim. In fact, a careful reading of the complaint as well as the survey report does not support the respondents claim that he suffered a loss of Rs.14 lakh.
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 one should have sufficient grounds not to agree with the assessment made by them.
18. In view of the above, as no sufficient grounds have been brought on record either by the respondent or the District Forum and the State Commission not to agree with the assessment made by the surveyor in this case, we allow the revision petition and set aside the orders of the State Commission and the District Forum and dismiss the complaint.
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[ Rekha Gupta ] Sd/-
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[ Ajit Bharihoke, J.] Satish