State Consumer Disputes Redressal Commission
United India Insurance Company Ltd., ... vs S.V.V.L.Satheesh Kumar S/O Subba Rao ... on 19 February, 2010
BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD. F.A.No. 790 OF 2007 AGAINST C.D.NO.49 OF 2005 DISTRICT CONSUMER FORUM KHAMMAM. Between 1. United India Insurance Company Ltd., Khammam Branch, rep. by its Branch Manager Khammam, Madhucon Complex, Khammam 2. The Divisional Manager, United India Insurance Company Ltd., Divisional Office, Kothagudem Khammam District Appellants/ opposite parties no.1 & 2 A N D 1. S.V.V.L.Satheesh Kumar S/o Subba Rao Age:37 years, Occ:Business, R/o Madhira Town and Mandal, Khammam District Respondent/complainant 2. Andhra Bank, Madhira Branch rep. by its Branch Manager, Madhira Khammam District Respondent/opposite party no.3 Counsel for the Appellant Sri E.Venugopal Reddy Counsel for the Respondent No.1 Sri V.Gourisankara Rao Counsel for the Respondent No.2 Sri K.Vijaya Kumar Reddy QUORUM: SRI SYED ABDULLAH, PRESIDING MEMBER
& SRI R.LAKSHMINARSIMHA RAO, MEMBER FRIDAY THE NINETEENTH DAY OF FEBRUARY TWO THOUSAND TEN Oral Order ( As per R.Lakshminarsimha Rao, Member) *** The opposite parties no.1 and 2 are the appellants. The appeal is filed against the order of the District Forum in C.D.No. 49 of 2005 whereby it directed the opposite parties no.1 and 2 to pay an amount of Rs.6,92,782.89 with interest @ 6% per annum from the date of filing of the complaint till realization and dismissed the complaint against the opposite party no.3.
The facts that led to filing of the appeal are that the complainant is doing whole sale business and for improvement of his business he had obtained loan from the opposite party no.3 by executing a hypothecation deed in favour of opposite party no.3. The complainant had insured the stocks with the opposite parties no.1 and 2 through the insurance policy bearing No.051701/48/03/00444 issued for the period from 15.12.2003 to 14.12.2004 for a sum assured of Rs.8 lakh.
On 27.3.2004 the complainants shop met with a fire accident wherein the entire stock worth Rs.6,93,000/- caught fire and burnt into ashes along with account books. On complaint lodged by the complainant the P.S. Madhira registered a case and conducted panchanama. The fire service department extinguished the fire but could not save the stocks. The complainant lodged claim and the opposite party no.1 repudiated the same by assessing the loss to the extent of Rs.15,168/-. The complainant has got issued legal notice dated 22.11.2004 for which the opposite party no.1 issued reply on speculative grounds.
On behalf of the opposite parties no.1 and 2 counter was filed wherein it was contended that the complainant was a business man and hypothecated the stocks of coconut oil, tea, incense sticks, soaps etc., with the opposite party no.3 bank. Immediately after receiving the intimation about the fire accident, the opposite party no.1 deputed surveyor to assess the loss of the stocks in the fire accident. The surveyor filed his report after taking into account of all purchases, returns submitted to the commercial tax department etc., and assessed the loss of the stocks in the fire accident at Rs.15,168/-. The opposite parties no.1 and 2 had settled the claim by issuing claim disbursement voucher claim no.051701/48/04/00002 dated 16.11.2004 towards full and final settlement of the claim. Therefore, there was no deficiency in service on the part of the opposite parties no.1 and 2. The subject matter involved complicated questions of law and fact which can be decided by a civil court. Hence, prayed for dismissal of the complaint.
The opposite party no.3 resisted the claim contending that the complaint is not maintainable. There was no cause of action for the complainant to file the complaint against the opposite partyno.3 bank. The opposite party no.3 is not a necessary party to the complaint. There was no deficiency in service on the part of the opposite party no.3 bank. The complainant has not sought any relief against the opposite party no.3.
The complainant has filed this affidavit in support of his claim as also the documents marked as Exs.A1 to A7.
On behalf of the opposite parties RWs 1 and 2 examined and Exs.B1 to B4 were marked on their side.
The District Forum has allowed the complaint awarding an amount o Rs.6,92,782.89 with interest @ 6% per annum against the oppose parties no.1 and 2 and dismissed the complaint against the opposite party no.3. The District Forum opined that the fire accident gutted the entire stock of the complainant and the surveyors report was arbitrary and without any basis.
Feeling aggrieved by the order of the District Forum, the opposite parties no.1 and 2 have filed the appeal contending that there was no deficiency in service on their part as they had processed the claim and allowed to the extent as assessed by the surveyor. The complainant did not suffer any loss and there was no occasion for him to claim the damage. It was made a ground of appeal that the insurance policy was obtained in the name of the firm M/s Venkatasai Manikanta Agencies. No firm has filed the complaint before the District Forum. The complainant has not filed a single document in proof of his allegation that he maintained the stocks and that no sale invoices were filed to show the actual movement of the stock during the period commencing from the date of the stock letter till the date of the accident. Even duplicate invoices of the purchase and sales were not filed to show the actual position of the stock. The surveyors report was supported by his evidence that the stock position as claimed by the complainant was wrong and incorrect. The complainant tried to have unfair benefit from the opposite parties.
The points for consideration are:
1. Whether the complainant is entitled to the amount prayed for?
2. Whether there was any deficiency of service in settlement of the claim by the opposite parties no.1 and 2?
POINT NO.1 The complainant has obtained insurance policy bearing No.051701/48/03/00444 for the period from 15.12.2003 to 14.12.2004 for the sum assured Rs.8 lakhs. Ex.A1 is the insurance policy issued for covering the risk of the stocks of the complainant. The stocks were hypothecated to the opposite party no.3 on 27.3.2004. The shop of the complainant met with a fire accident.
The complainant lodged complaint with the police, Madhira Town and gave intimation to the fire service authorities. The fire service department Madhira extinguished the flames. Asst. Divisional Fire Office, Khammam issued fire attendance certificate dated 31.3.2004 to the effect that the fire out-broke at 21.30 hours on 27.3.2004 and a message in the fire station was received at 22.00 hours after receiving which information the fire service attended the incident at 22.00 hours on 27.3.2004. The person who gave fire message was Sri K.Prakash Rao, Advocate, Madhira.
The police, Madhira conducted panchanama at 10 a.m. on 28.3.2004. The panchas opined that half burnt incense sticks that were lighted during pooja on Saturday in the shop of the complainant were the cause of accident. Hence, it can be concluded that the fire accident occurred on 27.3.2004 in the shop of the complainant. The complainant lodged a claim for Rs.6,93,316/-. The opposite parties no.1 and 2 deputed a surveyor. The surveyor inspected the shop and filed report dated 27.2.2004. The Surveyor observed on 28.3.2004 during his inspection of the shop of the complainant, that some stocks in the shop were found burnt, some of the damaged stock were kept in front of the shop stated to have been removed while controlling the fire. He had noted item wise details of burnt and soaked items as also taken the photographs of the scene. He had also noted down the details of undamaged items and their respective value.
The surveyor in his report has noted down that the complainant was submitting A2 returns and as per the A2 returns the turnover for the year 2003-04 for purchase is Rs.17,19,331.07 and sale is 16,60,013.65, average monthly purchase is Rs.1,43,277.59 and sales is Rs.1,38,834.47. The details have been mentioned in Annexure-D of the report.
As per the stock register, according to the surveyor the value of the stocks purchased for the year 2003-04 is Rs.19,28,050.04 and sale is Rs.16,47,132.30, the average monthly purchases is Rs.1,60,670.80 and sales is Rs.1,37,261.03. The value of the stocks shown in the bank statement for the month of March 2004 is Rs.8,80,000/-. The complainant has not submitted stock statement to the bank for about one year.
The surveyor was of the opinion that as per the statement of monthly purchase and sales, the purchases and sales were decreasing from the month of June 2003 to March 2004.
The surveyor had physically verified the statements of monthly purchases and sales and other records. He had stated in his report:
As per the statements of monthly purchases and sales comparison with A2 returns (as per Annexure D), it appears that the total stocks value physically identified in the shop at the time survey on 28.3.2004 i.e., Rs.1,40,765.72 is corroborating ( or 10% to 15%) with other stocks records of purchase bills, sales and A2 returns, but the value of stocks shown in stock records including opening stocks is shown very high i.e., shown more than 75% extra. Basing on the prepared stock register submitted estimate, and also submitted the stock statement in Bank (previously not submitted any statements in Banks since last 9 months) with higher quantity stocks. Hence, it appears that the stocks show as per stock register and estimate is not correct.
The surveyor has concluded that he had verified the stocks found in the shop at the time of his survey with the stock registers, A2 returns and thereby he had prepared a list of items and the value of the stocks to the tune of Rs.1,40,765.72. After making segregation of the burnt/damaged items, he had assessed the damaged item at Rs.32,732.65 and the salvage value from the damaged stocks would be realized to the extent of Rs.6,519.02. The surveyor has stated that the damaged stocks value of Rs.1,806/- is not shown in the stock register. Hence, he reduced the worth of damaged stocks to Rs.30,926.55. Therefore, deducting the amount of Rs.5,758.57 and policy excess of Rs.10,000/- from the value of damaged stock, Rs.30,926.55 the net assessed loss amount was arrived at Rs.15,167.98. Thus, the opposite parties no.1 and 2 acting upon the assessment made by the surveyor settled the claim of the complainant and they had sent voucher for an amount of Rs.15,168/- on 16.11.2004 to the opposite party no.3 to be credited in the account of the complainant. Consequent to the receipt of the voucher, the complainant has got issued notice dated 22.11.2004 protesting against the amount of Rs.15,168/- sent towards sent towards full and final settlement of his claim. The complainant asserted that the disbursement voucher for the amount of Rs.15,168/- was not to the satisfaction of his claim and he demanded for the sum of Rs.6,93,000/-
stating that the conclusion of final settlement of his claim was not justified.
The opposite parties no.1 and 2 had sent reply on 30.11.2004 the the complainant had shown excess stocks in the claim petition and he did not substantiate the same by producing stock register, invoice copies, particulars of sales along with bills. It was brought to the notice of the complainant that the fire authorities had not mentioned any loss and whatever stated in their report in regard to the loss sustained by the complainant was stated basing on the information given by the complainant.
The purchase invoice and invoices of Henko products worth Rs.4 lakhs, incense sticks of Rs.18,000/- and Bambino vermicilini worth Rs.60,000/-, Tea Powder worth Rs.10,000/- was not submitted by the complainant. The opposite party no.3 has not issued any stock certificate in respect of the stocks of the complainant. Therefore, taking into consideration of all these aspects and particularly the surveyors report the opposite parties had settled the claim.
The complainant except protesting against the assessment of loss made by the surveyor, has not produced any evidence to substantiate his claim for Rs.6,93,000/- except by way of a copy of stock list dated 19.3.2004 which was not supported by invoices and purchase bills. The complainant has not explained as to how he is entitled to file complaint as the insurance policy was issued in favour of M/s Venkatasai Manikanta Agencies. Therefore, the findings recorded and conclusion arrived at by the District Forum insofar as the quantum of the amount awarded in favour of the complainant is liable to be set aside.
The complainant is entitled to the amount of Rs.15,168/- which the opposite parties no.1 and 2 had sent to the opposite partyno.3 and returned by the complainant to them. Accordingly, the appeal is allowed.
In the result the appeal is allowed. The impugned order is modified and the amount directed to be paid by the opposite parties no.1 and 2 is reduced to Rs.15,168/- and the rate of interest is enhanced to 9% per annum from the date of filing of the complaint. There shall be no order as to costs.
Sd/-
PRESIDING MEMBER Sd/-
MEMBER Dt.19.02.2010 KMK*