BEFORE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD
F.A.No.426 OF 2010 AGAINST C.C.NO.202 OF 2008 DISTRICT FORUM ONGOLE AT PRAKASAM DISTRICT
Between
IFFCO-TOKIO General Insurance Co.Ltd.,
Nehru Place, New Delhi-019
Appellant/opposite party no.1
A N D
1. Kolluri Chimpiraiah S/o Subbaramaiah
Cultivation, R/o Chirvanuppalapadu Village
N.G.Padu Mandal, Prakasam District
Respondent/complainant
2. The Auction Superintendent,
Tobacco Board, Plat Form No.2
Throvagunta
Respondents/opposite partyno.2
Counsel for the appellant Sri A.Ramakrishna Reddy
Counsel for the Respondent no.1 Sri A.Giridhar
Counsel for the Respondent No.2 Sri S.Srinivas Reddy
QUORUM: SRI R.LAKSHMINARASIMHA RAO, HON’BLE MEMBER
AND
SRI THOTA ASHOK KUMAR, HON’BLE MEMBER
WEDNESDAY, THE EIGHTH DAY OF FEBRUARY,
TWO THOUSAND TWELVE
Oral Order (As per Sri R.Lakshminarasimha Rao, Hon’ble Member)
***
1. The opposite party is the appellant.
2. The respondent no.1 insured his Tobacco Barn with the appellant for Rs.1,00,000/-. On 30.10.2006 the barn of the respondent no.1 was damaged due to cyclone causing loss to an extent of Rs.1,50,000/-. The respondent no.1 informed the incident to the appellant and the respondent no.2. The surveyor inspected the damaged barn and assessed the loss. The respondent no.1 submitted all the relevant records to the appellant and the respondent no.2 and requested to pay the insurance amount. The appellant failed to pay the insurance amount.
3. The appellant resisted the case contending that the respondent no.1 submitted his claim form along with estimation for reconstruction of the barn for Rs.61,500/-. On receipt of the claim form, the appellant deputed one surveyor to inspect the damaged bran and submit his report. The surveyor investigated the case and submitted his report on 24.1.2007. As per the surveyor's report, the loss is Rs.21,145/- and less 50% depreciation on all damage occurs. The assessment of loss suspended on barn was Rs.10,572/- and the salvage value of the broken bricks and tiers may fetch for Rs.572.50. Under the insurance clause, the respondent no.1 is not entitled to any insurance amount from the respondent no.1 and the same was intimated to the respondent no.1 through the respondent no.2.
4. The respondent no.2 filed counter contending that due to the heavy rain the barn of the responentno.1 was damaged on 30.10.2006 and the same was informed to the appellant by the respondent no.1. The respondent no.2 is no way concerned with the assessment of loss and compensation to be paid to the respondent no.1. There is no consumer relationship between the respondent no.1 and the appellant insurance company.
5. The respondent no.1 filed his affidavit and the documents Exs.A1 and A2. On behalf of the appellant and the respondent no.2, the appellant filed affidavit and Standard Fire and Special Perils Policy is marked as Ex.B1 and the surveyor report as Ex.B2.
6. The District forum allowed the complaint directing the appellant to pay Rs.31,500/- towards damage to the barn together with compensation of Rs.5,000/- and costs of Rs.1000/-.
7. Aggrieved by the order of the District Forum, the opposite partyno.1 filed the appeal contending that the surveyor is an independent authority who is holding a licence issued by the Govt. of India, assessed the loss as per the procedure and norms laid down by IRDA and submitted his report.
8. The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?
9. The facts not in dispute are the issuance of insurance policy, the period of insurance coverage and also the sum assured of Rs.1 lakh. It is also an admitted fact that the barn was damaged in cyclone on 30. 10.2006. The surveyor N.Varahaswami submitted his report to the appellant insurance company and assessed the loss on super structure at Rs.21,145/-. The District Forum has questioned the propriety of assessing the loss in regard to the 8 units of cement with each cement bag at Rs.15/-. The surveyor observed as follows:
“The barn and the wall were collapsed upto lintel portion and roof structure trusses and purling were broken. Tiers–18 nos. were broken at its random. Roof sheets – 3 nos. roof ceiling sheets – 6 nos. were crushed and fallen under the debris. Top angular was cut into pieces. Flue pipes were badly pressed and damaged. Window was fallen and broken.
ASSESSMENT OF LOSS:
S.No Particulars No.Units Rs.unit Amount. Rs.
1. Bricks 6250 1.50 9,375.00
2. Cement 8 15.00 120.00
3. Tiers 7 450.00 3,150.00
4. Mason charges to rebuilt
the damaged walls. 8,500.00 8,500.00
21,145.00
Less 50% depreciation on all 10,572.50
Assessed loss on the barn 10,572.50
SALVAGE : The salvage value of the damaged material may
fetch Rs.572.50
INSURED CLAIMED AMOUNT: The insured submitted claim form with an estimate of Rs.61,500/-
VALUATION: The market value of the superstructure was worked out for an amount of Rs.47,668.00 as against they insured the same for a sum of Rs.1,00,000/-. Hence, the under insurance clause is NOT applicable.
ASSESSMENT OF LOSS:
A Assessed loss on the barn 10,572.50
B. Less Salvage Value 572.50
10,000.00
C. Less Policy excess 10,000.00
RECOMMENDED CLAIM AMOUNT 0,000.00
10. The observation of the District Forum that the cement bag for Rs.15/- as assessed by the surveyor as arbitrary and beyond the imagination of any prudent man, does show the arbitrariness of the assessment of the loss made by the surveyor. The District Forum has pointed out the unreasonable calculation of cement bags as mentioned by the surveyor in his report that 8 cement bags would suffice to construct two walls of the barn. Like wise, the District Forum has deprecated the arbitrary assessment of the loss assessed by the surveyor relating to the cost of the sand and mud mortar for construction of the walls of the barn.
11. At no point of time in the recent past, the cost of the cement bag is Rs.15/-. The surveyor has not shown the same from where he could get the cost of a cement bag at Rs.15/-. The surveyor has proceeded to assess the loss at a dismal rate in the matter of the cost of the cement and sand. The loss sustained to the barn is to be made taking into consideration of reasonable cost of the material used for construction of the barn. And estimate of the loss to the barn without any basis is not sustainable and does not stand to …...of this Commission. We completely agree with the conclusion of the District Forum as to the unreasonable and arbitrary assessment of the cost of the cement bags, mud mortar and etc pertaining to the material required for construction of the walls of the barn.
12. The 1st respondent claimed an amount of Rs.61,500/- as an estimate for reconstruction of the barn. The District Forum disbelieved some of the bills as they are inflated and not commensurate with the actual expenditure required for reconstruction of the barn. The District Forum has taken into consideration the entire evidence and the surveyor’s report showing the damage to the northern and eastern side walls of the barn and pragmatically assessed the loss at Rs.41,500/- and deducted therefrom the amount of Rs.10,000/- towards the policy excess. The balance amount of Rs.31,500/- as assessed by the District Forum towards the value of the damage of the barn is reasonable and sustainable. However the relief for compensation of Rs.5,000/- awarded against the appellant insurance company is not sustainable in the light of award of interest and as such is liable to be set aside. Accordingly, the order of the District Forum is liable to be modified.
12. In the result, the appeal is partly allowed. The order of the District Forum is modified. The 1st opposite party to pay Rs.31,500/- with interest @ 9% p.a from the date of filing of the complaint together with costs of Rs.1,000/-. Time for compliance four weeks.
MEMBER
MEMBER
Dt.08-02-2012
