Chandigarh

StateCommission

A/39/2020

Bajaj Allianz General Insurance Company Ltd. - Complainant(s)

Versus

Ajay Partap Singh - Opp.Party(s)

Punit Jain Adv.

05 May 2021

ORDER

 STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

Appeal No.	:	39 of 2020
Date of Institution	:	06.02.2020
Date of Decision	:	05.05.2021

Bajaj Allianz General Insurance Company Ltd., GE Plaza, Airport Road, Yervada, Pune 411006.

Local Address:- Bajaj Allianz Gen. Ins. Co. Ltd., SCO 156-159, Sector 9-C, Chandigarh, through its Authorized Signatory.

    ……Appellant/Opposite party

V e r s u s

Ajay Partap Singh son of Sh.Varinder Singh, Resident of House No.1678, Pushpac Society, Sector 49-B, Chandigarh (Proprietor of M/s Toy Zone, SCO No.1108-1109, Basement, Sector 22-B, Chandigarh).  

…..Respondent/Complainant

 

BEFORE:             JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                             MRS.PADMA PANDEY, MEMBER

                             MR.RAJESH K. ARYA, MEMBER

 

Present through video conferencing:                

                             Sh.Puneet Jain, Advocate for the appellant.

       None for the respondent.

 

JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

 

M.A./155/2020:-

                   For the reasons stated in the application filed by the appellant, delay of 45 days in filing this appeal is condoned and the application is disposed of, accordingly.

 

M.A./156/2020:-

                   For the reasons stated in this application filed by the appellant for placing on record additional evidence by way of documents Annexures A-2 and A-3 is allowed and the said documents are ordered to be taken on record. Accordingly, this application also stands disposed off.

                  

Appeal/39/2020:-

                   This appeal has been filed by the appellant/opposite party against the order dated 01.10.2019, passed by the District Consumer Disputes Redressal Commission-II, U.T., Chandigarh (in short the District Commission), whereby consumer complaint bearing no.15 of 2019, filed by the respondent/complainant was allowed as under:-  

“….a]  To pay balance claim amount of Rs.10 lacs (Ten Lacs Only), after making deduction of Rs.50,237/- only towards  salvage as per surveyor’s report, to the complainant along with interest @9% per annum from 19.10.2018 i.e. after one month from the surveyor’s report till the date of payment;

b)  To pay an amount of Rs.25,000/- as compensation on account of deficient services.

c)  To pay litigation cost of Rs.10,000/- to the complainant.

This order shall be complied with by the Opposite Party No.1 & 2 within a period of 30 days from the date of receipt of its copy…”

2.           The District Commission noted down the following facts out of the case of the respondent/complainant:-      

 

“……The facts in brief are that the complainant, being Proprietor of M/s Toy Zone, is engaged in the business of selling/retailing toys & other kids items, for earning his livelihood.  The complainant got Shopkeepers Package Policy bearing No.0G-18-1201-4092-00000013 from Opposite Party, effective from 19.6.2017 to 18.6.2018, to indemnify & protect its business from fire and allied perils, burglary, money insurance & plate glass (Ann.C-1).  It is averred that the shop of the complainant suddenly caught fire during the intervening night of 13^th/14^th June, 2018 and the entire basement full with stock and other interiors got engulfed by disastrous fire flames.  The incident of fire was reported to Fire Brigade, Police as well as to OPs on 14.6.2018 (Ann.C-2).  It is stated that it took almost 24 hours for the firemen to extinguish the fire.  It is also stated that the stock to the tune of Rs.1,10,70,235/- lying in the shop cum office of complainant got burnt & damaged in the said fire.  Then the claim was lodged with OPs, who after a long period of 107 days and exchange of various communications with complainant, disbursed an amount of Rs.75 lacs only.  It is submitted that the OPs illegally and wrongfully withheld an amount of Rs.10 lakhs from the claim of the complainant and also took too much long time to make payment of partial claim amount of Rs.75 lakhs.  The complainant requested the OPs to release the balance amount of claim, but to no avail.  Hence, this complaint has been filed alleging deficiency in service and unfair trade practice on the part of OPs. .”

 

3.           The appellant/opposite party responded to the complaint filed by the respondent as under:-

“………… The Opposite Parties No.1 & 2 have filed joint reply and while admitting the factual matrix of the case, stated that the amount was disbursed to the complainant on receipt of the Survey Report dated 19.9.2018, thus there is no delay as alleged by complainant.  It is stated that as per Survey Report, it is the complainant who delayed the submission of documents and the same were provided upon various reminders by the Surveyor.  It is submitted that the OPs made the disbursal of the insured amount based on the Survey Report submitted by the Surveyor.  It is also submitted that the complainant has not disclosed under which clauses of insurance policy, the amount of Rs.10 lakh is payable.  It is further submitted that the complainant could not provide the proof of the sale of stocks, thus, such stock would be considered as dead stock.  It is stated that the salvage deduction is on the basis of the stocks segregated by the complainant and the assessment of the Surveyor, thus the salvage deduction and lastly the deduction under the policy excess @5% is as per the terms & conditions of the policy.  The Surveyor upon investigation of the stocks, has assessed the salvage amount and has thus made the recommended necessary deductions. Denying all other allegations and pleading no deficiency in service, the OPs have prayed for dismissal of the complaint….”

4.           The respondent filed rejoinder wherein he reiterated all the averments contained in the complaint and controverted those in the reply filed by the appellant.
5.           After hearing the contesting parties and on going through the evidence and record of the case, the District Commission allowed the consumer complaint, in the manner stated above.
6.           Hence this appeal.
7.           We have heard the Counsel for the appellant and have also gone the entire record of the case, including the written arguments filed by the parties, very carefully.
8.           Coming to the merits of this case, it may be stated here that since the facts with regard to purchase of Shopkeepers Package Policy bearing No.0G-18-1201-4092-00000013 from the appellant by the respondent, effective from 19.6.2017 to 18.6.2018, to indemnify & protect its business from fire and allied perils, burglary, money insurance & plate glass; occurrence of sudden fire during the intervening night of 13^th/14^th June, 2018 in the said premises as a result whereof, the entire basement full with stock and other interiors got engulfed by disastrous fire flames; timely reporting of the said incident to the Fire Brigade, Police as well as to appellant by the respondent; and that stock to the tune of Rs.1,10,70,235/- lying in the premises got burnt & damaged in the said fire; lodging of claim with the appellant and disbursal of amount of Rs.75 lacs  against insured amount of Rs.85 lacs have not been disputed by the parties.

                   However, the dispute is only with regard to the illegal deduction/withholding of the remaining insured amount of Rs.10 lacs, over and above the amount of Rs.75 lacs already paid by it to the respondent?. It is significant to mention here that in the first instance, the appellant manipulated the Surveyor Report dated 19.09.2018, available with it and despite the fact that Sh.A.K. Wanikar, Director and Sukrat Bhardwaj, Branch Head, Puri Crawford Insurance Surveyors & Loss Assessors India Pvt. Ltd., have reported the value of the salvage as Rs.50,237/-, it (appellant) has provided a certificate dated 03.11.2018, Annexure C-9, wherein it has been wrongly informed to the respondent that the said Surveyors have assessed the salvage value to the tune of Rs.2,39,190/-. In this manner, the appellant wanted to usurp the amount of Rs.1,88,953/- (Rs.2,39,190/- (-) Rs.50,237/-) from the claim amount of the respondent, on the basis of untrue document, which act amounts to deficiency in providing service and adoption of unfair trade practice. The District Commission was also right in holding so.

9.           Now coming to the remaining amount assessed by the said Surveyors. It may be stated here that it has been clearly mentioned in Clause A of the policy in question that on the happening of any insured event as provided for herein, and arising during the policy period and notified as prescribed, the Company will make payment as provided for under each cover but only upto the Sum Insured and/or Limit of Indemnity as specified in the schedule against each cover or each sub-limit of Sum Insured or the Limit of Indemnity, as the case may be. In the present case, the Surveyors in para no.9 of their report dated 19.09.2018, have clearly opined as under:-

“9.01 The entire stocks of Kids Toys, Kids Body Care, Cosmetics, Garments, etc. kept inside the shop was badly burnt/damaged due to fire, heat, smoke and water used during  fire fighting and were rendered unfit for further use. Apart from this, considerable quantity was completely turned into ashes and was in non-identifiable and countable state. Practically,  all the stocks stored/lying in the insured’s premises got affected/damaged in the incident.

 

9.02 The entire furniture fixtures fittings and other contents including wooden/glass shelves, steel shelves, display racks, counters, computers, swipe, false ceiling etc. installed at the affected store was badly damaged/burnt/melted. However, same was not insured under the policy…”

 

Thus, when as per the version of the Surveyors themselves, to the effect that the entire stocks kept inside the shop was badly burnt/damaged due to fire, heat, smoke and water used during the fire fighting and were rendered unfit for further use and that considerable quantity completely turned into ashes and was in non-identifiable and countable state and that practically,  all the stocks stored/lying in the insured premises got affected/damaged in the fire incident, then there was no reason with the Company to deduct any amount out of the insured amount, in view of clause A of the insurance Policy.  

10.            As far as deduction of 5% towards Policy Excess by the Surveyors is concerned, it may be stated here that once a huge amount equal to 25% of the total value of stocks i.e. out of Rs.1,08,45,649/-  was deducted on account of variation in books of accounts/dead stocks/wastage/obsolesce etc., which too was only on the basis of assumptions, as admittedly, the entire stock was burnt/damaged due to fire, heat, smoke and water used during the fire fighting, then it was not required  of the said Surveyors to apply the Excess Policy @5% over and above the said deductions of 25%. The Surveyors have failed to give any convincing justification in doing so. Under above circumstances, it is held that the report submitted by the Surveyors and Loss Assessors deputed by the appellant suffers from some illegality, to that extent. In New India Assurance Company Ltd Vs Pradeep Kumar (Civil Appeal No 3253 of 2002, dated April 9, 2009), the Supreme Court referred to Section 64 UM (2) of the Insurance Act and observed that even though the assessment of loss by an approved surveyor is a pre-requisite for settlement of claim, yet the surveyor’s report is not the last and the final word. Even though it is the basis for settlement of claim, it is not sacrosanct and it is not binding on the insurer or the insured. The District Commission was also correct in holding that the deductions so made by the Surveyors to the extent of 5% towards Excess Policy are arbitrary.
11.           Now coming to the objection with regard to pecuniary jurisdiction of the District Commission, it may be stated here that it is settled law that it is the premium paid to the insurer which when added to the compensation claimed in the complaint would determine the pecuniary jurisdiction of this Commission and not the Insured Declared Value (IDV). Our this view is supported by the observations made by the Hon’ble National Commission in RP No.1794 of 2017, M/s. Maharani of India Vs. Branch Manager, United India Insurance Co. Ltd., decided on 11.01.2018, (NC ). Relevant part of the said order is reproduced hereunder:-

“4.      When an insurance policy is taken by a person he pays a premium to the insurer for hiring or availing its services. It is the premium paid by the insured to the insurer and not the extent of the sum insured which constitutes the agreed consideration and therefore in my opinion, it is the premium paid to the insurer which when added to the compensation claimed in the complaint would determine the pecuniary jurisdiction of this Commission. The extent of the sum assured would have no bearing on determination of the pecuniary jurisdiction of a consumer forum.

5.      Admittedly in the present case if the premium paid by the petitioner / complainant to the respondent is added to the compensation claimed by it, the aggregate does not come to more than Rs.20 lakhs. The District Forum, therefore, did possess the requisite pecuniary jurisdiction to entertain and decide the complaint...”.

Thus, because in the present case, the premium amount of Rs.12,273/- has been paid by the respondent towards the policy in question, which is less than Rs.20 lacs, as such, the District Commission was right entertaining and deciding the consumer complaint, out of which this appeal has arisen. Objection taken by the appellant in this regard stands rejected.

12.           As far as objection taken to the effect that since the respondent had received the amount of Rs.75 lacs as full and final settlement without any protest, as such, he cannot raise any dispute thereafter, it may be stated here that the appellant has failed to produce any evidence, wherefrom it is evident that the respondent has expressly waived of his right for claiming the remaining claim amount, which is available to him under the law. In our considered opinion, if the complainant did not reserve any right to claim remaining amount, which is available to him under the law, it was not necessary for him to expressly reserve his right for the same. Our this view is supported by the findings given by the Hon’ble National Commission in Vivek Kishorchandra Mehta & Anr. Vs. Puranik Builders Pvt. Ltd. & Anr., First Appeal No. 522 of 2017, decided on 03 Oct 2018, wherein it was held as under:-

“……….Hence, the finding of the State Commission does not stand on a firm legal footing.  So far as the question of protest by the complainants while receiving the amount is concerned, any protest on their part would have denied them the benefit of receiving the amount of refund and the prudence at that time demanded that they should first accept the refund and later claim for interest. Hence, both the grounds on which the complaint has been dismissed by the State Commission are not sustainable…..”

13.           For the reasons and law stated herein above, we do not find any illegality or irregularity in the impugned order passed by the District Commission and the same is upheld. Consequently, this appeal is dismissed with no order as to cost.
14.           Certified Copies of this order be sent to the parties, free of charge.
15.           The file be consigned to Record Room, after completion.

Pronounced.

05.05.2021

 

Sd/-

 [RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

Sd/-

(PADMA PANDEY)

          MEMBER

 

 

Sd/-

(RAJESH K. ARYA)

MEMBER

Rg.