Haryana

StateCommission

A/936/2015

ORIENTAL INSURANCE CO. - Complainant(s)

Versus

AMBALA WINE TRADERS - Opp.Party(s)

D.C.KUMAR

10 Nov 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA

                                                 

First Appeal No  :  936 of 2015

Date of Institution: 26.10.2015

Date of Decision :  10.11.2016

 

1.      Branch Manager, Oriental Insurance Company, LIC Building Ambala City

2.      Divisional Manager, Oriental Insurance Company Near Capital Chowk, Ambala Cantt.

3.      Lalit Swami, Development Officer, Oriental Insurance Company, LIC Building, Ambala City

 

                                      Appellants-Opposite Parties

Versus

 

M/S Ambala Wine Traders, 22 Jaggi Colony, G.T. Road, Ambala City through Partner Swaran Singh.

 

                                      Respondent-Complainant

 

 

CORAM:             Hon’ble Mr. Justice Nawab Singh, President.

                             Shri B.M. Bedi, Judicial Member.

                             Shri Diwan Singh Chauhan, Member   

 

Argued by:          Sh. D.C. Kumar, Advocate for the appellants

Sh. Ranjan Arora, Advocate for the respondent.

 

                                                   O R D E R

 

B.M. BEDI, JUDICIAL MEMBER

 

The Oriental Insurance Company and its functionaries- opposite parties are in appeal against order dated 10.09.2015 passed in Consumer Case No. 357 of 2012 passed by the District Consumer Disputes Redressal Forum, Ambala (in short, ‘District Forum’) vide which the complaint was allowed and opposite parties were directed to pay a sum of Rs.10,10,553/- to the complainant along with interest @ 9% per annum from the date of filing of complaint  and Rs.10,000/- as litigation expenses.

2.      M/s Ambala Wine Traders-complainant filed complaint with submissions that they were running a wholesale outlet of Indian made foreign liquor (IMFL) at Ambala. Their stock was insured with Insurance Company-opposite parties vide Policy Annexure C-6 and C-7 respectively for Rs.1 Crore.  On account of heavy floods in Ambala during first week of July, 2010 the stocks of complainant lying at their godown were damaged to the extent of Rs.13,47,404.40.  The Insurance Company was informed and requisite documents were submitted to the Insurance Company.  The Insurance Company appointed its surveyors on 08.07.2010. However, despite reminder and repeated visits the claim amount was not paid to the complainant. Complainant filed complaint under Section 12 of the Consumer Protection Act, 1986.

3.      The Insurance Company in its written version pleaded that the complainant was running the business of wholesale foreign liquor and their stock lying at the godown was insured with them.  It was denied that the complainant suffered loss to the tune of Rs.13,47,404/-.  It was stated that M/s Consolidated Surveyors Pvt. Ltd. visited the premises and despite visits, the complainant did not supply required documents, therefore, the claim was closed as “NO CLAIM”. It prayed for dismissal of complaint.

4.      District Forum after hearing both the parties allowed the complaint and issued directions as detailed in opening para of this order.

5.      Aggrieved of the order of the District Forum, the Insurance Company has come up in appeal. 

6.      Both the parties also submitted their respective written arguments.

7.      Two fold arguments were raised by the Insurance Company, firstly that as per the report of surveyor the complaint had disposed of the stock.  The supplementary report Exhibit R-2 dated 04.03.2015 was submitted which was based on certificate issued by Excise and Taxation Department vide which no loss was intimated by the complainant to the Excise and Taxation Department and secondly that complainant was not a consumer as it was running commercial activity.

 8.     Neither in the written version nor in the grounds of appeal, the Insurance Company has raised the plea of being a commercial transaction. However, in the written arguments, it was submitted that the complainant was not a consumer as he was running a commercial business.  It has been settled by the Hon’ble National Consumer Disputes Redressal Commission, New Delhi in Harsolia Motors Vs. M/s National Insurance Co. Ltd. at 2005 CPJ 27 (NC) that a person who takes insurance policy to cover the envisaged risk does not take the policy for commercial purpose.  Policy is only for indemnification and actual loss.  It is not intended to generate profit. In the light of aforesaid judgment it becomes clear that availing service of insurance company does not amount to taking services for commercial purposes and, hence, complainant is a consumer within the purview of Consumer Protection Act, 1986. Therefore, this argument has no force.

8.      Complainant to prove his case has placed on record inventory of loss (Annexure-C-10) alongwith details (Annexure-C-11) to the insurance company on 01.09.2010 in respect of their query. Besides the balance sheet (Annexure-C-14 and C-15) and invoices (Annexure-C-16 and C-26) showing the purchase of stocks.  Even the surveyor in his report (Annexure R-8) has admitted about the loss.  The relevant part of the report of surveyor i.e. Clause6, 7, 8, 8.1 & 8.2 under the heading is reproduced as under:-

6.      About the Incident:

“It has been reported to us by the representative of the insured that entire North India and Ambala and surrounding areas experienced heavy monsoon rains on 4^th, 5^th & 6^th July, 2010, which resulted in disruption of normal life and rail and road service in the region.  On 6^th morning due to braches in the seasonal rivulets, the Ambala City and Ambala Cantt. Experienced flash floods and the twin towns of Ambala Cantt. & Ambala City were inundated by flood water.  The accumulated water entered the shops, factories and residences in and caused havoc in the area.  The residents of Ambala City and Cantt. suffered huge losses on account of property loss by flash floods.  The insured’s premises are situated in a low lying area and the rain water accumulated and the stock stored on the floor was damaged by flash flood water.     

7.      Position at Survey:

The undersigned on 13.07.2010 visited the insured’s premises and inspected the site of loss and on visual inspection found tht the stocks were damaged by muddy flash flood water.  The water level up to a high of 4 ft. was observed on the walls of the premises.  The entire stock was submerged in water. On our first visit, we requested the insured to segregate the entire damaged stock.  After a gap of 5-6 days, we again visited the insured’s premises and found that no damaged stock was shown to us, rather the insured’s representative present there informed us that entire damaged stock has been disposed off. We have not been shown the damaged stock and no opportunity has been given to us to verify the quantity and extent of damage of stock.

8.      Cause of Loss:

8.1    The news of flash floods/Inundation was published in all leading news papers of the region and was telecasted by the electronic media.  The enclosed photographs of the insured’s premises clearly exhibits that stock has been damaged by flash floods.

8.2    The cause of loss being flash floods/inundation of the premises is covered under the insured perils.

 

9.      The admission by the surveyor is by itself sufficient regarding the loss suffered by the complainant.  The only reason for denying the claim was that the complainant has disposed off the stock.  The admission of the surveyor that on his visit the stock of liquor was actually found to be damaged by the muddy flash flood water.  The stock being a consumable item, could not have been sold for human consumption. It could create health hazards and risk human lives.  Therefore, the disposal of the stock did not mean that it was sold in the market.  The loss being admitted and the documents show the extent of loss besides the Insurance Company did not lead any evidence to disprove the quantum of loss.  As per the report Annexure-C-7, the version of complainant has to be accepted.

10.    Another plea was raised that as per Annexure R-3 no loss was intimated to the Excise Authorities.  No rule or instructions, whether statutory or contractual, have been brought to our notice which may require wholeseller to intimate about the loss to the excise authorities.  There is another aspect. The Insurance Company has closed the claim of the complainant as “No Claim” on 18.03.2011 while Annexure R-3 supplementary report was obtained by the insurance company from the Deputy Excise and Taxation Commissioner, Ambala on 03.03.2015.  The complaint was filed on 29.11.2012.  It means the certificate Annexure-R-3 was obtained by the insurance company during the pendency of the complaint and without any statutory requirement which was not justifiable.  The District Forum has taken into consideration all these facts.  The order is well reasoned and does not require any interference.  The appeal consequently fails and is hereby dismissed.

11.    The statutory amount of Rs. 25000/- deposited at the time of filing the appeal be refunded to the complainant against proper receipt and identification in accordance with rules, after the expiry of period of appeal/revision, if any.

 

 

Announced 10.11.2016

(Diwan Singh Chauhan) Member

(B.M. Bedi) Judicial Member

(Nawab Singh) President

DK