Punjab

Ludhiana

CC/20/364

Bahadur Mal Dharam Paul - Complainant(s)

Versus

Bharti Axa General Ins.Co.Ltd - Opp.Party(s)

Amit Tandon

16 Oct 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No: 364 dated 21.12.2020.                                                        Date of decision: 16.10.2023.

 

Bahadur Mal Dharam Paul, 14, Guru Nanak Complex, Doctor Gujjar Mal Road, Ludhiana, Punjab-141008 through his Authorized Representative Mr. Raghav Khanna.                                                                                                                                                                                              ..…Complainant

                                                Versus

1. Bharti Axa General Insurance Company Limited, First Floor Hosto Centre, No.43, Millers Road, Vasanth Nagar, Bangalore-560052.
2.  
7.  

…..Opposite party  

 

2. HDFC Bank Limited, SCF, 13-14, Block-F, BRS Nagar, Ludhiana through its Branch Manager/M.D.
3. M/s. Puri Crawford Insurance Surveyors & Loss Assessors Pvt. Ltd.

…..Performa Respondents

Complaint Under Section 2 (7) read with Section 17, 34, 35, 36 of the Consumer Protection Act, 2019.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

SH. JASWINDER SINGH, MEMBER

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Ms. Rituja Mohanti and Smt. Amit Tandon,                                                         Advocates.

For OP1                         :         Sh. Rajeev Abhi, Advocate.

For OP2                         :         Sh. Rahul Rajput, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

 

1.                Shorn of unnecessary details, the facts of the complaint are that the complainant firm is engaged in the business of wholesale cloth having its principal place of business at 122-I, Sarabha Nagar, Ludhiana. The complainant took Standard Fire & Special Perils Policy No.I2569141/22/05/004262 from opposite party No.1 Bharti Axa through respondent No.2 HDFC Bank. The policy was a General Insurance in nature for a period of one year i.e. from 22.05.2018 to 21.05.2019. According to the complainant the “risk location” for the policy was another shop of the complainant at 14, Guru Nanak Complex, Dr. Gujjar Mal Road, Ludhiana regarding which risk assumption letter dated 24.05.2018 was issued to the complainant. The detail of the policy is reproduced as under:-

Name of the Insured	Bahadur Mal Dharam Paul
Policy Number	12569141/22/05/004262
Period of Insurance	22.05.2018 to 21.05.2019
Risk Occupancy/Type	Shops
Sum Insured	Rs.14,82,000/-

Further the cover of the complainant as per clause 1049 of the policy was from storm, cyclone, typhoon, tempest, hurricane, tornado, flood, inundation, which is reproduced as under:-

“1049 – Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood, Inundation.

“Loss, destruction or damage directly caused by Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood, Inundation as covered under the policy.”

The complainant further stated that it approached opposite party No.1 in June 2017 with request to add the demised property being 122-I, Sarabha Nagar, Ludhiana, Punjab-141001 as “risk location” to the policy in question and thereafter, the address was updated in the records of respondent No.2 on 07.07.2017. However, on 17.07.2018 due to incessant rainfall in Ludhiana, the demised premises of the complainant was flooded and water logged which caused damage to the stock of fabric that was stored in the premises. The complainant lodged a claim on 18.07.2018 with opposite party No.1 on their toll free number which was registered vide claim No.I8C040K3. Opposite party No.1 appointed a surveyor M/s. Puri Crawford Insurance Surveyors & Loss Assessors India Private Limited, who visited the affected premises on 20.07.2018 and assessed the loss/damages to the stock of fabric by flooding of premises due to heavy rains and water logging. The complainant also shared photographs and videos of water logged premises and submitted an application to claim the damages along with an estimated damage assessment and other relevant documents. Even on request of surveyor, the complainant provided a certificate issued by respondent No.2 certifying that the complainant was also carrying on business at the demised premises and requested the bank to update the address as a “risk location” in the policy in question. Further the surveyor vide an email dated 13.08.2018 requested the complainant to provide certain other information/documents to determine the maximum liability of the insurers, which the complainant provided on 22.08.2018 to the surveyor.

                   The complainant further stated that the surveyor gave two offers i.e. either to retain the damaged stock by paying 20% to 30% material cost or to avail the services of a salvage buyer to pick the damaged stock. Accordingly, the complainant chose second option and requested the surveyor to ask a salvage buyer to collect the damaged stock vide email dated 25.10.2018. The surveyor gave details of a salvage buyer to the complainant and the salvage buyer visited the demised premises on 02.11.2018 but the salvage buyer never responded to the complainant after visiting demised premises. On 24.12.2018 the surveyor team informed the complainant that certain approvals were pending at the end of opposite party No.1 and the complainant share all the policy related details along with claim number with one Mr. Manpreet, an employee of opposite party so as to expedite the settlement of his claim. The complainant from January 2018 to March 2019 repeated followed up the surveyor and Mr. Manpreet upon which Mr, Manrpeet through telephonic conversation informed the complainant that the approvals were under process and the policy was with their underwriter to amend in the insurance policy and also informed that his claim would be settled before the end of financial year i.e. 31.03.2019. However, via email dated 25.03.2019, opposite party No.1 repudiated the claim of the complainant and closed the same as “No Claim” and it was also intimated that in the final survey report, the surveyor had estimated a loss of Rs.2,66,461/- only. However, the complainant was not provided the final survey report of the surveyor after lapse of eight months, as the surveyor visited the demised premises on 20.07.2018, so the surveyor is duty bound to provide copy of a report to the insured as per IRDAI (Insurance Surveyors), Regulations, 2015 (Clause 13(2), which is reproduced as under:-

“A surveyor or loss assessor whether appointed by insurer or insured, shall submit his report to the insurer as expeditiously as possible, but not later than 30 days of his appointment with a copy of the report to the insured giving his comments on the insured’s consent or otherwise on the assessment of loss.”

According to the complainant he failed to receive any response despite various Emails correspondences dated 01.04.2019, 08.04.2019, 18.04.2019, 13.05.2019, 31.05.2019 etc. between the complainant and officials of the opposite parties. The complainant sent a legal notice dated 14.01.2020 to the opposite parties. The complainant received evasive reply to notice on 30.01.2020. The complainant has suffered a lot of financial loss besides mental pressure, harassment and agony at the hands of opposite party No.1 due to its deficiency in service and unfair trade practice. In the end, the complainant prayed for issuing direction to opposite party No.1 to pay a sum of Rs.14,80,000/- as compensation along with interest and further to pay damages to the tune of Rs.1,00,000/- and litigation expenses of Rs.2,00,000/-.

2.                Upon notice, opposite party No.1 appeared and filed written statement and by taking preliminary objections, assailed the complaint on the ground of maintainability of the complaint; lack of jurisdiction; lack of cause of action; suppression of material facts; bad for non-joinder and mis-joinder of necessary parties etc. Opposite party No.1 stated that immediately after the receipt of the claim it was duly registered, entertained and processed. The complainant had obtained Standard Fire & Special Peril Policy bearing No.12569141/22/05/004262 valid from 22.05.2018 to 21.05.2019 covering the risk as detailed in the policy for a total sum insured of Rs. 14,52,000/- lying at the address i.e. 14, Guru Nanak Complex, Dr. Gujjar Mal Road, Ludhiana subject to the terms, conditions warranties and exclusions mentioned in the policy. According to opposite party No.1, the insurance is a species of a contract and the relations between the insured and insurers are governed by the terms and conditions contained therein such as coverage, premium amount etc. which are fixed as per the location of the insured premises and risk of loss etc. Therefore, once the contract is executed the relation between the parties is strictly governed by the terms thereof, which cannot be changed. A claim was lodged regarding the alleged flood and water logged due to rainfall which took place on 17.07.2018 at the premises situated at House No.122-1, Sarabha Nagar, Ludhiana which is at the distance of about 12 Kms. from the risk location mentioned in the policy i.e. shop No.14, Guru Nanak Complex, Gujjar Mal Road, Ludhiana.

                   Opposite party No.1 further stated that immediately on the receipt of the claim M/s. Puri Crawford Insurance Surveyors & Loss Assessors India Pvt. Ltd., (formerly known as Puri Crawford & Associates India Pvt. Ltd.) an IRDA approved licensed surveyor and loss assessor, Cabin No.304, SCO 218-219, 3rd Floor, Sector 34-A, Chandigarh 160022 was appointed as surveyor and loss assessor, who after its appointment visited the affected premises situated at House No.122-1, Sarabha Nagar, Ludhiana for the survey of the aforesaid loss. During their visit the said surveyor inspected the premises and took note of the circumstances, cause and extent of loss. The said surveyor observed that loss has occurred at House # 122-1, Sarabha Nagar, Ludhiana 141001 which is at a distance of about 12 Kms from risk location mentioned in the policy i.e. Shop # 14, Guru Nanak Complex, Gujjar Mal Road, Ludhiana 141001. Thus we request you to clarify the discrepancy. This fact was intimated by the surveyor to the complainant vide their email dated 13.08.2018. It was further intimated vide email dated 13.08.2018 by the said surveyor to the complainant that "However, to fix the maximum liability of insurers; we request you to provide us the following information/documents (on without prejudice basis, subject to terms & conditions of policy and admission of liability by insurers) at the earliest:-

 

• Copy of newspaper cutting confirming flooding/heavy rains in the area as on said date of loss.
• Copy of audited balance sheet of firm for the F.Y. 2016-17, 2017-18
• Provisional Trading, Profit & Loss Account from 01.04.18 to 30.06.2018 (immediately before the date of loss) duly certified by Chartered Accountant.
• Copy of GST Return for the period from 01.04.2018 to 30.06.2018 submitted to department.
• Copy of last six month's stock statement submitted to bankers.
• Claim bill along with all supporting invoices for the affected stocks such as purchase bills.
• Claim form duly filled and completed.
• Copy of salvage offers for affected stocks from at least three salvage buyers.
• Kindly keep the affected/damaged stocks in safe custody till further instructions from us.
• If we require any other information/documents, we shall ask for the same in due course of time.

The said surveyor had personally inspected the spot, took the photographs and other documents and thereafter prepared his final survey report dated 25.02.2019 under his signatures and submitted the same with the opposite party No.1 assessing the loss to Rs.2,46,461/- without prejudice and strictly as per terms, conditions and exceptions of the relevant insurance policy clearly stating in para 7.01 which is re-produced as under:

"As aforesaid that the risk location mentioned in the policy is 'Shop # 14 Guru Nanak Complex Dr. Gujjar Mal Road, Ludhiana Punjab 141001' remained safe whereas the loss had occurred at 'House 122-1, (wrongly typed as 112-1) Sarabha Nagar, Ludhiana 141001'; which is at a distance of about 12 kms from risk location under the policy. In view of this; we confirm that there will be no liability of insurers in the said claim". Thus, in the view of the same it is abundantly clear that there remains no dispute that the loss location is not covered under the policy."

After the receipt of the survey report of M/s Puri Crawford Insurance Surveyors & Loss Assessors India Pvt. Ltd. dated 25.02.2019 and after scrutinizing the documents placed in the claim file and after due application of the mind by the officials of the opposite party No.1 in terms of the insurance policy the claim of the complainant was repudiated as no claim vide email dated 25.03.2019 on the grounds that the place at which loss has taken place is not covered in the policy since the loss due to rainfall is stated to have taken place at 122-1 (wrongly typed as 112-1), Sarabha Nagar, Ludhiana whereas the location mentioned in the policy is 14, Guru Nanak Complex, Dr. Gujjar Mal Road, Ludhiana. Hence the opposite party No.1 is not liable for the loss. Opposite party No.1 further averred that the claim of the complainant has rightly been repudiated as no claim and the grounds of repudiation are legal, valid, enforceable and are in accordance with the terms and conditions of the insurance policy. The complainant has served the false and frivolous legal notice based on wrong facts which was duly replied on 30.01.2020 stating the true and correct facts.

                   On merits, the opposite party No.1 reiterated the crux of averments made in the preliminary objections. The opposite party No.1 has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.

3.                Performa respondent/opposite party No.2 filed separate written statement and by taking preliminary objections, assailed the complaint on the ground of maintainability of complaint; lack of jurisdiction; lack of cause of action; suppression of material facts by the complainant etc. Opposite party No.2 further stated that the complainant took CC limit from them and after reading and understanding the terms and conditions of the agreement/sanction letter appended his signatures on the same. Moreover, opposite party No.2 has been unnecessarily dragged into litigation as there is no dispute between him and the complainant concerning the said CC limit. The grievance of the complainant, if any is to be redressed by opposite party No.1 and not by opposite party No.2 as opposite party No.2 has no control to address concerns of the insured.

                   On merits, the opposite party No.2 reiterated the crux of averments made in the preliminary objections. The opposite party No.2 has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.

4.                In support of its claim, the complainant tendered affidavit Ex. CA of Sh. Raghav Khanna, authorized representative of the complainant in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. CA1 is the copy of  Authority letter dated 15.10.2020, Ex. C1 is the risk assumption letter and policy documents, Ex. C2 is the copy of newspaper, Ex. C3 is the copy of certificate dated 20.07.2018 of the complainant, Ex. C4 is the certificate dated 23.07.2018 of HDFC Bank, Ex. C5 is the copy  of certificate dated 03.08.2018 issued by HDFC Bank, Ex. C6 is the certificate dated 07.08.2019 issued by HDFC Bank, Ex. C7, Ex. C9, Ex. C11 to Ex. C24 are the copies of emails, Ex. C8 is the copy of letter dated 22.08.2018 along with documents submitted by the complainant, Ex. C10 is the copy of IRDAI regulation dated 30.10.2015, Ex. C25 is the copy of legal notice, Ex. C26 is the copy of reply dated 30.01.2020 to legal notice and closed the evidence.

4.                On the other hand, opposite party No.1 tendered affidavit Ex. RA of Sh. Rishi Kant, Manager (Legal), Bharti General Insurance Co. ltd., New Delhi branch as well as affidavit Ex. RB of Sh. Sukrat Bhardwaj, Branch Head, Chandigarh Operations of M/s. Puri Crawford Insurance Surveyors & Loss Assessors (P) Ltd., Chandigarh and submitted documents Ex. R1 is the copy of letter dated 24.05.2018 of insurance policy/documents, Ex. R2 is the copy of final survey report dated 25.02.2019, Ex. R3 is the copy of initial loss advice dated 23.07.2018, Ex. R4 is the copy of certificate dated 03.08.2018 issued by HDFC Bank, Ex. R5 is the copy of certificate dated 23.07.2018 issued by HDFC Bank, Ex. R6, Ex. R7 are the copies of news items, Ex. R8 to Ex. R12 are the ledger statements of the complainant,  Ex. R13 is the copy of Form GSTR-3B for the month of April for the year 2018-19,  Ex. R14 is the copy of Form GSTR-3B for the month of May for the year 2018-19, Ex. R15 is the copy of Form GSTR-3B for the month of June for the year 2018-19, Ex. R16 to Ex. R23 are the copies of tax invoices, Ex. R24 is the copy of claim form, Ex. R25 is the copy of claim bill of effective stock, Ex. R26 are the copies of Email correspondence, Ex. R27 is the copy of email dated 25.03.2019 and closed evidence.

                   Affidavit and documents of opposite party No.2 were already on record.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and affidavit produced on record by both the parties. We have also gone through the point of arguments submitted by the complainant.

6.                Admittedly, the complainant firm, a holder of Standard Fire and Special Peril Policy Ex. C1 = Ex. R1 having its validity from 22.05.2018 to 21.05.2019, lodged a claim due to water logging in the premises situated at 122-I, Sarabha Nagar, Ludhiana on 17.07.2018. On the receipt of the claim, M/s. Puri Crawford Surveyors & Loss Assessors (P) Ltd., an IRDA approved licensed surveyor and loss assessor, Chandigarh was appointed as surveyor and loss assessor. The surveyor inspected the spot, raised queries about the distance between the risk location and site in question and thereafter, submitted his report. The surveyor vide his survey report Ex. R2 made remarks which reads as under:-

“Remarks:   Upon perusal of policy; we observed that risk location                                mentioned in the policy “Shop #14, Guru Nanak Complex,                        Gujjar Mal Road,Ludhiana-141008” whereas the loss had                       occurred at “House #112-1, Sarabha Nagar, Ludhiana-                                  141001”; which is at a distance of about 15 Kms from risk                           location covered under the policy. In view of this; we request                      insurers to check & confirm whether insured has taken an                           insurance cover for affected location to enable us to proceed                             further in the claim.”

Opposite party No.1 scrutinized the survey report dated 25.02.2019 Ex. R2 and vide email dated 25.03.2019 Ex. C11 = Ex. R27 repudiated the claim of the complainant, operative part of which is reproduced as under:-

“We refer to the captioned claim which was reported to us on 19^th July 2018. On receipt of the intimation, we had appointed Surveyors M/s. Puri Crawford Insurance Surveyors & Loss Assessors India Pvt. Ltd., to verify and assess the reported loss of theft on 17.07.2018.

We have now received the Final Survey report along with supporting documents related to the said incidence. Estimated loss amount is INR 2,66,461 for reference purpose only.

Surveyor has confirmed the below details:

Actual loss location –, Sarabha Nagar, Ludhiana-141001.

Situation of risk as per policy – 14, Guru Nanak Complex, Dr. Gujjar Mal Road, Ludhiana, Punjab, Ludhiana, Punjab-141001.

Surveyor has confirmed the actual loss location is at distance of 12 km from risk location. The actual loss location is not covered as per the policy.

Corroborating the above, we wish to confirm that

          Loss location not covered.

We therefore repudiate our liability in the claim and are closing the same in our records as no claim.”

7.                The point in issue that arises for determination that whether premises at House #122-1, Sarabha Nagar, Ludhiana was covered under the policy in question or not. Ex. C1 is the policy along with its terms and conditions where it has been repeatedly mentioned that the location under coverage to be Bahadur Mall Dharam Paul, 14, Guru Nanak Complex, Dr. Gujjar Mal Road, Ludhiana, Punjab. There is no denial to this fact that the location described in the policy schedule and other related policy documents is at distance of 12 km where the damage stated to has been occurred. Perusal of the complaint filed before this Commission also shows that only one address which has been mentioned in the title of the complaint and no second address of House #122-1, Sarabha Nagar, Ludhiana has been mentioned by the complainant. The complainant has field the present complaint showing HDFC Bank Ltd. as performa respondent meaning thereby no relief has been claimed against the said bank. However, perusal of the email dated 18.09.2019 Ex. C24 shows that the complainant was fully aware of the fact that it is the mistake of the bank which failed to communicate updated address to the contesting opposite parties which has resulted in non-settlement of the claim. The contents of email Ex. C24 are reproduced as under:-

“As I have requested you in the previous mail that it’s the mistake of the bank who have not updated my address in their records and the insurance company has kept me hanging because the same address is not updated in the policy as well.

The same mistake has been repeated twice by the bank as the new insurance policy issued by the bank this year does not have the updated address as well.

Due to this mistake of the bank your customer is suffering.

So I request the bank to have a word with the insurance company and resolve this matter.

We have a small business and such big amount  (7.9 lacs INR) have a huge impact on our business.

I have also requested the bank official to talk to me over the phone regarding the issue but no such call have been made till now.”

8.                The counsel for the complainant to support his claim has drawn our attention towards the certificates dated 23.07.2018, 03.08.2018 and 07.08.2019 Ex. C4 to Ex. C6 stated to have been issued by the bank.        Firstly, these letters were issued after the occurrence of water logging. Secondly, if at all, the second address pertaining to House #122-1, Sarabha Nagar, Ludhiana existed in the bank record then what was the hitch on the part of the bank official to communicate the updated address at the time when the policy was being obtained or renewed.

9.                It is the settled law that the parties to the contract cannot travel beyond its contents. So from the aforesaid discussion, it is clear that House #122-1, Sarabha Nagar, Ludhiana location was not covered under the policy and only the risk was covered for the location 14, Guru Nanak Complex, Dr. Gujjar Mal Road, Ludhiana, Punjab. In this regard, reference can be made to I (2016) CPJ 40 (NC) Avon Organics Vs New India Assurance Co. Ltd. whereby the Hon’ble National Consumer Disputes Redressal Commission, New Delhi has held that the insurance policy clearly shows that alleged work place is not insured. Stocks insured in June 2022 and fire accident took place on 22.12.2022. If complainant had any grievance against non-mention of job work place as one of the insured locations he could have asked for rectification. Repudiation justified. Further reference can be made to I (2018) CPJ 296 (NC) in Jai Ambey Trading Company Vs National Insurance Company Ltd. and others whereby the Hon’ble National Consumer Disputes Redressal Commission, New Delhi has held that goods kept in two godowns. Intimation of shifting of goods from godown not given. Coverage under policy disputed. Claim repudiated. Had complainant communicated change of location to them, they would have inspected changed location so as to find out whether place was suitable to cover risk of fire and damage to insured goods or not. No such opportunity was given by complainant to insurer. Repudiation justified.

                                In the present case also, the location of the premises, wherefrom loss occurred is different than that of the insured premises as held above and as such, repudiation of the claim is duly justified. So there is no deficiency in service on part of the opposite parties.

10.              As a result of above discussion, the complaint is hereby dismissed being devoid of any merits. However, there shall be no order as to costs.  Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.

11.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)          (Jaswinder Singh)                      (Sanjeev Batra)                          Member                            Member                                      President         

 

Announced in Open Commission.

Dated:16.10.2023.

Gobind Ram.