Punjab

StateCommission

A/1140/2015

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

Versus

Deepak Jain - Opp.Party(s)

P.M. Goyal

19 Jul 2016

ORDER

2^nd Additional Bench

 

STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB

DAKSHIN MARG, SECTOR 37-A, CHANDIGARH

 

First Appeal No.1140 of 2015

                                                           

                                                              Date of institution:  16.10.2015

                                                                Date of Decision :  19.07.2016

 

Bajaj Allianz General Insurance Company Limited, SCO No.147, Firoz Gandhi Market, Ludhiana through authorized Signatory Mr. Navjeet Singh Assistant Manager (Legal), Bajaj Allianz General Insurance Company Limited, 4th Floor, Sector 5, Hotel Shiraz-2, Panchkula.                                                                                                                                                                                                                                                                                                                                                                     …..Appellant/Opposite party

                                      Versus

Deepak Jain S/o Sh. Ramesh Chander R/o Kiratnagar, Old Cantt Road, Faridkot and Proprietor of M/s Jain Foods, Street No.6, Machaki Mal Road, Teacher Colony, Tehsil and District Faridkot.

 

…..Respondent/Complainant

 

First Appeal against the order dated 05.08.2015 passed by the District Consumer Disputes Redressal Forum, Faridkot.

Quorum :-

              Shri Gurcharan Singh Saran, Presiding Judicial Member

              Shri Jasbir Singh, Member

              Shri Harcharan Singh Guram, Member

Present-

 

          For the appellant         :         Sh. Gaurav Sharma, Advocate.

          For respondent            :         Sh.Rajesh Gupta, Advocate.

 

Gurcharan Singh Saran, Presiding Judicial Member

ORDER

The appellant/OP (hereinafter called ‘the opposite party)  has filed the present appeal against the order dated 05.08.2015 passed by the District Consumer Disputes Redressal Forum, Faridkot (hereinafter called “the District Forum”) in consumer complaint No. 26 of 12.02.2015 vide which the complaint filed by the complainant was partly allowed and OPs were directed to pay Rs.2,55,055/- along with interest @ 9% per annum from 21.11.2014 till realization. They were further burdened to pay compensation of Rs.10,000/- for mental harassment and Rs.5000/- as litigation expenses with direction to pay the same within one month.

2.                The complaint was filed by the complainant/respondent (hereinafter referred as ‘the complainant’) under Consumer Protection Act, 1986 (for short ‘Act’) on the averments that he is proprietor of M/s Jain Foods, Faridkot, which deals in manufacturing of bread, toasts and bakery items  and he had availed loan facility from Punjab & Sind Bank Branch office Government Brijendra College, Faridkot. The said banker got insured both super structures i.e. building, plant and machinery and stock of wheat, rice raw material, finished and semi finished goods from OPs, vide policy no.OG-14-1213-4001-00001070 dated  22.08.2013, vide which the OPs insured the stock i.e. stock of wheat rice raw material finished and semi finished goods to the tune of Rs.40,00,000/-, super structure (building) Rs.10,00,000/-, plant and machinery Rs.10,00,000/- and issued 'Standard Fire and Special Perils Policy'. Due to ill luck on 09.08.2014, the complainant's factory got fire at 2.10 am.  The insured/complainant intimated the Fire Brigade situated at Kotkapura and fire tenors with much difficulty controlled the fire, however the complainant suffered a heavy loss to the tune of Rs.28,19,683/-. The complainant on 09.08.2014, intimated about the above said incident to P.S City Faridkot and DDR No.28 dated 09.08.2014 was recorded to this effect. The complainant had also informed OPs no.1 and 2 and P&SB Branch office Government Brijendra College Faridkot. The officials of Punjab & Sind Bank visited the place of incident. OPs also registered a complainant's claim; vide no.OC-15-1203-4001-00000016. The insured submitted all the documents to OPs as desired by the surveyor and loss assessor. The complainant suffered mental shock, as his income come to zero, whereas he had to pay loan instalment and other expenses. After much delay, OPs passed claim amount of Rs.12,44,877/- against  total loss of Rs.28,19,683/- and remaining claim was wrongly rejected by OPs without any plausible reason. Therefore, he is entitled to the remaining claim amount of Rs.15,74,806/-.

3.      Complaint was contested by OPs. OPs in their written reply admitted issuance of Standard Fire and Special Perils Policy in favour of the complainant, which was valid up to 21.08.2014. The fire was broke out in the factory of the complainant and IRDA licensed surveyor was appointed who assessed the loss to the tune of Rs.11,65,546/- plus Rs.79,454/- i.e. total loss to the tune of Rs.12,45,000/- subject to terms and conditions of the policy. It was denied that loss suffered by the complainant was to the tune of Rs.28,19,683/-. It was denied that complainant was entitled to the claim, as claimed in the complaint.  Therefore, the complaint is without merit, it be dismissed.

4.      The parties were allowed by the learned District Forum to lead their evidence.

5.                In support of his allegations, the complainant had tendered into evidence affidavit of complainant Ex.C-1, policy schedule duplicate copy Ex.C-2, copy of policy no.OG14-1213-4001-0000-1070 Ex.C-3, copy of Annexure 1 Ex.C-4, copy of Annexure 2 Ex.C-5. Copy of Annexure 3 Ex.C-6, policy schedule policy no.OG14-1213-4001-0000-1048 Ex.C-7, copies of Annexures C-8 to Ex.C-10, copy of fire report dated 12.08.2014 Ex.C-11, rapat no.28 dated 09.08.2014 Ex.C-12, copy of newspaper clippings as Ex.C-13 and Ex.C-14, copy of site plan Ex.C-15, copy of letter addressed to Engineer Parveen Kumar Goyal Ex.C-16,  copy of letter dated 22.09.2014 Ex.C-17, copies of reply Ex.C-18 to Ex.C-19, claim bill summary of Jain Foods Ex.C-20 to Ex.C-21, copies of bills and estimates Ex.C-22 to Ex.C-39, copy of letter dated 15.10.2014 Ex.C-40, copy of legal notice Ex.C-41, postal receipts Ex.C-42 to Ex.C-45, returned letter Ex.C-46, AD Ex.C-47, copies of bills Ex.C-48 to Ex.C-63, copy of letter from banker of complainant Ex.C-64. On the other hand, OPs tendered affidavit of Navjeet Singh Assistant Manager Legal Claims Ex.OP-1, copy of policy schedule Ex.OP-2, Standard Fire and Special Perils Policy Ex.OP-3, original report of Survyoer Mr. Parveen Kumar Goel Ex.OP-4, consent letter of the complainant Ex.OP-5, affidavit of Parveen Kumar Goyal Surveyor and Loss Assessor Ex.OP-6.

6.                After going through the allegations in the complaint, written statements filed by the OPs, evidence and documents brought on the record, the complaint was allowed,  as referred above.

7.                Aggrieved with the order, the appellant/OP has filed the present appeal.

8.                We have heard counsel for the OP Sh. Gaurav Sharma Advocate and counsel for the  complainant Sh. Rajesh Gupta, Advocate and have carefully gone through the grounds of appeal and record of the District Forum.

9.                The Insurance policy is admitted, breaking of fire is admitted and payment of Rs.12,45,000/- to the complainant is also admitted. Under the policy, stock of wheat rice raw material finished and semi finished goods to the tune of Rs.40,00,000/-, plant and machinery Rs.10,00,000/- and building to the extent of Rs.10,00,000/- was insured. The incident happened during the subsistence of the policy. OPs appointed Mr. Parveen Kumar Goyal as surveyor and loss assessor, who had assessed the loss to the tune of Rs.12,45,000/- and that amount stood already paid to the complainant. The complainant filed complaint that some deductions were wrongly made by the surveyor in his report and accordingly District Forum has allowed Rs.2,55,055/. It has been argued by counsel for OPs that report of surveyor be accepted because he is technical and independent person approved by IRDA, whereas the District Forum without any justification has ignored the report of the surveyor. The District Forum has allowed a sum of Rs.2,55,055/- over and above the report of the surveyor, which is not justified. The request of the counsel for OPs is that order of District Forum to that extent be set aside.

10.              Whereas, on the other hand, the counsel for complainant has stated that the report of the surveyor is not sacrosanct, it should be bassed upon reasons and deductions, which have been made without any reason cannot be accepted as it is. Reference has been made to the judgment IV (2015) CPJ 30 (NC), M. Devappa Kanchan versus United India Insurance Company Ltd, (NC) wherein surveyor has failed to give cogent reasons for drastic reduction in respect of two items, repudiation was not held justified. He has further contended that surveyor has wrongly made deductions against claim justified by the complainant, which was properly examined by the District Forum and allowed another amount of Rs.2,55,055/- to the complainant. Therefore, order passed by the District Forum  be affirmed.

11.              The report of the surveyor on the record is Ex.OP-4, it will reveal that he has made separate assessment of the stocks building, plant and machinery so far as raw material is concerned. He had made assessment of Rs.1244815.80 and from that amount 2.5% has been deducted on finished goods, 2073 for salvage and excess clause 5% and payable amount was assessed by him Rs.1165546.00. The policy documents are Ex.C-2 to Ex.C-10. Policy document with regard to stock is Ex.C-3 having coverage of Rs.40,00,000/- This policy schedule under the special conditions deductions and it speaks that up to INR 10 crore - 5% of claim amount subject to minimum of INR 10,000/-. No other deductions have been referred in the policy. Therefore, 2.5% deductions on finished goods amounting to Rs.15742.80 is not justified. However, in case 5% is taken on sum of Rs.1248815/-, it will come to Rs.62240.79 after deducting this amount payable amount is Rs.11,82,575/- and salvage value has been affixed as 2073 after deducting this amount it comes to Rs.11,80,502/-. Therefore, under this head, complainant was entitled to Rs.11,80,502/-. During the course of arguments, counsel for OPs was unable to point out on what account 2.5% deductions were made on account of finished goods. Therefore, this deduction on that account made by the surveyor was not justified. Therefore, we are of the opinion that under that head the complainant was entitled to Rs.11,80,502/- instead of Rs.11,65,546/-.,

12.              With regard to building, the claim lodged by the complainant was Rs.2,52,510/- and against that claim  of Rs.1,82,740/- has been assessed by the surveyor. However, the surveyor in his report has not assessed any amount against claim of 300 sq. ft. Crasher and 5000 against sand, claim of Rs.400/- of CFL,  5 Nos. MCCB, 3 Nos. MCCB Box 5 CFL Lamp 90W Rs.3250/- 1 Bus bar Rs.4200/-, 1 TP Rs.500/-, 2 Starter Rs.1900/-  2 pkt Capture Rs.500/- 4 Nos. Exhaust Fans Rs.16,800/-. The assessment has been made zero. No reasons have been given by the surveyor, how the amount was assessed as zero. Therefore, without any proper reasoning, the surveyor was not justified to give no assessment against items sited above.  A reference has been made by Hon'ble National Commission in judgment "M. Devappa Kanchan versus United India Insurance Company Ltd," (supra) wherein it was observed that  surveyor should have allowed the compensation claim of Rs.2,52,510/- against these items. He had made 5% deductions against electrical items. No terms and conditions have been referred by the surveyor or the counsel for the OPs under which 5% deduction on electrical goods is permissible. The surveyor has made deductions on account of depreciation. The building was covered for Rs.10 lac only. Although, the surveyor has assessed its valuation as Rs.27,57,000/- but in case of less coverage, OPs will be entitled to apply average clause. Therefore, where the insured value is less than the exact value after depreciation, then no amount can be allowed to be deducted on account of depreciation only. Salvage value will be allowed to be deducted as Rs.10,336.40 and after deducting this amount from the sum of Rs.2,52,510/- minus Rs.10336.40, it comes to Rs.2,42,174/- and value of the building after depreciation has been assessed by the surveyor as Rs.27,57,000/-, which has not been challenged by the complainant, because complainant has not given any value of the building. In case value of the building was Rs.27,57,000/- against which insurance was taken Rs.10,00,000/-, then certainly average clause will apply and after applying average clause, the assessed amount for building will come to Rs.87,840/-. Therefore, instead of Rs.48,966/- the complainant will be entitled Rs.87,840/-. Against plant and machinery, the amount claimed was Rs.1,25,800/-,  against which the amount was assessed of Rs.72,500/- and against that depreciation for six years was deducted i.e. 40%. The policy against plant and machinery is Ex.C-8 and Ex.C-10 are the terms and conditions. In case insurance policy was issued according to the value of the machinery, then deduction @ 40% is not permissible. The counsel for OPs has not been able to refer to any clause of the policy, under which this depreciation is allowed, in case insurance policy was issued according to the value of the machinery. In that way, the OPs will be entitled only to deduct the salvage value. The surveyor has further given no amount against taflon wire 2 roll 1 mm Rs.12,500/- , temporary controller timer Rs.3000/-, connector 6 pcs Rs.10800/-, labour charges Rs.7000/- and no reasoning has been given whether there was no loss to these items of the plant and machinery or that claim was on the enhanced side. Therefore, without any proper reasoning, surveyor was not justified to deduct that amount. We are fortified from the judgment   "M. Devappa Kanchan versus United India Insurance Company Ltd," (supra). In this way claim of the complainant comes to Rs.1,25,800/- minus Rs.8,830/- (salvage) = Rs.1,16,970/-. In this way, the claim of the complainant comes to Rs.13,85,312/-,  against which a sum of Rs.12,45,000/- has already been paid to the complainant. Therefore, complainant was entitled only Rs.1,40,312/-. However, the District Forum while making assessment has taken the amount claimed by the complainant and has failed to deduct the excess clause and the salvage value and average clause. The order passed by the District Forum required modification. Therefore, appeal filed by the appellant/OP is required to be accepted partly.

13.              In view of our above discussion, appeal filed by the appellants/OPs is partly accepted and instead of Rs.2,55,055/- the complainant will be entitled to Rs.1,40,312/-. There will be no change in the amount of compensation and cost of litigation.

14.              The appellant had deposited an amount of Rs.25,000/- with this Commission at the time of filing the appeal. This amount with interest accrued thereon, if any, be remitted by the registry to the respondent/complainant by way of a crossed cheque/demand draft after the expiry of 90 days. Remaining amount as per order of the District Forum shall be paid by the appellants/OPs to the complainant within 45 days from receipt of copy of this order.

15.              The arguments in this appeal were heard on 15.07.2016 and the order was reserved. Now the order be communicated to the parties as per rules.

16.              The appeal could not be decided within the statutory period due to heavy pendency of Court cases.

 

                                                (GURCHARAN SINGH SARAN)

                                                  Presiding Judicial Member

 

          

                                                (JASBIR SINGH GILL)

                                                              Member

 

 

                                             (HARCHARAN SINGH GURAM)

                                                             Member

 

July 19, 2016

 Ravi