Chandigarh

StateCommission

A/332/2023

THE NEW INDIA ASSURANCE CO. LTD. - Complainant(s)

Versus

ELNOVA PHARMA - Opp.Party(s)

SURINDER SINGH SIDHU

23 Sep 2024

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T. CHANDIGARH

[Additional Bench]

 

[1]

Appeal No.	:	A/332/2023
Date  of  Institution	:	06/10/2023
Date   of   Decision	:	23/09/2024

 

 

 

 

 

 

The New India Assurance Co. Ltd.,  through its Deputy General Manager, through Auth. Signatory, The New India Assurance Co. Ltd., Regional Office, SCO 36-37, Sector 17-A, Chandigarh.

….Appellant

 

Versus

 

1.     M/s Elnova Pharma, C/o Village Rampur Jattan, Moginand, Nahan Road, Kala Amb, Sirmour (H.P), through its Partner Sh. Rajesh Jain son of Sh. Sukhmal Jain, Resident of H.No1078-1079, Sector 12, HUDA, Panipat (Haryana).

 

2.     MERIT ISLA Pvt. Ltd., Branch Office 422A, Tower-B, 4^th Floor, Spaze 1- Tech Park, Sohna Road, Gurgaon.

 

3.     Globe Toyota, Karnal, Opposite PTC Madhuban, G.T. Road, Karnal, Haryana (India) 132 001.

 

…. Respondents

 

 

BEFORE: MRS. PADMA PANDEY   PRESIDING MEMBER

                PREETINDER SINGH      MEMBER

 

 

PRESENT	:	Sh. S.S. Sidhu, Advocate for the Appellant.
		Sh. Abhishek Sethi, Advocate for the Respondent No.1.
		Respondent No.2 ex-parte vide order dated 18.01.2024.
		Ms. Shairon Tyagi, Advocate proxy for Sh. Shivam Grover, Advocate for the Respondent No.3.

[2]

Appeal No.	:	A/304/2023
Date  of  Institution	:	02/11/2023
Date   of   Decision	:	23/09/2024

 

 

 

 

 

 

M/s Elnova Pharma, C/o Village Rampur Jattan, Moginand, Nahan Road, Kala Amb, Sirmour (H.P), through its Partner Sh. Rajesh Jain son of Sh. Sukhmal Jain, Resident of H.No1078-1079, Sector 12, HUDA, Panipat (Haryana).

….Appellant

 

Versus

 

1.     The New India Assurance Co. Ltd., through its Deputy General Manager, having its office at SCO 36-37, Sector 17-A, Chandigarh.

 

2.     Merit ISLA Pvt. Ltd., Branch Office: 422A, Tower-B, 4^th Floor, Spaze 1-Tech Park, Sohna Road, Gurgaon.

 

3.     Globe Toyota, Karnal, Opposite PTC Madhuban, G.T. Road, Karnal, Haryana (India) 132 001.

 

…. Respondents

 

BEFORE: MRS. PADMA PANDEY   PRESIDING MEMBER

                PREETINDER SINGH      MEMBER

 

PRESENT	:	Sh. Abhishek Sethi, Advocate for the Appellant.
		Sh. S.S. Sidhu, Advocate for the Respondent No.1.
		Respondent No.2 ex-parte vide order dated 18.01.2024.
		Ms. Shairon Tyagi, Advocate proxy for Sh. Shivam Grover, Advocate for the Respondent No.3.

 

PER PREETINDER SINGH, MEMBER

 

1.         This order shall dispose of above captioned cases i.e. A/332/2023 filed by the Appellant/ OP No.1 (The New India Assurance Co. Ltd. Vs. M/s Elnova Pharma & Ors.) and A/304/2023 filed by the Complainant (M/s Elnova Pharma Vs. The New India Assurance Co. Ltd. & Ors.), against the order dated 25.09.2023, rendered by the District Consumer Disputes Redressal Commission-I, U.T., Chandigarh (for brevity hereinafter to be referred as ‘the Ld. District Commission’), vide which it partly allowed the Consumer Complaint bearing No. CC/92/2022, filed by the Complainant (M/s Elnova Pharma), against Opposite Parties (The New India Assurance Co. Ltd. & Ors.), by passing the following order: -

“11]      In view of the above discussion, the present consumer complaint succeeds and the same is accordingly partly allowed. OP No.1 is directed as under: -

i)      to pay Rs.57,90,467/- to the Complainant with interest @6% p.a. from the date of filing of this complaint till payment is made.

ii)     to pay Rs.50,000/- to the Complainant as compensation for causing mental agony and harassment to him.

iii)    to pay Rs.10,000/- to the Complainant as costs of litigation.

12]   This order be complied with by the OP No.1 within thirty days from the date of receipt of its certified copy, failing which, it shall make the payment of the amounts mentioned at Sr. No.(i) & (ii) above, with interest @12% per annum from the date of this order, till realization, apart from compliance of diction at Sr. No.(iii) above.

 

2.          Since, the issues involved in the above-said cases, except minor variations, here and there, of law and facts are the same, as such, we are of the considered opinion that the same can be adjudicated by passing a consolidated order.

 

3.         For the convenience, the parties are being referred to, in the present cases, as position held in Consumer Complaint before the Ld. District Commission.

 

4.         Before the Ld. District Commission, it was the case of the Complainant that it had got its Toyota Land Cruiser 200 Car insured with Opposite Party No.1, which was valid from 02.08.2019 to 01.08.2020.  The IDV of the vehicle was ₹92,68,000/-. On the intervening night of 25^th and 26^th Feb. 2020, while the son of its Partner was driving the subject vehicle, the same met with an accident, which  caused extensive damage to the vehicle and the same was beyond the repair to its original condition and was incapable of normal use.  An FIR was also registered. The Opposite Party No.3 took the vehicle in question in its custody and intimation was also sent to Opposite Party No.1 – Insurance Company on 28.02.2020. As per demand of the Opposite Party No.1, the complainant submitted all the documents, pursuant to which a Surveyor was appointed by the Opposite Party No.1. In the meantime, the Opposite Party No.3 prepared repair estimate of ₹91,60,513.27. Opposite Party No.2 wrote an e-mail dated 10.08.2020 to Opposite Party No.3 to the effect that the vehicle under consideration was repairable as per liability calculated on the basis of estimates provided by Opposite Party No.3. However, as per complainant the vehicle was a total loss. It was alleged, later on, the repair estimate of the vehicle was increased to ₹1,13,64,383.88 though the IDV of the vehicle was ₹92,68,000/-. The complainant requested several times to the Opposite Parties to redress its grievance, but to no avail. Ultimately, a legal notice dated 18.10.2021 was served by the Complainant, but the same failed to fructify. Hence, the aforesaid Consumer Complaint was filed before the Ld. District Commission, alleging deficiency in service and unfair trade practice on the part of the Opposite Parties.

 

5.         The Opposite Party No.1 filed reply, inter alia, pleading that the complainant did not cooperate with the Surveyor appointed by it and in the absence of required assistance and cooperation; the surveyor was unable to assess the loss. The Opposite Party No.3 had also sought instructions from the complainant to dismantle the damaged car, for assessment of the loss by the Surveyor. The Opposite Party No.2 had also sent emails to the Complainant, which in turn insisted for declaring the vehicle as total loss without assessment of the loss by dismantling the vehicle by the duly licensed surveyor as required under IRDAI regulations and provisions of Section 64UM.  It was asserted that the complainant was itself responsible for the non-assessment of the claim; therefore, the Opposite Party No.1 was not liable to pay the claim in the absence of surveyor report. Denying all other allegations and pleading no deficiency in service, the Opposite Party No.1 prayed for dismissal of the Complaint.

 

6.         Opposite Party No.2 failed to appear, despite service before the Ld. District Commission and therefore, it was proceeded against ex-parte vide order dated 13.09.2022.

 

7.         Opposite Party No.3 filed its separate reply and pleaded that no cause of action ever arose in favour of the complainant against it. Opposite Party No.3 admitted that it had prepared the first estimate for the repair of the vehicle in question. It was averred, Opposite Party No.3 was stranger to the insurance contract between the complainant and the concerned Insurance Company of the subject vehicle, therefore, no liability can be fastened upon the dealership (Opposite Party No.3). Denying all other allegations and pleading no deficiency in service, the Opposite Party No.3 prayed for dismissal of the Complaint.

 

8.         On appraisal of the pleadings of the parties and the evidence adduced on the record, Ld. District Commission partly allowed the Consumer Complaint and issued directions to the Opposite Party No.1 (The New India Assurance Co. Ltd.) as noticed in the opening para of this order.  

 

9.         Aggrieved against the aforesaid order passed by the Ld. Lower Commission, Appeal No. 332 of 2023 has been filed by the Appellant/OP No.1 (The New India Assurance Co. Ltd. Vs. M/s Elnova Pharma & Ors.) and Appeal No. 304 of 2023 has been filed by the Complainant (M/s Elnova Pharma Vs. The New India Assurance Co. Ltd. & Ors.).

 

10.         Even during present proceedings, Respondent No.2 did not enter appearance, despite service, and was, therefore, proceeded against ex-parte vide order dated 18.01.2024.

 

11.         We have heard Learned Counsel for the contesting parties and have gone through the evidence and record of the case with utmost care and circumspection.

 

12.         The core question that falls for consideration before us is as to whether the Ld. Lower Commission has rightly passed the impugned order by appreciating the entire material placed before it. 

 

13.         After giving our thoughtful consideration, to the contentions raised and material on record, we are of the considered opinion, that the instant matters deserve to be dismissed for the reasons to be recorded hereinafter.

 

14.         It is the case of the Appellant/Opposite Party No.1 that the Ld. District Commission while passing the impugned order has failed to appreciate the documentary evidence available on record, which resulted into perverse finding. Also, the impugned order was passed without taking into consideration the facts of the case and without appreciating the correct legal position, which resulted into gross miscarriage of justice and thus deserves to be set aside. The learned counsel further argued on the similar lines and prayed for acceptance of the present appeal.

 

15.         Admittedly, the surveyor has assessed the loss to the vehicle in question to the tune of ₹57,90,647/- whereas the complainant has prayed that Appellant/ Opposite Party No.1 be directed to make payment of the IDV of the subject vehicle. Ld. District Commission in para 9 of its finding has categorically observed that the Surveyor had desired to further assess the loss, if any, and even made several requests to the Complainant who did not allow to further open the vehicle. The Ld. District Commission had thus held the Complainant entitled to the payment of loss as assessed by the Surveyor to the tune of ₹57,90,467/-.

 

16.         The main thread which runs through the present controversy is whether the assessment made by the Surveyor is conclusive and form basis for settlement of a claim by the insurer in respect of the loss suffered by the insured.

 

17.         According to the Insurance Act 1938, an approved surveyor’s assessment is necessary for a claim. The Complainant however contends that the surveyor’s report is not definite. The key question is the extent to which the report is binding and under what conditions can it be overridden in. To address this, Section 64(UM)(4) of the Insurance Act, 1938 can be usefully read which concerns surveyors and loss assessors: -

 

64-UM. (4) No claim in respect of a loss which has occurred in India and requiring to be paid or settled in India equal to or exceeding twenty thousand rupees in value on any policy of insurance, arising or intimated to an insurer at any time after the expiry of a period of one year from the commencement of the Insurance (Amendment) Act, 1968, shall, unless otherwise directed by the Authority, be admitted for payment or settled by the insurer unless he has obtained a report, on the loss that has occurred, from a person who holds a license issued under this section to act as a surveyor or loss assessor (hereafter referred to as “approved surveyor or loss assessor”).

 

Provided that nothing in this sub-section shall be deemed to take away or abridge the right of the insurer to pay or settle any claim at any amount different from the amount assessed by the approved surveyor or loss assessors.”

 

18.         The above prvision mandates that claim above ₹20,000/- must be initially assessed by an approved Surveyor. It is noteworthy that the insurer has the discretion to settle the claim for a different amount, than what is assessed by the Surveyor.

 

19.         In New India Assurance Co. Ltd. Vs. Pradeep Kumar, (2009) 7 SCC 787, the court addressed whether one had to accept payment based on the surveyors’ assessment or could provide independent evidence to support higher costs for replacement and repairs. The court’s pertinent conclusion is as follows:-

 

“22.  In other words although assessment of loss by approved surveyor is a pre-requisite for payment or settlement of claim of twenty thousand rupees or more by insurer, yet surveyor’s report is not the last and final word. It is not that sacrosanct that it cannot be departed from; it is not conclusive. The approved surveyor’s report may be basis or foundation for settlement of claim by the insurer in respect of loss suffered by insured but such report is neither binding upon the insurer nor insured.”           

20.         After having perused the surveyor report, copy whereof is available on the files of both the appeals, we find that the surveyor’s report is comprehensive and is conclusive on the aspect of identifying the actual loss caused to the subject vehicle.  Therefore, the report of the surveyor is to be accepted as the surveyor is an expert and also an independent person to assess the damage caused to the vehicle of the complainant.

 

21.         In this backdrop, we are of the firm opinion that the Surveyor is the best Judge of the situation who has also verified all the facts before assessing the loss. While arriving to the above said conclusion, we place our reliance on National Insurance Co. Limited and Others Versus Aleyamma Verghese and Others, II (2006) CPJ 193 (NC) , wherein it has been held that: -

 

        “Be that as it may, as held severally by this Commission as also by the Hon’ble Supreme Court, the report of the Surveyor is an important document which cannot be brushed aside……………… In these circumstances, we cannot go beyond the loss assessed by the Surveyor.” 

 

                Guided by the above ration, we also rely on National Insurance Company Limited Versus Krishan Kumar Mishra and Another, IV (2003) CPJ 5 (NC) and National Insurance Company Limited Versus Mithijam Vanaspati Limited, 2006 CTJ 433 (CP) (NCDRC).

 

22.         Since the Surveyor’s report, as found by us, is neither ambiguous nor arbitrary and has been prepared after detailed examination of the loss and after getting the documents as were available with the Complainant, has to be accepted. Accordingly, a total loss as assessed by the Surveyor of the value of ₹57,90,467/- is required to be paid by the Opposite Party No.1 (Insurance Company) to the Complainant. The judicious application of the Ld. District Commission to allow the payment of loss as assessed by the Surveyor appears to be well merited. No legal infirmity is thus seen with the impugned decision.

 

23.         In the realm of risk and uncertainty, individuals and organizations seek solace in the bastion of insurance – a covenant forged on the bedrock of trust. Trust serves as the cornerstone, forming the essence of the insurer- insured relationship. The fundamental principle is that insurance is governed by the doctrine of uberrimae fidei – there must be complete good faith on the part of the insured. The heart and soul of an insurance contract lies in the protection it accords to those who wish to be insured by it. This understanding encapsulates the foundational brief that insurance accords protection & indemnification, preserving the sanctity of trust within its clauses. Effectively, the insurer assumes a fiduciary duty to act in good faith and honour their commitment. This responsibility becomes particularly pronounced when the insured, in their actions, have not been negligent. In light of the vital role that trust plays in insurance contracts, it is important to ensure that the insurer adequately fulfils the duty that has been cast on it, by virtue of such a covenant. Accordingly, the appeal of the Appellant/ Opposite Party No.1 (Insurance Company) deserves to be dismissed. To our mind, no case is therefore made for any interference in the well reasoned findings recorded by the Ld. Lower Commission.

 

24.         Resultantly, Appeal No. 304 of 2023 filed by the Complainant titled as M/s Elnova Pharma Vs. The New India Assurance Co. Ltd. & Ors. is also dismissed.

 

25.         It is demonstrable from a reading of the impugned Order of the Ld. Lower Commission that it is certainly not an order passed without reasons or without applying the judicious mind. The facts and circumstances of the case have been gone into, weighed and considered, and due analysis of the same has been made. We do not see any strain of perversity discernible from the order which may occasion to vitiate the same. The order of Ld. District Commission is upheld.

 

26.         In view of the present Appeals being dismissed, the pending application(s), if any, also stands disposed of accordingly.

 

27.         Certified copy of this order be placed on the records of A/304/2024 - M/s Elnova Pharma Vs. The New India Assurance Co. Ltd. & Ors.

 

28.         Certified Copies of this order, be sent to the parties, free of charge.  

 

29.         The files be consigned to the Record Room, after due completion.

Pronounced

23^rd September, 2024                                                                         

                                         Sd/-                         

                                                                (PADMA PANDEY)

PRESIDING MEMBER

 

 

Sd/-

(PREETINDER SINGH)

MEMBER

“Dutt”