Order by:

Sh.Amrinder Singh Sidhu, President

1.       The complainant  has filed the instant complaint under section 12 of  the Consumer Protection Act, 1986 (now under section 35 of the Consumer Protection Act, 2019)  on the allegations that the complainant firm through its partners purchased policy from the Opposite Parties under the scheme of Business Suraksha Classic Policy and this was the continued policy, the detail of which as under:-

That during the course of business, the complainant lodged two claims with the Opposite Parties on account of damage of compressor amounting to Rs.70,000/- vide claim No. C294917000371  and another claim No.32949C294916000674 dated 08.08.2017 of Rs.70,000/-. Though the representative of the Opposite Parties told the complainant that both the claims have been settled, but on verification, the amount has not be credited to the account of the complainant. Thereafter, the complainant further lodged another claim on 10.06.2018 against claim No.294918000194 under the policy No. 2949201001671103000 in respect of another compressor and this claim has been rejected on 30.07.2018. The complainant lodged the protest in respect of all the above referred correspondence and also informed that the letters issued by the Opposite Parties are not correct. Thereafter, the Opposite Party issued letter dated 21.08.2018 as per the postal envelop otherwise the said letter is undated and referred in this policy No. 2949202316548900001 stands cancelled  from 23.02.2018 and amount of Rs.1,65,204/- has been credited in the account of the complainant, but this amount has not been credited in the account of the complainant.  In this way, the amount of Rs.1,40,000/ of two claims as well as  third claim of Rs.1,65,205/- has not been credited in the account of the complainant, so the complainant is entitled to this amount alongwith interest @ 12% per annum which comes to Rs.55,000/- upto the date of filing the present complaint. The Opposite Parties without assigning any reason have  cancelled the policy in the mid of its currency which causes the heavy loss to the complainant as the complainant was compelled to purchase another policy in mid term. The complainant made so many requests and visits to admit the rightful claim and to make the payment of loss, but the Opposite Parties did not pay any heed to the request of the complainant and hence, there is deficiency in service on the part of the Opposite Parties.  Vide instant complaint, the complainant has sought the following reliefs.

a)       Opposite Parties may be directed to make the payment of Rs.3,05,205/- alongwith interest @ 12% per annum which comes to Rs.55,000/- upto the data filing the present complaint alongwith future interest @ 12% per annum from the date of filing the complaint till its realization and Rs.5 lakhs as compensation on account of mental tension, physical harassment and professional loss and Rs.20,000/- on account of litigation expenses.

2.       Opposite Parties  appeared through counsel and contested the complaint by filing  the written version  on the ground inter alia that the complaint is not maintainable; that there is no deficiency in service on the part of the Opposite Parties;  that the present complaint pertains to insurance claim under Business Suraksha Classik Policy having policy number 2949-2010-0167-1102-000 and 2949-2010-0167-1103-000, however the liability of the Opposite Party, if any, is subject  to terms and conditions of the policy. With regard to Claim No. C294917000371, it is submitted that the complainant lodged one claim i.e. Claim No. C294917000371 under policy No.294920100167102000 for damage to the Air Conditioner. The AC was damaged on 06.08.2017 and intimation regarding the same was given to the Opposite Party on 14.08.2017 and the answering Opposite Party immediately appointed M/s.Astute Insurance Surveyors & loss Assessors Private limited to assess the loss and verify the loss to the machinery. During the survey, it was observed that the said machinery had already been repaired. As per the Survey Report, when the surveyor reached the spot, they were informed by the insured that they had called some mechanic who checked and repaired the AC as the AC had stopped working since gas had leaked out due to damage to the pipe. Since the same was repaired and hence, the insured had withdrawn his claim. With regard to second Claim No. C294916000674 it is submitted that the complainant lodged one claim i.e. Claim No. C294916000674 under policy No.2949201001671102000 for damage to the Ice Cube vending machine. AS per the version of the complainant, the Ice Cube machine stopped working on 26.02.2017. On receiving the intimation of the claim, the Opposite Parties immediately appointed Protech Insurance Surveyors & Loss Assessors to assess and verify the claim and said surveyor submitted its reports and observed the discrepancies during the survey; a) that identification plate describing serial number, model no. year of manufacturing etc. was missing at the time of visit. It was not possible to ascertain, if the said machine is covered under the policy issued. The insured had already repaired the damaged machine prior to surveyors visit and the insured did not give any opportunity to inspect the machine in damaged condition; further the insured did not have any AMC. AS per the policy terms and conditions of the policy, the policy is having warranty of AMC for all equipments during the policy period. The insured has not provided an AMC record against the said machine and there is thus an evident breach of warranty of the insurance policy. With regard to third Claim No. C294918000194 it is submitted that the complainant lodged one claim i.e. Claim No. C294918000194 under policy No.2949201001671103000  for the damage of outdoor unit (compressor) of AC. After receiving  the intimation, the Opposite Parties immediately appointed Skaad Insurance Surveyors & Loss Assessors to assess and verify the claim and submitted its report dated 06.07.2018  stating that said surveyor wrote emails dated 26.06.2018, 27.06.2018 and 03.07.2018 requesting the insured to  respond in case of any clarification or doubt, however, the insured did not respond to the said emails. As such, the complaint of the complainant is liable to be dismissed. On merits, the Opposite Parties took up almost the same and similar pleas as taken up by them in the preliminary objections. However, the claim no. C294916000674 is not for Rs.70,000/- as alleged but is for Rs.12,000/-. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint was made.

3.       In order to  prove  his  case, the complainant has tendered into evidence affidavit Ex.C1 of Yogesh Goyal, partner alongwith copies of documents Ex.C2 to Ex.C22 and closed the evidence.

4.       On the other hand,  to rebut the evidence of the complainant,  Opposite Parties tendered into evidence affidavit of Shweta Pokhriyal, AM Ex.OP1 alongwith  copies of documents Ex.OPs2 to Ex.OP10 and closed the evidence on behalf of the Opposite Parties.

5.       We have heard the ld.counsel for the parties and  also perused the written submissions of the Parties and  gone through the evidence placed  on record.

6.       During the course of arguments, both the ld.counsel for the Complainant as well as Opposite Parties  have mainly reiterated the facts as narrated in the complaint as well as in written reply respectively.   

7.       Ld.counsel for the complainant has mainly contended that  the written version  filed on behalf of Opposite Parties  has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. Opposite Party  is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party.  Further more,  the complainant firm through its partners purchased policy from the Opposite Parties under the scheme of Business Suraksha Classic Policy and this was the continued policy, the detail of which as under:-

Further contended that during the course of business, the complainant lodged two claims with the Opposite Parties on account of damage of compressor amounting to Rs.70,000/- vide claim No. C294917000371 and another claim No.32949C294916000674 dated 08.08.2017 of Rs.70,000/-. Though the representative of the Opposite Parties told the complainant that both the claims have been settled, but on verification, the amount has not been credited to the account of the complainant. Thereafter, the complainant further lodged another claim on 10.06.2018 against claim No.294918000194 under the policy No. 2949201001671103000 in respect of another compressor and this claim has been rejected on 30.07.2018. The complainant lodged the protest in respect of all the above referred correspondence and also informed that the letters issued by the Opposite Parties are not correct. Thereafter, the Opposite Party issued letter dated 21.08.2018 as per the postal envelop otherwise the said letter is undated and referred in this policy No. 2949202316548900001 stands cancelled  from 23.02.2018 and amount of Rs.1,65,204/- has been credited in the account of the complainant, but this amount has not been credited in the account of the complainant.  In this way, the amount of Rs.1,40,000/ of two claims as well as  third claim of Rs.1,65,205/- has not been credited in the account of the complainant, so the complainant is entitled to this amount alongwith interest @ 12% per annum which comes to Rs.55,000/- upto the date of filing the present complaint. The Opposite Parties without assigning any reason have cancelled the policy in the mid of its currency which causes the heavy loss to the complainant as the complainant was compelled to purchase another policy in mid term. The complainant made so many requests and visits to admit the rightful claim and to make the payment of loss, but the Opposite Parties did not pay any heed to the request of the complainant and hence, there is deficiency in service on the part of the Opposite Parties.

8.       On the other hand, ld.counsel for the Opposite Parties  has repelled the aforesaid contention of the ld.counsel for the complainant  on the ground that the present complaint pertains to insurance claim under Business Suraksha Classik Policy having policy number 2949-2010-0167-1102-000 and 2949-2010-0167-1103-000, however the liability of the Opposite Party, if any, is subject  to terms and conditions of the policy. With regard to Claim No. C294917000371, it is submitted that the complainant lodged one claim i.e. Claim No. C294917000371 under policy No.294920100167102000 for damage to the Air Conditioner. The AC was damaged on 06.08.2017 and intimation regarding the same was given to the Opposite Party on 14.08.2017 and the answering Opposite Party immediately appointed M/s.Astute Insurance Surveyors & loss Assessors Private limited to assess the loss and verify the loss to the machinery. During the survey, it was observed that the said machinery had already been repaired. As per the Survey Report, when the surveyor reached the spot, they were informed by the insured that they had called some mechanic who checked and repaired the AC as the AC had stopped working since gas had leaked out due to damage to the pipe. Since the same was repaired and hence, the insured had withdrawn his claim. With regard to second Claim No. C294916000674 it is submitted that the complainant lodged one claim i.e. Claim No. C294916000674 under policy No.2949201001671102000 for damage to the Ice Cube vending machine. AS per the version of the complainant, the Ice Cube machine stopped working on 26.02.2017. On receiving the intimation of the claim, the Opposite Parties immediately appointed Protech Insurance Surveyors & Loss Assessors to assess and verify the claim and said surveyor submitted its reports and observed the discrepancies during the survey; a) that identification plate describing serial number, model no. year of manufacturing etc. was missing at the time of visit. It was not possible to ascertain, if the said machine is covered under the policy issued. The insured had already repaired the damaged machine prior to surveyors visit and the insured did not give any opportunity to inspect the machine in damaged condition; further the insured did not have any AMC. AS per the policy terms and conditions of the policy, the policy is having warranty of AMC for all equipments during the policy period. The insured has not provided an AMC record against the said machine and there is thus an evident breach of warranty of the insurance policy. With regard to third Claim No. C294918000194 it is submitted that the complainant lodged one claim i.e. Claim No. C294918000194 under policy No.2949201001671103000  for the damage of outdoor unit (compressor) of AC. After receiving  the intimation, the Opposite Parties immediately appointed Skaad Insurance Surveyors & Loss Assessors to assess and verify the claim and submitted its report dated 06.07.2018  stating that said surveyor wrote emails dated 26.06.2018, 27.06.2018 and 03.07.2018 requesting the insured to  respond in case of any clarification or doubt, however, the insured did not respond to the said emails. However, the claim no. C294916000674 is not for Rs.70,000/- as alleged but is for Rs.12,000/-. As such, the complaint of the complainant is liable to be dismissed.  It is further contended that the complainant firm is partnership firm and the complaint has been filed through Yogesh Goyal being part of the firm and Order XXX of  the CPC, 1908 as amended upto date deals with the procedure for suits by or against the partnership firms which provides that any two or more persons claiming or being partners of a partnership concern may sue or sued in the name of the firm, but the instant consumer complaint has been filed only by one of the partners of the complainant firm. As per the documents annexed with the complaint, the complainant firm is engaged in the business of Cinemas and multiplex and the complainant does not come under the definition of consumer as defined under the Consumer Protection Act and on this score also, the complaint is liable to be dismissed.     

9.       Perusal of the contention of the ld.counsel for the complainant   shows  that  the written version  filed on behalf of Opposite Parties   has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party  is limited Company and written version has been filed on the basis of special power of attorney given  to ld.counsel for the Opposite Party. In this regard,  Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment,  has held that

“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”

Similar proposition came before the Hon’ble Delhi High Court in “Nibro Ltd. Vs. National Insurance Co. Ltd.”, 2 (2005) 5SCC 30 that the

“bear authority is not recognized under law and ultimately, it was held that the plaint was not instituted by an authorized person. Here also appellant has not placed on record any resolution passed by any Board of Director in favour of Mr. Soonwon Kwon and that he was further authorised to delegate his power in favour of any other person. Further there is no memorandum/articles of the Company to show that Mr. Soonwon Kwon is one of the Director of the Company. In the absence of that evidence on record we cannot say that the special power of attorney given by Director Soonwon Kwon is a competent power of attorney issued in favour of Sh. Bhupinder Singh. In the absence of any resolution of the Company or any memorandum/articles of the Company to show that Sh. Soonwon Kwon is Director and that he was further authorised to issue power of attorney in favour of Sh. Bhupinder Singh.”

Recently our own Hon’ble State Commission, Punjab Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by  an unauthorized person has no legal effect.

10.     For the sake of arguments, for the time being, if the written reply filed by Opposite Parties is presumed to be correct, the plea  raised by Opposite Parties  is that the complainant firm is partnership firm and the complaint has been filed through Yogesh Goyal being part of the firm and Order XXX of  the CPC, 1908 as amended upto date deals with the procedure for suits by or against the partnership firms which provides that any two or more persons claiming or being partners of a partnership concern may sue or sued in the name of the firm, but the instant consumer complaint has been filed only by one of the partners of the complainant firm. As per the documents annexed with the complaint, the complainant firm is engaged in the business of Cinemas and multiplex and the complainant does not come under the definition of consumer as defined under the Consumer Protection Act and on this score also, the complaint is liable to be dismissed.

11.     First of all, we would like to decide the objection raised by the opposite parties that the complainant does not fall under the definition of ‘consumer’, as defined in the Act as the complainant is a partnership firm and the complaint should be filed by atleast two partners. But we do not agree with the aforesaid contention of the ld.counsel for the Opposite Parties. In this regard, the complainant has already placed on record the copy of Form ‘A’ and Form ‘C’ vide which the name of all the three partners have been mentioned and also cknowledged the said  partnership firm  as required under section 58(1) of Indian Partnership Act, 1932 duly issued by registrar of Firms, Punjab dated 26.02.2007.  Not only this, the other partners of the complainant firm also authorized to Sh.Yogesh Goyal, partner of the firm vide its authorization letter placed on record, to do all the acts, deeds and things to contest the aforesaid matter and to execute all the relevant documents, affidavits etc. in this District Consumer Commission on behalf of complainant firm as well as on their behalf. In view of this, the present complainant has authorization from other partners to file the instant complaint alone.  Moreover, in same and similar facts, recently our own Hon’ble State Commission in Consumer Complaint No. 155 of 2020, decided on  22.12.2021 in case titled as M/s Shiva Engineers & Developers, Vs. National Insurance Co. Ltd. And that complaint was also filed by the complainant firm with one partner  i.e. M/s Shiva Engineers & Developers, 17, Labh Nagar, Ram Tirath Road, Amritsar, through its partner Sh.Kapil Chopra S/o Sh.Satish Kumar on the same and similar facts and Hon’ble State Commission has not taken any objection in this regard.

Further with regard to commercial purposes, in this regard, we are fortified with the judgment reported in II (2005) CPJ 27 titled Harsolia Motors Versus National Insurance Co. Ltd., wherein it has been held as under:

“25…….it is apparent that even taking wide meaning of the words ‘for any commercial purpose’ it would mean that goods purchased or services hired should be used in any activity directly intended to generate profit. Profit is the main aim of commercial purpose. But, in a case where goods purchased or services hired in an activity which is not directly intended to generate profit, it would not be commercial purpose.

 26. In view of the matter, 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.”

11. In the instant case, the policy was obtained by complainant firm only for indemnification and actual loss. It is not intended to generate profits. Therefore, the plea taken by the opposite parties/ Insurance Company is not tenable and the complainant-firm is a consumer of the opposite parties.

In supra judgment reported in II (2005) CPJ 27 titled Harsolia Motors Versus National Insurance Co. Ltd.,  decided on 3.12.2004 Hon’ble National Commission, New Delhi  has clearly held to the following effect:-

“Therefore, the two fold classification is commercial purpose and non-commercial purpose.

If the goods are purchased for resale or for commercial purpose then such consumer would be excluded from the coverage of Consumer Protection Act, 1986. Such illustration could be that a manufacturer who is producing one product A' , for such production he may be required to purchase articles, which may be raw-material, then purchase of such articles would be for commercial purpose. As against this, the same manufacturer if he purchases a refrigerator, a television or an air-conditioner for his use at his residence or even in his office, it cannot be held to be for commercial purpose and for this purpose he is entitled to approach the consumer forum under the Act.

Similarly, a hospital which hires the services of a medical practitioner, it would be a commercial purpose. But, if a person avails of such services for his ailment it would be held to be not a commercial purpose.

Further, from the aforesaid discussion, it is apparent that even taking wide meaning of the words for any commercial purpose it would mean that goods purchased or services hired should be used in any activity directly intended to generate profit. Profit is the main aim of commercial purpose. But, in a case where goods purchased or services hired in an activity which is not directly intended to generate profit, it would not be commercial purpose.

In this view of the matter, 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.”

Keeping in view the supra judgment reported in II (2005) CPJ 27 titled Harsolia Motors Versus National Insurance Co. Ltd.,  we do not find any merit in this plea of the Opposite Parties and the same is declined.  

12.     Now come on the merit of the case.  The main plea taken by the Opposite Parties for the repudiation of the claim of the complainant is that before the inspection of defective equipments of in two claims, the complainant has already got repaired the same at its own before reaching its surveyor on the spot and third claim was  repudiated by the Opposite Parties only on the ground that the complainant has not gave any response to  the queries of the Opposite Parties. It is not disputed that the equipments of the complainant were insured with the Opposite Parties as per policies referred above. It is not disputed that in all the claims, the surveyor of the Opposite Parties visited the premises of the complainant late, whereas it is not disputed that complainant is running a multiplex in their premises and in case the ACs or compressor becomes defective, it requires immediate repaired and without AC or compressor, the AC Cinema and Multiplex Hall can not run and it was the duty of the surveyor of the Opposite Parties to visit immediately the premises of the complainant and to direct its engineer for getting the defects removal, but they did not do so. The complainant further  contended that as and when  the equipment stopped working, they immediately reported the matter to the Opposite Parties, without any delay because it was  in its own interest because as stated above, without the AC or compressor, the AC Cinema and Multiplex Hall can not run and there would have great loss to the complainant without the AC or compressor and hence, the complainant immediately reported the matter to the Opposite Parties to do the needful. In the absence of immediate attention, the complainant has got the same repaired at its own and thereafter submitted the bills for the reimbursement of its claim with the Opposite Parties and in this regard, we are of the view that the Opposite Parties can not be escaped from its liability for making good the loss of the complainant  which is obviously under the insurance cover.

 13.    In such a situation the repudiation made by Opposite Parties regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation.  This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible.  It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

14.     Now come to the quantum of compensation. The complainant has claimed the repair charges amounting to Rs.3,05,205/- (i.e. Rs.70,000/-+ Rs.70,000/-+ Rs.1,65,205/-). Bare perusal of the record shows that the complainant has produced on the record the copies of bills Ex.C6,  Ex.C7, Ex.C8, Ex.C9, Ex.C10 and Ex.C13 on accountof repair charges of the insured equipments, amounting to Rs.2,72,004/- and as such, the complainant at the most can claim said amount of Rs.2,72,004/-. 

15.     In view of the aforesaid facts and circumstances of the case,  we allow the complaint of the Complainant partly and direct the Opposite Parties to make the payment of repair charges of the insured equipments of Rs.2,72,004/- (Rupees two lakh seventy two thousands four only) to the Complainant alongwith interest @ 8% per annum from the date of  filing the present complaint i.e. 18.02.2019  till its actual realization.  Opposite Parties are also directed to pay the lump sum compensation to the tune of Rs.10,000/- (ten thousands only) to the complainant on account of harassment, mental tension  and litigation expenses. The compliance of this order be made by  the Opposite Parties  within 45 days from the date of receipt of this order, failing which the complainant  shall be at liberty to get the order enforced through the indulgence of this District Commission. Copies of the order be furnished to the parties free of cost. File be consigned to record room after compliance.

16.     Reason for delay in deciding the complaint.

          This complaint could not be decided within the prescribed period because the State Government has not appointed any of the Whole Time Members in this Commission for about 3 years i.e. w.e.f. 15.09.2018 till 27.08.2021 as well as due to pandemic of COVID-19.

Announced in Open Commission.