Per Shri Narendra Kawde, Hon’ble Member
This consumer complaint is filed by the complainant no.1 who is a Voluntary Consumer Organisation espousing the cause of consumer Shri J.B. Gai appears to represent complainant No.1 and with authorization of complainant No.2. Complainant No.2 is a Sarman Engineering Private Limited Company who is actually aggrieved party before us. The complaint is filed alleging deficiency of service and unfair trade practice on the part of opponent-ICICI Lombard General Insurance Co. (hereinafter referred to as ‘opponent-Insurance Company’) for arbitrarily rejecting the claim payable under the Insurance Policy.
2. Salient facts giving rise to file this consumer complaint are summarized hereinafter.
Complainant No.2 i.e. Sarman Engineering Pvt. Ltd. subscribed to “Marine Inland Insurance (Open) Policy” for sum assured of `5 Crores issued by opponent-Insurance Company. During the validity period of the Insurance Policy, consignment of goods worth `30,37,500/- was destroyed in the fire in transit which was carried out in a truck. The incident occurred on 28/02/2010. The incident of loss was promptly reported to the opponent-Insurance Company. Opponent-Insurance Company appointed Cunningham Lindsey International Pvt. Ltd. as Surveyor to carry out the survey of loss. Surveyor assessed the loss and submitted their report to the opponent-Insurance Company estimating the loss of `24,75,000/- after deducting salvage and excess amount payable under the policy. Surveyor also reported that complainant No.2 sent declarations as required under the policy to the Marketing Officer-Mr.R.V. Nathan of the opponent-Insurance Company. Insurance claim preferred by complainant No.2 was repudiated on two grounds. Firstly, declarations for the cargo were not submitted before 5th of every month amounting to breach of policy warranty. Second ground taken for repudiation was non-discloser of all the material facts before entering into the contract by assured as per provisions of Section 20 of Marine Insurance Act, 1963. Aggrieved by the repudiation, complainant Nos.1&2 have filed this consumer complaint claiming an amount of `22,85,148/- payable to complainant No.2 with 12% p.a. interest thereon followed by cost of litigation.
3. We heard Mr.J.B. Gai, A.R. for the complainants and Mr.A.S. Vidyarthi, Advocate for the opponent. We have perused the record placed before us.
4. There is no dispute about the loss sustained due to sudden fire to the truck in transit while carrying consignment of goods. There is also no dispute about subsistence of contract of insurance under the Marine Inland Insurance Policy. What is disputed between the parties is that each consignment while in transit was limited to `25 Lakhs only whereas consignment loss in transit exceeded the limit of `25 Lakhs. Secondly, the truck carrying consignment was not having valid licence to transport goods from Maharashtra to place of destination in the State of Karnataka and thirdly, there is a dispute about submission of declaration of each consignment.
5. Learned A.R. of the complainants has drawn our attention to the limit per consignment as stipulated in the policy condition which is `25 Lakhs. Admittedly, damage/loss of consignment was more than `25 Lakhs. But, it is clarified by A.R. of the complainants that claim preferred under the policy was limited to the cap admissible under the terms of the policy. Secondly, it was submitted that initially, opponent-Insurance Company disputed the authorization of the transporting truck. However, said truck carrying damaged consignment was authorized by the authority to ply from the State of Maharashtra to the State of Karnataka which is evident from the documents submitted on record (at pages-40&41). As regards submission of declaration of each consignment, we find that complainant No.2 has been regularly filing such required declarations on email, sent to the Marketing Officer of the opponent-Insurance Company, which is supported by the authorized Surveyor in their report. Therefore, all these grounds relied by the opponent-Insurance Company for repudiating the insurance claim payable under the policy were unreasonable and arbitrary.
6. Learned Advocate of opponent-Insurance Company in submission argued that at the time of incident, consignment carried was worth `35 Lakhs which was in violation of policy condition, but no explanation from opponent-Insurance Company could come forward about the amount claimed which was well below the cap available under the policy terms. It was further argued by Learned Advocate for the opponent-Insurance Company that declarations were not submitted regularly as required under the subject policy terms and conditions. According to them each declaration is directly linked to reduction in sum assured. But at the time of occurring loss, sum assured of `5 Crores under the policy was available. Claim amount preferred by complainant No.2 was limited to `22,85,148/-. No satisfactory reply came forward to this query by Advocate for the opponent-Insurance Company.
7. Opponent-Insurance Company tried to substantiate their contention relying on the judgement passed by Hon’ble Apex Court in case of Suraj Mal Ram Niwas Oil Mills (P) Ltd. V/s. United India Insurance Co. Ltd. & Anr., IV (2010) CPJ 38 (SC). The judgement relied relates to submission of declaration of consignment. However, there was a failure on the part of the appellant therein to file declaration on time and the appeal filed by the appellant was dismissed by the Supreme Court. However, ratio deci-dendi of said judgement cannot be made applicable to the case on hand since as at the time of the claim, there was no adequate sum insured available under the policy to cover the loss claimed by the appellant who failed to declare each and every consignment in that case. In the case on hand, sum assured is `5 Crores at the time of claiming the loss whereas the claim preferred by complainant No.2 is `22,85,148/- which is very much below the sum insured available for settling the claim. Therefore, we do not agree with the submission of Learned Advocate of opponent-Insurance Company in this regard.
8. We have gone through all the documents, affidavits of evidence of the parties carefully and also given our thoughtful consideration to the submissions made by the parties. Opponent-Insurance Company repudiated the insurance claim on the unsustainable grounds as there was sufficient sum insured available under the policy to settle the claim and it is reported by the authorized Surveyor that consignments declarations were sent by complainant No.2 to the Marketing Officer of opponent-Insurance Company. Survey Report is an important document as held by Hon’ble Apex Court. There is no reason as to why Survey Report be ignored.
9. In view of aforesaid observations, we find that opponent-Insurance Company repudiated the insurance claim on unsustainable grounds and incurred deficiency of service to complainant No.2. Opponent-Insurance Company did not act on the Survey Report is not explained. Complainants have made out a case of arbitrary repudiation of the insurance claim payable under the policy. Therefore, consumer complaint deserves to be considered and allowed. We hold accordingly and pass the following order :-
-: ORDER :-
1. Consumer complaint is partly allowed.
2. Opponent-Insurance Company is directed to pay an amount of `22,85,148/- to complainant No.2 together with interest @ 9% p.a. from the date of repudiation i.e. 12/10/2010 till its realization.
3. Opponent-Insurance Company to bear their own costs and pay an amount of `25,000/- as costs to complainant No.2.
4. All the aforesaid amounts shall be paid within a period of sixty days; otherwise amounts ordered to be paid shall carry additional interest @ 6% p.a. payable to complainant No.2 till realisation.
5. Copies of the order be furnished to the parties.
Pronounced
Dated 3rd September 2013.
