Date of Filing :21.01.2017
Date of Disposal : 30.10.2023
BEFORE THE KARNATAKA STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BENGALURU (PRINCIPAL BENCH)
DATED:30.10.2023
PRESENT
HON’BLE Mr JUSTICE HULUVADI G RAMESH : PRESIDENT
Mr K BSANGANNANAVAR: JUDICIAL MEMBER
Mrs DIVYASHREE M:LADY MEMBER
APPEAL No.187/2017
National Insurance Company Ltd
Chickmagalur Branch-577101
Through its Regional Office
No.144, Subharam Complex
M G Road, Bengaluru-560 001
Rep. by its Regional Manager
Mr G.Chandrasekharan Appellant
(By Mr B C Seetarama Rao, Advocate)
-Versus-
Sri Mohan Gowda G M
Aged about 61 years
S/o Sri Manjegowda
Beeralingeshwara Traders
Market Road,
Chickmagalur-577 101 Respondent
(By Mr Jayakirthi, Advocate)
:ORDER:
Mr JUSTICE HULUVADI G RAMESH : PRESIDENT
1. This Appeal is filed under Section 15 of Consumer Protection Act 1986 by the OP, aggrieved by the Order dated 30.11.2016 passed in Consumer Complaint No.69/2014 on the file of District Consumer Disputes Redressal Forum, Chickmagalur (hereinafter referred to as District Forum).
2. Heard the arguments of the learned Counsels on record. Perused the Impugned Order, grounds of Appeal and the documents on record.
3. It is an admitted fact that the Complainant had obtained a Standard Fire and Special Perils Policy, to his Shop covering the Stocks & Machineries such as Gunny Bags & materials and Sewing Machineries insured for a declared values of Rs.15,00,000/- and Rs.1,00,000/- respectively for the period 23.10.2013 to 22.10.2014. On 09.02.2014, a fire accident occurred in his Shop and the stocks stored therein got burnt in the fire accident, he reported the said incident to the jurisdictional Police as well as to OP and thereafter submitted the relevant Claim Form on 19.02.2014. The licensed Surveyor & Loss Assessor appointed by the OP assessed the loss at Rs.1,89,605/- and as per Surveyor’s Report, OP paid a sum of Rs.1,89,600/- on 18.06.2014. The allegation of the Complainant is that he had suffered the loss of stock valued at Rs.12,00,000/- and as such he is entitled to receive the Insurance coverage for the same.
4. The stand taken by the OP is that the surveyor had computed the loss i.e., Net loss x Sum Assured/Actual stock viz., Rs.2,70,140 x 15,00,000/20,00,000,which works out to Rs.2,02,605/- and after deducting the Policy excess for fire accident at Rs.10,000/-, salvage value of partially burnt bags at Rs.3,000/-, the liability of the Insurer to pay for the loss suffered works out to Rs.1,89,605/-. Accordingly, credited the said amount to the account of the Complainant at IDBI Bank Ltd., MG Road, Chickmagalur.
In the Appeal, Appellant has taken a ground that the District Forum without looking into the Report of the Surveyor, perversely held that the Surveyor had admitted the loss to the tune of Rs.10,17,000/- and then he applied the average clause. The Respondent had not produced the Annual Returns, Stock Book, Sales Register, Purchase Bills and Sale Bills, either before the District Forum or to the Appellant and District Forum ignored this fact and arrived at a conclusion based on the estimate of Police or Fire Force personnel, which cannot be the basis to find out the actual loss or otherwise. During the course of his arguments, the learned Counsel for the Appellant submitted that the physical stock was higher than the Sum Assured. Thus seeks to set aside the Impugned Order by allowing the Appeal.
5. Let us examine whether the Complainant is entitled for reimbursement of Rs 12,00,000/- instead of Rs.1,89,600/- paid as Insurance Coverage, based on the Surveyor’s Report, under the Insurance Policy issued by the OP ?
6. On perusal of Ex-P3 - the document produced before the District Forum it is seen that it is a Standard Fire & Social Peril Policy issued by the OP vide Policy No.604901/11/13/3100000243, policy coverage period being from 23.10.2013 to midnight of 22.10.2014, Net Premium the Sum Assured being Rs.16,00,000/- for Abrasive Manufacturing viz.., 1)stock of Gunny Bags and its materials worth Rs.15,00,000/- 2) Gunny bags making machineries Rs.1,00,000/-. Further, under Policy Schedule, it is clearly mentioned as a) stock in trade–stock of Gunny bags and materials – sum insured Rs.15,00,000/- and others to be specified Rs.1,00,000/- and Net Premium with Service Tax is shown as Rs.3,596/-.
Further, on perusal of the document Ex-P4 - Stock in Trade of the Complainant produced before the District Forum and audited by Mr G L Lingamariyappa, Auditor and Tax Consultants, Chickmagalur for the month of January 2014, reflecting the details of stock as under:
- Opening Balance : Empty Gunny bags Rs.6,367.00
- ADD : Purchase Rs.14,63,130.00
- Total Rs.14,69,497.00
- LESS : Sales Rs. 3,85,138.00
- Closing stock as on 31.01.2014 Rs.10,84,359.00
Further, on perusal of Fire Claim Form which is marked as Ex-R1, produced by the OP, it is seen that the Complainant had estimated the total loss plus item No.1 to 7 mentioned in the Claim Form, which works out to Rs.11,16,854/- and after deducting Salvage value of Rs.3,000/-, the amount claimed is indicated as Rs.11,13,845/- .
On perusal of the document Ex-R2 - the Surveyor’s Report, under the Head - Adequacy of Insurance, it is mentioned that-
‘The insured not maintained any documents as to show the details of stock, purchase and sales. But the insured revealed that he had stock of gunny bags worth of Rs.19,00,000/- in the premises and Rs.1,00,000/- as machineries. But the insured declared his stock while getting the insurance to the tune of Rs.15,00,000/- stocks and machineries worth of Rs.1,00,000/-. Hence, the average clause of insurance is applicable for the insured shop stocks
Further under the Head - Details of Survey/Extent of Damage at Sl. No.10 it reads-
10. On 12th February 2013, I received call from the insured and I once again made a visit to the shop, counted the bags in detail, prepared the consolidated list and had taken the signature to the details of burnt stock list and is enclosed in the annexure-I. The list discloses that, in the incident the insured’s total 20780 bags were partially burnt up to 40% and those bags were water damaged and stained by burnt soot and huge smoke. Hence, it was considered as 100% damage in the incident.
Thus, the general condition No.(6) (a) of the Insurance Policy reads thus:
6(a) A claim in writing for the loss or damage containing as particular an account as may be reasonably practicable of all several articles or items or property damaged or destroyed and of the amount of the loss or damage thereto respectively, having regard to their value at the time of the loss or damage not including profit of any kind.
7. Though the Surveyor had given his detailed Report with regard to availability of the Plant & Machineries at the spot and has stated with regard to the details of extent of damage, it is clear that in the incident the insured’s total 20780 bags were partially burnt up to 40% and those bags were water damaged and stained by burnt soot and huge smoke. Hence, it was considered as 100% damage in the incident and has not placed any record of independent valuation of the goods so burnt.
8. We have also taken note of the fact that the Appellant or his Authorised Surveyor has not sought any sort of clarification from the Insured on any of their observations. Also, the very purpose of taking special Insurance like standard Fire & Social Peril Policy gets defeated, if the Insurer resorts to the easiest manner of settling the claim, instead of application of mind on the Policy issued by him, vis-à-vis, the Claim in its entirety, also, not bothering to get the declaration obtained from the Insured verified even at random at any point of time and in such a situation, the Insurer is honour bound to settle the claim of the Insured, in toto. In the circumstances, the finding recorded by the District Forum is just and proper and the same does not call for any interference. Accordingly, Appeal stands Dismissed.
9. The Statutory Deposit in this Appeal is directed to be transferred to the District Commission for further needful.
10. Send a copy of this Order to the District Commission, as well as to the parties concerned, immediately.
Lady Member Judicial Member President
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