Punjab

Ludhiana

CC/19/380

Ravinder Pal - Complainant(s)

Versus

M/s Ram Kumar Ajay Kumar - Opp.Party(s)

J.B.Khanna Adv.

13 Sep 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:582 dated 18.12.2019.                                                         Date of decision: 13.09.2023.

 

1. M/s. Nav Bharat Traders, 4811, B-23, Bobby Palace, Dharampura, Ludhiana through its Proprietor Ms. Pavneet Kaur
2. Pavneet Kaur, Proprietor of  M/s. Nav Bharat Traders, 4811, B-23, Bobby Palace, Dharampura, Ludhiana.                                                                                                                                        ..…Complainants

                                                Versus

1. Cholamandalam MS General Insurance Company, 1^st Floor, K.L. Plaza, Rani Jhansi Road, Civil Lines, Ludhiana, through its Manager/Officer Incharge.
2. Central Bank of India, Nizam Road, Ludhiana, through its Manager.                                                                                        …..Opposite parties 

Complaint Under section 12 and 14 of the Consumer Protection Act, 1986.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainants            :         Sh. Iqbal Singh, Advocate.

For OP1                         :         Sh. Vyom Bansal, Advocate.

For OP2                         :         Sh. Aman Sharma, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Briefly stated, the facts of the case are that complainant No.1 is the proprietorship firm of which complainant No.2 is the sole proprietor. The complainants maintain MTL account with opposite party No.2 bank, who as per their policy, earlier got insured the machinery of the complainant firm with opposite party No.1 insurance company vide policy No.213001176250/000/00 and deducted the next policy premium from the account of the firm on 19.11.2018. As several transactions are being routed in the account of complainant firm in routine and it is difficult for them to note/check/maintain or to keep record of each and every transaction routed in their account and generally record of big transactions are being checked and noted down. Opposite party No.1 at their own level without intimation of the complainant, credited the premium amount of the insurance policy on 08.08.2019 and even the complainant had no knowledge about this fact nor the same was ever conveyed, communicated or informed to the complainant by the bank. The complainants further stated that though the premium amount was credited/refunded into their account but the policy in their favour was not cancelled nor revoked. Even opposite party No.2 bank did not give any information or intimation regarding cancellation or revocation of insurance policy or about refund of premium of the policy to the complainants. The complainants further stated that in the evening of 11.11.2019, due to short circuit fire broke out into their factory due to which the factory premises including stocks, raw materials, finished goods, machines, packing machines, furniture, electronic appliances including fans etc. and other articles lying in the factory premises were completely damaged. The fire was controlled by Fire Brigade and Fire Call Report No.630/FB/D dated 21.11.2019 was submitted by Asst. Divisional Fire Officer, Fire Brigade, Ludhiana. Due to fire, the complainants suffered huge loss of machinery etc. worth Rs.9,00,000/-. A DDR No.22 dated 15.11.2019 was lodged at P.S. Divisional No.3, Ludhiana.

                   The complainants lodged a claim with respect to loss with opposite party No.2, who did not respond on the excuse that the amount of premium was already returned to the complainant by opposite party No.1. The complainant approached officials of opposite parties at Ludhiana branch with request to make the payment of claim amount but they flatly refused to make any payment and rather misbehaved and insulted with the complainant. The complainant suffered mental pain, agony, harassment, humiliation etc. due to deficiency in service and unfair trade practice on the part of the opposite parties. In the end, the complainants prayed for issuing direction to the opposite parties to make payment of claim amount of Rs.9,00,000/- along with compensation of Rs.2,00,000/- besides litigation expenses of Rs.21,000/-.

2.                Upon notice, opposite party No.1 appeared and filed written statement and by taking preliminary objections, assailed the complaint on the ground of maintainability of the complaint; lack of cause of action; lack of jurisdiction; suppression of material facts etc. According to opposite party No.,1 the Standard Fire and Special Perils Insurance Policy vide policy no. 213001176250/000/00 valid for the period 01.12.2017 till 30.11.2018 was taken by Central Bank of India for the complainant firm from it. The benefits under the policy are governed by the terms and conditions of the policy and the liability of opposite party is limited to the insured perils occurring within the policy period for the recorded location subject to conditions and exceptions as mentioned in the terms and condition of the Policy. Opposite party No.1 further stated that for renewal of said policy an amount of Rs.2603/- was deducted on 19.11.2018 from the bank account of the complainant with the Central Bank of India by the bank but no policy was issued as a request for refund of the premium was received from Central Bank of India vide Letter dated 03.08.2019 and the premium received was refunded. Thus no Policy was renewed/issued by the Insurance Company to renew the previous Policy expiring on 30.11.2018. Thus, neither the loss in question covered under the previous policy no. 213001176250/000/00 nor any effective policy was issued by opposite party No.1 covering the date of alleged loss. As such there arises no liability of the Insurance Company to pay any amount to the complainant.

                   On merits, opposite party No.1 reiterated the crux of averments made in the preliminary objections and facts of the case. However, opposite partyNo.1 stated that no claim was intimated with it for the period of policy No.213001176250/000/00. The alleged loss on 11.11.2019 to the factory of the complainant is not covered under the said policy period. Opposite party No.1 has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.      

3.                In separate written statement, opposite party No.2 by taking preliminary objections, assailed the complaint on the ground of lack of cause of action; non-disclosure of facts etc.

                   On merits, opposite party No.2 admitted the fact of maintaining MTL account by the complainant with it.  The insurance was got at the instance and consent of the complainant and the complainant was well within knowledge that as and when payment became due and deducted of the said insurance. Opposite party No.2 further stated that it is a bank and it was not in any kind of duty of obligation to track/watch each and every account in its branch unless it seems suspicious transaction and further to track/watch/see each and every transaction of each account. Opposite party No.2 sent emails to opposite party No.1 but no reply was received. However, on sending reminder, opposite party No.1 sent email dated 13.02.2020 making false averments and excuse. In response to said email, opposite party No.2 further sent email dated 08.09.2020  to opposite party No.1 but no reply was received. Opposite party No.2 has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.     

4.                In support of their claim, complainant No.1 Ms. Pavneet Kaur tendered her affidavit Ex. CA in which she reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 is the copy of letter dated 10.11.2019 written to opposite party No.2, Ex. C2 is the copy of insurance policy w.e.f. 01.12.2017 to 30.11.2018, Ex. C3 is the copy of DDR No.22 dated 15.11.2019, Ex. C4 is the copy of account statement of complainant firm, Ex. C5 is the copy of deposit details of the complainant, Ex. C6 is the copy of fire call report dated 21.11.2019, Ex. C7 is the copy of news item, Ex. C8 and Ex. C9 are the copies of emails and closed the evidence.

4.                On the other hand, counsel for opposite party No.1 tendered affidavit Ex. RA of  Ms. Vidhi Passi, Legal - TP Claims of opposite party No1. Office at Chandigarh along with documents Ex. R1 is the copy of insurance policy documents, Ex. R2 is the copy of application for refund and closed the evidence.

                   The counsel for opposite party No.2 tendered affidavit Ex. RA2 of Sh. Kamal Kumar Marmath, Senior Manager of opposite party No.2 branch along with documents Ex. R1 is the copy of account statement w.e.f. 19.11.2018 to 25.11.2018, Ex. R2 is the copy of account statement w.e.f. 08.08.2019 to 10.08.2019, Ex. R3 to Ex. R8 are the copies of emails and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written replies along with affidavits and documents produced on record by the parties. We have also gone through written arguments submitted by opposite party No.2.

6.                Admittedly, the complainant firm was maintaining a MTL account with opposite party No.2 and opposite party No.2 while acting as a corporate agent of opposite party No.1, facilitated the issuance of a Standard Fire and Special Perils insurance policy Ex. R1 for complainant firm. The policy so issued was having a validity from 01.12.2017 to 30.11.2018 with a coverage of Rs.9,00,000/- for plant and machinery. The amount was deducted by opposite party No.2 and remitted to opposite party No.1 as premium for issuance of policy Ex. R1. Just before completion of coverage period of Ex. R1, opposite party No.2 bank again deducted an amount of Rs.2603/- from the bank account of the complainant for the payment of renewal premium. Opposite party No.1 received the premium but the policy was not reissued and finally after a gap of more than 9 months, refunded the premium to opposite party No.2.

7.                Unfortunately, a fire broke in the premises of the complainant on the intervening night of 11.11.2019 resulting in a huge loss of stock and machinery and fire was got extinguished by the Fire Brigade, Ludhiana.  Fire Call Report Ex. C6 and even a DDR No.22 dated 15.11.2019 Ex. C3 was also recorded by competent authorities. Opposite party No.1 has refused to entertain the claim on the pretext that no insurance policy was in existence at the time when the fire took place and they had already refunded the premium as per request Ex. R2 of opposite party No.2. On the other hand, opposite party No.2 had seriously disputed the moving of application for refund Ex. R2 to opposite party No.1.

8.                It is a settled proposition of law that once an insurance company receives a premium, then the company is duty bound to extend the coverage by issuing formal cover note or the insurance policy. In case of renewal of previous policy acceptance of renewal premium irrevocably amounts to renewal of previous policy on the same terms and conditions unless parties opt for its change. In the present case as well, since the renewal premium of Rs.2603/- was admittedly received by opposite party No.1 and non-issuance of renewal policy certainly amounts to deficiency in service. The previous policy Ex. R1 stands renewed for its corresponding period of subsequent year i.e. from 01.12.2018 to 30.11.2019 for a sum assured of Rs.9,00,000/-. So in the given set of facts and circumstances, it will be just and appropriate if opposite party No.1 is directed to settle and reimburse the claim of the complainant in view of the terms and conditions as stipulated in original policy Ex. R1 along with composite compensation of Rs.10,000/-.

9.                As a result of above discussion, the complaint is partly allowed with direction to opposite party No.1 to settle and reimburse the claim of the complainant in view of the terms and conditions as stipulated in original policy Ex. R1 within period of 30 days from the date of receipt of copy of the order, failing which the complainant shall be held entitled to interest @8% per annum on the settled amount from the date of order till its actual payment. Opposite party No.1 shall further pay a composite cost of Rs.10,000/- (Rupees Ten Thousand only) to the complainant. Payment of costs shall be made within a period of 30 days from the date of the receipt of the copy of this order. However, the complaint as against opposite party No.2 is hereby dismissed. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.         

10.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)                                (Sanjeev Batra)

Member                                                President         

 

Announced in Open Commission.

Dated:13.09.2023.

Gobind Ram.

 

Announced in Open Commission.

Dated:13.09.2023.

Gobind Ram.