BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION

AT HYDERABAD.

F.A. 31/2008 against C.C. 675/2005, Dist. Forum-I, Hyderabad.   

F.A. 32/2008 against C.C. 674/2005, Dist. Forum-I, Hyderabad.  

F.A. 33/2008 against C.C. 673/2005, Dist. Forum-I, Hyderabad.  

F.A. 34/2008 against C.C. 676/2005, Dist. Forum-I, Hyderabad.  

Between:

M/s. National Insurance Company Ltd.

Rep. by its Senior Divisional Manager

Divisional Office: II Floor,

4-68/6, Ferozguda

Secunderabad.                                            ***                         Appellant/

                                                                                                O.P.     

.                                                                  And

The Singareni Collieries  Company Ltd.

Rep. by its G.M. R.G-III

Godavarikhani (A Govt. Company)

Regd. Office: Kothagudem

Khammam Dist.

Administrative Office at Meher Manzil

Singareni Bhavan, Red Hills

Hyderabad.                                                          ***                         Respondent/       

                                                                                                Complainant. 

Counsel for the Appellants:                         M/s. Katta Laxmi Prasad

Counsel for the Resps:                                M/s.  Shankarnarayana.

CORAM:

                         HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT     

                                                             &

  SMT. M. SHREESHA, MEMBER

TUESDAY, THIS THE TWELFTH DAY OF OCTOBER TWO THOUSAND TEN

Oral Order: (Per Hon’ble Justice D. Appa Rao, President)

                                                          *****

1)                These appeals are   preferred by the insurance company against the  common order of the Dist. Forum in the complaints filed by the  Singareni Collieries Company Ltd. directing it to pay  the amounts covered under the policies together with costs.  

2)                Since the  Dist. Forum passed common order in all these matters, we are of the opinion that a common order could even be passed in all these appeals  as common questions of fact and law  are involved. 

3)                The case of the complainant   Singareni Collieries  Ltd in brief is that  it is a government company  had taken the following policy  under Ex. B1  for Rs. 35,49,33,488/-   covering the risk of  the power distribution cables lying on ground in open cast mines at Godavarikhani, Bellampally and Medipally covering the period from 20.1.1996 to 19.1.2007 and 20.1.1997 to 19.1.1998. While so, some unknown offenders had committed  theft of cables as mentioned  and on the complaint lodged by them  the police registered a case.  The particulars  of which as under : 

They have also lodged a complaint with the insurance company claiming the amounts for which they  were insisting on FIR and other police records and despite the same was forwarded they did not settle the claim on the ground that it was pending with the higher authorities.    Therefore it has filed a complaint claiming the amount as above  together with interest @ 18% p.a.,  till the date of realization  and costs. 

4)                 The appellant insurance company resisted the case.  It has filed written statement more or less taking the very same pleas.  It admitted  issuance of  policies for the periods mentioned covering the risk of the power distribution  cables  lying  on  ground  in  open cast  mines  at  Godavarikhani,

Bellampally and Medipally  subject to certain terms and conditions.    On receipt of claims  for the loss of cables,  immediately it had appointed a surveyor,  who visited the spot  and filed his report.    Copies of FIR, police record etc. were not produced before him in order to process the claim.   Despite repeated reminders,   they did not  file and therefore they closed the  file by informing ‘No claim’.   Submission of  FIR and other records  are important for settlement of the claims.  At any rate,  the complainant had violated  clause-3 of the  policy viz.,  ‘taking  reasonable care’.   The condition says that the insured should take all reasonable steps to safeguard  the property insured against the accident  loss or damage.   Since the complainant could not file FIR and other relevant registers to hold that  there was theft the claim was repudiated.  There was no deficiency in service on its part and therefore prayed for dismissal of the complaint with costs.

5)                 The complainant in proof of its  case filed affidavit evidence  of its  Deputy General Manager and got Exs. A1 to A11marked.  Refuting its  evidence the appellant insurance company filed the affidavit evidence of its  Assistant Manager and got Exs. B1 to B21 marked.

6)                 The Dist. Forum after considering the evidence placed on record opined that  the complainant could prove that some unknown  offenders had committed theft of cables  confirmed by surveyor, more so, when there was  minutes of the meeting  between the complainant and the officials of the insurance company  for settlement of claims and therefore it was entitled to the amount claimed  and accordingly directed it to pay the same within 30 days from the date of receipt of order.

7)                 Aggrieved by the said decision, the insurance company preferred the appeals  contending that the Dist. Forum did not appreciate either facts or law in correct perspective.  It ought to have seen that there was  no proof that the property was lost.  They did not file FIR and other records.  The complaints  were  belatedly filed  six years after the theft.    The order was contrary to the report of the surveyor.  Mandatory documents  as required were not filed.  Therefore it prayed that the appeals be allowed  by dismissing the complaints.

8)                 The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

9)                 It is an undisputed fact that the complainant  Singareni Collieries a government company had taken  policies  Ex. B1 for an amount of Rs. 35,49,33,488/-   covering the risk of  the power distribution cables lying on ground in open cast mines at Godavarikhani, Bellampally and Medipally for the periods mentioned therein.    It is also not in dispute that the complainant informed the insurance company whenever theft of cables had taken place  mentioning the value  of the claim.   It may be stated herein that though the insurance company had treated  all the cases under the same category despite the fact that  FIR and other material  were produced in some of the cases as stated above.    The repudiation of  claims on the ground that  FIRs etc.  were not produced  except in one of the cases is without application of mind on the part of insurance authorities  while repudiating the claim.   For example the complainant had produced   FIR  Ex. A2 in  C.C. No. 674/2005.  In one of the cases the police  had investigated into the theft, caught the culprits and filed charge sheet vide Ex. A5  in c.c. No. 18/97.  Still the insurance company without taking cognizance  of it was sending identical letters insisting them to file FIR and other material.    For example in C.C. No. 674/2005 charge sheet was filed, nabbed the accused having registered the FIR under  Ex. B8  and they were filed by  the very insurance company having received them from the complainant.    They repudiated the claims on the ground that “as the recovery is more than the assessed loss, the claim is recommended to close as “No Claim and intimated to  the insured accordingly.”  The complainant in the said complaint complained that 35 metres of armoured cable worth Rs. 50,000/- was stolen.  The surveyor by his report  Ex.B11 opined that the value would be around Rs. 14,250/-.   He did not state that it was recovered. More over this was not pointed out by the surveyor.  

10)               The learned counsel for the  insurance company contended that the complaints were filed belatedly six years after  the alleged theft  and therefore not maintainable.    It may be stated herein that despite the documents being produced by way of FIR,  in some cases charge sheet etc. as mentioned  in  our  order  the insurance  company  has  been  dragging  on the

matter and asking them to file FIR, Final report etc.   They did not repudiate. Having waited  by issuing notice on  2.4.2004,  they filed the complaints on 28.5.2004,  along with it  I.A. No. 225/2004 to condone delay  and the same was allowed by order dt. 29.4.2005.    No revision or appeal has been preferred  against the said order and it has become final.   Therefore the complaints cannot be said to be not  maintainable on the said ground. 

11)               As far as C.C. 676/2005 is concerned  the complainant had  admittedly informed about the theft  to the insurance company vide its letter Ex. B2 for the theft that was committed on 10.6.1996.    We may mention herein that  number of  thefts were occurred  and for each of the theft  a report was given to the police followed by information to the insurance company.  In Ex. B4  requisition for final surveyor appointment was made.   It was mentioned  “27 claims reported, paid Rs. 7,63,362/-  towards settlement of the claims.”   This agreement pertains to the theft that was committed on 10.6.1996.   On that one M. Narasiah, Surveyor & Loss Assessor was appointed  who visited the spot  submitted his report Ex. B7.    The surveyor noted:

 “  It is explained by the insured that the cables are capitalised only after the same are installed.  The cables were  purchased in  May, 1994 but installed in the financial year 1996-97.    I am informed that  the company follows  weighted average  method of valuation  of inventories  due to which these kind of differences could exist.  In the absence of any evidence to the contrary  I am inclined to accept the same.   The loss of Rs. 2,73,550.20 may be adjusted by the excess clause, underinsurance  and other deductions, if any, and the balance may be paid to insured in full and final settlement of  all claims under the policy.”

In his report   he never alleged  that the report was wrongly given in order to make false  claims. Only in one of the cases  they could not file the FIR  somehow  despite notice was given  to the police evidenced under Ex. A7 to the  Station House Officer, no FIR was registered.   The complainant had followed up in regard to this by repeatedly issuing letters to the insurance company under  Exs. A1 to A4 and A9.    Therefore solely on the ground that copy of  FIR  was not given  the claim cannot be rejected, more so, in the light of various circumstances to show  that  said cable was stolen.    The Dist. Forum was justified in relying  minutes of the meeting  scheduled on 8.6.2001  where the insurance company authorities  had agreed to settle the claims.    Therefore, we have no doubt that the cables were lost and the complainant was entitled  to the amounts  claimed  in this regard.    This is supported by surveyor’s report. 

12)              The insurance company was bent upon repudiating the claims.    We may mention here that  the complainant had taken the insurance policies  worth Rs.  35 crores.  The question of mentioning lesser amounts would not arise.    Therefore the repudiation was unjust.    The Dist. Forum was justified  in allowing the complaints.  However  claiming  interest @ 18%  p.a. and awarding  the same is on high side.  The complainant is  entitled to the value of the cables together  with  interest @ 9% p.a.,  from  8.6.2001 till the date of realization together with costs of Rs.5,000/-  in each of the complaints.  The order of the Dist. Forum is modified accordingly.  

13)              In the result the appeals are dismissed  with costs  of Rs. 5,000/- in each of the complaint except for modification  with interest @ 9% p.a.,  from  8.6.2001 till the date of realization.  The order of the Dist. Forum is modified accordingly.  Time for compliance four weeks.

1)      _______________________________

PRESIDENT                 

2)      ________________________________

 MEMBER           

   Dt.  12. 10.   2010.

*pnr

“UP LOAD – O.K.”