In this first appeal filed under Section 19 read with Section 21(a)(ii) of the Consumer Protection Act, 1986, the impugned order dated 27.8.2015, passed by the U.P. State Consumer Disputes Redressal Commission, Lucknow   (hereinafter referred as ‘State Commission’) has been challenged, vide which , Consumer Complaint No. 60/2014 filed by the present respondents, was allowed and the appellant insurance company was directed to pay Rs.19,13,000/- as assessed by the surveyor to the complainant  for damage to the X-ray Tube of CT Scanner purchased by the complainant with interest @ 9% per annum from the date of the complaint  alongwith litigation cost of Rs.50,000/-.

2.      Briefly stated, the facts of the case are that complainant no.1, Adarsha Diagnostics Centre is partnership firm and complainants no.2 and 3 are partners of the said firm,  engaged in the pathological examination of patients in Jaunpur area of U.P. State. The complainants purchased a refurbished C.T. Scanner Model  X-Lead worth Rs.28,63,421, for which an insurance policy was taken from the appellant insurance company for the period from 29.8.2012 to 28.8.2013 by paying a premium of Rs.1,09,256/-. It has been stated that X-ray Tube is a vital component of the C.T. Scan machine,  and the premium was calculated taking into account the value of the said X-ray Tube. It has also been stated that the machine became dead on 16.9.2012 and it was revealed that there was a problem in the X-ray Tube. The OP insurance company was informed about the problem and on their assurance, a new X-ray Tube was purchased for Rs.19,13,000/- on 28.11.2012. The complainants alleged that despite providing bills etc. for the purchase, the insurance company refused to pay the claim,  saying that the X-ray Tube of C.T. Scanner was made in the year 2007 and  after applying 100% depreciation, the claim for the old Tube could not be paid. The repudiation letter dated 25.3.2013 was sent by the appellant insurance company  to the complainant, saying that the claim was being treated as ‘No Claim’.  The complainant filed  the consumer complaint in question, seeking directions to the OP insurance company to pay an amount of Rs.19,13,000/- for the X-ray Tube alongwith interest and also to pay compensation for mental harassment etc. as well as punitive damages. The State Commission allowed the complaint,  saying that the insurance policy had been issued by the appellant/OP after carrying out the requisite inspection of  the machine and  they were not justified in taking the plea that one component of the machine was manufactured in the year 2007 and hence, 100% depreciation could be applied on the value of the said component. Being aggrieved against the order of the State Commission, the insurance company is before this Commission by way of the present appeal.

3.      There is a delay of 34 days in filing the appeal in question. An application for condonation of delay has been filed by the appellant, explaining that the delay on their part was not wilful or intentional. The appellant  is a company owned by Government of India and has got multiple offices and levels of authority situated at different places. The delay was caused in seeking approvals at various levels as per the internal procedure laid down.  The complainants/respondents, however, objected to the condonation of delay by filing a written reply to the said application,  in which they stated that  specific details about the time spent at each level in the insurance company had not been indicated. After considering the entire facts of the case and since there does not seem to be any wilful or intentional delay in filing the appeal, the said delay of 34 days is ordered to be condoned.

4.      The learned counsel for the appellant contended that in the insurance policy itself detailed description of  insured four items had been given. Item no.4 is the X-ray Tube insured for Rs.32 lakhs and  the year of make for the said item had been mentioned as 2011. However, the said X-ray Tube had been made in the ear 2007. The surveyor, therefore, rightly  recommended that 100% depreciation was applicable for the X-ray Tube machine. The insurance company has, therefore, rightly declared the matter as ‘No Claim’.

5.      Per contra, the main line of argument taken by the respondents  is that the insurance policy was issued after carrying out proper inspection/investigation about the  components of the machine, and it was decided to issue the policy after charging a premium of Rs.1,04,396/-.  Since it was clear that it was a refurbished machine, the insurance company was not justified in saying,  after the filing of the claim,  that 100% depreciation was to be allowed on the X-ray Tube. The learned counsel further argued that the affidavit of the surveyor had also not been proved  on record.  The conclusion arrived at by  the State Commission  was therefore,  in accordance with law, because all the documents had been provided to the insurance company,  before they decided to grant the insurance cover for the said machine.

6.      I have examined the material on record and given a thoughtful consideration to the arguments advanced before me.

7.      A perusal of the report of the surveyor, Sanjay Kumar Srivastava indicates that he made assessment of loss as Rs.19,13,000/- based on the invoice dated 28.11.2012 for the new X-ray Tube produced by the complainant. In the said survey report, the surveyor has stated about the cause of loss as follows:

          ‘CAUSE OF LOSS

The proximate cause of loss appears due to sudden fluctuation of voltage spikes, which caused short-circuiting in the part of aforesaid CT Scan machine & damaged it, already reported in details i.e. ‘Electrical Breakdown’.

8.      It is clear from above that the cause of loss was short-circuiting due to fluctuations in the voltage. In so far as the plea of the insurance company that the X-ray Tube was mentioned as a separate item in the insurance policy,  and that the same was made in the year 2007 and 100% depreciable, is not tenable,  because  the insurance company has not denied anywhere that full particulars of the machine or its components were not in the knowledge of the insurance company when they decided to extend the insurance cover for the said machine.  The case of the complainants is that all documents were provided to the insurance company before the grant of insurance coverage and the engineers and the agents of the company inspected the machine and only after ensuring the feasibility of the grant of insurance cover,  the premium amount was calculated and charged from the complainants. I find force in the assertion made by  the complainants  and agree with the conclusion arrived at  by the State Commission  that the status of the machine and its components was well within the knowledge of the insurance company at  the time of grant of the insurance cover. The proforma invoice clearly provided that it was a refurbished machine. I therefore, agree with the findings of the State Commission  that the repudiation letter dated 25.3.2013 should not have been issued by the insurance company and that there had been no breach of the terms and conditions of the insurance policy.

9.      During arguments, the learned counsel for the appellant insurance company has drawn attention to an order passed by the Hon’ble Apex Court in Vikram Greentech (I) Ltd. and another Vs. New India Assurance Company Ltd., II (2009) CPJ 34 (SC)  saying as follows:

 “That the insurance contract is a species of commercial transactions and must be construed like any other contract  to its own terms and by itself. In a contract of insurance, there is requirement of uberimma fides i.e. good faith on the part of the insured. Except that, in other respects, there is no difference between a contract of insurance and any other contract.”

10.    A perusal of the facts on record indicates that there has been no allegation against the complainants that they failed to provide the requisite or necessary information to the insurance company regarding the status of the machine or its parts. There is, therefore, no breach of good faith on the part of the complainants, vis-à-vis the insurance company.  It is held, therefore, that there is no illegality, irregularity or jurisdictional error in the order passed by the State Commission  and the same is upheld. This first appeal is ordered to be dismissed with no order as to costs.