JUSTICE SUDIP AHLUWALIA, MEMBER This Appeal has been filed by the Appellants/Opposite Parties against Respondent/Complainant challenging the impugned Order dated 31.01.2011 passed by the State Consumer Disputes Redressal Commission, Lucknow, U.P. in case bearing No. 31 of 2007. Vide such Order, the State Commission had partly allowed the Complaint. 2. The brief facts of the case are that the Complainant Company is engaged in manufacturing paper from agricultural waste and by- products. During 2003-2004, the Complainant took the following fire Insurance Policies to cover the risk of fire and allied perils: a. Policy No. 081104/11/03/00298 to insure stocks for a sum of Rs.3.57 crores from 01.07.2003 to 31.07.2004 b. Policy No. 081104/11/03/0028 to insure building, plants and machinery for Rs.5.46 crores from 01.07.2003 to 31.07.2004 c. Policy No. 081104/11/03/00150 to insure DG set for Rs.25 Lacs from 29.05.2003 to 28.05.2004 3. A major fire had broken out on 16.04.2004 in the factory premises of the Complainant resulting in massive damage to stocks and minor losses to machinery and accessories. Consequently, the claim was lodged for Rs.1,01,23,305/- towards damage to stocks and for Rs.6,54,250/- towards damage to machinery, fittings and installations. The Opposite Parties had deputed Mr. Naushad Ali as Spot Surveyor followed by Mr. Vinod Sharma as Final Surveyor. Both the Surveyors had visited the factory and were provided with all the documents and information as was asked by them. However, due to delay in settlement of the claim by the Opposite Parties, the Complainant had filed a complaint with IRDA on 20.11.2004. Thereafter, the Complainant was informed that the Branch Office had recommended repudiation of claim on the ground of violation of the Policy terms whereas the Regional Office which is the Competent Authority for settlement of claims had stated that there was no violation of the Policy terms by the Complainant and had advised the Divisional Office to review and revise their recommendation accordingly. The Regional Office was of the view that the assessment of loss done by the Final Surveyor was on the lower side and there was no violation of the Policy terms. However, the Divisional Office referred the claim to M/s. Puri Anuj & Associates Pvt. Ltd. for opinion and M/s. Puri Anuj & Associates stated that the claim is payable and there would be an upward revision in the claim. They further stated that the Survey Report was not prepared according to the stock register and actual verification of the stocks, apart from observing discrepancies in the Survey Report of Sh. Vinod Sharma. It was further stated that the assessment of loss on machinery was Rs.5,14,308/- as against Rs.2,89,328/-. Thereafter, the Opposite Party settled the claim of the Complainant in June, 2005 for Rs.39,32,000/- as assessed by Sh. Vinod Sharma as against the actual loss of Rs.1.07 crores and the Complainant was forced to accept this settlement as full and final discharge of the entire claim but no Surveyor Report was supplied to the Complainant. Finally, on 18.06.2005, two cheques amounting to Rs.39,05,871/- were received by the Complainant. It was contended that both the Surveyors acted under the influence of the Opposite Parties and failed to follow the IRDA guidelines. Also, in the Complaint before the IRDA, it was stated by the IRDA vide letter dated 12.10.2006 that deputation of Arbitrator is not possible and advised the Complainant to approach a Judicial Forum. The Complainant resented its acceptance of the settlement amount and because the consent was taken by pressure/coercion. The Complaint was therefore filed before the Ld. State Commission seeking the balance amount of Rs.68,61,684/- along with interest @ 10% till the date of payment, interest on delayed payment of Rs.39,05,871/- received after 11 months from due time, Rs.50,000/- for incidental expenses and Rs.25,000 for legal expenses alleging unfair trade practice by the Opposite Parties. 4. The Opposite Parties appeared before the Ld. State Commission and resisted the Complaint and denied all the allegations thereby denying deficiency in service on their part. It was contended that the Opposite Party-Insurer had adequately compensated the Complainant for loss; that the Complainant was irregular in submitting the stock positions; that the Complainant had made an excessive claim; that the Surveyor, Sh. Vinod Sharma had assessed the claim at Rs.39,32,900/- and a sum of Rs.39,05,931/- has been paid to the Complainant on 16.06.2005 in full and final satisfaction of the claim; that the report of Final Surveyor was delayed due to non-cooperation from the Complainant and delay in settlement of claim was unavoidable and unintentional. It was further the case of the Opposite Party that seeking technical opinion from M/s. Puri Anuj and Associates by the Divisional Office was not appointment of a Second Surveyor as the authority of appointment of Second Surveyor vests exclusively with the IRDA and they were appointed only for an advisory opinion on two specific points in order to help the Opposite Party in disposal of the claim. Hence, their opinion has no legal sanctity. It was further averred that M/s. Puri Anuj and Associates were under the influence of Complainant. Moreover, their opinion is unreliable as being self-contradictory and no objection was raised by the Complainant at the time of assessment of stock. It was stated that the Complainant has made allegations of pressure and threat only to wriggle out of the free consent given by him in his letter dated 15.03.2005 for accepting Rs.39,32,000/-. It was also contended that the Complainant is a Company and the services were hired for commercial purpose. Hence, the Complainant is not a ‘Consumer’. Therefore, the Opposite Party prayed for dismissal of the Complaint with costs. 5. The Ld. State Commission vide its Order dated 31.01.2011 partly allowed the Complaint and directed the Opposite Party to pay Rs.55,51,583/- along with 9% interest from 16.06.2005 till actual payment while observing inter alia: “…From the above, it is established that preliminary surveyor did not give the height of stakes then as to how the surveyor Shri Vinod Sharma determined the height in an arbitrary manner. Shri Sharma has also mentioned the same at page-76 and page-80 of the record. It may be mentioned that Surveyor Sharma should have obtained the signatures of the insured on the height of stakes so that the correctness of the height could be proved. In the absence of signature of the complainant or his representative this document cannot be accepted in evidence. Following the above analysis, the assessment of Rs. 39, 32,900/- by Surveyor Vinod Sharma on the basis of average is entirely one sided, arbitrary and made with sole motive to give benefit to the insurance company. It is clear that in the absence of height, the actual loss could have been assessed had the surveyor based its assessment on stock register and account statement. The counsel for the complainant has further argued that the Ops' themselves were not in agreement with the loss assessed by Surveyor Shri Vinod Sharma because they sought the opinion of a third Surveyor Shri Puri Anuj and Associates on the report of Surveyor Vinod Sharma. If it was not so, the O.Ps. should have accepted the report of Surveyor Puri Anuj. It is also clear from the report dated 3.3.05 of Surveyor Puri Anuj that Surveyor Puri Anuj also disagreed with the assessment made by Shri Vinod Sharma on the basis of average. Surveyor Puri Anuj has stated in his report that in case the assessment of loss is made again that the assessment will be higher than the amount assessed by surveyor Shri Vinod Sharma. He mentioned in his report that the complainant has not violated any condition of the policy and the claim is payable. At the same time the assessment of loss of volume basis i.e. average by Shri Vinod Sharma was not justified. Accordingly to surveyor Puri Anuj, Vinod Sharma has not given any reason for not following the books of accounts/official record. Keeping in view the circumstances of the case, accordingly to this Bench, it appears that Ops could not procure kind of favourable report which they wanted from Surveyor Puri Anuj. It is worthwhile to mention here that Ops have themselves sought the report from Surveyor Puri Anuj and therefore it was their responsibility to have given full opportunity to surveyor Puri Anuj to assess the loss. It is worth mentioning that surveyor Puri Anuj as mentioned in his survey report that the assessment of loss will definitely be on the higher side…” 6. Aggrieved by the above Order, First Appeal bearing No. 249 of 2011 has been filed by Appellants/ Opposite Parties against the Respondent/ Complainant before this Commission. 7. It is contended by the Appellants/ Opposite Parties that the Ld. State Commission had acted without jurisdiction in entertaining the Complaint which was originally beyond its jurisdiction by allowing an application for amendment of complaint so as to bring the complaint within its jurisdiction; that Respondent had given its consent to the sum of Rs.39,32,900/- as full and final settlement; that the Complaint is filed after almost an year of accepting the full and final settlement; that the Ld. State Commission illegally brushed aside the assessment of loss made by the Surveyor, Sh. Vinod Sharma, and failed appreciate the settled law that independent Surveyors are the best persons to make the assessment of the loss and their Report cannot be ignored lightly; that the Ld. State Commission was not justified in disbelieving the assessment simply because the assessments were not countersigned on behalf of the Insured; that the Surveyor had taken all the relevant factors including height into consideration in making the assessment. 8. Heard the Ld. Counsel for Appellants and Respondent. Perused the material available on record. 9. It was the case of the Complainant that the assessment of loss/admissible claim made by the Surveyor, Mr. Vinod Sharma, was not correct in as much as for no justifiable reasons he did not consider the Stock Register and Books of Accounts being shown to him on behalf of the Complainant, but made the assessment on a purely volumetric basis which was quite speculative and questionable. But the Insurance Company with a view to create pressure upon the Complainant to somehow agree to the amount being offered to it themselves referred the matter to another Surveyor “M/s. Puri Anuj & Associates Pvt. Ltd.”, on the questions whether the claim was payable or not, and if yes, what was the amount payable. Unluckily for the Insurance Company, the report of the aforesaid second expert became damaging to it since it was of the opinion that the claim was not only admissible but also upwardly revisable as the assessment of the previous Surveyor was not proper. 10. In such circumstances, the Ld. State Commission in its impugned Order had correctly come to the conclusion that the assessment made by surveyor, Mr. Vinod Sharma, was not objective and could not be relied upon, since for no convincing reasons he had refused to consider the Stock Books and Registers of the Complainant which were tendered before him. Furthermore, the next Surveyor/Expert- M/s. Puri Anuj & Associates Pvt. Ltd. were appointed by the Insurance Company itself and its report favouring the Complainant’s claim was certainly a good ground to not rely upon the earlier assessment of Shri Vinod Sharma. 11. In Para 17 of its original complaint, the Complainant had specifically stated that after using much pressure tactics the Insurance Company/Opposite Parties had called the Complainant to its Office to settle the claim for Rs. 39,32,000/- which was grossly inadequate pro-rata the loss of Rs. 1.07 crore suffered by it. The Complainant therefore declined to agree to the offer and demanded a copy of the Survey Report which was not only refused but the Complainant was also threatened that in case the settlement offered by the Company is not accepted, it would not forward the claim filed for approval of the Competent Authority. It was in such helpless situation that the Complainant had to give its consent as demanded by the Branch Manager Consequently, the same was obtained in a manner which grossly violated the provisions laid down in the IRDA(Protection of Policy Holders’ Interests) Regulations, 2002. 12. In similar circumstances, the Hon’ble Apex Court in the case of “National Insurance Co. Vs. Bhogra Polyfab Pvt. Ltd., (Civil Appeal No. 5733 of 2008)”, had held that the discharge voucher signed by the insured in such circumstances cannot be accepted and the insured would be entitled to pursue his further claim in accordance with law, or as otherwise suitable, such as by way of invoking arbitration. The relevant extracts from the decision of the Apex Court in his regard are set out as below- “19…….When we refer to a discharge of contract by an agreement signed by both parties or by execution of a full and final discharge voucher/receipt by one of the parties, we refer to an agreement or discharge voucher which is validly and voluntarily executed. If the party who has executed the discharge agreement or discharge voucher, alleges that the execution of such discharge agreement or voucher was on account of fraud/coercion/undue influence practiced by the other party and is able to establish the same, then obviously the discharge of the contract by such agreement/voucher is rendered void and cannot be acted upon. Consequently, any dispute raised by such party would be arbitrable…….” “25. In several insurance claim cases arising under Consumer Protection Act, 1986, this Court has held that if a complainant/claimant satisfies the consumer Forum that discharge vouchers were obtained by fraud, coercion, undue influence etc., they should be ignored, but if they were found to the voluntary, the claimant will be bound by it resulting in rejection of complaint. In United India Insurance Co. Ltd. Vs. Ajmer Singh Cotton & General Mills – 1999 (6) SCC 400, this Court held : “The mere execution of the discharge voucher would not always deprive the consumer from preferring claim with respect to the deficiency in service or consequential benefits arising out of the amount paid in default of the service rendered. Despite execution of the discharge voucher the consumer may be in a position to satisfy the Tribunal or the Commission under the Act that such discharge voucher or receipt had been obtained from him under the circumstances which can be termed as fraudulent or exercise of undue influence or by misrepresentation or the like. If in a given case the consumer satisfies the authority under the Act that the discharge voucher was obtained by fraud, misrepresentation, undue influence or the like, coercive bargaining compelled by circumstances, the authority before whom the complaint is made wold be justified in granting appropriate relief……” “30. The discharge voucher form was handed over to the respondent on 21.3.2006. It was signed and delivered to the appellant immediately thereafter acknowledging that a sum of Rs. 2,33,94,964/- had been received from the insurer (appellant) in full and final settlement, and that in consideration of such payment, the respondent absolved the appellant from all liabilities, present and future, arising directly or indirectly, out of said loss or damage under the policy. Admittedly, on the date when such discharge voucher was signed and given by the respondent, the payment of Rs. 2,33,94,964/- had not been made. It was made after receiving the voucher. Therefore, at the time of signing the voucher by the respondent and at the time of delivery of voucher by the respondent to the appellant, the contents of the voucher that the said amount had been received, that such amount had been received in full and final settlement of all claims, and that in consideration of such payment, the company was absolved from any further liability, are all false and not supported by consideration.” 13. In this case also the Complainant/Respondent had initially approached the IRDA on 20.11.2004. But on 12.10.2006, the IRDA informed him in its letter that it was not possible to depute the Arbitrator, on account of which the Complainant was advised to approach an appropriate judicial Forum. A copy of such letter from the IRDA was attached as Annexure-8 to the original Petition of the Complainant. 14. It may also be mentioned that the IRDA in its Circular No. IRDA/NL/CIR/Misc/173/09/2015 dated 24th September, 2015 had notified all Insurers in this manner – “Accordingly insurers are hereby advised as under: Where the liability and quantum of claim under a policy is established, the insurers shall not withhold claim amounts. However, it should be clearly understood that execution of such vouchers does not foreclose the rights of policy holder to seek higher compensation before any judicial for a or any other fora established by law.” 15. So the Complainant was perfectly within its rights to approach the State Commission for compensation when its actual claim was wrongfully denied to it, since in “Ramdas Sales Corporation Vs. The New India Assurance Company” this Commission held that the operation of this Circular was retrospective in nature. 16. Consequently, this Commission has no hesitation in holding that the claim of the Respondent/Complainant was justified and was rightly allowed in his favour by the Ld. State Commission. No grounds are made out to interfere with the impugned Order. The Appeal is therefore dismissed. Parties to bear their own costs. 17. The Petitioner-Insurance Company is now directed to comply with the directions of the Ld. State Commission within a month from the date of this order failing which payment of any outstanding amounts will attract interest @ 12% p.a. thereafter till the date of realisation. 18. Pending application(s), if any, also stand disposed off as having been rendered infructuous. |
