DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I, U.T. CHANDIGARH

===

M/s Berkeley Automobile Ltd., Plot No.87, Industrial Area, Phase-II, Panchkula through Sh.O.P.Sharma its Legal and Liaison Officer.

…..Complainant

                 V E R S U S

1]  National Insurance Co. Ltd., 3 Middle Ton Street Calcutta through its M.D.

2]  National Insurance Co. Ltd., SCO No.305-306, Sector 35-B, Chandigarh through its Branch Manager.

                      ……Opposite Parties

CORAM: SH.P.D.GOEL                    PRESIDENT

         SH.RAJINDER SINGH GILL           MEMBER

DR.(MRS.) MADANJIT KAUR SAHOTA     MEMBER

Argued by: Sh.Sandeep Jasuja, counsel for complainant

          Sh.D.P.Gupta, Counsel for OPs.      

             --

PER P.D. GOEL, PRESIDENT

         The complainant has filed the present complaint under section 12 of the Consumer Protection Act (as amended upto date) “hereinafter referred to as the Act”. In nutshell, the facts of the case are that the complainant-company who deals in the business of selling cars, in order to cover the risk of cash/money used to take money insurance policies from the OPs. The complainant-company got renewed the money insurance policy from OP-2 for a period of 10.03.2007 to 09.03.2008 for estimate annual transactions of Rs.3 crores which was later on extended to for Rs.15 crores. As per the policy schedule, the following insurance coverage was provided:-

        Cash on counter                25 lakh

        Cash in safe                   15 lakh

        Cash in transit with single    30 lakh

        Carrying limit  

         On 18.01.2008, Sh.Satish Sharma along with Sh.Tarlochan Singh were going from Berkeley Dealership, Panchkula to ICICI Bank, Sector 11, Panchkula in a car for depositing an amount of Rs.5,14,000/- which was kept in a bag. The bag containing Rs.5,14,000/- was snatched on the gun point by the some persons and a FIR No.7 of 2008 in the Police station Sector 20, Panchkula (Annexure C-9) to this effect was recorded. The complainant intimated the OP-2 telephonically as well as vide written communication dated 21.01.2008 (Annexure C-10). The complainant submitted all the relevant documents for release of the claim. M/s N.Kumar Surveyors (P) Ltd. was appointed as investigator to investigate the incident and assess the loss. According to the complainant, he provided all the documents as desired by the OPs from time to time but still the OPs are delaying the claim on one pretext or other. The complainant was forced to file the complaint before this Forum and only thereafter the OPs have repudiated the claim vide letter dated 30.11.2009 on the ground that the sum assured is far from fair estimate of the actual cash transited during the proceeding year, hence this complaint.

2.      OPs filed written statement and took some preliminary objections. On merits, the averments of the complainant made in the complaint were denied. It has been admitted that the policy (Annexure C-1 was taken by the complainant for the period from 10.03.2007 to 09.03.08. It has further been pleaded that the policy was firstly extended upto Rs.5 crores and then to Rs.15 crores. It has been denied that on expiry of the policy, the final premium was subject to adjustment basis on the actual transaction of cash during the currency of the policy. It has been pleaded that if during the currency of the policy, the total sum assured stand exhausted the complainant was supposed to pay further premium. In the present case, after considering the money transit, which have already taken the sum assured stood exhausted on the date of loss and there was no premium available for covering that risk. According to Ops, the policy for sum of Rs.15 crores was not extended on the date of loss rather the said extension was given after the loss w.e.f. 25.01.2008. It has further been pleaded that as per the surveyor report, the sum of Rs.5 cores for the risk taken by the insurer as cash in transit has already been exhausted on 25.05.2007 and on calculation, the total cash in transit during policy period from commencement of the policy to the date of loss came to Rs.23,14,07,619/-, whereas the complainant had paid premium for Rs.5 crores. The surveyor did not recommend for passing of the claim. Hence, keeping in view the report of the surveyor and the terms and conditions of the insurance policy, the claim of the complainant has been rightly repudiated vide letter 30.11.2009. Denying all the material allegations of the complainant and pleading that there has been no deficiency in service or unfair trade practice on their part prayer for dismissal of the complaint has been made. 

3.       Parties led evidence in support of their contentions.

4.       We have heard the learned counsel for the parties and have also perused the record. 

5.       The point for consideration is whether the repudiation of the claim by the OPs vide repudiation letter dated 3011.2009 (Annexure C-25) is legal and valid. The answer to this is in negative.  The Ops have repudiated the cash in transit claim (loss dated 18.01.2008) under the policy in question valid from 10.03.2007 to 09.03.2008 Claim No.420101/48/07/7690000031 on the following grounds:-

i)         That the SI opted for by the insured during the year 2007.08 is far from fair estimate of the actual cash transited during the proceeding year.

ii)     As per rule 59, sub section(F) titled as policies issued on the basis of adjustable premium of insurable rules 1939, risk in respect of policies issued on the basis of adjustable premium as such as workmen’s compensation, cash in transit etc. may be assumed in respect of provisional premium based on fair estimate.

iii)  The S.I. of Rs.5 crores of the covered perils taken by you was consumed by 25.05.2007 itself and loss allegedly occurred on 18th Jan. 2008, no balance of S.I. was left under the policy to cover the risk at that time. Hence, the claim is found not payable.

6.       Now it is clear that the OPs have repudiated the claim of the complainant on the ground that the policy in question was consumed by 25.05.2007 and lost allegedly occurred on 18.01.2008 and as such no balance of SI was left under the policy to cover the risk in question.

7.       To decide the present controversy effectively, it will be relevant to reproduce the condition No.2 of the terms and conditions of the insurance policy qua Annexure C-5 at page 35 of the complaint which reads as under:

“ADJUSTMENT OF PREMIUM : The premium in so far as it relates to Cash-in-Transit is to be regulated by the amount of such money in transit during each period of Insurance and for this purpose a proper record shall be kept in the books of the Insured which the Insured shall at all reasonable times allow the Company to inspect. Within one month from the expiry of each period of Insurance the Insured shall furnish the Company with a correct account of the amount of all such money in transit during the period and if the ascertained amount shall differ from the estimated amount on which premium has been paid, the difference in premium shall be met by a further proportionate payment to the Company or by a refund to the Insured as the case may be, but in no case shall be refund by more than fifity percent (50%) of the premium stated in the Schedule and retention of premium shall not he less than the minimum of Rs.30/-“.

8.       Admittedly, in this case, the OPs had extended the policy after the incident of robbery. The complainant has applied for the extension of the policy in January, 2008 and the same was duly extended by the OPs during the subsistence of the policy period. Thus, the OPs after extending the insurance cover after the incidence had no right to reject or repudiate the claim  of the complainant. Further, the OPs in reply to para No.21 of the complaint in clear words have admitted about the condition No.2 of the policy with regard to the adjustment but have raised the plea to ignore it as the same is against the Insurance Act.  The said plea is not available to the OPs as the terms and conditions of the insurance policy have been issued by the OPs. Moreover, it is bilateral contract and the terms and conditions of the insurance policy are binding upon the parties. Therefore, the OPs are estopped from raising the defence that the condition No.2 of the insurance policy in question referred to above in preceding paras is to be ignored as the same is against the Insurance Act.

9.       The matter does not rest here. Even in the report of the surveyor (Annexure R-2) which was produced by the Ops themselves, it has been stated that under the terms and conditions of the insurance policy, the adjustment of annual premium is maintainable after the expiry of policy period. Therefore, the denial of the genuine claim of the complainant by the Ops is certainly illegal and amounts to deficiency in service on their part. The surveyor has also stated in his report that under the heading adjustment of risk at page 34 “the premium received under the policy being provisional is to be calculated on the basis of actual money in transit during the policy period i.e. 10.03.07 to 09.03.08”. The said observations of the surveyor further prove on record that the OPs were not legally competent to deny the genuine claim of the complainant. It is settled proposition of law that the surveyor’s report is an important document and cannot be brushed aside without any cogent evidence to the contrary. In the present case, the surveyor has assessed cash loss in transit to the tune of Rs.5,14,000/-.  Therefore, the report of the surveyor is to be accepted as the surveyor is an expert and also an independent person to assess the loss suffered by the complainant. Thus, we are of the opinion that the claim of the complainant can be allowed on the basis of the surveyor report. Reliance placed on Pradeep Kumar Sharma Versus National Insurance Company reported in III (2008) CPJ 158 (NC).

10.      As a result of the above discussion, this complaint is accepted and OPs are directed to pay to the complainant a sum of Rs.5,14,000/-as assessed by the surveyor. The OPs shall also pay to the complainant a sum of Rs.50,000/- as compensation for mental agony and harassment besides Rs.15,000/- as costs of litigation, within one month  from the date of receipt of the certified copy.

11.      This order be complied with by the OPs within one month from the date of receipt of the certified copy failing which OPs shall be liable to pay the entire amount of Rs.5,64,000/- to the complainant along with interest @ 12% p.a. from the date of filing of the complaint i.e. 08.02.2010 till realization besides costs of litigation. 

12.      The certified copies of this order be sent to the parties free of charge. The file be consigned.