Tamil Nadu

South Chennai

10/2009

Shri.Ram Lakhan Strach Company,Propritor - Complainant(s)

Versus

National Insurance Company ltd. & others - Opp.Party(s)

V.Anand

06 Jun 2016

ORDER

                                                                        Date of Filing :  17.12.2008

                                                                        Date of Order :  06.06.2016.

 

DISTRICT CONSUMER DISPUTE REDRESSAL FORUM, CHENNAI(SOUTH)

     2^nd Floor, Frazer Bridge Road, V.O.C.Nagar, Park Town, Chennai-3

 

PRESENT: THIRU. B. RAMALINGAM M.A.M.L.,                     : PRESIDENT

                 TMT. K.AMALA, M.A. L.L.B.,                                 : MEMBER I

           DR. T.PAUL RAJASEKARAN, M.A ,D.Min.PGDHRDI, AIII,BCS : MEMBER II

 

C.C.NO.10/2009

MONDAY THIS  6^TH DAY OF JUNE 2016

 

Shri.Ram Lakhan Starch Company,

Rep. by its Proprietor,

Ashok Kumar Tripathi,

No.19 /10, Pillaiyarkovil Street,

New Colony, Porur,

Chennai 600 116.                                                 ..Complainant

                                      ..Vs..

1. National Insurance Company Limited,

Unit 501 700,

Rep. by its Manager,

No.35, North Usman Road,

T.Nagar,

Chennai 600 017.

 

2. National Insurance Company Limited,

Regional Manager,

Chennai Regional Office,

No.190, Anna Salai,

Chennai 600 006.                                               ..Opposite parties.  

 

 

For the Complainant                   :  M/s. V. Anand      

For the Opposite parties              :  M/s. Srinivasan Ramalingam

ORDER

THIRU.   T.PAUL RAJASEKARAN ::    MEMBER-II     

Complaint under section 12  of the Consumer Protection Act 1986.  The complaint is filed seeking direction against  the opposite parties  to pay a sum of Rs.8,00,000/- as compensation  and cost of the complaint  to the complainant.   

1.The case of the complainant is briefly as follows:

The  complainant submit that  he had taken a Standard Fire and Special Perils policy with the opposite parties covering stock of raw materials finished products and materials on trade occupied as starch factories for the period 23.9.2005 to 22.9.2006 subject to  agreed bank clause and warranty attached with the policy and the sum insured the within mentioned policy is Rs.6,00,000/- and same was hypothecated to Bank of India, Usman Road, Chennai.    The complainant further submit that he  was in the process of adhesives for paper packing units and the material used in the process is tapioca starch.   In addition the complainant was using caustic soda, borex ,soda ash, hydro chloric acid as ingredients.  It is a proven fact that on 26 & 27 of Oct 2005 there were heavy rains and accompanied by thunder and lightning that took siege of the Chennai and adjoining suburban areas which was substantiated by the meteorological evidence submitted to opposite party by processing in the claim.    On account of the natural calamity the raw material kept in the factory  were completely washed away and the unit was submerged  for several hours and the complainant has estimated a loss of stock to the extent of Rs.5,00,000/- which was informed to the opposite party by the complainant and the opposite party had deputed the loss assessor and based on his assessment the opposite party rejected the claim, on the reason of the document submitted by the complainant has not substantiate the value of loss, quantity of loss and the presence of stock value claim, and the activity of the unit does not evidence the presence of water entry and the extensive of loss of stock washed away on account of entry of flood water into the factory.     The opposite party had repudiated the claim on the above grounds the complainant of the view the opposite party repudiation was in proper.     As such the complainant sought for claim for a sum of  Rs.8,00,000/- as compensation  and cost of the complaint  to the complainant.     Hence the complaint.

Written version 1^st  opposite party and adopted by the 2^nd opposite party  in briefly is as follows:

2.     The  opposite parties  denies all the averments and allegation contained in the complaint except those that are specifically admitted herein.      The claim towards loss / damage to the stocks of the complainant due to alleged inundation on account of heavy rains is neither true nor probable and is not duly substantiated.   The opposite party has carefully processed the claim as made by the complainant conducted a survey through a duly licensed and a competent surveyor, examined the findings of the surveyor and has with due application of mind, rightly repudiated the claim and hence this opposite party submit that there is no deficiency in service traceable on the opposite parties and therefore this claim is not maintainable either in law or on facts.    on the direction of the opposite party the surveyor visited the accident spot on 2.11.2005 and reported there was no finished product or its salvage and there was no water mark level from the ground level to substantiate the loss where the finished stock was soaked in the water and no evidence of coagulant and sticking layer due to the presence of  moisture and the loss of entire stock 24 tonnes as alleged by the complainant as which is impossible when the doors of the rooms were closed and there was no evidence to substantiate the  stocks were damaged due to the immersion of stock in the water and the surveyor on verifying the stock as on 31.3.2005 plus auditor’s statement and profit and loss account submitted by the complainant found not tallying. This surveyor alleged that the complainant had not maintained stock register had prepared the entry of stock based on the purchase and sales in a haphazardly manner and submitted to satisfy the insurance claim.   There are lot of discrepancy and anomalies found by the surveyor from the books of accounts submitted to the opposite party and there is no prima facie evidence to substantiate the quantum of loss claimed by the complainant since the complainant had not proved and substantiated the quantum of loss and moreover it is a time barred claim and could not ask for the remedy on the guise of benevolent  Provisions of the C.P. Act.   The complainant has made long after period of 12 months from the date of the letter dated 27.6.2006 rejecting the claim is hopelessly barred by time.    Hence there is no deficiency in service on the part of the  opposite parties and the complaint is liable to be dismissed.

 

3.   Complainant has filed his Proof affidavit and Ex.A1 to Ex.A20 were marked on the side of the complainant.   Proof affidavit of Opposite parties   filed  and Ex.B1 series was marked on the side of the  opposite parties.    

4.      The points that arise for consideration are as follows:-

1)   Whether there is any deficiency in service on the part of the opposite parties?

 

2. Whether the complainant is entitled to the  reliefs sought for?.

5.     POINTS 1 & 2 :

           Perused the complaint filed by the complainant and his proof affidavit and documents Ex.A1 to Ex.A20  were marked on the side of the complainant.  Written version and proof affidavit filed by the opposite parties and Ex.B1 series was marked on the side of the opposite parties  and also considered the both side arguments.

6.     The complainant had taken a Standard Fire and Special Perils policy with the opposite parties covering stock of raw materials finished products and materials on trade occupied as starch factories under risk code No.177 for the period 23.9.2005 to 22.9.2006 subject to  agreed bank clause and warranty numbers 1,4,6, NFW 2001 attached with the policy and the sum insured the within mentioned policy is Rs.6,00,000/- and same was hypothecated to Bank of India, Usman Road, Chennai.    The complainant was in the process of adhesives for paper packing units and the material used in the process is tapioca starch.  In addition the complainant was using caustic soda, borex, soda ash, hydro chloric acid as ingredients.  It is a proven fact that on 26 & 27 of Oct 2005 there were heavy rains and accompanied by thunder and lightning that took siege of the Chennai and adjoining suburban areas which was substantiated by the meteorological evidence submitted to opposite party for processing the claim.    On account of the natural calamity the raw material kept in the factory  were completely washed away and the unit was submerged  for several hours and the complainant has estimated a loss of stock to the extent of Rs.5,00,000/- which was informed to the opposite party by the complainant and the opposite party  had deputed the loss assessor and based on his assessment the opposite party rejected the claim, on the grounds of  1) the document submitted by the complainant has not substantiate the value of loss, quantity of loss and the presence of stock value claim, and the activity of the unit does not evidence the presence of water entry and the extensive of loss of stock washed away on account of entry of flood water into the factory.     The opposite party had repudiated the claim on the above grounds the complainant of the view the opposite party repudiation was improper thus claiming Rs.8,00,000/- in which Rs.5 lakhs for stocks as loss and Rs.3 lakhs for damages for mental agony.  Hence the complainant approached the forum to resolve the dispute to the opposite party and the complainant  on  16.2.2009.

7.     The opposite parties stated that the damage to the stock is due to inundation on account of heavy rains neither true Nor probable and  on the direction of the opposite party the surveyor visited the accident spot on 2.11.2005 and reported there was no finished product or its salvage and there was no water mark level from the ground level to substantiate the loss where the finished stock was soaked in the water and no evidence of coagulant and sticking layer due to the presence of  moisture and the loss of entire stock 24 tonnes as alleged by the complainant as which is impossible when the doors of the rooms were in closed condition and there was no evidence to substantiate the  stocks were damaged due to the immersion of stock in the water and the surveyor on verifying the stock on 31.3.2005 plus auditor statement and profit and loss account submitted by the complainant found not tallying.    Thus  surveyor alleged that the complainant had not maintained stock register had prepared the entry of stock based on the purchase and sales invoices in a haphazardly manner and submitted the same to satisfy the insurance claim.  There were lot of discrepancy and anomalies found by the surveyor from the books of accounts submitted to the opposite party and there is no prima facie evidence to substantiate the quantum of loss claimed by the complainant since the complainant had not proved and substantiated the quantum of loss and moreover it is a time barred claim and could not ask for the remedy on the guise of benevolent  Provisions of the C.P. Act. The complainant has made complaint long after period of 12 months  from the date of the letter dated 27.6.2006 rejecting the claim is hopelessly barred by time.  Hence the opposite party was pleading to dismiss the complaint with cost.

8.     Pursuant of the written version, claim papers and documents and written arguments filed by both the parties to the dispute it is observed that the policy issued to the complainant covers 12 risks and 13 exclusion and 15 general conditions in the within mentioned policy.  The insured  covered a stock of raw materials finished products materials pertaining to trade occupied as starch  manufacturing  unit subject to the warranty condition No.1,4, 6 of Form NWF 2001 attached with the said policy.  Condition No.1 of the policy stipulates “ this policy shall be voidable in the event of misrepresentation, mis-description, or non-disclosure of any material particular “  Condition No.4 of the within mentioned policy states “ this insurance does not cover any loss or damage, to property which, at the time of happening of such loss or damage, is insured by or would, but for the existence of this policy, be insured by any marine policy or policies except in respect of any excess beyond the amount which would have been payable under the marine policy or policies had this insurance not been effected.      Condition No.6.1 stipulates “On the happening of the any loss or damage the insured shall forthwith give notice thereof to the company and shall within 15 days after the loss or damage, or such further time as the company may in writing allow in that behalf, delivery to the company”.      

9.     The complainant had informed to this forum that the date of loss was on 26, 27th October 2005 which was  affected by heavy rain accompanied with thunder Chennai and adjourning area.  As a affected party the complainant had not informed to the insurer in time but the banker (Bank of India, Chennai 17) who informed to the insurer on 2^nd November 2005 after five days from the date of occurrence immediately the opposite party had deputed the loss assessor to the spot who in turn and the same day visited the site and found there was no finished product or any salvage was available or its packing bags when enquired about the same to the insured / opposite party-1 indicated that the finished product was in heed form and due to inundation the finished product was fully washed away.  The surveyor had called various documents from the complainant to ascertain the action of loss suffered by the complainant and it is found the insured had produced stock registered which was not properly maintained and the lot of discrepancies which could not be substantiated with the actual loss suffered.  During the survey of the opposite party there are no water marks on the walls or inside the walls or in the alleged back side entrance to substantiate entry of water into the premises where the loss had occurred.  The surveyor had concluded there was no physical evidence to the damage of stocks and no reliable records maintained by the complainant to substantiate the incoming and outgoing stocks which were lying within the said premises.  Based on the surveyors findings the opposite party on the thorough scrutiny had denied their claim on the grounds of non substantiation of the loss by the complainant with proper evidence and not taking adequate care in safe guarding the property.   The letter of the complainant (Ex.A12) he himself committed “request to ignore relevant entries.  This is an utter failure on the part of my accountant to furnish baseless and meaningless figures in the issue of material column.  Further communication also establishes that he has not taken any preventive method to prevent loss.     

10.    In addition to the policy conditions the insured had attached the warranty Form NFW 2001, states under warranty No.1 of construction where the complainant had asbestos sheet on the roof of the said building and warranty No.4 of NFW 2001 attached with the said policy describes about plinth and foundation which will not attract the said policy warranty No.6 describes about jurisdiction clause whereby the cause of action arose within the jurisdiction of the claim made. 

11.        The opposite parties have submitted a citation of NCDRC, New delhi Revision Petition No.580 of 2006 in the case of

Oriental Insurance Company Limited

..Vs..

M/s. Pragathi Constructions.

referring the condition No.7 of the policy

        “It is also hereby further expressly agreed and declared that if the Company shall disclaim liability to the insured for any claim hereunder and such claim shall not, within 12 calendar month from the date of such disclaimer have been made the subject matter of a suit in a court of law then the claim shall for all purpose be deemed to have been abandoned and shall not thereafter be recoverable hereunder.  “

12.    The cause of action arose on 26^th  October 2005 and the complaint was filed in this forum on 16.2.2009 which has beyond the limitation period.   Taking into consideration from the date of repudiation 26.7.2006  with a reason non compliance of policy conditions that the complainant had not proved to substantiate the actual loss suffered hence the claim is repudiated.    Considering the repudiation dated 26.7.2006 (Ex.A13) the filing of the complainant to this forum has exceeded the time limit prescribed are barred by limitation.   Under Sec. 24 A of the C.P. Act 1986 the cause of action arose in the year 2005 and submission of complaint  to this forum in the year 2009 which proves it is barred by limitation.     Curtailment of the period of limitation is not permissible in view of Sec.28  of the contract act if the policy of the insurer provides that if the claim is made and rejected and no action is commenced within the time stated in the policy the benefits following from the policy shall stand extinguished and any subsequent action would be time barred.     

13.    The opposite party had taken the surveyors written statements as an important evidence to repudiate his claim I  (2010) CPJ 141 NC in the case of

DABIRUDDIN COLD STORAGE

.Vs..

NEW INDIA ASSURANCE COMPANY LTD. & ORS.

u/s 2 (1) (g) of the C.P. 1986 it is decided that surveyors report being important document cannot easily brushed assign.  

In this judgment they have reported  two judgments cited in United India Insurance Co. Ltd., ..Vs..  Roshan Lal Oil Mills Ltd. & Ors.,   (2000) 10  SCC 19 (2) the Apex court held that the Surveyor’s report is an important documents and non-consideration of this important document results in serious miscarriage of justice.  In National Insurance Company Ltd. ..Vs.. Blanny C.D’ Souze, in R.P. No.3221 of 2008 II (2009) CPJ 110 ( NC) held that

“The report of the surveyor is an important and vital document, which has to been taken into consideration.”    

Based all these citation and thorough scrutiny of the records submitted to this forum we are of the considered view that the surveyor report and his findings are the basis of the repudiation by the opposite party is acceptable the complainant had not substantiated his claim with physical identification and clean records to substantiate his claim the stand taken by  the opposite party found to be in order as per the conditions stipulated within mentioned policy issued to the complainant and we found that with  available records the complaint has to be dismissed.  No cost.

        In the result the complaint is dismissed.  No cost.

            Dictated directly by the Member-II to the Assistant,  and computerized by her, corrected by the Member-II and pronounced by us in the open Forum on this the   6^th    day of  June    2016.

 

MEMBER-I                        MEMBER-II                             PRESIDENT.

Complainant’s side documents :

Ex.A1-  30.5.2006 - Copy of Stock Statement given by the complainant

                              to the bank.

 

Ex.A2- 19.7.2005  - Copy of stock statement given by the complainant

                              to the bank.

 

Ex.A3- 17.8.2005  - Copy of stock statement given by the complainant

                              to the bank.

Ex.A4- 12.9.2005  - Copy of stock statement given by the complainant

                              to the bank.

Ex.A5- 26.9.2005  - Copy of policy issued by the 1^st respondent.

 

Ex.A6- 20.10.2005         - Copy of delivery challan.

 

Ex.A7- 10.11.2005         - Copy of revised stock statement

 

Ex.A8- 27.1.2008  - Copy of reminder letter to the investigator of the 1^st

                             Opposite party.

Ex.A9- 31.1.2006  - Copy of letter of the investigator seeking records.

Ex.A10- 15.2.2006         - Copy of reply of the petitioner to the investigator.

Ex.A11- 8.3.2006  - Copy of letter of the investigator to the complainant.

Ex.A12- 13.3.2006         - Copy of explanation given by the complainant

Ex.A13- 26.7.2006         - Copy of rejection of the claim by the 1^st opposite party.

Ex.A14- 2.8.2006  - Copy of reply given by the complainant to the 1^st opposite

                             Party.

Ex.A15- 7.8.2006  - Copy of rejection of consideration by the 1^st opposite party.

Ex.A16- 28.8.2006         - Copy of reconsideration proposal given by the complainant.

Ex.A17- 4.12.2006         - Copy of letter of reminder and explanations submitted by

                             the complainant to the 2^nd opposite party.

Ex.A18- 7.9.2007  - Copy of letter of 2^nd opposite party.

Ex.A19- 10.9.2007         - Copy of reply of the complainant.

Ex.A20- 17.10.2007- Copy of final rejection of the claim by the 2^nd opposite

                              Party.

 

opposite parties’ side  documents:

 

Ex.B1- 13.4.2006  - Copy of Survey report.

 

 

                                                                                                             

MEMBER-I                        MEMBER-II                             PRESIDENT.