DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

U.T. CHANDIGARH

[Complaint Case No: 298 of 2010]

                                                           Date of Institution : 13.03.2010

                                                           Date of Decision     :11.04.2011

M/s. Swastik Enterprises, Village Saidpura, Tehsil Derabassi, District Mohali through one of its Partner Smt. Seema Jain.

                                                                   ---Complainant.

V E R S U S

1.      New India Assurance Company Limited, Divisional Office, SCO No.804, NAC, Manimajra, U.T., Chandigarh through its Divisional Manager.

2.      New India Assurance Company Limited, Regional Office, SCO No.37-38, Sector 17-A, Chandigarh through its Regional Manager.

---Opposite Parties.

BEFORE:   SHRI LAKSHMAN SHARMA        PRESIDENT

                SHRI ASHOK RAJ BHANDARI     MEMBER

                SMT. MADHU MUTNEJA            MEMBER

Argued By:Sh. Parmod Jain, Advocate for the complainant.

                   Sh. Sukaam Gupta, Advocate for the OPs.

PER LAKSHMAN SHARMA, PRESIDENT

                   M/s Swastik Enterprises, which is a partnership concern, has filed this complaint under Section 12 of the Consumer Protection Act, 1986 praying for the following reliefs:-

(i)       To pay Rs.1,21,350/- with interest @12% per annum from the date of loss i.e.31.05.2006 onwards with pendentelite and future interest from the date of filing of this complaint till realization.

(ii)      To pay Rs.1,00,000/- for inconvenience, harassment and mental agony caused to the complainant on account of illegal and unlawful repudiation of the claim.

(iii)     To pay Rs.11,000/- towards lump-sum costs of notice and litigation expenses and;

2.                In brief the case of the complainant is that it got its finished and raw material insured  from the OPs vide Standard Fire and Special Perils Policy No.353000/11/05/11/00000325. The said policy was effective from 23.11.2005 to 22.11.2006 vide Cover Note (Annexure C-3). On 31.5.2006, due to heavy rains, the material lying in the godown was badly damaged and the complainant suffered a loss of Rs.1,21,350/-. So, the complainant lodged a claim (Annexure C-4) with the OPs. The surveyor was appointed by the OPs who inspected the spot and thereafter, assessed the loss. The OPs wrote letter dated 7.7.2006 (Annexure C-5) and sought some information. The said letter was duly replied and the required information was sent to the OPs vide letters dated 19.7.2006 and 31.7.2008. Despite it, the OPs did not settle the claim. Ultimately, the complainant received a letter dated 18.9.2008 whereby the complainant was informed that the claim has been filed being barred by limitation. Thereafter, the complainant wrote letters (Annexures C-9 and C-10) but to no effect. The complainant also served a legal notice (Annexure C-12) but to no avail. 

                   In these circumstances, the present complaint has been filed seeking the reliefs mentioned above.

3.                In the reply filed by OPs, it has been admitted that the complainant got its finished goods and raw material insured vide Standard Fire and Special Perils Policy No.353000/11/05/11/  00000325. It has also been admitted that the loss was caused to the said material due to rains. It has also been admitted that the surveyor was appointed and he assessed the loss.

                   The case of the OPs is that the loss took place on 31.5.2006 and thereafter, the claim was lodged on the same day. The OPs wrote number of letters dated 30.6.2006, 15.7.2006, 8.11.2006, 11.12.2006 and 25.1.2007 requiring the complainant to furnish the information mentioned in those letters. As the required information was not furnished, so, the claim was closed as ‘No Claim’ and intimation to this effect was given to the complainant vide letter dated 20.2.2007. It has further been averred that the present complaint was filed in the year 2010, so, the same is barred by limitation. Otherwise also, according to the OPs, as the required information was supplied after expiry of two years, the claim was rightly not entertained. In these circumstances, the complaint deserves dismissal.

4.                We have heard the learned counsel for the parties and have gone through the entire record including documents, annexures, affidavits etc and the written arguments filed by the OPs.

5.                It is the admitted case of the parties that the complainant got its finished goods and raw material insured vide Standard Fire and Special Perils Policy No.353000/11/05/11/  00000325. It is also admitted case of the parties that due to rains, the said material was damaged and the complainant suffered a loss. Vide letter dated 7.7.2006, the OPs asked the complainant to supply the following documents: -

1.      Media coverage report/meteorological office report.

2.      Audited Balance Sheet as on 30-05-2006, 31-03-2006 and 31-03-2005.

3.      Sale Tax Returns for the year 2005-2006.

4.      Copy of purchase and sale account in ledger from 01-04-2005 to 30-05-2006.

5.      Stock Records along with detail of stock as on 30-5-2006.

6.      Purchase bills/cost sheets of damaged stock.

7.      Detailed statement of insured regarding damages.

8.      Three quotations of salvage.

9.      Lab analysis report for perfume claimed damages.

10.  Stock statement for the month of April & May, 2006 submitted to State Bank of India, duly receipted by bank.

6.                Out of the above said documents, five documents were sent to the OPs vide letter dated 19.7.2006. Thereafter, three documents were sent vide letter dated 31.7.2008. Some of the documents such as Audited Balance Sheet, Quotations for salvage and Lab Analysis Report, demanded by the OPs could not be supplied to it because the same were not in possession of the complainant at the time the demand was made. Furthermore, the documents, which were not supplied, were not so relevant for the proper adjudication of the loss as is evident from the Final Survey Report dated 4.9.2006 (Annexure R1-2/B). The surveyor has assessed the loss in the absence of all these documents. So, it is clear that the said documents were not so relevant and necessary for the proper assessment of the loss.  In these circumstances, closure of the case amounts to deficiency in service and unfair trade practice.

7.                For the sake of arguments, even if it is presumed that the said documents were necessary, even then the OPs could not reject the claim as the loss had already been assessed by the surveyor and the amount assessed by the surveyor could be offered to the complainant, which was not done.

8.                Furthermore, the complainant had lodged the claim on the day the loss was caused. Delay in supply of information sought by the OP would not mean that the claim is belated.

9.                It is the case of OPs that vide letter dated 20.2.2007 (Annexure R1-2/A), the complainant was informed about the closure of the case and the final cause of action took place on that date. It is pertinent to mention here that the complainant in its affidavit has stated categorically that he had received the information regarding the closure of the case for the first time vide letter dated 18.9.2008 (Annexure C-8), despite the fact that on the letter (Annexure R1-2/A), it has been mentioned that it is a Registered A.D letter. Neither the receipt issued by the Post Office has been placed on record nor its acknowledgement has been placed on record. The Despatch Register is a document of the OPs itself. In these circumstances, in the absence of the receipt issued by the Postal Department, it is not proved that the said letter was duly dispatched.  Thus, the last letter intimating about the closure of the case is dated 18.9.2008. The complaint was filed on 3.5.2010. Thus, it is within two years. So, it is not barred by limitation.

10.              Otherwise also, as mentioned above, the case could not be closed as the loss had already been assessed by the surveyor. So, refusal to pay the claim amounts to deficiency in service and unfair trade practice on the part of OPs.

11.              Annexure R1-2/B is the Final Survey Report dated 4.9.2006. The surveyor has assessed the total loss after applying the average clause to the tune of Rs.25,827/- and has mentioned that the claim payable is Rs.15,827/-. From the report of the surveyor, it is apparent that he has not paid any claim qua the loss/damage caused to the perfume though the claimant has assessed the loss for the damage to the perfume as Rs.27,060/-. The surveyor in its report has stated that the loss regarding damage to the perfume could not be assessed for want of report of laboratory analyst. It is pertinent to mention here that the OPs have failed to place on record any letter requiring the claimant to get the perfume bottles analyzed from the laboratory. In the absence of such letter, demand of the report of laboratory is merely a lame excuse for non payment of the claim.  In these circumstances, the complainant is also entitled to a sum of Rs.27,060/- in addition to the amount already recommended by the surveyor.

12.              The surveyor has also deducted a sum of Rs.10,000/- in view of the excess clause. The policy, which has been placed on record, has not been marked as annexure. So, we have marked the same as Annexure OP-Z. Clause 5 under the ‘General Exclusion’ reads as under: -

“5. Loss, destruction or damage to bullion or unset precious stones, any curios or works of art for an amount exceeding Rs.10,000/-, manuscripts, plans, drawings, securities, obligations or documents of any kind, stamps, coins or paper money, cheques, books of accounts or other business books, computer systems records, explosives unless otherwise expressly stated in the policy.”

13.              From perusal of this clause, it is apparent that the loss to the extent of Rs.10,000/- is not payable on the articles such as bullion, unset precious stones, any curios or works of art. In the present case, the material, which was damaged, is different from the articles mentioned in Clause 5. So, this exclusion clause is not applicable in this case. So, the above said amount of Rs.10,000/- has been arbitrarily excluded. The complainant is entitled to this amount also. Thus, the complainant is entitled to a total amount of Rs.52,887/- [Rs.27,060 + Rs.15,827 + Rs.10,000] for the loss caused to it.

14.              In view of the above discussion, the present complaint is allowed and the OPs are directed as under: -

(i)       to pay an amount of Rs.52,887/- to the complainant for the loss caused to it due to heavy rains in view of the terms and conditions of the Standard Fire and Special Perils Policy No.353000/11/05/11/  00000325;

(ii)      to pay an amount of Rs.20,000/- as damages on account of deficiency in service on the part of OPs;

(iii)     to pay an amount of Rs.7,000/- as litigation costs.

15.              The above order be complied with by the OPs within a period of 30 days from the date of receipt of its certified copy, failing which OPs shall pay the aforementioned amounts along with interest @18% per annum from the date of filing of the complaint i.e.13.3.2010 till the date of actual payment besides costs of litigation of Rs.7,000/-.

13.              Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

11^th April 2011.

Sd/-

 (LAKSHMAN SHARMA)

PRESIDENT

Sd/-

(ASHOK RAJ BHANDARI)

MEMBER

Sd/-

(MADHU MUTNEJA)

MEMBER

Ad/-

C.C.No.298 of   2010

Argued By: None.

                                                ---

                   Arguments heard on 07.04.2011.  The case was reserved for orders. As per separate detailed order of even date, this complaint has been allowed. After compliance file be consigned.

Announced.

11.04.2011          Member              President             Member