Punjab

StateCommission

A/11/245

M/s Kapil Traders - Complainant(s)

Versus

OBC - Opp.Party(s)

Sukhdev Kamboj

16 Feb 2015

ORDER

                                                               FIRST ADDITIONAL BENCH

 

STATE  CONSUMER  DISPUTES  REDRESSAL  COMMISSION,  PUNJAB

          SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.

                                     

                             First Appeal No.245 OF 2011

 

                                                          Date of Institution: 02.02.2011  

                                                          Date of Decision : 16.02.2015

 

 

M/s Kapil Traders through its Proprietor Sh.Rakesh Kumar son of Sh.Om Parkash, Factory Road, Maur Mandi, District Bathinda.

 

                                                                                                                                                                             …Appellant/Complainant    

                                                                   

                                      Versus

1.      Oriental Bank of Commerce, through its Manager, Maur Mandi,        Tehsil Talwani Sabo, District Bathinda

2.      The Oriental Insurance Company Ltd, through its Senior          Branch Mager, Shree Ram Building, Near Court Road,          Mansa.

 

                                                                                                                                                             …Respondents/Opposite Parties

                                                               

First Appeal against order dated 12.11.2010 passed by the District Consumer Disputes Redressal Forum, Mansa.

Quorum:-

 

 

          Shri J. S. Klar, Presiding Judicial Member.

          Shri Vinod Kumar Gupta, Member.    

Present:-

 

          For the appellant                   :         Sh.Sukhdev Kamboj, Advocate

          For the respondent No.1      Sh.Jatinder Sharma, Advocate

          For the respondent No.2  :   Sh.Vinod Chandhari, Advocate.

 

          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

J. S. KLAR, PRESIDING JUDICIAL MEMBER:-

         

           The appellant M/s Kapil Traders through its proprietor Sh.Rakesh Kumar (the complainant in the complaint) has directed this appeal against Oriental Bank of Commerce (hereinafter respondents) (the opposite parties in the complaint) challenging the order dated 12.11.2010 of District Consumer Disputes Redressal Forum, Mansa, dismissing the complaint of the appellant. The instant appeal has been preferred by the appellant against the order of dismissal of the complaint.

2.      The complainant M/s Kapil Traders has filed the complaint U/s 12 of the Consumer Protection Act, 1986 (in short, "the Act") against the OPs on the averments that complainant had secured one cash credit Limit with OP No.1 from 2007 onwards for Rs.10 lacs, but thereafter, the limit was enhanced to Rs.20 lac in the year, 2009 by the complainant. The complainant was giving monthly statement of his cotton seed stock, stored in his factory to OP No.1 and OP No.1 on the basis of stock statement was getting the stock of complainant insured from OP No.2 and was deducting the amount of Insurance from his cash credit Limit. That lastly complainant's stock worth Rs. 20 lac was got insured by OP No.1 from OP No.2 on 22.5.2009, vide policy No. 233202/11/2010/68 for the period 22.5.2009 to 21.5.2010 after making payment of Rs.3,971/-, which was deducted from the cash credit limit of the complainant by OP No.1. The Insurance was for fire and earthquake and sum assured was 20 lac and the stock statement was given to OP No.1 and at the time of getting the stock insured, OP No.1 himself gave the stock detail to OP No.2 although detail of monthly stock statement was provided to OP No.1. That neither any cover note was given to the complainant, nor separate terms and conditions were ever supplied to him by OP No.1 and even cover note was supplied by OP No.2 to OP No.1 and even OP No.1 never consulted or intimated the complainant before getting the stock insured on the ground that, if he wants to continue the cash credit Limit, then the stock has to be insured through OP No.1 as per his wish. It was pleaded by the complainant that as per norms stock statement for the month of January, 2010 was also given to OP No.1 as on 10.1.2010. Stock worth Rs. 32 lac was lying with complainant and from 10.1.2010 to 17.1.2010, stock worth Rs. 12 lac was sold and approximately stock valuing Rs. 19,90,000/- was lying with him at the time of fire. Unfortunately, a fire broke out in the factory of the complainant on 17.1.2010, intimation of which was duly given to Police Station, Maur Mandi and DDR No. 21 dated 17.1.2010 was registered about it and fire Brigade was also immediately called and it took approximately 5 hours to control the fire, but in that process complainant's cotton seed stock worth Rs. 10 lac was destroyed and some other articles lying there were also destroyed. Fire Service, Bathinda also gave receipt and details of the same to complainant i.e. 350 quintals cotton seeds (Binola) have damaged and "Bardana" bags worth Rs. 80,000/- also got damaged in fire. Intimation was also given to OPs regarding the fire on same day alongwith claim intimation form. The claim of the complainant was wrongly repudiated by OP No.2 on 30.3.2010 on the ground that cotton seeds stock was not insured, thereafter on receipt of the letter complainant immediately personally met Manager of OP No.1 and told him that when monthly stock statement is given to OP No.1 clearly reflecting stocks of cotton seeds and Khal, then how OP No.1 can purchase insurance policy of mustard oil, which was never stocked by complainant from year 2008 onwards and immediately OP No.1 felt that he was negligent at the time of getting the stock of the complainant insured and it wrote a letter dated 22.4.2010 to OP No.2 stating that inadvertently stock of cotton seeds ( Binola) was not mentioned in cover note due to negligence of OP No.1&2. It was pleaded by the complainant that OP No.1&2 had been negligent at the time of getting the stock of the complainant insured because neither OP No.1 went through the stock statement nor OP No.2 physically verified the stock because both the OP were not serious, while purchasing and selling the policy rather since there is a nexus between both OPs of giving and receiving commission on insurance as such, both the opposite parties were least bothered about the loss, which complainant had to suffer due to negligence of opposite parties. The complainant, has, thus, prayed that the OPs be directed to pay Rs. 2,00,000/- as compensation for mental harassment, Rs. 20,000/- for litigation expenses, insured stock wroth Rs. 20,00,000/-, stock worth Rs. 10,00,000/- of cotton seeds, Rs. 80,000/- of Bardana alongwith interest @ 18% p.a w.e.f. 17.1.2010.

3.      Upon notice, OP No.1 contested the allegations of the complaint and filed written reply, resisting the complaint by taking legal objections that the complaint is not maintainable in its present form. That the District Consumer Forum has got no jurisdiction to try and decide the present complaint, as the value of the goods in dispute, exceeded Rs. 20,00,000/-, which is beyond the pecuniary jurisdiction of this Hon'ble Forum. That the complainant has no locus standi or cause of action to file the present complaint. That the complainant has not come to the Forum with clean hands and rather has intentionally concealed the true and material facts from this Forum. That intricate and complicated questions of fact and law are involved in the present case, which require voluminous evidence, as such, only Civil Court is competent to try and decide the dispute, which cannot be decided in summary manner by the Consumer Fora. That the complainant is estopped from filing the present complaint by its own act and conduct as it failed to get its goods insured. That it was the duty of the complainant to get his stock insured in the name of bank and or in the joint names of the bank and the borrower. That the complainant executed an agreement of hypothecation of assets and that the complainant also agreed regarding the insurance thereof. On merits, it was alleged by OP No.1 that it was the duty of the complainant to get the stock insured itself, to which it failed and OP No.1 got the stock insured at the risk and responsibility of the complainant. It is specifically denied that OP No.1 got the stock of the complainant insured as per the stock statement, rather OP No.1 only forwarded the copy of the stock statement and paid the amount of premium to OP No.2 for the insurance of the stock after deducting the same from the cash credit limit of the complainant and the insurance was to be provided by OP No.2 after making the physical verification on the spot. The copy of the statement of stock of the complainant was forwarded by OP No.1 to OP No.2 along with requisite charges for providing insurance and the stock of the complainant was duly verified by OP No.2 before providing the insurance in the presence of the complainant and thereafter insurance was provided and copy of the insurance policy was directly sent to the complainant and OP No.2. The complainant has not raised any objection nor intimated OP No.1 to the effect that the stock of cotton seeds has not been covered under the insurance policy or the said stock has not been verified by OP No.2. The stock of the complainant was insured with OP No.2 for the year 2007-08, 2008-09 and 2009-10 and OP No.1 has now come to know that the stock of cotton seeds were never covered under the insurance policy during the above said period, but the complainant never raised any objection thereto. It was the duty of the complainant to get the entire stock checked and since no insurance was provided for the cotton seeds, as such, the stock of the cotton seeds was never inspected by the officials of OP No.2, but the complainant kept mum. The copy of the insurance policy containing all the terms and conditions of the insurance policy, was directly sent by OP No.2 to the complainant and he was fully aware of the terms and conditions of the insurance policy and the complainant failed to get the stock insured as per the terms and conditions of the cash credit limit, as such, stock was got insured by OP No.1 at the risk and responsibility of the complainant. The complainant informed OP No.1 regarding the fire, which broke out in his factory. The receipt regarding the damage of the cotton seeds and "Bardana" bags, alleged to have been issued by Fire Brigade Authorities is a forged, fabricated, manipulated and procured documents, as no assessment could have been made by the Fire Brigade Authorities after fire broke out. The claim of the complainant has been rightly repudiated and complainant after receiving the repudiation letter from OP No.2 approached OP No.1 and OP No.1 also enquired about the same from OP No.2 and wrote a letter dated 22.4.2010 that the cotton seeds could not be mentioned in the insurance policy due to the negligence on part of the official of OP No.2, but OP No.2 did not give any reply to the said letter. It is alleged by OP No.1 that copy of the stock statement along with requisite premium amount forwarded to OP No.2 and OP No.2, who has to provide the insurance after making the physical verification but the complainant did not get the stock of cotton seeds inspected from the officials of OP No.2 and OP No.2 provided the insurance to complainant after physical verification at the spot and the complainant never pointed out to the OP No.1 that the insurance to the cotton seeds has not been provided or the stock of cotton seeds has not been inspected by the officials of OP No.2. All other facts narrated by the complainant are not admitted as correct and OP No.1 prayed for dismissal of the complaint.

4.      The OP No.2 contested the allegations of the complaint and filed written reply resisting the complaint by taking legal objections that the complainant is not a consumer of OP No.2. That the complainant has got no locus standi and cause of action to file the present complaint. That the complaint is false and vexations and has been filed only to harass OP No.2. That the claim of the complainant is not covered under the insurance policy. That the complaint is bad for non-joinder and mis-joinder of necessary parties. That the claim was rightly repudiated, vide letter dated 30.3.2010, by the competent authority after application of mind and against the repudiation complaint before the 'Consumer Forum' is not maintainable. That complicated and intricate questions of law and facts are involved and matter cannot be adjudicated by the Forum. That this Forum has got no jurisdiction to adjudicate upon the matter. That the complainant has not come to the Forum with clean hands and has tried to suppress the material facts from this Forum. That the policy was obtained by the complainant for the stocks of mustard, mustard oil, mustard cakes and its bye-products lying in the insured Mill and the Binola, Binola Seeds or any of its by-products were not got insured by the complainant or OP No.1 with OP No.2. That the complainant was getting the insurance of the material mentioned in the insurance policy consecutively for the last 3/4 years and the insured never intimated OP No.2 for making any change in the insurance policy regarding the material to be insured. That now when the fire took place in the premises of the complainant, where the uninsured material was lying and under the circumstances, OP No.2 is not liable for making good the loss of the uninsured material and OP No.2 duly intimated OP No.1 that the company is not liable, as the subject matter is not insured vide policy No. 233202 /11/2010/00068 and claim was correctly repudiated. That it is immaterial that the complainant has mentioned in the stock statement about lying of cotton seeds and it is the sole discretion of the insured which products are to be insured and which products are not to be insured; that a surveyor and loss assessor Er. Bharat Bhushan Bansal, who after visiting the spot came to the conclusion that loss had occurred and as such, the insured has no risk cover for the stocks of Binola seeds lying in the factory. On merits it is admitted by OP No.2 that an insurance policy was obtained by the complainant against the stocks of all kinds of mustard, mustard oil, mustard cakes and its bye-products. It is alleged by OP No.2 that the complainant might have been furnishing monthly stock statement to OP No.1 but the cotton seeds stocks were not got insured by complainant. The complainant was getting the stocks insured comprising of mustard, mustard oil, mustard cakes and its bye-products and he cleverly did not get the cotton seeds or other products insured to save the premium. The premises were got insured by the complainant right from the year 2007. It is alleged by OP No.2 that the fact about the cotton seeds being not insured came to the knowledge of the complainant only after the fire took place and not earlier and it is also imaginary that cotton seeds and Bardana were only destroyed in the fire and why the other stocks which were duly insured were not burnt during the fire. The cover note is to be issued in fresh cases and in such like cases when the policy is renewed year to year, then fresh policy is issued and the complainant is getting the statement of account periodically and in the statement of account, there is always a reflection towards the deduction of the insurance premium. The complainant was well aware that a policy of insurance was being issued by the insurer and he can get the copy of the same. All other facts narrated by the complainant not admitted as correct and OP No.2 prayed for dismissal of the complaint.

5.      The complainant tendered in evidence its affidavit Ex.C-1, copies of letters  Ex.C-2 to Ex.C-4, copy of statement Ex.C-5, copy of stock statement Ex.C-6, copy of letter dated 22.4.2010 Ex.C-7, copy of letter dated 30.3.2010, Ex.C-9 and Ex.C-10 copies of receipt, Ex.C-11 is copy of fire report, Ex.C-12 is copy of policy schedule and copy of DDR Ex.C-13. As against it, opposite parties tendered in evidence affidavit of Sh.M.S Sidhu, Sr.Branch Manager, Mansa Ex.OP-1, Ex.OP-3 is copy of letter dated 30.3.2010, copy of letter of repudiation Ex.OP-4, copy of report dated 25.3.2010 Ex.OP-5, copy of assessment Ex.OP-6, copy of claim form Ex.OP-7, copy of policy for the year 2009-2010 Ex.OP-8,  copy of policy for the year 2007 Ex.OP-9, copy of policy for the year 2008, copy of policy for the year 2008 Ex.OP-10, copy of claim paid for building loss Ex.OP-11, copy of voucher for the claim paid dated 31.3.2010 Ex.OP-12 , affidavit of Vinod Kumar Ex.OP-13, agreement of Hypothecation of assets Ex.OP-14, copy of agreement Ex.OP-15 and closed the evidence. On  conclusion of evidence and arguments, the District Forum dismissed the complaint of the complainant. Dissatisfied with the order of the District Forum dismissing the complaint of the complainant U/s 12 of the Consumer Protection Act, the instant appeal has been preferred against the same by the complainant now appellant.

 6.     We have heard learned counsel for the parties and also examined the record of the case.   Sh.Rakesh Kumar, Proprietor of the complainant tendered his affidavit Ex.C-1 on the record. He reiterated the averments of the complaint on oath in this affidavit. He stated that he obtained cash credit limit with OP No.1 from 2007 onwards. The cash credit limit was enhanced to rupees twenty lac in the year 2009 from previous cash credit limit of rupees ten lac. The insurance policy was obtained against cash credit limit on the basis of his stock statement by OP No.1 from OP No.2.  OP No.2 issued the insurance policy after inspection of the stock consisting mustard oil, mustard cakes and bye-products. The contract of insurance was renewed in December 2008 and due intimation was given by the complainant to OP of the stock of mustard oil, cotton seeds, mustard cake, which were to be insured in the insurance cover note. The insurance cover note Ex.C-12 was issued by the OP No.2 in May 2009 covering period from 22.5.09 to 21.5.2010 detailing the stock, which were covering mustard oil, mustard cake and bye-products. The insurance is completed after inspection of the stock and not on the basis of mere statement of stock discharged by the insured to OP No.1. The complainant further stated in his affidavit that he had stock worth Rs.30,00,000/-  as per his statement of stock submitted in January 2010 from 10.01.2010 to 17.01.2010 and stock of Rs.12 lac was sold and remaining stock of Rs.19,90,000/- was lying in the stock of the complainant. Unfortunately, fire took place on 17.01.2010 in the premises of the complainant gutting 350 qtls cotton seeds (Binola) and Baradana bags worth Rs.80,000/-. Due intimation was given by the complainant about the incident of the fire to police as well as to the OP No.2. Engineer Bharat Bhushan Bansal was deputed to assess the loss suffered by the complainant in this conflagration. Vide Ex.OP-6 the loss was assessed by the surveyor as Rs. 2,84,970/- , which is not final.

8.      The submission of the appellant before this Commission is that perusal of documents Ex.C-2, Ex.C-3 and Ex.C-4 has substantiated that the fire took place destroying the stock of the complainant for Rs.10,00,000/-. Ex.C-5 and Ex.C-6 further proved that on 17.01.2010 the complainant had stock worth of Rs.19,90,000/- . Complainant has not produced any stock statement or document on the record to prove that on 22.5.09, when he got the stock insured and godown was inspected by the official of the OP No.1 and 2 what was the exact stock. The stock articles like Mustard oil, Mustard Cake and bye-products were stored in there. We find that no statement of stock or any cogent evidence is brought on the record by the side of the complainant to establish that official of the OP No.1 and 2 had deliberately omitted the stock articles of the complainant from the inspection report and wrongly stated it in insurance cover noted Ex.C-12. Actual proof as to what stock was stored on the date of breaking out of fire is not established by any cogent evidence on the record by the complainant. The complainant was supposed to establish it on the record as to on what account and for what stock it  paid the premium for insurance. The insurance cover note Ex.C-12 does not specify the loss of stock to be indemnified in the godown of the complainant. Had there been stock there, they must have found mention in the inspection note and then duly reflected in the cover note on the record.

9.      It is settled principal of law and even District Forum has also placed reliance on law laid down in case titled as United India Insurance Company Ltd…Versus… M/s Harchand Rai Chandan Lal 2005(1) CLT, Page 215, that "The insurance policy has to be construed having reference only to the stipulations contained in it and no artificial far-fetched meaning could be given to the words appearing in it."  Apex Court further held in the case titled as Oriental Insurance Company Ltd… Vs.Sony Cherlyan reported in 1999 (6) SCC  Page 451, that "insurance policy is contract between the parties. Since the insurer undertakes to compensate the loss suffered by the insured on account or risks covered by the insurance policy, the terms of the agreement have to be strictly construed to determine the extent of liability of the insurer. The insured cannot claim anything more than what is covered by the insurance policy." The Apex Court also examined the point in case titled as General Assurance Society Ltd  Versus.. Chandumull Jain and another reported in 1996 (3) SCR Page 500 to the effect that "to interpret only the words in which the contract is expressed by the parties, because it is not for the court to make a new contract, however, reasonable, if the parties have not make it themselves. Therefore, it is settled law that the terms of the contract has to be strictly read and natural meaning be given to it."

10.    The sheet-anchor of the submissions of the complainant now appellant is letter Ex.C-1, wherein OP No.1 admitted that cash credit limit of the complainant was renewed in December 2008 and in the sanction letter stock of sarso (mustard) and oil was mentioned. The submission of the complainant is that insurance cover note was issued with some mistake. We find that the point is as to what stock was maintained by the complainant on 22.5.09, when insurance company  issued cover note Ex.C-12 after inspection by the officials of the OP No.1. There is no cogent evidence or any reliable record of any statement of account adduced by the complainant to establish that on 22.5.09. The inspection report was prepared incorrectly and fraudulently by the officer of the OP No.2. In the absence of these evidence with regard to stock position on 22.5.09, we can safely infer that the insurance cover note Ex.C-12 was correctly prepared on the basis of the inspection note in this case.

11.    From discussion of the above-referred evidence on the record, we have reached this firm conclusion that in the insurance cover note, which was correctly issued, the stock, which is sought to be indemnified by the complainant in the incident of fire of bardana, cotton seeds was not a part of the contract of the insurance, vide Ex.C-12 on the record. Since, it was not part of the contract of the insurance and the cover note Ex.OP-8 does not record in this case specifically about it, therefore, OP No.2 is not bound to indemnity the complainant by travelling beyond the terms and conditions of the insurance contract.

12.    As a sequitor of our above discussion, we hold that appeal of the complainant now appellant is without any merits, in as much as order of the District Forum is found to be suffering from no legal infirmity. The appeal is accordingly dismissed by upholding the order of the District Forum dated 12.11.2010 under challenge in this case. 

13.    Arguments in this appeal were heard on 12.02.2015 and the order was reserved. Now the order be communicated to the parties.

15.    The appeal could not be decided within the statutory period due to heavy pendency of court cases.

 

                                                                          (J. S. KLAR)

                                                        PRESIDING JUDICIAL MEMBER

                       

                                                               (VINOD KUMAR GUPTA)

                                                                          MEMBER

 

February,16   2015.                                                            

(Ravi)