Haryana

Yamunanagar

CC/581/2012

M/S Shivam Plywood Industries - Complainant(s)

Versus

OIC Ltd. - Opp.Party(s)

I.K.Dhiman

15 Jun 2017

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, YAMUNA NAGAR.

 

                                                                                    Complaint No. 581 of 2012

                                                                                    Date of institution: 05.06.2012                                                                                  

                                                                                   Date of decision: 15.06.2017

 

M/s Shivam Plywood Industries Village Kami Majra, Khajuri Road, Yamuna Nagar, District Yamuna Nagar through its partner Shri Kunal Garg son of Shri Sham Lal.                                                                                                                                                                                 

                               …Complainant.

                                    Versus

Oriental Insurance Company Limited, Opposite Hindu Girls College, Jagadhri 135003, District Yamuna Nagar through its Senior Branch Manager.

                                                                                                                                                                                                                                                                                                                                          …Opposite Party

                                                                                                                            

BEFORE:          SH. ASHOK KUMAR GARG…………….. PRESIDENT.

                         SH. S.C.SHARMA………………………….MEMBER.

                         SMT. VEENA RANI SHEOKAND…..…… MEMBER

 

 

Present:            Shri  I.K. Diwana, Advocate for complainant.

                        Shri Rajiv Gupta, Advocate along with Shri Vikrant Sharma, Advocate for                               OP.

 

ORDER (ASHOK KUMAR GARG, PRESIDENT)

 

1.                     The present complaint has been under section 12 of the Consumer Protection Act. 1986 amended upto date.

2.                     Brief facts, as alleged in the complaint, are that complainant is a firm and carrying on the business of manufacturing of plywood and block board etc.  and accordingly  the complainant purchased a standard fire and special perils policy No.261701/11/2012/206 on 06.07.2011 which was valid from 08.07.2011  to 07.07.2012  for a sum of Rs.2,43,20,000/- which included damage to building, plant and machinery including two generator sets and stock etc. owning to fire accident and other unforeseen circumstances. Unfortunately, on 01.06.2011, during currency of Insurance policy in question fire took place in one of the generator sets installed in the factory premises of the complainant and generator set was completely destroyed along with the Canopy and the complainant suffered heavy losses. Accordingly, complainant informed OP Insurance Company on the same day and also informed to the Fire Brigade Centre. The OP appointed the Surveyor and loss assessor to assess the loss and during the visit on 01.06.2011 the surveyor and the Branch Manager told the complainant that their claim is payable and they would pay the loss after completion of the formalities.  It has been further mentioned that surveyor did not assess the loss properly and prepared his report in arbitrary and illegal manner. After that, the OP Insurance Company informed the complainant vide letter dated 12.12.2011 that the surveyor has reported that the proximity cause of loss i.e. “fire was occurred due to short circuiting in DG Set” and sought clarification from the complainant. The complainant, vide his letter dated 28.12.2011, clearly mentioned his position that short circuiting is not the cause of fire and on their visit on 01.06.2011, the surveyor Mr. Pankaj Goel and Senior Branch Manager raised no objection in this regard. The OP repudiated the claim of the complainant arbitrarily which rendered highly defective and deficient service to the complainant and lastly prayed for acceptance of the complaint and requested for directing the OP insurance company to pay a sum of Rs.3,00,000/- along with interest and also to pay compensation as well as litigation expenses.

3.                     Upon notice, OP Insurance Company appeared and filed its written statement taking some preliminary objections such as complaint is not maintainable, there is no negligence or deficiency in service on the part of the OP, in this case an intimation dated 01.06.2011 was received by the OP Company from the complainant that a fire has taken place in the generator set owned by the complainant and insured on 01.06.2011. On receipt of the said intimation, the OP Company immediately deputed Shri Pankaj Goel, Surveyor and loss assessor to assess the loss, if any, to the generator set which was insured for a sum of Rs.3,00,000/-  with the OP Insurance Company. The Surveyor visited the premises of the complainant on 01.06.2011 and after taking into account all the relevant damages spot inspection documents and insurance policy in question, prepared his report dated 19.09.2011 and submitted the same to the OP Insurance Company observing therein that “Surveyor came to the conclusion that circumstances indicates that most probable cause of higher in the DG Set was a electronic short circuiting  of the DG Set causing ignition that resulted into flames gradually and such kind of claims are not covered under the terms and conditions of the insurance policy. As per exclusion clause No.7 of standard fire and special perils policy, loss destructions or damages to any electrical or any electronic machine apparatus, fixture or fitting (excluding fans and electrical wiring in dwellings) arising from or occasioned by over running, excessive pressure, short circuiting, arcing, self heating or damage of electricity, or whatever cause for lightening included)” “No claim is payable/maintainable under the terms and conditions of the Insurance policy. However, the said surveyor for the purpose of quantification of loss, assessed the loss on repair basis to the tune of Rs.1,45,875/- after applying the average clause on account of under insurance of DG Set in question. Besides that, the loss was also assessed by the said surveyor on the total loss basis to the tune of Rs.1,14,000/- after applying the relevant depreciation clause and subject to terms and conditions of the insurance policy and after deducting Rs.26,000/- as salvage value vide addendum dated 11.11.2011. On receipt of the said report of the surveyor, the claim in question was duly processed by the OP company and a registered letter dated 12.12.2011 was sent to the insured with a request to clarify the points relating to the cause of fire and the fact that as per exclusion clause Short Circuit in DG Set is not covered under the policy condition. However, the complainant did not give any satisfactory reply and thereafter the respondent company vide its letter dated 18.04.2012 repudiated the claim of the complainant on the ground that the DG Set was under insured and that cause of fire i.e. short circuit fall under exclusion clause as per terms and condition of the insurance policy and on merit rest contents of the complaint were controverted and reiterated the stand taken in the preliminary objections.

4.                     In support of case, learned counsel for the complainant tendered into evidence short affidavit of the complainant as Annexure CW/A, photocopy of insurance policy as Annexure C-1, photocopy of cover note as Annexure C1/A, photocopy of receipt of municipality as Annexure C-2, photocopy of report fire brigade as Annexure C-3, photocopy of clarification letter as Annexure C-4, photocopy of repudiation letter dated 18.04.2012 as Annexure C-5, photocopy of bill dated 01.07.2011 as Annexure C-6, photocopy of estimate dated 01.07.2011 as Annexure C-7, photocopy of letter issued by OP company dated 12.12.2011 as Annexure C-8 and closed the evidence on behalf of complainant.

5.                     On the other hand, learned counsel for the OP tendered into evidence affidavit of Shri R.S. Kalra Divisional Manager as CW/A, copy of affidavit of Surveyor and Loss Assessor Shri Pankaj Goel as Annexure RB, photocopy of email as Annexure R-1, photocopy of surveyor report as Annexure R-2, photocopy of supplementary surveyor report dated 11.11.2011 as Annexure R-3, photocopy of inquiry  letter as Annexure R-4, photocopy of repudiation letter as Annexure R-5, copy of insurance policy along with terms and conditions as Annexure R-6 and closed the evidence on behalf of OP.

6.                     We have heard the learned counsel for parties and have gone through the pleadings as well as documents placed on the file very carefully and minutely.

7.                     It is not disputed that complainant firm has obtained Insurance policy bearing No. 261701/11/2012/206 on 06.07.2011 which was valid from 08.07.2011  to 07.07.2012 covering risk on account fire of the complainant factory/premises. It is also not disputed that during the currency of Insurance policy in question, a fire took place in one of generator sets installed in the factory premises of the complainant upon which the complainant lodged the claim with the OP Insurance company and OP Insurance Company deputed a surveyor and loss assessor Shri Pankaj Goel, who inspected the DG Set and submitted his report (Annexure R-2 and R-3) and assessed the loss to the tune of Rs.1,45,875/- after applying the average clause on account of under insurance of DG set in question and also assess the loss on account of total loss basis to the tune of Rs.1,14,000/- after applying the relevant depreciation clause and after deducting the salvage value of Rs.26,000/- subject to terms and conditions of the Insurance policy.

8.                     The only grievance of the complainant is that the claim of the complainant has been wrongly and illegally repudiated by the OP Insurance company vide its letter dated 18.12.2012 (Annexure C-5/R-5) on the false and manipulated grounds. Learned counsel for the complainant draw our attention towards the clarification letter dated 28.12.2011 (Annexure C-4) and argued that from this letter it is clear that the said surveyor and loss assessor Shri Pankaj Goel was also not aware about cause of loss i.e. whether the cause of loss i.e. fire of DG Set was due to short circuit of electricity or not? Learned counsel for the complainant further argued that surveyor and loss assessor and even the Senior Branch Manager of the OP Insurance Company had visited the factory of the complainant firm and was satisfied that there was no short circuiting. Learned counsel for the complainant lastly argued that OP Insurance Company has wrongly and illegally repudiated the claim of the OP Insurance Company on the false ground and referred the case titled as “

New India Assurance Co. Ltd. Vs. M/s Trimurti Tablewares Ltd., 2013(2) CLT, P-549, Consumer Education and Research Society, Suraksha Sankool, Ahmedabad and others Vs. IFFCO TOKIO General Insurance Co. Ltd, Ahmedabad and others 2013(2) CLT, P-275, Oriental Insurance Co. Ltd. Vs. M/s Mangal Textile Mills (India) Pvt. Ltd. 2013(2) CLT, P-345, Oriental Insurance Co. Ltd. Vs. M/s R.P. Bricks, 2013 (3) CLT, P-99, The Oriental Insurance Co. Ltd. and others Vs. Radhey Govind Steel and alloys Pvt. Ltd. 2014(4) CLT, P-460, M/s A.R. Trading Company Vs. Oriental Insurance Company Limited through Divisional Manager, 2016(3) RCR (Civil), P-987“

9.                                 On the other hand learned counsel for the OP Insurance Company argued at length that claim of the complainant has been rightly repudiated by the OP Insurance Company vide its repudiation letter dated 18.04.2012 (Annexure C-5/R-5). Learned counsel for the OP further draw our attention towards the Surveyor and loss assessor report (Annexure R-2 and R-3) and argued that the said surveyor found that the DG Set was under Insured and the cause of fire of the DG Set i.e. Short Circuiting fall under exclusion clause of the terms and conditions of the Insurance policy in question. Accordingly, the claim of the complainant has been rightly repudiated by the OP Insurance Company. Learned counsel for the OP further argued that however the said surveyor assessed the loss to the tune of Rs.1,45,875/- on account of damage to the DG Set on repair basis after applying average clause and the said surveyor also assessed the loss on account of total loss basis to the tune of Rs.1,14,000/- after apply the relevant depreciation clause and subject to terms and conditions of the insurance policy and after deducting Rs.26000/- as salvage value vide addendum dated 11.11.2011 and lastly prayed for dismissal of the complaint.

10.                   Learned counsel for the OP referred the case law titled as “United India Insurance Company Limited Vs. Harchand Rai Chandan Lal 2004(2) CPC, P-686”  and prayed for dismissal of the complaint.

11.                   After hearing both the parties and going through the case law referred by the counsel for the parties, we are of the considering view that there is deficiency in service and unfair trade practice on the part of the OPs as from the perusal of receipt (Annexure C-2) and report (Annexure C-3) issued by Fire Brigade Office, Yamuna Nagar, it is duly evident that complainant had suffered loss on account of fire in the Generator set as well as Canopying. The only plea of the OP Insurance Company for repudiating the claim “most probably cause of fire in the DG set was a electric short circuit of the DG Set resulted into flames gradually and such kind of claim are not covered in the terms and condition of the policy as it falls under exclusion clause No.7. But this plea of the Insurance Company is not tenable as the Surveyor and Loss Assessor Mr. Pankaj Goel has mentioned in his report under the head “Recommendations” that subject loss is accidental in nature, which is quite unforeseen and unpredictable. Meaning thereby that the said Surveyor and Loss Assessor was not of confirmed view that the fire took place due to electric short circuiting or otherwise. But from his report one thing is clear that the said DG set had damaged due to fire which was caused accidentally and is quite unforeseen reason and in the absence of any cogent evidence, it cannot be presumed that fire took place due to electric short circuit,  as alleged by the OP Insurance Company. Hence, we are of the considered view that claim of the complainant has been wrongly and illegally repudiated by the OP Insurance Company which constitute the deficiency in service and unfair trade practice on its part. As such, the complainant is entitled to get relief.

12.                   Now next question arises what amount should be awarded to the complainant. The complainant has mentioned in his complaint that he has suffered a loss of Rs.3,00,000/- on account of damage to the DG Set but on the other hand, independent Surveyor and Loss Assessor Shri Pankaj Goel has assessed the loss to the tune of Rs.1,45,000/-  on account of damage to the DG Set on repair basis after apply average clause and the set surveyor also has assessed the loss on account of total loss basis to the tune of Rs.1,14,000/- after apply the relevant depreciation clause and subject to terms and conditions of the insurance policy and after deducting Rs.26000/- as salvage value vide addendum dated 11.11.2011.

13.                   The said surveyor has assessed the loss on two accounts and we have perused entire file but the complainant has not placed on file any cogent evidence that he got the DG Set in question repaired or replaced the same with new one as no fresh purchase/repair bill has been placed on file to prove the same. So, we have no option except to decide the case on account of repair basis. According to Surveyor Report (Annexure R-2 and R-3) an amount of Rs.1,45,875/- has been assessed on repair basis subject to salvage Rs.6000/- and after deducting the same it become to Rs. 1,39,875/-.

14.                   Resultantly, we partly allow the complaint of the complainant and direct the OP Insurance to pay Rs.1,39,875/-  along with interest @ 7% per annum from the date of filing of the present complaint till its realization and further to pay a sum of Rs.5500/- as compensation for mental agony, harassment as well as litigation expenses. Order be complied within 30 days after preparation of copy of this order failing which complainant shall be entitled to invoke the jurisdiction of this Forum as per law. Copies of this order be supplied to the parties concerned free of costs as per rules. File be consigned to the record room after due compliance.

Pronounced in open court.

Dated: 15.06.2017.

 

 

		(ASHOK KUMAR GARG) PRESIDENT,DCDRF, YAMUNANAGAR.
(VEENA RANI SHEOKAND) MEMBER	(S.C.SHARMA) MEMBER