Haryana

Ambala

CC/357/2012

AMBALA WINE TRADERS - Complainant(s)

Versus

OIC - Opp.Party(s)

Suksham Aggarwal

10 Sep 2015

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AMBALA.

            Complaint Case No.    : 357 of 2012

Date of Institution       : 29.11.2012

            Date of Decision         : 10.09.2015

M/s Ambala Wine Traders, 22, Jaggi Colony, G.T. Road, Ambala City  through Partner Swaran Singh.

                                                                                                                                         ……Complainant.

                                                                                      Versus

             1.         Branch Manager, Oriental Insurance Company,  LIC Building, Ambala City.

2.         Divisional Manager, Oriental Insurance Company Near Capital Chowk, Ambala Cantt.

3.         Lalit Swami, Development Officer, Oriental Insurance Company, LIC Building, Ambala City.

                                                                                                ……Opposite Parties.

Complaint Under Section 12 of the Consumer Protection Act

CORAM:        SH. A.K. SARDANA, PRESIDENT.

                        SH. PUSHPENDER KUMAR, MEMBER.                       

Present:          Ms. Suksham Aggarwal, Adv. counsel for complainant.

                        Sh. S.C. Jaiswal, Adv. counsel for Ops.

ORDER.

                        Present complaint under section 12 of the Consumer Protection Act, 1986 (hereinafter in short called as the ‘Act’)  has been filed by the complainant alleging therein that  the complainant is running a business under the name & style  M/s Ambala Wine Traders  and he is a partner of the firm. The complainant got a license from Collector-Cum Additional Excise  & Taxation Commissioner (HQ) Haryana vide Code No.64 and is authorized for wholesale outlet of foreign liquor (IMFL) qua trade only.  The godown of complainant for stock of liquor is also situated at 22, Jaggi Colony, near Motor Market, G.T. Road, Ambala City.  It has been further submitted by the complainant that in the first week of July 2010, stock of wine lying in the godown got damaged due to flood and complainant firm suffered a loss of Rs.13,47,404.40 Ps. The complainant reported the matter to OP No.1 on 08.07.2010 alongwith list & documents.  The matter was investigated by Ops through Investigator Consolidated Surveyors Pvt. Ltd.  It has been further  alleged that the complainant submitted reminders dated 01.09.2010 & dated 25.10.2010 to the OP No.1 for settling the claim but in response to it, investigator deputed by OP-company i.e. Consolidated Surveyors Pvt. Ltd. sent a letter dated 15.11.2010 to the complainant seeking some documents which were duly submitted  by the  complainant in the office of OP  No.1. Thereafter, the complainant visited the office of Ops several times but the Ops failed to make the payment of the claim on one pretext or the other and even failed to reply the application as well as reminders of the complainant which is admittedly a deficiency in service on the part of Ops.   It has been further stated by the complainant that the Ops failed to discharge their liability to make the payment of claim of stock of liquor (IMFL) damaged in the flood in the first week July 2010 and requested for issuing a direction to the Ops to  pay  a sum of Rs.13,47,404.40NP as a compensation for damaged stock alongwith Rs.11000/- as costs of litigation and Rs.25,000/- for mental harassment etc. as mentioned in prayer para of the complaint.  

2.                     Upon notice, OPs appeared through counsel and filed written statement raising preliminary objections qua non-maintainability of complaint, no cause of action & suppression of material facts etc. On merits, it has been denied that the liquor/wine was got damaged in the godown and the complainant suffered a loss of Rs.13,47,404/-.  Further it has been urged that the case of the complainant is not that the stocks were flooded away since  the liquor is not an item to be damaged rather the cartoons in which the bottles are lying can be damaged in the flood, as such, the liquor was not damaged or destroyed.  However, the OP insurance company promptly appointed M/s Consolidated Surveyor Pvt. Ltd. Chandigarh for survey and assessment report of the alleged loss but the complainant failed to submit the requisite information and documents despite letters dated 10.08.2010,04.10.2010 & 15.11.2010 by the said surveyor, hence, the Op insurance company was compelled to close the case as ‘No Claim’.  It has been stated by the OP that during the survey, it was found & confirmed by the complainant’s representative that the damaged stock was disposed off and as such the complainant pocketed the money of the sale proceeds of the liquor and malafidely claimed the compensation. Thus, the Ops have prayed that the complaint be dismissed with costs.

3.                     To prove his version, the counsel for complainant tendered affidavit of complainant as Annexure CX alongwith documents as Annexure C-1 to Annexure C-26 and closed the evidence whereas on the other hand, the counsel for OPs tendered in evidence affidavit of one Sh. Lalit Swami, Branch Manager, Oriental Insurance Company Ltd., Ambala as Annexure RX alongwith documents as Annexures R-1 to R-16 and closed the evidence on behalf of Ops.

4.                     We have heard the learned counsel of the parties and considered the record minutely.  Counsel for complainant argued that complainant firm obtained insurance cover notes bearing No.233973 &758778 dated 11.06.2010 effective during the period 13.06.2010 to 12.06.2011 qua standard fire & special perils policy covering risk of flood, fire, earthquake & burglary  etc. for  indemnification of  the loss/damage  caused on all types of stocks of liquor including IMFL, FL lying in the premises of complainant firm against a sum of Rs.1.00 crore after  paying a handsome premium.  The counsel further argued that in the first week of July 2010, due to heavy rain, the flood water entered the godown of complainant firm and damaged the stock there. The mater was reported to OP-insurance company and they deputed M/s Consolidated Surveyors Pvt. Ltd. to investigate the claim & assess  the loss.  Counsel for the complainant further urged that all the documents/information sought by the said surveyor & OP, were submitted to them from time to time and the version put by the Ops in their reply that the complainant failed to submit requisite documents is totally wrong as in para No.1.3 of the Surveyors Report dated 26.02.2011 (Annexure R-8) tendered by OP in their evidence, it  has been specifically mentioned that “Now, after receipt of requisite  information and documents from the insured, our Survey & Assessment report on the captioned claim is as under.”

“Further in clause 7 of said report, it is also specifically mentioned that on visual inspection of the insured premises, it was found that the stocks were damaged by the muddy flash flood water and the water level upto a high of 4’ was observed on  the walls of the premises and the entire stock was submerged”  

                        Counsel for complainant further urged that in-spite of damage of stock due to flash floods admitted by the surveyor so deputed by the OP, said  surveyor wrongly reported  at the behest of OP insurance company that “no damaged stock was shown to them rather the insured’s representative present there informed us that entire damaged stock has been disposed off and no claim will be preferred on the insurers” but no any name of the insured’s representative  has been  clarified by the OP  nor any statement of so called representative of complainant has been produced by the OP which itself shows that the Surveyor intentionally rejected the claim of complainant under the garb of alleged version of complainant’s representative. As such, the report of Surveyor is self-contradictory because on one hand, he is admitting the damage of stock due to floods whereas on the other hand, he is rejecting the claim, without any basis.  Counsel for complainant further argued that to cover the said lacuna in the Surveyor Report, OP deputed 2^nd Surveyor/Investigator Mr. R.P. Kakkar in the year of 2015 i.e. during the pendency of the said case violating the provisions of Insurance Act to investigate the matter with Excise officials and the said 2^nd investigator submitted the report that as per reply received from D.E.T.C. office on dated 23.03.2015 “ No liquor Bottles Floods loss from 01.07.2010 to 28.07.2010 is reported to them” which is not sustainable legally since neither the consent of complainant nor permission of IRDA was obtained by OP for appointing the second investigator nor complainant was associated in the investigation with the excise officials.  Moreover, neither  any affidavit of Sh. R.P. Kakkar nor of any official of Excise Department to prove the report/version of 2^nd Investigator has been placed on record and as such said report is also not tenable rather a mere formality to  defeat the claim of complainant. Further to strengthen  his claim, complainant’s  counsel submitted plethora  of case laws rendered by Hon’ble National Commission in case law titled as New India Assurance Co. Ltd. &Anr. Vs. Shree Shyam Cotspin Ltd.2009(1) CPJ Pg. 110(NC); New India Assurance Co. Ltd. Vs. Pardeep Kumar 2009(IV) CPJ Pg.46(SC); Shakun Overseas Ltd. Vs. National Insurance Co. Ltd 1995(1) CPJ Pg.88 (State Commission Delhi); Voleti Duryodhunudu and another Versus United India Insurance Co. Ltd. 2013(1)CLT Pg. 360(NC); Essen Connectors Pvt. Ltd. Versus New India Assurance Co. Ltd. and others 2013(1) CLT Pg. 391(NC); Himachal Pradesh State Forest Corporation Ltd. & others versus National Insurance Company Limited & others 2013(2)CLT Pg. 377 (H.P.State Commission) & New India Assurance Co. Ltd. Versus Malti Bhikhabhai Bhoya 2013(3) CLT Pg.178 (NC). 

                        In the end, counsel for  complainant vehemently argued that at the time of purchasing policy from OP company, there was no any pre-condition that in case of loss/damage to stock, report from Excise Officials was mandatory  but now the version of OP that there is report from Excise officials that “As per office record M/s Ambala Wine Traders has not intimated/reported regarding  any liquor bottles flood loss from 01.07.2010 to 28.07.2010” (though not proved) is not tenable and thus the act of OP in not settling the claim of complainant firm is an admittedly deficiency in service on the part of Ops.

                        On the other hand, Learned counsel for OPs argued that the complainant failed to submit documents & cooperate the Surveyor and as such, he himself is guilty of not supplying the requisite documents in-spite of repeated reminders dated 10.08.2010, 04.10.2010 & 15.11.2010. Therefore, the Surveyor has rightly recommended to close the file as ‘No Claim’.  Further the complainant malafidely disposed off the stocks of liquor at the back of Insurance Company and concocted the claim of loss of the liquor stock in order to gain compensation. Counsel for the Ops further urged that liquor is not an item to be damaged rather the cartoons only in which the bottles are lying can be damaged in the flood. It has been further urged by the OP counsel that during the pendency of the case, another investigator was appointed by OP company to verify the facts from Excise & Taxation Department, Ambala whether any liquor bottles flood loss was reported by M/s Ambala Wine Traders during the period dated 01.07.2010 to 28.07.2010 wherein Excise officials have reported that no such loss has been reported  by the complainant firm. Therefore, the claim filed by the complainant is false, frivolous and is liable to be dismissed.

5.                     At the very outset, it is an admitted  fact on record that the insurance cover notes dated 11.06.2010 (Annexures C-6 & C-7) were issued byOP insurance Company for indemnification of loss/damage  caused to the all items of stock of liquor including IMFL & F.L. etc. lying in the godowns or in office of complainant firm in its due course of business to the extent of rupees one crore being sum insured but the main objection of OP in not settling the claim  of complainant  rather repudiating the same as No Claim is that the complainant failed to submit the requisite documents to the surveyor so deputed by the company and further the insured’s representative informed the surveyor on 11.08.2010 that the entire effected stock has been sold/disposed off and no claim will be preferred on the insurers.  To prove the aforesaid version, OP insurance company has  placed on record the ‘report of M/s Consolidated Surveyors Pvt. Ltd.’ as Annexure R-8 wherein at relevant clauses 1.3, 7 & 12.2, it  has been reported as under:-

1.3       Now, after receipt of requisite information and documents  from the insured, our survey and assessment report on the captioned claim is as under:

7.         POSITION AT SURVEY:

The undersigned on 13.07.2010 visited the insured’s premises and inspected the site of loss and on visual inspection found that the stocks were damaged by the muddy flash flood water.  The water level up to a high of 4 ft. was observed  on the walls of the premises.   The entire stock was submerged in water. On our first visit, we requested the insured to segregate the entire damaged stock. After a gap of 5-6 days, we again visited the insured’s premises and found that no damaged stock was shown to us, rather the insured’s representative present there  informed us that entire damaged stock has been disposed off. We have not been shown the damaged stock and no opportunity has been given to us to verify the quantity and extent of damage of stock.

                                   

12.2    The water level around the insured’s premises was almost 4 ft. we requested the insured to segregate the entire damaged stock, so as to enable us to verify the same.  We regularly followed for segregation of the stock through numerous personal visits to their premises.  Finally, during the course of our visit dated 11.08.2010, we were informed by their representative that the entire affected stock has been sold and no claim will be preferred on the insurers.

                        From the above, it is concluded that damage was caused to the stock lying in the premises of complainant due to submerging  in the flood water  and requisite information and documents  were also supplied by the complainant to the surveyor (as per clause 1.3) but the further version of the Surveyor that complainant failed to submit the required documents/information and his representative informed to them that entire damaged stock has been disposed of, appears to be added in the report by the Surveyor at the instance of Op insurance company because the said report itself is ambiguous one having two versions and thus we hold that the second version of the Surveyor report has been added only to repudiate  the claim of complainant which is admittedly deficiency in service & unfair trade practice on the part of OP.  Even otherwise, to prove the said version of Survey Report, neither any affidavit of the Surveyor nor any name of the complainant’s representative who told that the damaged stock was disposed of /sold has been placed on file  and as such the second version of the Surveyor report is not believable  and thus in view of the above,  we have no hesitation in holding that the stock lying in the premises of complainant damaged due to submerging of stock in the flood water.

6.                     Now the next question arises for consideration before the Fourm is that “whether the  report of Second Surveyor/Investigator allegedly to be obtained from Excise &  Taxation Commissioner, Ambala during the pendency of the case by OP insurance company at the back of complainant firm after a period of 5 years  have any effect on the claim case of the complainant firm?” In the present case, the second surveyor was deputed by the insurance company violating the provisions of Insurance Act and even without the consent of the complainant/insured because the op has failed to tender any document on the case file vide which they have taken prior approval of Controller/Authority of Insurance Company which is mandatory for appointment of second surveyor as per Sections 64UM(2), 64UM(3) & 64UM(4)- of Insurance Act, 1938. After going through the case laws reported in 2009(I) CPJ Pg.110 titled as New India Assurance Co. Ltd. & Ors. Vs. Shree Syam Cotspin Ltd.  rendered by Hon’ble National Commission; New India Assurance Co. Ltd. Vs. Pardeep Kumar 2009(IV) CPJ Pg.46(SC); Shakun Overseas Ltd. Vs. New India Assurance Co. Ltd 1995(1) CPJ Pg.88 (State Commission Delhi); Voleti Duryodhunudu and another Versus United India Insurance Co. Ltd. 2013(1)CLT Pg. 360(NC); Essen Connectors Pvt. Ltd. Versus New India Assurance Co. Ltd. and others 2013(1) CLT Pg. 391(NC) (supra), we are of the view that no arbitrary & unilateral decision of insurer could be imposed on the insured.  Moreover,  the  OP has also failed to file any affidavit of second surveyor/investigator Mr. R.P. Kakkar or any official of Excise & Taxation Department, Ambala that “As per office record M/s Ambala Wine Traders has not intimated /reported to this office regarding any liquor bottles flood loss from 01.07.2010 to 28.07.2010” as alleged in documents/reports placed on file as Annexure R-2 & R-3 by the OP. Therefore, the said version of OP is also not sustainable in the eyes of law. As such, we have no hesitation in holding that the OP company is not only negligent in providing proper services to the complainant rather has committed an unfair trade practice by wrongly withholding the claim of complaint.

7.                     Now, the next question arises for consideration before the Forum is that “what amount of compensation on account of damage to the insured stock, complainant firm is entitled?”

                         To prove this fact, complainant has submitted in para no.3 of the affidavit (Annexure CX) “That in first week of July 2010, the stock of wine mentioned in the enclosed list lying in the godown got damaged due to  flood upto water level and complainant firm suffered a loss of Rs.13,47,404.40NP.” and further tendered  the list of inventory & value of damaged stock as Annexure C-11 mentioning amount of loss to the tune of Rs.13,47,404/- but no any report of valuer/loss assessor has been placed on file by the complainant to further  substantiate their claim whereas on the other hand, OP has also failed to produce any evidence on the court file to the effect that  the effected/damaged stock was sold by the complainant firm against such particular amount except alleging in the Surveyor Report(Annexure R-8).  In these circumstances, we are of the considered view that the claim of complainant firm qua value of damaged stock as claimed in the complaint/affidavit cannot be accepted in toto and at the same time, Op insurance company is also not entitled to repudiate/reject the claim of complainant firm in toto.  Thus we hold that complainant firm is entitled to get compensation on non-standard basis i.e. 75% of the claimed value of the damaged stock of Rs.13,47,404/- i.e. Rs.10,10,553/- only appreciating the judgment rendered by Hon’ble National Commission in case titled as New India Assurance Co. Ltd. Vs. Malti Bhikhabhai Bhoya reported in2013 (3) CLT Pg.178. Accordingly, we allow the present complaint partly and direct the Ops No.1 & 2 to comply with the following directions within 30 days from the communication of this order:-

(a)       To release the insurance claim amounting to  Rs.10,10,553/- to the complainant firm alongwith simple interest @ 9% per annum from the date of institution of complaint to till its realization.

(b)       To pay Rs.10,000/- as litigation costs including the Advocate’s fee etc.             

 

                   Further the award in question/directions issued above must be complied with by the Ops No.1 & 2 within the stipulated period failing which all the awarded amounts  shall further attract simple interest @ 12% per annum for the period of default. So, the complaint is decided in above terms. Copies of this order be sent to the parties concerned, free of costs. File be consigned to the record room after due compliance. 

Announced:10.09.2015

                                                                                                                 Sd/-

                                                                                                      (A.K. SARDANA)

                                                                                                            PRESIDENT

                                                                                                                Sd/-

                                                                                                 (PUSHPENDER KUMAR) 

                                                                                                               MEMBER