Per Hon’ble Mr.Narendra Kawde, Member

This consumer complaint has been filed by M/s.Aimco Pesticides Ltd., a company registered under the Companies Act 1956, (In short ‘Complainants’) alleging deficiency of service against M/s.Oriental Insurance Co. Ltd. (In short ‘Insurance Company’) for repudiation of the claim payable under the insurance policy on account of damages sustained to the insured goods, namely, pesticides due to storm in the coastal areas of Orissa that occurred on 29^th and 30^th October 1999 resulting into damage to the lives and loss of properties on heavy scale.

2.       It is the case of the complainant that insurance policy bearing no.2000/1440 was obtained to provide insurance cover to the stock of pesticides stored at 26, Lingpur Mouza, Puri Road, Bhubaneshwar 752 002. The policy was valid for 01/10/1999 to 30/09/2000.  As complainants are carrying on the business as manufacturers of pesticides, herbicides, fungicides and production of various other chemicals.  For the purpose of marketing their products, the complainants have appointed C & F Agents in the various regions of the country.  One of the C & F agents appointed by the complainant for Bhuvaneshwar, M/s.Manorama Enterprises in whose custody the insured pesticides were stored by obtaining the godown/warehouse.  Due to super cyclone that hit coastal areas of Orissa coast on 1^st October, 1999, the insured storage of pesticides got damaged due to flood water, inundation with 7 feet high on the ground floor of the said warehouse and was completely submerged under the water.  The incidence was reported to the opponent/Insurance Company, who appointed the authorized surveyor-M/s.J.B.Boda Surveyors Pvt.Ltd. from Bhuvaneshwar.  The said surveyor carried out the survey and assessed the loss to the extent of `15,91,613/-.  However, the claim preferred by the complainant was repudiated by the opponent/Insurance Company on the ground that there was no physical verification of the pesticides stock allegedly destroyed due to inundation of flood water.  Aggrieved thereby the consumer complaint has been filed claiming an amount of `18,80,168.75ps. with interest.

3.       The opponent/Insurance Company was served, appeared and filed written version denying inter-alia the contentions of the complainant and further stated that surveyor has carried out the survey report on the basis of closing stock and the stock register, which cannot be taken as a conclusive proof of the material having been stored in the ground floor of the insured premises.  It is averred by Insurance Company that entire claim of the complainant is based on the statement of their C & F agent based at Bhuvaneshwar.  Further, it is stated that the survey report being a confidential document cannot be parted or shared with the insured.  Moreover, the said surveyor appointed for the purpose was not given any opportunity for physical examination of the purportedly damaged insured goods, namely, pesticides.  The said surveyor observed that the ground floor of the warehouse where the stock of pesticides was reportedly stored was empty at the time of inspection.  All these observations of the surveyor are well founded as this is the result of the visit by the said surveyor to the affected godown and tried to justify repudiation of claim.

4.       Heard Mr.Ashutosh Gavnekar-proxy advocate for Deven Dwarkadas & Partners Advocate for the complainant. Opponent and their advocate preferred to remain absent. 

5.       This matter pertains to the year 2000.  It was placed on board for hearing and disposal from the sine die list. Therefore, we proceed to decide the matter by hearing the Ld.advocate of the complainant.  The short issue before us for our determination is whether the survey report, which is an important piece of document for evidence in deciding the insurance claim can be overlooked by the opponent/Insurance Company in absence of insured goods, physically not available at the time of verification for the surveyor.  Observation of said surveyor while preparing the survey report  are worth to be reproduced as,

“As mentioned earlier, the damaged stock could not be physically verified as the same was destroyed before the survey/assessment was carried.  Moreover, the stock was exposed to flood water for a considerable period and considering the (i) inherent property of the pesticides (ii) the nature and extent of damages and (iii) the offensive odour which was emitting from dissolved pesticides, it is not advisable for anybody to take inventory of the damages stock by verification/segregating/counting from the debris as this requires considerable time.

In view of the above we decided to go through the books of account to quantify/cross check the quantity claimed by the Insured.”

6.       The opponent/Insurance Company tried to dislodge the survey report on the ground that the insured pesticides were not physically available at the time of verification of the surveyor.  The surveyor has quantified the damages on the basis of books of accounts by applying cross check in respect of sale of stock, etc. and arrived at a conclusion to establish the loss of `15,91,613/- .  The said surveyor has eloquently stated as to why he was compelled to quantify the loss on the basis of books of account which was carefully scrutinized.  Prime reason as recorded by the surveyor is that the stock was exposed to flood water for a considerable period of time and considering the inherent property of the pesticides and the nature and extent of damage, the offensive odour which was emitting from dissolved pesticides, the said insured stock of pesticides was required to be destroyed by the complainant.  Further, it is observed by the said surveyor that it is not advisable for anybody to take inventory of the damaged stock by verification/segregating/counting from the debris as this requires considerable time.  Survey report carried out by the authorized surveyor which is considered as an important piece of evidence to decide the insurance claim under the insurance policy is a settled law.  Therefore, we do not agree with the observations of the opponent/Insurance Company to dislodge the claim as against recommendation of surveyor.  The opponent/Insurance Company did not file copy of the survey report on record.  However, the complainant has produced copy of the survey report forwarded by the advocate of the opponent/ Insurance Company to the complainant together with other enclosures by letter dated 01/02/2002.

7.       Another contention of the Insurance Company is that the survey report being a confidential document cannot be shared with the insured.  This presumption is totally unsustainable as Regulation 9(1) of IRDA (Protection of Policy Holders Interest) Regulations 2002 do provide for supply of copy of the survey report in case it is requested by the insured.  In the case on hand, it is the contention of the complainant that in spite of request for supply of copy of the survey report, it was never provided to them.  The surveyor further observed that since the policy has commenced on 01/10/1999, no declaration as to value of the last day stock of each month was required before the date of incidence.  Therefore, the declaration condition was also not applicable.

8.       Admittedly, the stock of pesticides was insured under the policy no. 2000/1440 issued by the Insurance Company favouring the complainant company for `65 lakhs. There is also no denial of the fact that the super cyclone occurred in October 1999 in the coastal areas of Orissa, Bhuvaneshwar.  The insured pesticide stock was damaged and also due to inherent property of offensive odour, it was destroyed by the complainant company prior to visit of the authorized surveyor.  Claim was repudiated though recommended by surveyor.

9.       There are no sufficient grounds made out by the Insurance Company to disagree with the survey report nor there is any documentary evidence contrary to establish that complainant company have not incurred the loss as reported by authorized surveyor.  By repudiating the insurance claim, the opponent/ Insurance Company has incurred deficiency of service against the complainant company.  It will be just proper in the interest of justice to award an amount of `15,91,613/-  as recommended by the authorized surveyor.  Considerable period has lapsed since the claim pertains to year 1999.  Awarding interest @ 9% p.a. on the payable amount from the date of filing the consumer complaint will meet the ends of justice. We hold accordingly and pass the following order:-

ORDER

1.     Complaint is partly allowed.

2.     Opponent/Insurance Company is directed to pay an amount of `15,91,613/-  with interest @ 9% p.a. w.e.f. 30/11/2000 within a period of 60 days from the date of this order, failing which, opponent/Insurance Company shall pay additional penal interest @ 6% p.a. w.e.f. 30/11/2000 till realization.3.     Rest of the claims of the complainant stands rejected.

4.     In the circumstances, parties to bear their own costs.

Pronounced on 25^th February, 2013.