1.      The present First Appeal has been filed under Section 19 of the Consumer Protection Act, 1986 (“the Act”) against the Order dated 14.02.2017 passed by the Haryana State Consumer Disputes Redressal Commission, Panchkula (“the State Commission”), in Consumer Complaint No. 88 of 2014, wherein the Complaint filed by the Appellant was dismissed.

2.      For convenience, the parties involved in this matter are referred to as mentioned in the Complaint before the State Commission. "M/s Sagar Packaging" is recognized as the Complainant (Appellant herein). "The Oriental Insurance Co. Ltd,” is denoted as the Respondent No.1/Opposite Party No. 1/ the Insurer (OP-1) and “Oriental Bank of Commerce is acknowledged as the Respondent No.2/Opposite Party No.2 (OP-2).

3.     As per the report of Registry, there is 57 days delay in filing the Appeal and the same was condoned vide order dated 18.03.2019.

4.      Brief facts of the case, as per the Complainant, are that the Complainant had obtained Standard Fire Special Peril Policy No. 272400/11/2011/68 from OP-1 valid from 21.09.2012 to 20.09.2013 for Rs.22 Lakhs. On 22.04.2013 fire broke out in the premises of the Complainant at Shed No.7 Jeevan Nagar, Faridabad and loss was to the extent of about Rs.28 Lakhs. A Claim was submitted to OP-1 through OP-2. The Complainant was surprised to know that while the stock was worth Rs.35 Lakh and whereas insurance of Rs.22 Lakhs was obtained. OP-2 also sanctioned a cash credit limit of Rs.35 Lakhs. Vide letter dated 16.06.2000 his claim was repudiated on the ground that policy pertains to Shed No.70, whereas the fire broke out in Shed No.7, which is a different place. Vide letter dated 17.02.2014 an objection was raised about wrong address but was not attended to. All documents pertain to Shed No.7 and not Shed No.70. Previously he consented to settle the dispute for Rs.14.29 Lakhs instead of Rs.28 Lakhs because he was concerned about the legal proceedings which may be initiated by OP-2 under Recovery of Debt Due to Banks and Financial Institutions Act 1993 ("Debt Act").  The Complainant filed a Complaint before the State Commission.

5.      In their reply filed before State Commission, OP-1 contended that the policy pertains to shed No.70 whereas the loss occurred in shed No.7. Therefore, there is no liability of the insurer towards loss occurred in that property. As per the surveyor report, the loss was Rs.14,19,216. While a letter was forwards by the Complainant to pay the same, however, it was withdrawn later. As the policy was issued as per information provided by OP-2, it cannot now be alleged that the policy pertains to Shed No.7. OP-2 in the reply has contended that the Complainant has full knowledge of the policy and its terms. He did not suffer loss of Rs.28 Lakh as claimed. As per the stock statement, it never exceeded Rs.22 Lakhs. Vide letter dated 17.02.2014 he was ready to accept compensation of Rs.14,19,216/- as full and final settlement.

6.      The learned State Commission vide order dated 14.02.2017 dismissed the complaint with the following observations:

“6.      Learned counsel for the complainant vehemently argued that from the perusal of rent agreement Ex.C-8 and stock statement etc. Ex.C-9 onwards it is clear that complainant was running it's business in shed No.07 and shed No.70 was wrongly mentioned in the policy Ex.C-1.  O.P. No.1 has not produced any proposal form wherein shed No.70 was mentioned. The policy was never supplied to it and difference about number of shed came to it's notice when letters Ex.C-13 and C-14 were received. It was the bank who got the stock insured, so claim cannot be repudiated on this ground, as mentioned in repudiation letter dated 16.06.2014 Ex.C-14. When Divisional Manager of O.P.No.1 entered witness box, he admitted that it's claim was genuine so compensation be awarded as prayed for. He has also placed his reliance upon the opinion of Hon'ble Supreme Court expressed in United India insurance Vs. M/s M.K.J. Corporation 1997 AIR (SC) 408.

7.        This argument is devoid of any force. From the perusal of copy of insurance policy Ex.C-1 it is clear that the same was pertaining to shed NO.70 Jeevan Nagar and not shed No.07 Jeevan Nagar. This policy came into force from 21.09.2012, but neither complainant nor O.P.No.2 approached O.P.No.1 to correct the address before 22.04.2013, when incident took place. It is nowhere alleged by O.P.No.1 that insurance policy was not received by it. It shows that the fact of the address was to their notice.

8.  More so, it was not the first policy. From the perusal of Ex.C-1 the previous policy No. was 272400/11/2012/623. In this way the complainant as well as O.P. No.2 were aware about this address since very beginning, but, they never requested to correct the same. O.P.NO.2 nowhere alleged in reply that O.P.No.1 was ever requested to correct address before this incident. Complainant has also not alleged in the complaint that he ever asked bank to approach O.P.NO.1 to get the address corrected. Had it been wrong, bank people must have raised this issue before insurance company. O.P.No.1 did not indemnify insured stock lying in shed No.07. If as per surveyor's report Ex.OPI/4 there is no shed No.70 in that area, it does not mean that insurance company is liable to pay compensation.

9.   More-over it cannot be presumed that complainant was unaware about the contents of insurance policy. It is business concern and obtained insurance policy time and again through the bank. It cannot be presumed that a business concern will not go through details of Insurance policy. Had it been a layman then it could have been a different matter. This commission also opined in appeal No.803 of 2013 titled as Microvolt communication vs Oriental Insurance company Ltd decided on 06.04.2015 that if policy is obtained for different premises and loss has occurred in different premises then insurance company is not liable to pay any compensation. Opinion expressed by Hon'ble Supreme Court in United India Vs. M/s MKJ corporation's case (supra) is based on altogether different footings.

10.      Keeping in view all the facts and circumstances it is clear that the complainant is not entitled for compensation on the basis of this policy. Hence the complaint fails and the same is hereby dismissed. However complainant may take up matter with the bank if law permits.”                                 

7.      Being aggrieved, the Appellant/Complainant filed the present First Appeal No.975 of 2017 with the following prayers:

          i. Set aside the impugned order dated 14-02-2017 passed by the Hon’ble State Consumer Disputes Redressal Commission Haryana in Complaint No.88 of 2014.

          ii. May pass any other order as deemed fit by the Hon’ble National Commission in the interest of justice.

8.      In the Appeal, the Appellant mainly raised following issues:

(a)  The Shed Number was wrongly and inadvertently printed in the address column as Shed No.70 instead of Shed No.7 by the insurance company itself while issuing the policy bond.

(b) The claim rejected on technical ground rather taking into consideration merits of the case.

(c) The statement of Shri Baldev S Chawla, the Surveyor, who admitted that the said incident of fire was genuine. Therefore, the question of wrong shed number in the policy is not relevant. Further, Shri Satish Kumar Arya, who was appointed by the OPs for verification of address brought out that there was no Shed No.70 in the area and clarified that Shed No. of Shri Nanak Chand, the Complainant is 7 and not 70.

(d)  Shri Chotu Ram, Divisional Manager of OPs admitted that the proposal form was not issued to the Complainant at the time of issue of the policy because it was insured through Oriental Bank of Commerce and the policy was issued as per details provided by the bank. The signature of insured is also not required on such policy and the policy was sent to the bank by OPs. The main reason for claim repudiation claim was wrong Shed No. mentioned in the policy intimated to the OPs by the bank. At the time of issue of the policy, they did not confirm the number of the property. Otherwise, the claim was genuine.

(e)  The main purpose of Insurance Act is to provide financial assistance to the insured from such accidents. However, in the present case, their genuine claim was rejected for no fault.

(f) The Surveyor has taken 60% of the amount as claim without explaining the same in the survey report or before the State Commission. They filed for Rs.28 Lakhs as loss on actuals as per records. But the Surveyor has considered only 60% of the claimed amount without assigning any reasons.

(g)  The OPs collected the premium of Rs. 5097 for insurance of Rs. 22 Lakhs stock and deliberately repudiated the claim while the policy was issued CGTSME scheme introduced by the Govt for benefit of small and medium scale industries under which the bank provides credit limit against the stocks. Thus, there is no role of the insured for errors in address, shed number etc.

(h)  There is no confusion of address in the Bank A/c and stock statements furnished to the bank. If there is any error, it is between bank and insurer. There is no lapse of the Appellant.

(i)  The State Commission dismissed the Complainant’s Appeal with liberty to pursue its appropriate legal remedy qua the bank. This impliedly means that there was no fault of the Complainant and wrong noting of Shed No. was a communication error of the bank and OPs and they cannot be made to suffer remedy less.

9.      On being served the memo of Appeal, The Respondents/OPs have not filed any Reply. However, they filed brief synopsis.

10.    In his arguments, the learned Counsel for Appellant asserted that the insurance company erroneously printed Shed No.70 instead of No.7 in the address column of the policy. The claim was rejected on technical ground rather than merits. The surveyor affirmed the authenticity of the fire incident and confirmed by physical verification that the address was erroneous with respect to Shed No. mentioned in the policy has lost its significance. Shri SK Arya, appointed by the Insurer for address verification, confirmed that there is no shed No. 70 in the area, clarifying that their correct Shed No. is 7 and not 70. The Divisional Manager of insurer (Shri Chotu Ram) acknowledged that a proposal form was not issued to them at the time of policy, as they were insured through OP-2. He admitted that the main reason for claim repudiation was the incorrect Shed Number in the policy bond, and otherwise, the claim was genuine.  The Counsel argued that the rejection of a genuine claim on technical grounds defeats the fundamental intent and objective of the Insurance Act and the Govt to provide financial assistance in such cases. All witnesses from the insurer admitted that there was no fault of the Complainant. Yet, the claim was rejected based on a flimsy technicality. The surveyor reduced the claim to 60% without providing a rationale.

11.    The learned Counsel for OP-1 reiterated the facts of the case and asserted that the OP-2 provided the wrong address (Shed No.70 Jeevan Nagar instead of Shed No.07, Jeevan Nagar, Old Faridabad, Haryana) while obtaining the policy. He argued that the Complainant, being aware of the incorrect address, did not take steps to correct it, justifying the insurance company's repudiation of the claim. He supported the order of the State Commission. He contended that the Complainant acknowledged the wrong property number printed by the insurance company itself, absolving the bank of any negligence. He argued that the Complainant, having full knowledge of the policy contents, failed to correct the address after receiving the policy. He pointed out that, despite giving consent to accept Rs.14.29 Lakh as a full and final settlement of the claim, did not resolve the issue. The learned Counsel for OP-2 argued that the Complainant acknowledged the wrong property number printed by the insurer (OP-1). Therefore, no negligence can be attributed to the bank (Respondent No.2). He contended that the Complainant, having full knowledge of the insurance policy's contents, did not take steps to correct the address after receiving the policy. He asserted that the Complainant failed to resolve the issue even after giving consent to accept Rs.14.29 lakh as a full and final settlement amount, as evidenced by the letter dated 17.02.2014 sent to OP-1.

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12.    I have examined the pleadings and associated documents placed on record and rendered thoughtful consideration to the arguments advanced by learned Counsels for both the Parties.

13.    The central issue in the case is whether the Complainant is entitled for the claim of Rs.14,19,216/-, notwithstanding the difference in the address of the premises in the insurance policy stating Shed No.70 instead of Shed No.7.

14.    The Complainant argued that the insurance company itself made the error in printing the wrong address in the insurance policy, whereas the insurer contended that the incorrect information was provided by OP-2. Admittedly, all parties acknowledge that the insurance policy was issued based on details about the premises provided by OP-2. It is also an established position that nothing exists named as Shed No. 70 in the vicinity of the said address or anywhere else where the Complainant has any insurable interest. The surveyor undertook detailed investigation, assessed the loss, and confirmed the genuineness of the case including the location and correct address. It is also uncontested that no proposal form for the policy was filled and submitted by the Complainant. The details including the address were provided by OP-2 and, however, none of the parties took steps to rectify the error in the address mentioned in the insurance policy. OP-1 did not object to any of the documents submitted by the Complainant. It is also an uncontested position that, at no stage, the Complainant had misrepresented any fact whatsoever.

15.    This is not the case where the Complainant had multiple godowns at different locations and some ambiguity creeped into as to stocks of which godown are insured vis-à-vis the other. He has only one godown of which the address was erroneously recorded. It is an established position that Shed No.70 does not even exist in the area. It is also an undisputed that the Complainant had suffered loss in the said fire at Shed No.7 at the same address. Therefore, repudiation of the claim by OP-1, well knowing that the same is based merely on an error in recording the address or a typographical error, that too provided by OP-2, is grossly untenable.

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16.    In view of the foregoing discussion, the impugned order of the learned State Commission dated 14.02.2017 in C.C. No.88 of 2014 is set aside.  And, consequently, the Appeal No.975 of 2017 is allowed with the following directions:

Order

1. The Respondent No.1/Opposite Party No.1 is directed to pay Rs.14,19,216/- as assessed by the surveyor to the Appellant/Complainant, along with simple interest @ 9% per annum from the date of filing of the complaint i.e. 03.09.2014 till realization, within a period of one month from the date of this order. In the event of delay beyond one month, the interest applicable for such extended period shall be @ 12% per annum.

2. The Respondent No.1/Opposite Party No.1 is also directed to pay Rs.25,000/- as cost of litigation.

17.    All pending application, if any, stand disposed of accordingly.