The District Consumer Dispute Redressal Commission [Central District] - VIII, 5th Floor MaharanaPratap ISBT Building, Kashmere Gate, Delhi
Complaint Case No.188/29.07.2017
M/s Rathi Special Steels Limited
Office at - SPI-7 RIICO Industrial Area,
Khushkhera District, Alwar
Rajasthan - 310029 …Complainant Versus
SBI General Insurance Company Limited
Office at Ground floor, 7-B, Pusa Road,
Opp Metro Pillar no.153, Delhi-110060 ...Opposite Party
Date of filing: 29.07.2017
Coram: Date of Order: 04.12.2024
Shri Inder Jeet Singh, President
Ms Rashmi Bansal, Member -Female
FINAL ORDER
Inder Jeet Singh , President
The case is scheduled today for Final Order (item no.2).
1.1. (Introduction to case of parties)–The complainant has grievances of deficiency of services against the OP that complainant took Standard Fire and Special Perils Insurance Policy (material damage) no.3300194 w.e.f 22.09.2015 to 21.09.2016 (hereinafter referred as insurance policy) from OP. On 23.05.2015 at about 6pm, there storm, wind and rain due to which wall of the insured property had fallen. The OP was informed of episode and claim was lodged within the tenure and terms of policy but it was not settled on flimsy ground, it was repudiated by written letter. That is why the complaint for legal insurance claim of Rs.7,53,56/- with interest at the rate of 18% besides compensation in lieu of deficiency suffered, mental tension, agony, harassment and humiliation suffered, cost of proceedings and other relief.
1.2. The OP/insurer opposed the complaint that neither there is any deficiency of services nor any claim is made out since there is breach of policy warranty, which was treated outside the ambit of policy coverage. The complaint is liable to be dismissed.
1.3 It is material to mention here the parties' pleadings comprises the complaint, the written statement and the replication. Moreover, the complaint is supported by documents but OP had not filed any document with the written statement. But, manyfacts and figures are not appearing in the pleading but the same are in the documents. It is being felt that in order put the case with clarity, the appropriate material from documents will be mentioned.
2.1. (Case of complainant)–The complainant is a registered company and Shri R.K. Sharma is its AR to sign, verify, institute and file the complaint by virtue of Board Resolution dated 17.12.2016 vis-à-vis he is well conversant with the facts and features of the case. On the other side, the OP is also a registered company and it offers insurance policy for various risks to private individuals as well as companies.
2.2. The complainant took the subject insurance policy from OP and at the time of executing the insurance policy, the OP made the complainant to sign number of documents but without explaining contents of the same vis-à-vis complainant signed bulk of documents without reading them by keeping in mind reputation of OP.
2.3 On 23.05.2016 at about 6 pm, due to storm, wind and rain the wall of insured property was fallen, immediately the complainant informed the OP on 24.05.2016 about said loss vide claim no. 268821 and asked the OP to settle the claim of Rs. 7,53,9756/-.
The OP got conducted a survey of the insured property through Sh. Rajesh Maheshwari, insurance surveyor and loss assessor, who sent an email dated 13.08.2016 to the complainant informing assessment of claim of Rs. 2,50,025/- in place of amount of Rs.7,53,756/- as claimed by the complainant. The complainant sent letter dated 21.09.2016 by protesting the assessment of loss done and also requested to settle the whole claim.
It shocked the complainant when he received OP’s reply dated 17.10.2016 by wrongly alleging that complainant had committed breach of policy warranty (i.e. “warranted nil loss experience at the proposed location during the last 3 years”), whereas, the complainant never made breach of any terms of the policy, it was also explained so to the officials of OP. Moreover, the OP has wrongly stated in the policy document about no claim during three years as much it was easily possible for respondent or its officials to misguide the complainant. The OP paid no heed to the request of complainant, therefore, the complainant served legal notice dated 01.12.2016 upon the OP to settle the claim alongwith interest since it had refused valid legal claim of the complainant. The legal notice was served but it had no result. The complainant was left with no alternate or efficacious remedy but to file the present complaint. That is why the complaint.
2.4.The complaint is accompanied with copies of – Board Resolution dated 17.12.2016, insurance policy cover, claim intimation, protest letter dated 21.09.2016 to valuation given by the surveyor, OP's letter dated 17.10.2016 seeking feedback and in its absence, to it shall be treated as close of case as breach of warranty and complaint's legal notice dated 01.12.2016.
3.1 (Case of OP)– The OP has filed written statement but under illegible signature without mentioning the name of author of the written statement nor there is supporting authority letter to cull out name of author of the written statement.
3.2. Otherwise, the OP opposed the complaint that complainant had informed that due to storm, wind and rain, the wall of insured property fell down and damages were caused. The OP appointed his surveyor to assess the loss occurred in accident. The surveyor furnished his report and assessed the damages of Rs.1,39,116/-.
However, the claim could be considered as per terms and conditions of policy but as per the terms and conditions of policy, the claim was not admissible and no deficiency can be attributed to the OP. It has been observed from the claim documents, furnished by the complainant, as well as the subject policy carrying warranty of “nil claim experience” which reads as “warranted nil loss experience at the proposed location during the last 3 years”. On 6.06.2016, the complainant himself admitted in the claim form ‘Yes’, we have taken claim during last 3 preceding years. The paragraph 4 of preliminary objection reproduces preamble clause and general policy conditionno.1 that policy shall be voidable in the event of misrepresentation, mis-description and non-discloser of any material particulars. The OP had acted in accordance with the policy contract, therefore, there is no deficiency of services and complaint is liable to be dismissed.
In addition, the complainant has no locus standi to file the complaint. Although, the surveyor appointed has assessed the damages of Rs. 1,39,116/- but the claim could be settled under the terms and conditions of the policy, however, the claim is not tenable.
3.3. The written statement is not supported with a single document.
4. (Replication of complainant) -The complainant files detailed replication, while denying the allegations of complaint but reaffirming the complaint as correct. It is also supplemented the OP has not filed any proof in support of its averment in the written statement. The complainant has not admitted that it has taken claim during last 3 years; the complainant never applied for any claim except the present claim/complaint. There is general practice and uses of agent of insurance companies, they took signatures of clients on number of papers in routine practice without telling the contents of documents to the client and later those documents are filled in by the agent as per their own convenience, such documents are not binding, which is settled law by Hon’ble Supreme Court of India and various Hon’ble High Courts of India. There is no violation of any condition by the complainant to deny its valid claim; there is deficiency of services on the part of OP.The complaint is reaffirmed as correct.
5.1.(Evidence)-Complainant led evidence by filing affidavit of evidence of Shri R.K. Sharma, authorized representative of OP, with support of documents filed with reply
5.2.OP led evidence by filing affidavit of Shri Jitender Dhabai, Legal Officer [without mentioning his complete address and authority in his favour to depose]. The OP had not filed any document with the written statementnor any document is mentioned in the body of affidavit but affidavit is coupled with insurance policy, claim form, surveyor's report dated 31.08.2016 and repudiation letter 26.12.2016. It is also appropriate placeand not out of context to mention (i) the affidavit does not mention date of surveyor's report (ii) the contents of surveyor's report mentions 15-Annexure/ enclosuers but not a single is attached, the same are with-held by OP and (iii) neither the written statement nor affidavit of evidence mention about the letter dated 26.12.2016 of no claim case.
5.3. The OP did not take permission for filing the document at the stage of evidence, since no document was filed with the written statement. It is improper practice on the part of OP to file document all of sudden at the stage of evidence that too without permission of Commission, it is deprecated.
6.1 (Final hearing)- The complainant and the OP have filed their respective written submissions. The material facts and dispute between the parties have already been detailed in paragraphs 2 and 3 above, therefore, it does not require torepeat them. It was followed by oral submissions by Sh. ShobhitTrehan, Advocatefor complainant and Sh. Rakesh Kumar Advocate for OP.
6.2. In order to fortify its contentions, the complainant relies upon -.
(a) "M/S Modern Insulators Ltd vs The Oriental Insurance Co. Ltd (2000) 2 SCC 734 has specifically held that Exclusion Clauses, which are not explained to the insured, are not binding to the insured and are required to be ignored. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the Appellant, the Respondent cannot claim the benefit of the said exclusion clause". The complainant supplements that it is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the facts which the parties known. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose all material facts in their knowledge since obligation of good faith applies to both equally. The clause as "warranty nil loss experience at the proposed location during the last 3 years" was never explained to the complainant.
(b) National Insurance Co. Ltd. vsShri D.P. Jain on 15May, 2007(NCDRF) [points 11 and 12], the unexplained or unnoticed exclusion clauses would not be binding to the insured. The reason being the Regulations are of mandatory in nature so as to protect the consumers' interests."
7.1 (Findings)-The contentions of both the sides are considered, keeping in view the pleadings and evidence of the parties, the written arguments, oral submissions and case law presented. Therefore, by considering, analysing and assessing the rival contentions with all the material on record, there are some undisputed facts butmany other rival plea of the parties, the following conclusions are drawn:-
(i) The complainant has proved its documentary record that there is resolution dated 17.12.2016 in favour of Sh. Rajendra Kumar Sharma, Liaison Officer to sign, verify and file the complaint and to prosecute to it besides other documents mentioned in paragraph 2.4 above. Therefore, the complainant being an insured has a locus standi to file the complaint.
(ii) Although, the OP had filed documents first time at the stage of evidence that too without mentioning them in the affidavit of evidence and there is also no reference of letter dated 26.12.2016 in the written statement. A party can lead evidence when there is pleading to that affect, but the written statement is not supported by any authority letter or it also does not decipher as who has actually authored the written statement, besides the author of affidavit of evidence and of written statement are also appearing to be different person. The written statement filed is not a valid written statement for want of name of its author and authority in its favour to sign, verify and file it.
This case is of 2017 and in order to avoid further delay, the record furnished by the OP is being considered but it will not set a precedent for this Commission nor it would make a practice to file the written statement and documents in a manner it has happened in this case.
(iii) There is no dispute that the complainant was issued insurance policy by the OP;saidepisode of 23.05.2016 at 6 pm of storm, wind, rain happened, which caused damage to the insured property of complainant, it happened during the validity of insurance policy.
(iv) In the entire written statement as well as affidavit of evidence, the OP maintains that the surveyor had assessed the damages of Rs. 1,39,116/- but because of breach of condition of policy, the OP is not liable to pay any amount.
(v) The OP has filed no claim letter dated 26.12.2016 as if there is breach of policy, however, this letter has not been proved as per law as the same is not deposed in the affidavit of evidence, besides it was not never the case of complainant in the written statement.
(vi) The OP has brought on record the policy terms and conditions that mentions special condition at page 4 of the policy, which was breached by the complainant by mentioning the fact in the claim form vis-à-vis it is opposed by the complainant firstly -those warranties were not explained to the complainant, secondly- the documents for executing of policy were got signed blank and thirdly the same were filled by the agent of OP.
Is there breach of condition of policy?. There is no independent proof by the OP as to when (date, month and year) previous claim was lodged by the complainant with the OP or when it was actually dealt by the OP or its result. Moreover, the complainant has rightly pointed out that the OP's surveyor specifically mentions in his report that there is "No breach of warranties was observed by us" [paragraph O (1) at page 6 of the report]. By reconciling these facts and features when there was no previous claim was lodged by the complainant nor any breach of warranty was discovered by the surveyor of OP, therefore, the OP had not to deny the claim. Otherwise, the OP is taking inconsistence stand like in the written statement as well as in the affidavit of evidence that the claim is not within the ambit of policy and letter dated 26.12.2016 of no claim case. It establishes the plea of complainant that he was refused the claim by the OP.
(vii) The OP has brought on record survey and assessment report dated 31.08.2016, it is a detailed report, the report mentions of 15 Annexures/enclosures thereto but none of them has been filed with the surveyor’s report. It would not be out of context to mention here that the OP has even not mentioned the date of report in the written statement or in the affidavit of evidence, such information was withheld and the copy report filed is incomplete as it is not annexed with the 15 enclosures, many of them are regarding repaired estimate, final repair bill, etc.
Generally, the surveyor report is to be accepted as it is, however, the report filed has not been proved nor all the Annexures are filed vis-à-vis the facts emerging from such report can be read against the OP; which proves that there was episode of heavy rain, storm and wind, which has caused damage to the wall of insured property. The insured property is SP 29, F20-24, RIICO Industrial Area, P.O.Tapukhera, Alwar, Rajasthan-301018 which is mentioned in Annexure-A (location-wise detail) to the insurance policy proved by the complainant and the same is also mentioned in insurance particulars of surveyor’s report dated 21.08.2016.
In view of the above, when the complainant had lodged claim of Rs. 7,53,756/- and the OP could not disprove this claim, the surveyor report being incomplete cannot be accepted to restrict the claim to the extent of Rs. 2,50,025/-, therefore, the complainant is held entitled for this valid claim of Rs.7,53,756/-.
7.2. The complainant claims interest at the rate of 18%pa from the date of complaint till realization of amount. But there is no agreed rate of interest vis a visthe complaint was declined valid claim, therefore, the complainant is held entitled for simple interest at the rate of 5% pa from the date of surveyor's report dated 31.06.2016 till payment of claim amount.
7.3 The complainant also claims compensation in lieu of harassment, trauma and agony faced by it besides costs of litigation without quantifying them. Since after exhausting all the remedy with OP including writing protest letter, legal notice but for want of its reply or compliances, then complainant was constrained to file complaint for claimed amount, therefore, the compensation of Rs. 20,000/-,to the situation of this case, is determined and is allowed in favour of complainant and against OP besides cost of Rs. 10,000/-.
8. Accordingly, the complaint is allowed in favour of complainant and against the OP while directing the OP to pay a sum of Rs.7,53,756/- along-with simple interest from 31.08.2016 till realisation of amount, compensation of Rs.20,000/- and costs of Rs.10,000/-payable within 45 days from the date of this order.
In case the OP does not pay the amount within stipulated period, then there will be higher rate of interest of 7%pa. The OP will be at liberty to deposit the amount in the form of valid instrument in the name of complainant in the Registry of this Commission.
9. Announced on this 4th day of December 2024 [अग्रहायण 13, साका1946].Copy of this Order be sent/provided forthwith to the parties free of cost as per rules forcompliances, besides to upload on the website of this Commission.
[RashmiBansal]
Member (Female)
[InderJeet Singh]
President
[ijs148]
