Haryana

Karnal

CC/720/2021

Tandon Industrial Enterprises - Complainant(s)

Versus

SBI General Insurance Company Limited - Opp.Party(s)

V.K. Kapoor

26 Sep 2023

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KARNAL.

                                                      Complaint No. 720 of 2021

                                                      Date of instt. 27.12.2021

                                                      Date of Decision:26.09.2023

 

Tandon Industrial Enterprises situated at Pal Nagar, Kachhwa Road, Karnal, through its proprietor Shri Deepak Tandon son of Shri Des Raj. 

                                               …….Complainant.

                                              Versus

 

 

1. SBI General Insurance Company Limited, SCO NO.388-389, Karan Commercial Complex, Ist Floor, Near Guru Hari Kishan Public School, Sector-13, Karnal, through its Manager.

 

2. State Bank of India, Branch (11979) SME Industrial Area, SCO No.18, Near PNB, Sector-3, HSIDC, Karnal.

 

…..Opposite Parties.

       

Complaint Under Section 35 of Consumer Protection Act, 2019.

 

Before   Shri Jaswant Singh……President.

              Shri Vineet Kaushik…….Member

              Dr. Rekha Chaudhary……Member

          

Argued by: Shri V.K.Kapoor, counsel for complainant

                   Shri R.K.Chauhan, counsel for OP No.1.

                   Shri R.K.Mehta, counsel for OP No.2.

 

                    (Jaswant Singh, President)

 

ORDER:                     

     

                 The complainant has filed the present complaint Under Section 35 of Consumer Protection Act, 2019 against the opposite parties (hereinafter referred to as ‘OPs’) on the averments that complainant is running a firm in the name and style of M/s Tandon Industrial Enterprises, situated at Pal Nagar, Kachhwa Road, Karnal. The complainant is proprietor of said firm and the said firm deals in manufacturing of wooden pallets, boxes, processing of wood etc and its stock. The entire wood stock of complainant firm got insured vide policy No.0000000011417423 w.e.f. 18.01.2019 to 17.01.2020 issued by OP No.1 for a sum insured of Rs.70,00,000/- and complainant paid Rs.16,520/- as premium which was debited from the account of complainant by OP No.2 and paid the same to OP No.1. Complainant is having a CC limit of Rs.60,00,000/- with the OP no.2 vide A/c No.65244723235 and OP No.2 got insured the entire stock of wood of complainant firm through OP No.1 being corporate agent and amount of premium got deducted from the account of complainant regularly. The officials of OP No.2 assured the complainant firm to secure the loan amount/CC limit got insured the same in this regard they will directly deduct the premium amount from the account of the complainant firm. All the documents are in the possession of OP No.2 and they are well aware of the address of working unit at Pal Nagar, Kachhwa Road, Karnal, as well as correspondence address is at Timber Market, Sadar Bazar, Karnal, since the day when the unit started. On 13.06.2019, at about 04:00 PM fire took place at the working unit of the complainant and on receiving the intimation the complainant immediately rushed to the spot and also given the intimation to the Fire Brigade and Local Police. On seeing the severity of fire a few more fire brigade were called to control the same since the entire wooden stock was lying there, fire entered everywhere and same converted into ashes. On receiving the intimation, OP No.1 deputed surveyor Mehta and Padamsey (Insurance Surveyor and Loss Assessor Pvt. Ltd.) Mr.Rajiv Gupta, Surveyor duly visited the spot and all the relevant documents demanded by the surveyor duly supplied by the complainant. The actual loss of complainant firm is more than Rs.87,00,000/- since the sum insured was Rs.70,00,000/- and the surveyor had wrongly assessed the claim of Rs.65,83,175/- whereas duly proved that the entire stock of wooden got burnt in the fire. The complainant approached the OPs several times to settle his claim but the OPs postponing the matter on one ground. The complainant received a repudiation letter dated 02.01.2020 from the OP No.1 and got shocked that the OP No.1 wrongly repudiated the claim on the grounds of effective location and effective occupancy as same are not covered under the insurance policy.  The stock of the complainant firm got insured through insurance policy by the OP No.2 from the OP No.1. There is negligence regarding the location and occupancy of the complainant firm on the part of official of the OPs and to verify the same the complainant approached the OP No.2 to verify the working unit address in the proposal form but the OP No.1 refused to show the same to the complainant then the complainant has left no other remedy to get the same through RTI. The complainant was shocked to see the proposal form in which neither the address of working unit of complainant firm was mentioned nor the proposal form was got signed by the complainant. Complainant was very much surprised, shocked and perturbed to seek the negligence on the part of OPs. The complainant also came to know that the OP No.2 even did not get insured his entire stock in the tenure of 2018-19, which duly proves sheer negligence on the part of OPs. Complainant has moved a representation to Grievances Redressal Officer of SBI General Insurance Co. Ltd. as well as to the OPs but till date no reply has been received by the complainant. In this way there is deficiency in service and unfair trade practice on the part of the OPs for which the complainant suffered huge financial loss, mental pain and agony. Hence complainant filed the present complaint seeking direction to the OPs to pay Rs.70,00,000/- alongwith interest @ 18% per annum from the date of repudiation of  claim till its realization, to pay Rs.5,00,000/- on account of mental pain, agony and harassment and Rs.1,10,000/- towards litigation expenses.

2.             On notice, OPs appeared and filed their separate written version. OP No.1 in its written version has raised preliminary objections with regard to maintainability; cause of action and concealment of true and material facts, etc. On merits, it is admitted that the stock worth Rs.70 lakh stored in the ware house at the insured’s premise under the policy i.e. Timber Market, Sadar Bazar, Karnal, was insured with OP No.1 whereas the manufacturing unit and stock lying at manufacturing unit of complainant firm in Pal Nagar, Kachhwa Road, Karnal, was never get insured with the OP No.1. The policy was issued by OP No.1 based upon the proposal forms submitted on behalf of complainant firm alongwith the statement of stock submitted by the OP No.2 at the premises disclosed by the complainant firm in the proposal form submitted through OP No.2 and the policy was issued in favour of complainant firm at the address furnished by complainant in the proposal form and if there was any discrepancy or mistake in the policy certificate regarding nature of working and insured premises, it was the duty of the complainant to intimate the OP No.1 immediately for the necessary corrections and amendments, therefore, now at this stage after the occurrence of loss the complainant cannot claim any benefits under this policy for the other premises which is purely a manufacturing unit. The complainant firm lodged the claim showing the loss of Rs.87,00,000/- in the fire incident, whereas the surveyor assessed the loss of Rs.62,54,010/- at the uninsured location i.e. manufacturing unit of complainant firm.  There is no deficiency in service and unfair trade practice on the part of the OP. The other allegations made in the complaint have been denied by the OP and prayed for dismissal of the complaint.

3.             OP No.2 in its written version has raised preliminary objections with regard to cause of action, etc. On merits, it is submitted that the dispute if any is within the complainant and the OP No.1 i.e. insured and the insurer, so the complainant dragged the OP No.2 in an unwanted litigation knowingly and intentionally to lower down the well established reputation of the OP No.2. It is submitted that OP has performed his duty as banker of complainant as on the instructions of the complainant the OP No.2 debited his account only to the tune of Rs.16,520/- and paid to the OP No.1. The proposal form dated 18.1.2019 was received duly signed and stamped by OP No.1 and OP No.2 being a banker of the complainant paid the insurance premium by debiting the account of complainant to the OP No.1 on the instructions of the complainant. The OP No.2 requires the insurance policy of stock as the complainant has been availing Cash Credit Hypothecation Limit from the OP No.2 with the purpose to safe the interest of bank. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

4.             Parties then led their respective evidence.

5.             Learned counsel for the complainant has tendered into evidence his affidavit  Ex.CW1/A, copy of insurance policy Ex.C1, copy of account statement Ex.C2 and Ex.C3, copy of repudiation letter Ex.C4, copy of acknowledgement Ex.C5, copy of approval of CEC Ex.C6, copy of NSIC and MSME Ex.C7, copy of government purchase and enlistment certificate Ex.C8, copy of form VAT GI Ex.C9, copy of letter dated 15.06.2019 Ex.C10, copy of letter of arrangement Ex.C11, copy of agreement Ex.C12, copy of letter dated 10.06.1998 Ex.C13, copy of letter dated 10.06.1998 Ex.C14, copy of MSME Ex.C15, copy of letter dated 08.04.2021 Ex.C16, copy of proposal form Ex.C17, copy of DDR dated 14.06.2019 Ex.C18, copy of fire brigade report Ex.C19, copy of MC Tax Ex.C20, copy of receipt Ex.C21, copy of MC Tax Ex.C22, copy of tax receipt Ex.C23, copy of certificate MSME Ex.C24, copy of government purchase enlistment certificate Ex.C25, copy of stock detail Ex.C26, copy of ST registration certificate Ex.C27, copy of acknowledgment Ex.C28, copy of letter dated 12.06.2013 Ex.C29, copy of performa of kast Udhyog, copy of account statement Ex.C31, copy of letter dated 14.06.2019 Ex.C32, copy of MC receipt Ex.C33, copy of receipt of tax Ex.C33, copy of list of corporate agent Ex.C34, letter dated 19.7.2019 Ex.C35, copy of letter dated 27.9.2000 Ex.C36, copy of SME advance Ex.C37A to Ex.C37E, letter of intimation Ex.C38, copy of stock report Ex.C39, copy of email Ex.C40 to Ex.C42, copy of letter dated 28.6.2019, copy of letter dated 30.8.2019 Ex.C43, copy of letter dated 28.8.2019 Ex.C44, copy of emails Ex.C45 to Ex.C48, copy of inspection report Ex.C49, copy of book of accounts Ex.C50, copy of revised provisional balance sheet Ex.C51, copy of insurance surveyor report Ex.C52 and closed the evidence on 09.12.2022 by suffering separate statement.

6.             On the other hand, learned counsel for the OP no.1 has tendered into evidence affidavit of Shri Rajiv Gupta, Executive Director of Mehta and Padamsey Insurance Surveyors and Loss Assessors Pvt. Ltd. As Ex.OP1/A, Shri Rohit Ranjan, Legal Manager, SBI General Insurance Co. Ltd. As Ex.OP1/B and Shri Rajiv Gupta Executive Director of Mehta and Padamsey Insurance Surveyors and Loss Assessors Pvt. Ltd. Ex.OP1/C and copy of insurance policy Ex.OP1, copy of surveyor report Ex.OP2, copy of claim form Ex.OP3 and  copy of SPA Ex.OP4 and closed his evidence on 31.05.2023 by suffering separate statement.

7.             Learned counsel for OP No.2 tendered into evidence affidavit of Shri Raman Deep Ghambir Chief Manager, SBI Ex.OP2/A and copy of letter of arrangement Ex.OP1, copy of insurance policy Ex.OP2, copies of letter of arrangement Ex.OP3 to Ex.OP6, copy of sanction letter Ex.OP7, copy of insurance policy Ex.OP8, copy of valuation report Ex.OP9 and Ex.OP10, copy of TIR Ex.OP11, copy of insurance policy Ex.OP12 and copy of TIR Ex.OP13 and closed the evidence on 09.06.2023 by suffering separate statement.

8.             We have heard the learned counsel of the parties and perused the case file carefully and have also gone through the evidence led by the parties.

9.             Learned counsel for complainant, while reiterating the contents of complaint, has vehemently argued that complainant is running a firm in the name and style of M/s Tandon Industrial Enterprises, Karnal. Complainant is having a CC limit of Rs.60,00,000/- with the OP no.2 and OP No.2 got insured the entire stock of wood of firm through OP No.1 for a sum insured of Rs.70,00,000/-. The amount of premium got deducted from the account of complainant regularly. He further argued that on 13.06.2019, at about 04:00 PM fire took place at the working unit of the complainant. Intimation in this regard was given to OP No.1, on receipt of intimation, OP deputed a surveyor Mehta and Padamsey (Insurance Surveyor and Loss Assessor Pvt. Ltd.)  and Mr.Rajiv Gupta, who duly visited the spot and all the relevant documents demanded by the surveyor were duly supplied by the complainant. The actual loss of complainant firm is more than Rs.87,00,000/- since the sum insured was Rs.70,00,000/-. The surveyor was wrongly assessed the claim of Rs.62,54,010/- whereas  the entire stock of wooden got burnt in the fire. He further argued that the OP No.1 wrongly repudiated the claim of complainant on the grounds of effective location and effective occupancy as same are not covered under the insurance policy. He further argued that in the proposal form neither the address of working unit of complainant firm was mentioned nor the proposal form was got signed by the complainant. The surveyor vide mail dated 19.6.2019 advised that the risk location is wrongly mentioned in the policy scheduled as Sadar Bazar, Timber Market, Karnal, instead of Pal Nagar, Kachhwa Road, Karnal. He further argued that in the agreement dated 10.06.1998, the place of factory as Tandon Industrial Enterprises, Pal Nagar, Kachhwa Road, Karnal, has been mentioned. There is deficiency in service on the part of OPs as they did not insured both the unit of the complainant and lastly prayed for allowing the complaint. Learned counsel for the complainant relied upon the case laws titled as Canara Bank Vs. M/s Leatheroid Plastics Pvt. Ltd. in Civil Appeal no.4645 of 2019, decided on 20.05.2020 and M/s Texco Marketing Pvt. Ltd. Versus TATA AIG General Insurance Company Ltd. and others in Civil Appeal no.8249 of 2022, date of decision 09.11.2022 of Hon’ble Supreme Court.

10.           Learned counsel for OP no.1 while reiterating the contents of written version, has vehemently argued that the insured premise under the policy was Timber Market, Sadar Bazar, Karnal, whereas the manufacturing unit and stock lying at manufacturing unit of complainant firm in Pal Nagar, Kachhwa Road, Karnal, was never get insured. The policy was issued by OP No.1 based upon the proposal forms submitted on behalf of complainant firm alongwith the statement of stock submitted by the OP No.2 at the premises disclosed by the complainant firm in the proposal form submitted through OP No.2 and the policy was issued in favour of complainant firm at the address furnished by complainant in the proposal form and if there was any discrepancy or mistake in the policy certificate regarding nature of working and insured premises, it was the duty of the complainant to intimate the OP No.1 immediately for the necessary corrections and amendments, therefore, now at this stage after the occurrence of loss the complainant cannot claim any benefits under this policy for the other premises which is purely a manufacturing unit. He further argued that complainant firm lodged a claim showing the loss of Rs.87,00,000/- in the fire incident, whereas the surveyor assessed the loss of Rs.62,54,010/- at the uninsured location i.e. manufacturing unit of complainant firm and lastly prayed for dismissal of complaint.

11.           Learned counsel for OP no.2 while reiterating the contents of written version, has vehemently argued that the dispute if any is within the complainant and the OP No.1 i.e. insured and the insurer, so the complainant dragged the OP No.2 in an unwanted litigation knowingly and intentionally to lower down the well established repudiation of the OP No.2. He further argued that OP has performed his duty as banker of complainant. The proposal form dated 18.01.2019 was received duly signed and stamped by OP No.1 and OP No.2 being a banker of the complainant paid the insurance premium by debiting the account of complainant to the OP No.1 on the instructions of the complainant. The OP No.2 requires the insurance policy of stock as the complainant has been availing Cash Credit Hypothecation Limit from the OP No.2 with the purpose to safe the interest of bank and prayed for dismissal of complaint.

12.           Admittedly, the complainant had availed a CC limited of Rs.60,00,000/- from the OP No.2 and also purchased an insurance policy for a sum assured of Rs.70,00,000/-. It is also admitted that OP No.1 has appointed a surveyor, who assessed the net loss to the tune of Rs.62,54,010/-.

13.           The claim of the complainant has been repudiated by the OPs, vide repudiation letter Ex.C4 dated 02.01.2020 on the grounds which are reproduced as under:-

“This refers to the intimation of the captioned claim dated 17.06.2019, wherein we have deputed IRDA Licensed surveyor M/s Mehta and Padamsey Insurance Surveyors and Loss Assessors Pvt. Ltd. For the survey and assessment of the claim.

We are now in receipt of survey report wherein it is observed that reported loss has taken place at your “Saw Mill cum Manufacturing Unit” located at “Pal Nagar, Kachhwa Road, Karnal 132001 (Haryana)

While subject policy under which claim has been intimated is covering occupancy of “Godown” and Risk Location at “Timber Market, Sadar Bazar, Karnal, 132001 (Haryana) which was not affected in reported incident. Thus, in given case both affected location and affected occupancy are not covered under captioned policy and subject claim is falling outside ambit of policy coverage. The extract of the preamble clause of the policy is reproduced herewith for your ready reference:-

“The company hereby agrees, subject to the terms, conditions and exclusions herein contained or endorsed or otherwise expressed hereon, to indemnify the insured to the extent and in the manner specified herein, against any loss/damage to the property insured due to operation of any of the insured perils as hereinafter mentioned during the policy period provided that the liability of the company shall in no case exceed in respect of each item the sum expressed in the Schedule hereto to be insured thereon or in the whole the total sum insured hereby”.

We regret our inability to proceed further with the claim and are treating this as No Claim. We would like to place on records our concern for the loss would look forward to serving you once again in future.” 

 

14.           The complainant has alleged that the principal place of business of the complainant’s firm was/is at Pal Nagar, Kachhwa Road, Karnal and complainant has also availed the CC limit of Rs.60,00,000/- for the said premises and the said premises was got insured by the OP No.2 for the tune of Rs.70,00,000/- with the OP NO.1. The onus to prove his version was relied upon the complainant and to prove his version, the complainant has relied upon the documents Ex.C1 to Ex.C52.

15.           From the documents i.e. Acknowledgment issued by General Manager, District Industries Centre, Karnal, dated 01.01.1997 Ex.C5, copy of approval of CEC dated 30.10.2002, Ex.C6, copy of NSIC and MSME dated 20.07.2012 Ex.C7, copy of government purchase and establishment certificate dated 08.07.2013, Ex.C8, copy of VAT form GI dated 01.04.2003 Ex.C9 and copy of performa Ex.C30, it is proved that the manufacturing unit of the complainant’s firm namely Tandon Industrial Enterprises is situated at Village Pundrak, Kachhwa Road, Karnal, since 1997.  The address of the complainant firm has been mentioned as Tandon Industry Enterprises, Pal Nagar, Kachhwa Road, Karnal and all type of stocks of wood, packing cases/cartridges/furniture, etc. etc. were hypothecated by the State Bank of Patiala now merged in State Bank of India. In this regard, agreement for hypothecation and guarantee Ex.C12 was executed between the parties, on the same day, i.e. on 10.06.1998 and in the said agreement, the address of factory has also been mentioned as Pal Nagar, Kachhwa Road, Karnal. The address of the complainant’s firm has also proved from the copy of No Lien Letter dated 10.06.1998 Ex.C13, from the receipt dated 10.06.1998 Ex.C14, copy of MSME Ex.C15. In the government purchase enlistment certificate dated 23.02.2016, Ex.C25, the address of the complainant firm is of Village Pundrak, Kachhwa Road, Karnal and correspondence address is mentioned as M/s Tandon Industrial Enterprises, Timber Market, Sadar Bazar, Karnal.  Copy of stock detail dated 28.02.2016, Ex.C26 and copy of registration certificate Ex.C27 dated 25.10.2017, copy of acknowledgement Ex.C28 dated 05.06.2013 and letter dated 12.06.2013, issued by State Bank of Patiala, have also proved the address of the complainant firm as Village Pundrak, Kachhwa Road, Karnal. 

16.           It has also proved from the copy of letter of arrangement dated 10.06.1998 Ex.C11, that the complainant firm had availed Cash Credit Limit of Rs.3,00,000/-. The said CC limit has been enhanced from time to time upto Rs.60,00,000/- till the time of incident.

17.           The OP No.1 has alleged that on receipt of proposal form, they had insured the Tandon Industrial Enterprises from 18.01.2019 to 17.01.2020 situated at Timber Market, Sadar Bazar, Karnal. The OP No.2 has alleged that the complainant himself got insured the hypothecated assets from the OP No.1 and OP No.2 had only remitted the premium in account of the complainant’s firm. The complainant has alleged that OP No.2 itself got insured the CC limit. Neither the OPs supplied the copy of insurance policy nor the proposal form to the complainant, despite several requests made by him. Ultimately, the complainant procured the proposal form Ex.17, under RTI Act 2005.

18.           In the said proposal form Ex.C17, the name of intermediary person is mentioned as Mr. Suresh Gandhi, on behalf of bank i.e. OP No.2. It is very surprising that in column No.6 of the said proposal form “the location of risk” is left blank. It is also more surprisingly that the said proposal form has been duly received by the OP No.1 and appended its stamp on it. Both the OPs had insured the CC limit in a very casual way and on the basis of incomplete proposal form. Further, in the column No.14, the insured property has been shown as Industrial/manufacturing risk and in column No.22, stock to the tune of Rs.70,00,000/- has also got been insured by the OPs. From the said proposal form, it has been proved that the OPs had got insured the industry/manufacturing unit of the complainant. OP no.1 alleged that policy was issued, based upon the proposal form submitted on behalf of complainant’s firm alongwith the statement of stock submitted by the OP no.2 at the premises disclosed by the complainant in the proposal form. In this regard, as discussed above, when in the proposal form column of the location of risk is left blank then how OP no.1 can allege that policy was issued as per the location of risk shown in the proposal form. Hence, the plea taken by the OP has no force.

19.           On receipt of intimation of incident, the OP No.1 has appointed a surveyor namely Shri Rajiv Gupta, Executive Director of Mehta and Padamsey, Insurance Surveyors and Loss Assessors Pvt. Ltd, and on his demand, the complainant had provided account statement of account of CC Limit of Rs.60,00,000/- Ex.C2 from 01.01.2019 to 30.03.2019, account statement Ex.C3 from 01.01.2019 to 18.02.2019 and account statement Ex.C31 from 01.04.2019 to 04.04.2019. In the above said account statements issued by OP No.2, the address of the complainant firm is mentioned as Tandon Industrial Enterprises, Pal Nagar, Kachhwa Road, Karnal.

20.           OP No.2, has issued a certificate dated 14.06.2019 on its letterhead, which is reproduced as under:-

                        Ref. No.                             Dated 14.06.2019

                        To whom it may concern

 

This is to inform that M/s Tandon Industrial Enterprises, GST No.06ABRPT8270F1Z3 and address in GST portal as principal place of business is Kachwa Road, Karnal, Haryana, 132001 and address in our CBS account No.65244723235  is Pal Nagar, Kachwa Road, Karnal, Haryana, 132001. This is for your record please

 

        Sd/-                                          Sd/-

Branch Manager                         Relationship Manager

                       

21.           The said letter has been issued on 14.06.2019 i.e. on the very next date of the incident. In the said letter it has been clearly mentioned by the bank that the principal place of business of the Tandon Industry is Kachwa Road, Karnal and in the CBS account also the address Pal Nagar, Kachhwa Road, Karnal, is mentioned in the record of OP No.2.

22.           The OP No.2 has also relied upon the letter of arrangement dated 24.02.2010 Ex.OP1, at that time the CC limit of the complainant firm was Rs.10,00,000/- and in the said letter of arrangement, the hypothecation/pledge of stock of  Woods, timber goods lying at Godown Sadar Bazar, Karnal and Saw Mill at Pal Nagar, Kachwa Road, Karnal. Meaning thereby, OP No.2 had hypothecated stocks lying at both the places and not only Sadar Bazar, Karnal, as now alleged by the OP No.2.

23.           The OP No.2 has placed on record letter of arrangement Ex.OP3 dated 18.09.2012, Ex.OP4 dated 16.09.2014, whereby the CC limit has been increased to Rs.40,00,000/- and vide letter of arrangement dated 07.11.2015 Ex.OP5 and letter of arrangement dated 07.03.2017 Ex.OP6, the CC limit has been increased to Rs.60,00,000/-. In all the said letters, only correspondence address has been mentioned and principal place of business has not been mentioned. OP No.2 has also relied upon the valuation report Ex.OP9 dated 21.12.2018 of the property owned by Smt.Pooja Tandon and valuation report Ex.OP10 dated 21.12.2018, of the property owned by Shri Deepak Tandon and legal report dated 11.01.2019 Ex.OP11. In the abovesaid reports except the value of the immovable property, no other assets/stock have been taken into consideration. Hence, it appears that aforesaid letters of arrangement, valuation reports and legal report were prepared only for the purpose of enhancement of CC limit and for security purpose. 

24.           It is not possible that the complainant had not got insured his manufacturing unit which was in existence since 1997 and stock lying there and only got insured the immovable property which was pledged only for the enhancement of CC limit. 

25.           It is evident from the emails Ex.C40 to Ex.C42 that there is a correspondence between the complainant’s firm and OPs relating to the address of the risk location mentioned as Sadar Bazar, Timber Market, Karnal, whereas the loss has been occurred at Pal Nagar, Kachhwa Road, Karnal. In the email dated Ex.C42 dated 28.06.2019, Suresh Gandhi (on behalf of OP No.2), who had got insured the CC limit with the OP No.1 has specifically mentioned that “principal place of business of Tandon Industrial Enterprises is Pal Nagar, Kachhwa Road, Karnal and the correspondence address of the firm is Sadar Bazar, Timber Market, Karnal”.   

26.           The surveyor of the OP No.1 has submitted his report Ex.C52. The said survey report has been prepared on the basis of stock statement to the banker’s for the period from April 2018 to May 2019, after verifying the sale value with the insured’s books of accounts and assessed the net loss to the tune of Rs.62,54,010/-, after applying the deductions. Incident took place on 13.06.2019. The OPs have appointed the abovesaid surveyor on 17.06.2019 and final report has been submitted by the surveyor on 13.12.2019, after verifying the all documents including insurance policy. The investigation was carried out by the said surveyor near about six months. If the principal place of business was not insured under the insurance policy, as to why the OP had appointed the surveyor and the surveyor had processing the claim of the complainant and submitting his report.

27.           It has been proved from the above documents that the principal place of business of the complainant’s firm is at Kachhwa Road, Karnal and OP No.1 had issued insurance policy of the wrong place i.e. Sadar Bazar, Timber Market, Karnal in a very casual way, only on the basis of proposal form in which the column of principal place of business was left blank by the OP No.2. Hence, the complainant cannot suffer due to the wrong act committed by both the OPs. Thus, both the OPs are liable for that.   

28.           The complainant had availed the CC limit from the OP No.2 and it was the obligation of the OP No.2 to cover the entire unit under CC limit. In this regard, we rely upon case titled as Canara Bank Vs. M/s Leatheroid Plastics Pvt. Ltd. (supra), wherein Hon’ble Supreme Court of India has held that Respondent had credit facilities from appellant bank and two documents were executed. One was deed of hypothecation and other was agreement of collateral security for machinery and vehicles. Fire broke out in the respondent premises causing damages to their stocks and machineries. Respondent received insurance claim. Complaint before Commission, however, was founded on loss on account of portion of assets left uncovered in insurance policy. Respondent approached National Commission, with original petition for compensation of Rupees two crores along with certain other reliefs from bank alleging deficiency in service in not obtaining insurance for machineries, accessories, etc. As per deeds it was duty of the respondent to obtain insurance policy. If, however, bank in exercise of their liberty effected insurance, then it became their obligation to cover entire set of hypothecated assets. Commission was right in holding that complainant had suffered loss because of inaction and negligence on part of bank.     

29.           Furthermore, now a days it has become a trend of insurance companies, they issue the policies by giving false assurances and while giving claim amount, they make such type of excuses. It appears that OPs have repudiated the claim of the complainants on the basis of flimsy grounds.  Thus, the repudiation of the claim of complainants is arbitrary and unjustified. In this regard we are relying upon the authority of Hon’ble Punjab and Haryana High Court titled as New India Assurance Company Ltd. Versus Smt. Usha Yadav & others 2008 (3) RCR (Civil) 111, wherein it has held that:-

“It seems that the Insurance Companies are only interested in earning the premiums which are rather too stiff now a days, but are not keen and are found to be evasive to discharge their liability. In large number of cases, the Insurance companies make the effected people to fight for getting their genuine claims. The Insurance Companies in such cases rely upon clauses of the agreements, which a person is generally made to sign on dotted lines at the time of obtaining policy. This is, thus pressed into service to either repudiate the claim or to reject the same. The Insurance Companies normally build their case on such clauses of the policy, but would adopt methods which would not be governed by the strict conditions contained in the policy”.

30.           Keeping in view the ratio of law laid down in the aforesaid judgments, facts and circumstances of the complaint, we are of the considered views that the act of the OPs amount to deficiency in service and unfair trade practice while repudiating the claim of the complainant, which is otherwise proved as genuine one.     

31.           As per the survey report Ex.C52, net liability has been assessed by the surveyor to the tune of Rs.62,54,010/- but the complainant has claimed Rs.70,00,000/-, thus, the complainant is entitled for Rs.62,54,010/- as the report of the surveyor will prevail. In this regard, we are relying upon the authority titled as United India Insurance Co. Vs. Maya, 2008 (2) CPJ 182 (NC), wherein it has been held that a surveyor report should not be dismissed summarily as the surveyor is independent and qualified person under the relevant provision of Insurance Act, 1938.

32.           In view of the above discussion, we allow the present complaint and direct the OPs to pay Rs.62,54,010/- (Rs.sixty two lacs fifty four thousand and ten only) to the complainant alongwith interest @ 9% per annum from the date of repudiation of claim till its realization. We further direct the OPs to pay Rs.50,000/- to the complainant on account of mental agony and harassment suffered by him and Rs.22,000/- for the litigation expenses. The awarded amount shall be paid by both the OPs in equal share. This order shall be complied within 45 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated:26.09.2023                                                                     

                                                                  President,

                                                       District Consumer Disputes

                                                       Redressal Commission, Karnal.

 

(Vineet Kaushik)             (Dr. Rekha Chaudhary)

                     Member                          Member