Order by:
Sh.Mohinder Singh Brar, Member
1. The complainants have filed the instant complaint under section 35 of the Consumer Protection Act, 2019 stating that complainants are running a rice mill under the name and style of M/s Bhagwant Agro Foods, Gaziana. The complainant’s firm took CC limit from Opposite Party No.1 and Opposite Party No.1 had got insured the stock from Opposite Party No.2, vide policy no.000000001624460901 dated 06.01.2021 for amount of Rs.45,00,000/-. Alleged that in the midnight of 26/27.06.2021 a theft of 6750 bags of empty bardana amounting to Rs.2,70,000/- had took place from the rice mills by unknown persons and to this effect FIR No.138 dated 04.08.2021 u/s 457/380 IPC PS Nihal Singh Wala was registered against unknown persons. Alleged that the stock was hypothecated with Opposite Party No.1 and when the complainant filed claim with Opposite Parties, then they rejected the claim of the complainant on the ground that there is no violent entry or exit from the premises. The complainant made oral complaints to the Opposite Parties, but the Opposite Parties had neither taken any step to solve the problem nor done their duty as per promised made by them. Due to such act and conduct of Opposite Parties, the complainant has suffered mental tension and harassment. Hence, this complaint. Vide instant complaint, the complainant has sought the following reliefs:-
a) Opposite Parties may be directed to pass the claim of Rs.2,70,000/- plus interest from 27.06.2021 till realization of amount.
b) To pay Rs.30,000/- as compensation on account of mental torture and agony.
c) To pay Rs.20,000/- on account of deficiency in service.
2. Opposite Party No.1 appeared through counsel and contested the complaint by filing written reply taking preliminary objections therein inter alia that the present complaint is not maintainable against answering Opposite Party. Averred that SBI General’s Business Package Insurance is available only to the account holder of Opposite Party No.1 Bank. This policy is governed by the terms and conditions laid down in the prospectus of the said policy. The said business package policy was issued to the complainant in accordance with IRDA. The premium of the policy in question was paid to Opposite Parties No.2 & 3 through Opposite Party No.1. Answering Opposite Party is only a corporate agent of Opposite Parties No.2 & 3. Thus, sole liability to settle the claim in dispute of complainant is of Opposite Parties No.2 & 3, which are the insurer. Hence, present complaint is not maintainable against answering Opposite Party No.1. Thus, present complaint against op1 is not maintainable. On merits, all other allegations made in the complaint are denied and a prayer for dismissal of the complaint is made.
3. Opposite Parties No.2 & 3 appeared through counsel and contested the complaint by filing written reply taking preliminary objections therein inter alia that there is no contractual relationship between complainant and Opposite Parties No.2 & 3. Hence, the complainant has no locus standi to file this complaint; the complaint is not tenable as there is no deficiency in service or unfair trade practice on the part of Opposite Parties No.2 & 3 invoking the jurisdiction of this Commission. Opposite Parties No.2 & 3 repudiated the claim of the complainant after due perusal of all documents received as per the coverage given in the policy. Opposite Parties No.2 & 3 has not erred in offering services to complainant under the settled business practices of insurance industry and as per coverage given in the insurance policy. As there is no consumer dispute between the party, this complaint is not tenable under the Consumer Protection Act, 2019. The intricate questions of law and facts are involved in the present complaint which require voluminous documents and evidence for determination which is not possible in the summary procedure under C.P. Act and the Civil Court is the appropriate remedy; the complainants have concealed material facts and documents from this Commission as well as answering Opposite Parties, therefore, the complainants are not entitled to any relief. Averred that on receipt of claim, they deputed Rohit Ramesh & Associates, Surveyor and Loss Assessor who conducted the survey and gave report and it was observed that the stock of Bardana was stolen by Miscreant by scaling up the compound wall. There were no marks of forcible entry/exit into the premises noted by surveyor. Further there is inordinate delay of more than 45 days in intimating of claim, which is clear violation of the policy condition. In view of the above, the claim was found tenable under the policy, as such the answering Opposite Party expressed their inability to proceed further with the claim and was treated the same as no claim, hence the claim was repudiated vide letter dated 31.08.2021. Averred further that there is no locus standi or no cause of action in favour of the complainant against answering Opposite Parties; the complainants are not the consumer of the answering Opposite Parties; the complaint is not maintainable in the present form. On merits, all other allegations made in the complaint are denied and a prayer for dismissal of the complaint is made.
4. In order to prove their case, the complainants have placed on record copies of documents Ex.C1 to Ex.C10 and affidavit of Bhagwant Singh s/o Jangir Singh as Ex.C11.
5. On the other hand, Opposite Party No.1 has placed on record affidavit of Sh.Ashwani Kumar, Chief Manager, State Bank of India as Ex.OPs1/1. Whereas, Opposite Parties No.2 & 3 have placed on record copies of documents Ex.OPs 2 & 3/1 to Ex.OPs2 & 3/3, affidavit of Sh.Rohit Ranjan, Manager Legal & Authorized Signatory, SBI General Insurance Company Limited as Ex.OPs 2 & 3/4 and affidavit of Sh.Rohit Gupta, Proprietor of M/s Rohit Ramesh & Associates Surveyors & Loss Assessors as Ex.OPs2 & 3/5.
6. We have heard the ld. counsel for the parties and have also gone through the record.
7. Ld. counsel for the complainant contended that complainants are running a rice mill under the name and style of M/s Bhagwant Agro Foods, Gaziana. The complainants have took CC limit from Opposite Party No.1 and Opposite Party No.1 had got insured the stock from Opposite Party No.2, vide policy no.000000001624460901 dated 06.01.2021 for amount of Rs.45,00,000/-. In the midnight of 26/27.06.2021 a theft of 6750 bags of empty bardana amounting to Rs.2,70,000/- had took place from the rice mills by unknown persons and to this effect FIR No.138 dated 04.08.2021 u/s 457/380 IPC PS Nihal Singh Wala was registered against unknown persons. Contended further that the stock was hypothecated with Opposite Party No.1 and when the complainant filed claim with Opposite Parties, then they rejected the claim of the complainant.
8. On the other hand, ld. counsel for Opposite Party No.1 contended that SBI General’s Business Package Insurance policy was issued to the complainant in accordance with IRDA. The premium of the policy in question was paid to Opposite Parties No.2 & 3 through Opposite Party No.1. Opposite Party No.1 is only a corporate agent of Opposite Parties No.2 & 3. Hence, present complaint is not maintainable against Opposite Party No.1.
9. Ld. counsel for the Opposite Parties No.2 & 3 contended that on receipt of claim, they deputed Rohit Ramesh & Associates, Surveyor and Loss Assessor who conducted the survey and gave report and it was observed that the stock of Bardana was stolen by Miscreant by scaling up the compound wall. There were no marks of forcible entry/exit into the premises noted by surveyor. Further there is inordinate delay of more than 45 days in intimating of claim, which is clear violation of the policy condition.
10. We have considered the rival contentions of ld. counsel for the parties and gone through the record. It is not denied that the complainant firm availed the finance amount for running the firm and took a cash credit facility/CC Limit from Opposite Party No.1 and Opposite Party No.1 got insured the stock from Opposite Parties No.2 & 3 for an amount of Rs.45,00,000/- vide Policy No.000000001624460901 from the period 06-01-2021 to 05-01-2022. But on the other hand, the surveyor who was appointed by Opposite Parties No.2 and 3 has assessed the loss to the tune of Rs. Rs.1,50,053/-, but we failed to understand on which account, the surveyor of the Opposite Parties No.2 and 3 has assessed the loss to such meagre amount and no such reason has been a assigned by the surveyor of the Opposite Parties No.2 and 3 for reducing the claim amount of the complainant. On the other hand, the complainant has vehemently contended that the loss occurred to the complainants due to the burglary/theft of stocks lying in the rice mill of complainants to the tune of Rs.2,70,000/- approximately. We are of the opinion that if there are some flaws in the surveyor’s report, it is not binding upon the insured/insurer. We are further fortified with the judgment of the Hon’ble Supreme Court reported in (2009) CPJ 46 (SC) titled “New India Assurance Company Limited v. Pardeep Kumar” wherein it has been laid down that surveyor’s report is not the last and final word. It is not that sacrosanct that it cannot be departed from; it is not conclusive. The approved surveyor’s report may be basis or foundation for settlement of a claim by the insurer in respect of the loss suffered by the insured but surely such report is neither binding upon the insurer nor insured. Hon’ble State Consumer Disputes Redressal Commission, in First Appeal No.370 of 2019 decided on 19.01.2022 in case titled as Vishav Jindal Versus Lombard General Insurance Company Limited, also held so. The relevant para of the order passed by Hon’ble State Consumer Disputes Redressal Commission, Punjab at Chandigarh is reproduced as under:-
“We are of the opinion that if there are some flaws in the surveyor’s report, it is not binding upon the insured/insurer. We are further fortified with the judgment of the Hon’ble Supreme Court reported in (2009) CPJ 46 (SC) titled “New India Assurance Company Limited v. Pardeep Kumar” wherein it has been laid First Appeal No. 370 of 2019 12 down that surveyor’s report is not the last and final word. It is not that sacrosanct that it cannot be departed from; it is not conclusive. The approved surveyor’s report may be basis or foundation for settlement of a claim by the insurer in respect of the loss suffered by the insured but surely such report is neither binding upon the insurer nor insured’
Furthermore, Hon’ble Supreme Court of India in New India Assurance Company Limited Vs. Luxra Enterprises Private limited (2019) 6 SCC 36 (Paragraph-21) has held that the stock, hypothecated with the Bank, who had first charge on it, was verified by the bank, can not be ignored by the Insurer. In this regard, Hon’ble National Consumer disputes Redressal Commission, New Delhi in Consumer Case no.101 of 2009 titled as Mahalaxmi Dyers & Chemicals Limited Vs. new India Assurance Company Limited, decided on 7th September, 2021 also held so. Hence, keeping in view the aforesaid judgement of Hon’ble Supreme Court as well as Hon’ble National Commission, New Delhi and Hon’ble State Commission, Punjab at Chandigarh (supra), the aforesaid report of the surveyor can not be deemed to be correct.
11. Ld. counsel for the Opposite Parties No.2 & 3 has also taken the plea that as per terms and conditions of the policy, the complainants are not entitled to the claim as claimed. But the Opposite Parties could not produce any evidence to prove that terms and conditions of the policy were ever supplied to the complainant insured, when and through which mode? It has been held by Hon’ble National Commission, New Delhi in case titled as The Oriental Insurance Company Limited Vs. Satpal Singh & Others 2014(2) CLT page 305 that the insured is not bound by the terms and conditions of the insurance policy unless it is proved that policy was supplied to the insured by the insurance company. Onus to prove that terms and conditions of the policy were supplied to the insured lies upon the insurance company. From the perusal of the entire evidence produced on record by the Opposite Party, it is clear that Opposite Party has failed to prove on record that they did supply the terms and conditions of the policy to the complainant insured. As such, these terms and conditions, particularly the exclusion clause of the policy is not binding upon the insured. Reliance in this connection can be had on Modern Insulators Ltd.Vs. Oriental Insurance Company Limited (2000) 2 SCC 734, wherein it is held that “In view of the above settled position of law, we are of the opinion that the view expressed by the National Commission is not correct. 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 can not claim the benefit of the said exclusion clause. Therefore, the finding of the National Commission is untenable in law.”
12. The other plea taken by the Opposite Parties No.2 & 3 is that there is inordinate delay of more than 45 days in intimating of claim, the aforesaid plea taken by the Opposite Parties No.2 & 3 is also not genuine, as in this regard, the IRDA has issued a circular to the Insurance Companies stating that the genuine claims shall not be rejected on hyper technical grounds i.e. delay etc. which for the sake of convenience is reproduced as under:-
“INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY
Ref. IRDA/HLTH/MISC/CIR/216/09/2011 Dated:20.09.2011 CIRCULAR
To All life insurers and non-life insurers.
Re: Delay in claim intimation/documents submission with respect to
i. All life insurance contracts and
ii. All Non-life individual and group insurance contracts.
The Authority has been receiving several complaints that claims are being rejected on the ground of delayed submission of intimation and documents.
The current contractual obligation imposing the condition that the claims shall be intimated to the insurer with prescribed documents within a specified number of days is necessary for insurers for effecting various post claim activities like investigation, loss assessment, provisioning, claim settlement etc. However, this condition should not prevent settlement of genuine claims, particularly when there is delay in intimation or in submission of documents due to unavoidable circumstances.
The insurer’s decision to reject a claim shall be based on sound logic and valid grounds. It may be noted that such limitation clause does not work in isolation and is not absolute. One needs to see the merits and good spirit of the clause, without compromising on bad claims. Rejection of claims on purely technical grounds in a mechanical fashion will result in policyholders losing confidence in the insurance industry, giving rise to excessive litigation.
13. Further it is proved on record that 6750 kg bardana were stolen from the premises of the complainant which is approximately 67 quintal, which cannot taken away by a single person, it is an activity of gang, who climbed the boundary wall of the rice Sheller, which further proves that it is a forcible entry in the premises of the complainant.
14. In view of the above discussion, we are of the view that the Opposite Parties No.2 & 3 wrongly and illegally rejected the genuine claim of the complainant.
15. Sequel to the above discussion, the instant complaint is partly allowed against Opposite Parties no.2 & 3. Hence, Opposite Parties No.2 & 3 are directed to pay Rs. 2,70,000/-(Rupees Two Lakh Seventy Thousand only) to the complainants and direct the Opposite Parties No.2 and 3-Insurance Company to firstly clear the due amount of facility availed by the complainant on the hypothecation of lost stock of Opposite Party No.1-Bank and the remaining amount, if any, be remitted to the complainant out of the awarded amount. Complaint against Opposite Party No.1 stands dismissed. Further Opposite Parties No.2 & 3are directed to pay compository cost of Rs.20,000/- (Rupees Twenty Thousand only) as compensation and litigation expenses to the complainant. The pending application(s), if any also stands disposed of. The compliance of this order be made by the Opposite Parties No.2 & 3within 30 days from the date of receipt of copy of this order, failing which, the Opposite Parties No.2 & 3 are further burdened with additional cost of Rs.20,000/- (Rupees Twenty Thousand only) to be paid to the complainant for non compliance of the order. Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room.
Announced on Open Commission
