Sri Debasis Bhattacharya, Member
This is a case over repudiation of Complainant’s insurance claim by the OP Insurance Company.
Brief facts of the complaint case are that the Complainant on 06-02-2010 sent an intimation of peril caused to a motor that it purchased from M/s BHEL. On the basis of such information, one Surveyor inspected the said motor at the factory of the Complainant on 08-03-2010 in presence of officials of the Complainant. Thereafter, the Complainant received an email from the said Surveyor on 16-03-2010 asking for some documents. Meanwhile, the Complainant took up the matter with M/s BHEL to ascertain the extent of damage and repairing cost of the same. The representatives of M/s BHEL inspected the damaged motor from time to time and submitted its estimate for a sum of Rs. 50,56,000/-. Subsequently, the motor was sent to M/s BHEL, Bhopal and after due repairing, the same was sent to the project site of NTPC at Simhadri. It is the further case of the Complainant that the OP vide its email dated 24-08-2011 sought for some additional documents, which the Complainant provided under cover of its letter dated 07-09-2011. Allegedly, the OP Insurance Company despite receiving requisite documents repudiated Complainant’s claim vide its letter dated 02-11-2011. Hence, this case.
OP contested the case by filing W.V. Besides disputing the status of the Complainant as ‘consumer’ under the Consumer Protection Act, 1986, it is asserted by the OP that although the alleged accident took place on 02-02-2010 and the Complainant detected such damage on 06-02-2010, when it reached Complainant’s factory, the Complainant intimated the matter to the OP only on 06-03-2010, i.e., long after one month although in terms of the insurance policy, it was incumbent upon the Complainant to give immediate intimation to the OP. It is the further allegation of the OP that the Surveyor, deployed by it, repeatedly asked the Complainant to arrange for joint inspection with BHEL officials, but the Complainant paid no heed to such requests. Another allegation raised from the side of the OP is that although the weight of the consignment was 37 M.T., from the registration details extracted from the records of the RTO in respect of the vehicle concerned, it appeared that carrying capacity of the vehicle was 27 M.T. Terming it as a severe breach of policy conditions, it is contended by the OP that the carrying vehicle was not fit for carrying such a mammoth transformer. Finally, it is contended by the OP that as stipulated in the policy document, tarpaulin was not used while carrying the transformer from Bhopal to West Bengal. For all these reasons, according to the OP, it was fully justified in repudiating Complainant’s claim.
Points for consideration
- Whether the Complainant is a consumer?
- Whether there is any deficiency in service on the part of the OP, as alleged?
- Whether the Complainant is entitled to any relief, as prayed for?
Decision with reasons
Point No. 1:
Whether insurance related disputes involving an industrial house come under the purview of the Consumer Protection Act, 1986, or not, the die in this regard is cast by the Hon’ble National Commission in the matter of M/s Harsolia Motors vs M/S. National Insurance Co. Ltd., reported in [I (2005) CPJ 26 (NC)]. Relevant portion of the observation of Hon’ble Apex Commission is appended below which is self-explanatory.
“If the goods are purchased for resale or for commercial purpose then such consumer would be excluded from the coverage of Consumer Protection Act, 1986. Such illustration could be that a manufacturer who is producing one product A' , for such production he may be required to purchase articles, which may be raw-material, then purchase of such articles would be for commercial purpose. As against this, the same manufacturer if he purchases a refrigerator, a television or an air-conditioner for his use at his residence or even in his office, it cannot be held to be for commercial purpose and for this purpose he is entitled to approach the consumer forum under the Act.
Similarly, a hospital which hires the services of a medical practitioner, it would be a commercial purpose. But, if a person avails of such services for his ailment it would be held to be not a commercial purpose.
Further, from the aforesaid discussion, it is apparent that even taking wide meaning of the words for any commercial purpose it would mean that goods purchased or services hired should be used in any activity directly intended to generate profit. Profit is the main aim of commercial purpose. But, in a case where goods purchased or services hired in an activity which is not directly intended to generate profit, it would not be commercial purpose.
In this view of the matter, a person who takes insurance policy to cover the envisaged risk does not take the policy for commercial purpose. Policy is only for indemnification and actual loss. It is not intended to generate profit”.
This point is, thus, decided in favour of the Complainant.
Point Nos. 2&3:
Both these points are taken up together for the purpose of brevity of discussion.
We find, there remains an ambiguity as to the actual date when the Complainant gained knowledge about such peril and also when due intimation to this effect was given to the OP.
In the petition of complaint, it is stated that when the motor reached the factory of the Complainant at Panihati on 06-02-2010, the damage to the said motor was detected. However, in his affidavit-of-evidence, as also replying to the question put forth by the OP, Mr. Partha Banerjee, Dy. General Manager – Accounts of the Complainant company stated that the motor reached the factory of the Complainant on 06-03-2010. In fact, with a view to strengthen its case that it gained knowledge about the peril on 06-03-2010, Complainant has placed on record photocopy of a statement of even date from the concerned driver, who carried the transformer.
On the other hand, on going through the survey report, it appears that the Surveyor stated in his report that, “as advised on 06/02/2010 by M/s Tata AIG General Insurance Company Limited… the undersigned visited on 08/03/2010 at the consignee’s place…”. Again, the said Surveyor has stated in his report under Sl. No. (12 a) and (22) that on 06/03/2010, the goods reached the consignee’s place. Moreover, it appears from the survey report that the Surveyor concerned quizzed the concerned driver with a view to ascertain the sequence of events that led to overturning of the motor in question. Noticeably, the Surveyor has not disputed the eligibility of the Complainant to get the claim settled on account of delayed intimation to the OP Insurance Company.
Frankly speaking, in absence of copy of the purported email, whereby intimation of peril was conveyed to the OP by the Complainant, we are unable to figure out the actual date of knowledge about such peril by the Complainant vis-à-vis date of intimation to the OP by the Complainant.
At the same time, it is important to bear in mind that in theft related cases, time is the essence to ascertain the genuineness/extent of loss. Likewise, in case of flood related damages, prompt intimation to the Insurer is extremely vital to enable the Insurance Company rush Surveyor to ascertain the extent of loss. However, in case of peril of present nature, certain delay in giving intimation to the Insurance Company, it appears, does not pose any serious impediment to ascertain the genuineness or extent of peril. To our mind, therefore, even if for the sake of argument, it is assumed that there was indeed some delay in giving intimation to the OP, that cannot be a raison d'être to repudiate a claim as long as it is otherwise admissible.
Coming to the allegation of the Surveyor of being denied due opportunity to inspect the damaged motor along with BHEL officials, it is argued by the Complainant that no such request was ever made by the concerned Surveyor. Further, the Complainant also questioned the competency of the concerned Surveyor to conduct such survey drawing our attention to the fact that the Surveyor was an Electronics & Telecommunication Engineer, implying that he had no expertise in the discipline of mechanical engineering.
It is always desirable that Surveyor with due expertise is only deployed to do justice to the odd work of assessing loss. In the instant case, as it appears, the Surveyor was a square peg in a round hole. No wonder, therefore, he cut a sorry figure and could not figure out the loss despite inspecting the damaged motor at site. Question remains, why he did not assess the loss on his own and instead remained at the beck and call of experts of M/s BHEL. To our mind, the OP cannot shrug off its responsibility for deputing a wrong person to do the job.
It is stated by the Surveyor that he repeatedly asked the Complainant to arrange for joint inspection of the damaged motor along with officials of M/s BHEL. However, one wonders, why he did not send written reminder(s) when he found that the Complainant did not act upon his direction. In fact, on going through the photocopy of email dated 16-03-2010, sent by the OP to the Complainant, we find that the OP merely sought for certain documents to process Complainant’s claim. Given that the concerned Surveyor visited the factory of the Complainant earlier, it is only natural that had any such request for joint inspection been made by the Surveyor concerned to which the Complainant allegedly did not pay any heed, the OP would have certainly asked the Complainant to follow suit. Let us not forget that mere claim does not prove anything; it is the immaculate proof that holds the key.
Besides, it appears that the Surveyor prepared his report on 03-09-2010, whereas officials of M/s BHEL made their maiden visit to the site only on 22-01-2011. Therefore, to our mind, the Surveyor or for that matter the OP has been bit unfair towards the Complainant in their criticism of the latter. While BHEL officials did not visit the factory premises of the Complainant by the time the Surveyor was busy giving final touches to his report, such question cannot arise. One is fully justified criticizing other’s action as long as there is some substance in such allegation, otherwise not.
As for the allegation of the OP of choosing a wrong vehicle for the purpose of transporting the transformer, it is clarified by the Complainant that the entire matter was handled by M/s BHEL. Moreover, Ld. Advocate appearing for the Complainant also questioned the legitimacy/authenticity of the document relied upon by the OP on the ground that it was not signed by anyone.
On a reference to the photocopy of concerned RC verification report on record purported to have been prepared by Mr. Arihant Jain, Insurance Claim Investigator, it is observed that the same is not signed by anyone. The document concerned being not filed under affidavit by the author of said report and more so, the same being merely an unsigned piece of paper, we are not inclined to form any opinion about the veracity of that document. The objection of the OP in this regard is, thus, not tenable.
Finally, it is argued by the OP that the Complainant breached policy condition by not putting the consignment under tarpaulin cover. We wonder, while damage to the motor, which was kept inside a wooden box, caused due to overturning of the goods during transportation, how come absence of tarpaulin cover could be considered as material breach of policy condition. Minor deviation here and there vis-à-vis policy stipulations cannot be a hindrance as long as the same does not play catalyst to the peril concerned.
If the OP was indeed predetermined to repudiate the claim of the Complainant on the basis of the survey report, it could have done so immediately after receipt of the survey report given that as per the Insurance Regulatory and Development Authority (Protection of Policyholders’ Interests) Regulations, 2002, it is obligatory on the part of the Insurer to either allow or reject a claim within 30 days of receipt of the survey report. There was no point dragging the matter seeking documents from the Complainant. It is a glaring example of misusing of official position by the OP, which is highly condemnable.
It appears that M/s BHEL has charged a sum of Rs. 45,04,240/- towards repairing cost of the motor. It is mentioned in the claim bill of the Complainant that a sum of Rs. 5,51,500/- was required being labour charge. However, no bill is placed on record in this regard. The Complainant also staked claim for reimbursement of a sum of Rs. 5,00,000/- and another sum of Rs. 8,153/- on account of freight charges and insurance premium, respectively. However, the Complainant has not clarified under which clause of the insurance policy, it staked claims on these accounts. Therefore, we are of opinion that the Complainant is entitled to reimbursement of the cost of Rs. 45,04,240/- that the BHEL charged towards repairing cost of the damaged motor after deduction of policy excess for a sum of Rs. 41,310/- (0.5% of Rs. 82,62,000/-). Since the OP has not picked any hole into the said bill of M/s BHEL, in our considered opinion, ends of justice would be met if the OP is directed to reimburse this amount to the Complainant. Besides, considering the gross deficiency in service on the part of the OP, we hold it liable to pay compensation for a sum of Rs. 1,00,000/- to the Complainant.
Both these points are also, thus, decided in favour of the Complainant.
Hence,
O R D E R E D
That CC/18/2012 be and the same is allowed on contest against the OP. The OP shall reimburse, within 40 days hence, the sum of Rs. 44,62,930/- (Rs. 45,04,240/- - Rs. 41,310/-) being the repairing cost of the damaged insured motor. The OP shall also pay a sum of Rs. 1,00,000/- as compensation to the Complainant. In case, the order is not complied with within the aforesaid stipulated period, OP shall be liable to pay interest @ 9% p.a. over the amount of Rs. 44,62,930/- from the date of filing of the present complaint case, i.e., 31-01-2012 till full and final payment is made.
