Sri Shyamal Gupta, Member

This Appeal is directed against the Order dated 04-01-2011 passed by the Ld. District Forum, Paschim Medinipur in C.C. No. 109/2010 whereof the complaint has been dismissed.  Aggrieved by and dissatisfied with the same, Complainant thereof has preferred this Appeal.

It is the case of the Complainant that a fire broke out in his medicine shop on 05-04-2009.  As a result of said fire incident, entire stock of medicines, furniture & fixtures got gutted. The Complainant intimated such matter to all the concerned authorities, including the Insurance Company and based on such intimation, the Surveyor deputed by the Insurance Company caused due enquiry.  Besides this, the Complainant also engaged registered Surveyor, M/s B.S. Panda & Associates to carry out simultaneous inspection, who estimated the total loss at Rs. 5,13,742/-.  However, as the Insurance Company did not take due initiative to settle his claim, the Complainant filed the complaint.

Case of the OP No. 1, on the other hand, is that during in-depth inspection it was observed that the fire was not so devastating as it was claimed.  Quoting from the survey report, the OP No. 1 stated that despite noting several anomalies in respect of the claim of the Complainant, the Surveyor assessed the loss at Rs. 50,000/- and on the basis of such assessment, it paid a sum of Rs. 49,999/- to the Complainant.

Decision with reasons

At the very outset, it bears mentioning here that the matter was previously decided by this Commission.  However, in view of an erroneous finding of this Commission, the Hon’ble National Commission was pleased to remand back the matter with a direction to adjudicate it afresh without being influenced by the earlier findings of this Commission.

Heard the Ld. Advocates, perused the material on record carefully.

Ld. Advocate appearing on behalf of the Appellant contended that save and except the photocopy of survey report, the Respondent No. 1 has not furnished a single document to substantiate the fact that in the shop room, there was 80% expired medicine.

In order to nullify such findings of the Surveyor, the Appellant furnished photocopy of Statement of Stock as on 09-04-2009, purportedly signed by one Chartered Accountant Firm, namely, B.S.Panda & Associates.  However, most surprisingly, while the Appellant called in question the evidentiary value of the purported survey report over non-examination of the Surveyor concerned, we find, the Appellant himself made no such endeavour to prove the value assessed by the above Chartered Accountant firm by subjected it to cross-examination. 

That apart, we also find that the Appellant has also not furnished corroborative purchase and sale bills to co-relate the details mentioned in the stock statement prepared by the said Chartered Accountant Firm. 

In this regard, it may not be totally out of the place to mention here that the said Chartered Accountant firm did not use its official letter-head while certifying the correctness of the so-called stock statement prepared on a plain piece of paper, but merely put its rubber stamp and signature on the same. 

Further, Ld. Advocate appearing on behalf of the Respondent No. 1, wondering the reason behind keeping the Insurer totally in the dark about engagement of said firm, questioned the hush-hush manner in which the so-called stock statement was prepared.  We afraid, no plausible reason is given by the Appellant as to why the Respondent No. 1 was not taken on board and joint inspection arranged while the Chartered Accountant firm visited the affected shop of the Appellant. 

It is further pointed out by the Ld. Advocate of the Respondent No. 1 that while the Appellant showed 80 nos. items in his Statement of Stock submitted to the Respondent No. 2, as per the audited report of the above Chartered Accountant firm, there were 130 items of medicine when the shop was closed after the fire.  Thus, the Ld. Advocate wondered how the quantum of stock could get increased after the incident of fire.  To this query of the Ld. Advocate of the Appellant has not offered any explanation. 

As regards non-examination of the Surveyor, it is submitted by the Ld. Advocate of the Respondent No. 1 that it did file original copy of the survey report together with CD, photographs etc.  Therefore, in case the Appellant had slightest doubt about the veracity of the said report, he could easily make a prayer before the Ld. District Forum to summon the said Surveyor and examine him.  

Explaining the findings of the Surveyor that 80% of the medicines stored had outlived their shelf life, it is pointed out by the Ld. Advocate of the Respondent No. 1 that from the photos taken by the Surveyor in presence of the Appellant, it was apparent that there was huge stock of expired medicines inside the shop.  When the said Surveyor asked the Appellant to explain the reason for storing such large volume of expired medicines, the Appellant remained silent.  The said Surveyor also wrote a letter in this regard to the Appellant on 07-04-2009, but the latter did not offer any explanation.  The Ld. Advocate also pointed out that from the photographs it would be seen that particular portion of the labels on the medicines where mfd. is printed, was carefully cut out or torn away. In this regard too, the Appellant has not offered any explanation.

There also remains a dispute as to the extent of loss suffered by the Appellant.  In support of his contention that the incident of fire was quite devastating, the Appellant filed certificates issued by BDO, Dantan-II Dev. Block, Paschim Medinipur, Branch Manager, SBI etc. beside the stock statement of the afore-mentioned Chartered Accountant firm. 

On the other hand, Ld. Advocate for the Respondent No. 1, drawing our attention to the survey report, stated that the Surveyor during physical inspection of the spot found that all the paper boxes were not burnt down, wooden shelves bore no sign of burning, even black marks from fume were not found, outside painting of the shutter found to be with normal lock and not at all scorched due to heat in the reported fire incident, the wreckages of the burnt materials were very few which clearly signify that the alleged fire was of low intensity. 

The Ld. Advocate of the Respondent No. 1 also pointed out that there was huge anomalies in respect of the value of stock mentioned by the Appellant himself at different times.  First, the Insured tendered a written declaration to the Surveyor stating that stock worth Rs. 3,00,000/- got burnt.  However, in the stock statement prepared by him, the value of stock was mentioned as Rs. 8,99,988/-.  As against this, the Appellant filed the complaint staking claim for a sum of Rs. 5,13,742/-. Here too, we find that the Appellant has not offered any valid reason for such flip-flops on his part.  

On going through the Survey Report, we notice that the Surveyor pointed out plenty of loopholes in respect of the claim of the Appellant.  To cite a few examples, we quote relevant portions from the survey report which is self-explanatory.

“1.There was only one opening in the shop, i.e., the front shutter gate and at the time of incident it was closed.  Hence, there was no chance of detecting flame of the fire as it was observed to be a low intensity one where wooden racks etc. remained unchanged.  In spite of that in the midnight how a person could (be) able to understand the said situation and inform the insured about fire was not clear. ….”

“2.…..It is rather surprising that with the reported burning of huge quantity of medicines valuing approx. Rs. 9 lacs how the iron shutter was opened so easily as it was expected to be very hot with such burning inside and the same would have been distorted in shape and discoloured with peeling off of paints.  The insured easily opened the shutter and there was no change of outside painting.”

“3. As per the annual accounts provided by the Insured it was observed that the closing stock as on 31^st March 2006 was Rs. 1,80,700/- and as on 31^st March 2007 was Rs. 3,95,750/-.  The rate of increase of closing stock was 119%,  Hence, if we consider the same rate of increase the closing stock as on 31^st March 2008 should be Rs. 8,66,692/- and the same as on 31^st March 2009 should be Rs. 18,98,056/-.  But insured claim his stock was Rs. 8,99,988/- as per records.  In this connection it must be mentioned that the place was a very remote village and per capita income of the said locality was much lower than the developed area of the said district like Belda.  The undersigned conducted a market survey in the locality in Howrah  and the most popular medicine shops are holding maximum stocks of medicine on an average Rs. 7,00,000/- where the size of the shop considering its area is 2 times bigger than the insured’s shop….”

“4. The Insured has submitted un-audited annual accounts along with IT Return copies…. From the above data it can be noted that stock has risen by three times but sales increase is only less than times over the last four years.  GP ratio shown an erratic pattern considering the nature of business.  Further Sales/Stock ratio has come down from 8.8 times in 2005-06 to 4.28 times in 2008-09.  These indicated that the figures as recorded in the annual accounts are not realistic ones”.

It appears from the Survey Report that in the Sale Register for the year 2008-2009, purchase and sale figure was shown as Rs. 17,33,316/- and Rs. 17,32,485/-, respectively.  However, in the Income Tax Return the same was shown as Rs. 21,87,621/- and Rs. 22,42,712/-, respectively.

Another interesting fact being pointed out by the Ld. Advocate of the Respondent No. 1 is that as per the Purchase and Sale Register of the Complainant for the year 2008-09, his monthly average purchase was Rs. 1,44,443/- and Rs. 1,44,373/-, respectively; whereas, during the same period, his average monthly stock was Rs. 8,90,554/-.  No doubt, it is quite abnormal for any small businessman to keep stock eight times higher than average monthly sale. 

On due evaluation of the material on record and submission of the Ld. Advocate of the Appellant we find that the Appellant has not offered any satisfactory explanation to the above-mentioned inconsistencies being pointed out by the Surveyor in his report.  It is the settled position of law that the survey report is a crucial piece of document for the purpose of determination of compensation figure in respect of any insurance claim. Therefore, as long as the claimant does not show/prove any inherent flaw with the said report, findings of the Surveyor cannot be faulted with. 

Given that the Appellant has miserably failed to establish the bona fide of his claim, we have no qualms holding a concurrent view with the Ld. District Forum.

The Appeal, thus, fails.

Hence,

O R D E R E D

that the Appeal stands dismissed on contest being bereft of any merit.  The impugned order stands hereby affirmed.

Let the LCR be sent back to the Ld. District Forum at once along with a copy of this order.