DISTRICT FORUM :: KADAPA
PRESENT: SRI P.V. NAGESWARA RAO, M.A., LL.M., PRESIDENT
SRI S. ABDUL KHADER BASHA, B.Sc., MEMBER
Thursday, the 31st day of July 2008.
C.C. No. 22 /2008.
A. Raghurami Reddy, aged 35 years,
S/o A. Narayana Reddy, Gurijala Village,
Simhadripuram Mandal, Kadapa Dist. .……Petitioner /Complainant.
Vs
United India Insurance Co. Ltd.,
Rep. by its Branch Manager, Branch Office,
situated in 21/72, Dwaraka Towers, Kadapa City. ..….…Respondent.
This complaint coming on this day for orders in the presence of SriP. Raghunatha Reddy, Advocate for complainant and Sri. D.V.S. Prasad, Advocate for Respondent, and upon perusing the material papers on record, the Forum made the following:-
O R D E R
(per Sri. P.V. Nageswara Rao, President)
1. Complaint filed under section 12 of the Consumer Protection Act. 1986.
2. The Complainant was running Vijaya Lakshmi Baby Expeller in Gurijala Village with the loan availed from State Bank of India, Parnapalli Branch and hypothecated the goods stored in it. The Complainant used to purchase Groundnut and Groundnut seeds from the vicinity villages by advancing money to ryots. It was insured for Rs.6,25,000/- for groundnuts, seeds and groundnut oil in the mill for a period from 2-2-2007 to 3-2-2008 under policy No. 050904/11/06/11/00000255. On account of heavy rain and wind around 8:00 PM on 5-6-2007 the Complainant’s groundnut oil mill had a damage and the iron sheets were thrown away to a distance of 100 ft. into the fields of Narigolla Gopal Reddy. At that time the Complainant collected and stored 150 bags of groundnut, 250 bags of groundnut seeds, 800 Kgs of groundnut oil and 30 bags of groundnut cake worth about Rs.8,44,030/-. The Complainant paid NALA to the revenue authorities. The Complainant entered the commodities in the stock register and issued receipts to the concerned farmers. The incident was communicated to the Respondent company who appointed a surveyor to assess the loss. The surveyor observed that on account of heavy wind and rain the entire stocks were drenched in rain water and due to natural calamity the roof of the oil mill was plucked from its fixtures and thrown away into the fields of N. Gopal Reddy. The surveyor observed the damage of 150 bags of groundnut worth about Rs.1,42,500/-, 250 bags of groundnut seeds worth about 6,25,000/- and groundnut oil mixed with water of 800 Kgs worth about 52,000/- and groundnut oil cake of 2100 Kgs worth about Rs.19,500/-totaling Rs.8,39,000/- as damage. As per the stock register the value of the stock was Rs.8,44,030/-. But under policy it was insured for Rs.6,25,000/-. The surveyor assessed the loss at 50 bags of groundnut @ Rs.750/- per each bag i.e. Rs.37,500/-, 160 bags of groundnut seed of 12,800 Kgs @ Rs.25/- per Kg totaling Rs.3,25,000/- and groundnut oil of 600 Kgs @ 62/- per Kg totaling Rs.37,200/-. The Respondent company reduced Rs.75,000/- towards total salvage and liability arrived by reducing less policy excess Rs.10,000/- and the total loss estimated by the surveyor was Rs.2,07,273/-. The Respondent company paid Rs.1,18,675/- on 7-1-2008 without any reason. The Complainant entitled to 120 bags @ Rs. 950/- per each bag of groundnut out of 150 bags valued at Rs.1,14,000/- and 160 bags out of 250 bags of groundnut seeds @ Rs. 2,500/- per each bag valued at Rs.4,00,000/- and 800 Kgs of groundnut oil @ Rs. 65/- per Kg valued at Rs. 52,000/- and 30 bags of groundnut cake @ Rs. 605/- of each bag valued at Rs. 19,500/- totaling Rs.5,85,500/- since the insurance cover was for Rs.6,25,000/- Thus the Complainant filed the complaint for Rs.4,66,825/- towards loss, Rs.25,000/- towards mental agony and costs.
3. The Respondent company filed a counter that the policy was issued in the name of M/s Vijayalakshmi Oil Mills, Proprietor A. Raghurami Reddy. But the complaint was filed by A. Raghurami Reddy, as if the insurance policy was issued in his name. Without impleading the firm the complaint was not maintainable and liable to be dismissed. The Complainant admitted that a loan was availed and goods were hypothecated to State Bank of India, Parnapalli Branch and so the bank was financier and the policy was received from the bank. The stock belonged to the bank. The Complainant was not owner. Therefore the complaint had to be filed by the bank and not by the Complainant. Though the loss was Rs.5,85,000/- as alleged by the Complainant the surveyor assessed the loss as Rs.2,07,273/-. However the Respondent company paid Rs.1,18,675/- to the Complainant. The material facts were suppressed. A surveyor was deputed to assess the loss on the requisition made by the bank vide letter dated 6-6-2007. The surveyor submitted the report dated 20-9-2007. The surveyor on the basis of the stock register submitted by the Complainant filed an addendum report dated 10-11-2007. On that basis the claim was settled and sent the amount by way of cheque. It was towards full and final settlement to the Complainant towards the claim. To that effect a voucher was signed without objection. The Complainant was aware of addendum report dated 10-11-2007 of the surveyor but suppressed the same. As per practice the Respondent would send the discharge voucher to the financier for their acceptance after the approval of the claim. If there was any objection it would be brought to the Respondent company before discharge of the voucher. If voucher was discharged it would be treated that the insured had agreed for the approval of the claim. On the basis of the voucher payment would be made.
4. The Respondent sent the discharge voucher for Rs.1,18,675/- towards full and final settlement of the claim and same was signed by the Complainant on revenue stamp and signed by financier bank and returned to the Respondent company. No objections were raised by the financier or the Complainant. The Respondent released the cheque for Rs.1,18,675/- after deducting Rs.4,217/- towards reinstatement premium. On receipt of the discharge voucher signed by the Complainant, It was not mentioned that the cheque was received under protest. The bank issued a letter to the Respondent intimating the damaged stock was worth about Rs.3,00,000/- but the Complainant claimed Rs.5,85,000/-. In case there was any grievance the Complainant had to approach Civil Court of Law. The Forum had no jurisdiction because the Complainant was doing business. There was no deficiency of service on the part of the Respondent. Thus the complaint may be dismissed with costs.
5. On the basis of above pleading the points for consideration are:
(i) Whether there is any deficiency of service on the part of the
Respondent?
(ii) Whether the Complainant is entitled to the relief as prayed for?
(iii) To what relief?
6. On behalf of the petitioner Ex.A-1 to A-5 were marked and on behalf of the Respondent Ex.B-1 to B-7 were marked.
7. Point No.1 & 2: The Complainant was running Vijayalakshmi Baby Expeller (M/s Vijayalakshmi Oil Mill) at Gurijala Village, Simhadripuram Mandal, Kadapa District. After availing a loan from State Bank of India, Parnapalli Branch and hypothecated his stock to the bank. The oil mill was represented by its proprietor A. Raghurami Reddy. The Complainant insured the oil mill with its stock like groundnuts, groundnut seeds and groundnut oil for Rs.6,25,000/- with a total premium of Rs.1,614/- for the period from 2-2-2007 to 1-2-2008 under policy No. 050904/11/06/11/00000255 under standard fire and special perils policy. The X/c of the policy was Ex.A-3. The Complainant used to purchase groundnut seeds and groundnuts while advancing money to the respectable farmers within vicinity of the oil mill in various villages.
8. On 5-6-2007 around 8:00 PM on account of heavy rain and wind the groundnut oil mill of the Complainant was badly damaged. The iron sheets of the mill were thrown away to a distance of 100 ft. into the fields of one Narigolla Gopal Reddy. At the time of the occurrence 150 bags of groundnut, 250 bags of groundnut seeds, 800 Kgs of groundnut oil and 30 bags of groundnut cake worth about Rs. 844030/- was in the mill. The incident was informed to the Respondent company by way of letter dated 8-6-2007 that 120 bags out of 150 bags of groundnut @ Rs. 950/- per bag valued at Rs.1,14,000/- and 160 bags out of 250 bags of groundnut seeds @ Rs.2,500/- per each bag valued at Rs.4,00,000/- and 800 Kgs of groundnut oil @ Rs. 65/- per Kg valued at Rs. 52,000/- and 30 bags of groundnut cake @ Rs. 605/- per each bag valued at Rs. 19,500/- totaling Rs.5,85,500/- worth of stock was damaged. But the insurance cover was for Rs.6,25,000/-. The X/c of the letter sent by the Complainant to the Respondent was Ex.A-1. Subsequently the Complainant sent fire insurance claim form to the Respondent company for Rs.5,85,500/-. The X/c of claim form was Ex.A-2, dt. 12-10-2007 signed by both the complainant and financier.
9. On the report of the Complainant the Respondent appointed a surveyor who filed a report dated 20-9-2007 and observed the damages as Rs.8,39,000/- i.e. 150 bags of groundnut worth about Rs.1,42,500/- and 250 bags of groundnut seeds worth about Rs.6,25,000/- and 2100 Kgs of groundnut oil cake worth about Rs.19,500/- and 800 Kgs of groundnut oil mixed with water worth about Rs.52,000/- totaling Rs.8,39,000/- and also observed the stock as per the stock register worth about Rs. 8,44,030/-. The X/c of the surveyor report was Ex.A-4. The surveyor assessed the net liability of the insurer as Rs.1,22,892/-. The X/c of the second report of the surveyor was Ex.B-3, dt. 10-11-2007. The reasons for second report was that the insured did not submit the details of the stock registers for items damaged. Even though stock was verified and noted in Ex. A4, the surveyor filed the Ex. B3 with less assessment as second thought. When the surveyor visited the company for assessing the damage he would have observed and verified the stock register before coming to the conclusion and filed his report. He observed the damaged stock was drenched in rain water and came to the conclusion that the loss was Rs.8,39,000/-. In Ex. A4 it was noted that the stock register was verified and hence disclosed the value of the stock as Rs. 8,44,030/-. Copy of the stock register for February 2007 was Ex.B-4. The Respondent contended that in the month of February the days were only 28 but the stock register was 31 days. On perusal of the stock register the stock for the days 29, 30 and 31 shown under February 2007 was marked with “X” mark. Therefore the stock was considered for 28 days only. Ex.B-5 was the X/c of stock register for the month of June 2007. Ex.B-6 was X/c of the claim details report assessing the claim as Rs.1,22,800/-. Ex.B-7 was the X/c of settlement intimation voucher for Rs.1,18,675/- signed by the Complainant towards full and final discharge. The Respondent filed Ex.B-1 a copy of the policy with conditions and Ex.B-2 was the X/c of the letter from State Bank of India, Parnapalli Branch to the Respondent that Rs.3,00,000/- worth of stock was damaged on account of rain and winds on the night of 5-6-2007 and requesting to depute the surveyor. The Complainant filed X/c of the cheque for Rs.1,18,675/- dated 7-1-2008.
10. The major contentions raised by the Respondent was the Complainant received Rs.1,18,675/- towards full and final settlement and therefore he was not entitled for any relief and stock was hypothecated to the bank and bank was financier and the Complainant had no right to file the complaint. The State Bank of India, Parnapalli Branch in its letter under Ex.B-2 did not mention the installments due towards loan from the Complainant and even the surveyor in its report under Ex.B-3 as well as Ex.A-4 did not mention the outstanding dues from the Complainant to the bank. The financier was not a necessary party. In case of any outstanding dues from the Complainant the Respondent Company would repay installments and other outstanding dues to the bank and pay the balance amount if any to the Complainant. Receiving the amount of Rs.1,18,675/- by way of a cheque under Ex.A-5 and in view of settlement intimation voucher under Ex.B-7 it could not be treated as full and final discharge. The full and final discharge mentioned in Ex.B-7 would amount to coercive bargaining. It could be accepted or rejected by the Complainant. The Complainant had a claim for more than Rs.1,18,675/-. He received the said amount as part amount and claimed for the balance of Rs.4,66,825/-. Under Ex.A-4, the surveyor assessed the loss as Rs.3,94,700/-. The Respondent company already paid Rs.1,18,675/-. The first surveyor report had to be considered when there were two surveyor reports. hence, the first report under Ex. A4 has been considered. Thus the complainant is entitled to Rs. 2,76,025/- without interest and Rs. 10,000/- towards mental agony and Rs. 2,000/- towards costs.
11. Point No.3: In the result, the complaint is allowed directing the Respondent to pay Rs.2,76,025/- (Two lakhs Seventy Six thousand and Twenty Five only) without interest and Rs.10,000/- towards mental agony and Rs.2,000/- towards costs of the complaint to the Complainant payable within 60 days from the date of receipt of this order through State Bank of India, Parnapalli Branch after deducting the bank installments if any due. Rest of the claim is dismissed.
Dictated to the Stenographer, transcribed by him, corrected and pronounced by us in the open Forum, this the 31st July 2008.
MEMBER PRESIDENT
APPENDIX OF EVIDENCE
Witnesses examined
For Complainant : Nil For Respondent : Nil
Exhibits marked for Complainant:
Ex.A-1 X/c of the letter sent to the Respondent from the Complainant
dated 8-6-2007.
Ex.A-2 Fire Insurance Claim Forum issued by the Respondent company
Ex.A-3 X/c of the policy
Ex.A-4 X/c of the surveyor report, dt. 20-9-2007
Ex.A-5 X/c of the cheque bearing No. 821834 for Rs.1,18,675/-
Exhibits marked for Respondent:
Ex.B-1 X/c of the policy with conditions
Ex.B-2 X/c of the letter from State Bank of India, Parnapalli Branch to the
Respondent
Ex.B-3 X/c of the surveyor report, dt. 10-11-2007
Ex.B-4 X/c of the stock register for February 2007 in the name of
Complainant’s company.
Ex.B-5 X/c of stock register for the month of June 2007.
Ex.B-6 X/c of the claim details report assessing the claim as
Rs.122800/-.
Ex.B-7 X/c of settlement intimation voucher for Rs.118675/- signed by
the Complainant towards full and final discharge
MEMBER PRESIDENT
Copy to : 1) Sri.P. Raghunatha Reddy, Advocate, Kadapa
2) Sri.D.V.S. Prasad, Advocatep, Kadapa
1) Copy was made ready on :
2) Copy was dispatched on :
3) Copy was delivered to parties :
V.R.V. - - -
