This is a Consumer Case under Section 17 of the C.P Act, 1986. The Complainant Case in brief is that the Complainant Pave Infrastructure Pvt. Ltd represented by its director one Mahavir Agarwal registered the instant Consumer Complaint to the effect that the said Infrastructure company a leading Civil Construction Company in North Bengal who by virtue of a tender and work order procured a contract from NBCC for the construction of a new ITI Campus at Phasidewa with total project cost of Rs. 8,70,96,408/- and as per condition of the contract he was required to take contractors all risks of insurance policy from any Insurance Company in the joint name with NBCC with third-party liability and for that reason invited quotations from the Insurance Companies. The Branch Manager of Bajaj Allianz General Insurance Co. of Siliguri (O.P No. 2) issued a quotation in favour of the Complainant for Rs. 75,330/- as premium on 30.01.2016 and the said premium amount has been duly accepted by the Complainant and paid the said amount by an accompanied cheque drawn on HDFC Bank Siliguri and O.P No. 2 then issued the Insurance Policy in the head of “Constructors all risks with third party liability” for a period from 15.02.2016 to 14.02.2017 and before issuing the said policy the officials of the Bajaj Allianz Insurance Co. has visited the project site and inspected everything.
And from 21.07.2016 to 24.07.2016 there was torrential and intermittent rain for hours in Siliguri and its adjoining area through out North Bengal and due to such heavy rainfall, the adjacent river of the project site was overflown and become flood through out the project constructional site area and washed away the base materials from plinth and foundation work of the project building. On 25.07.2016 the Complainant sent a mail for intimation to O.P Company to inspect the site and flood situation which causes severe damage to the construction site at Phasidewa and requested Insurance officials to have a physical spot inquiry and accordingly one Mr. Indranil Bhattacharjee an empaneled surveyor and loss assessors visited the spot on that very day on 25.07.2016 but unfortunately the project site was totally covered with rain water and for that reason actual loss and damages could not be assessed properly on 27.07.2016 when the water level gone down and the project site was visible the Complainant sent a request mail to the Insurance officials for further spot inquiry by their loss Assessor. On that very day the said assessor Mr. Indranil Bhattacharjee again visited the spot and completed the survey work and instructed the Complainant to submit all relevant documents with claim intimation form at the earliest opportunity in Insurance office. On 28.09.2016 the Complainant managed to calculate and framed a detailed estimated cost of damages and losses sustained and submitted the claim intimation form with necessary documents which was assessed at Rs. 62,20,244/- on 12.10.2016 at about 3:00 AM due to heavy rainfall for hours in Siliguri and adjoining areas the Complainants Project Construction site has become flood due to overflood of the adjacent river which was intimated to the Insurance Company through mail on that very day and requested the spot inquiry and on next day Mr. I. Bhattacharjee again visited the spot and assessed the damage on 16.02.2017. The further loss was assessed at Rs. 3,74,340/- and the claim was submitted on 18.02.2017 the Complainant sent a mail request for extension of the said policy for another 3 to 6 months but the O.P Insurance Company did not make any response. On 27.02.2017 the Complainant sent a letter to the O.P.s for immediate release of total claims amounting to Rs. 65,94,584/-. On 09.03.2017 the O.P sent a mail to the Complainant with an instruction to submit the relevant document and clarification of settlement of claims. The Complainant through a letter dated 21.03.2017 make details clarifications about his claim. On 30.06.2017 the Surveyor I. Bhattacharjee submitted the report that at physical verification the loss and damage of the Complainant was assessed to Rs. 24,12,201/- and Insurance liability stood to Rs. 21,25,980/- and also made a remark that the Complainant suppressed the actual distance of the river from the project sites and mentioned the distance as 5 KM in proposal form which is not correct and also observed that there was no preventive measure to prevent to cover the site area from inundation of overflow river water. The Complainant again and again asked the Insurance Company for releasing the claim of Rs. 62,20,244/- for first incident and Rs. 3,74,340/- for second incident but Insurance Company by a letter dated 30.10.2017 informed the Complainant the repudiation of the claim on the part of the Insurance Company. So, the Complainant was compelled to register the case with allegations of deficiency of service, unfair trade practice on the part of the Insurance Company and raise the claim for realizing damage estimated to 65,94,584/- and Rs. 20,000/- for compensation on account of the mental agony, pain and business loss, Rs. 3 Lakh for interest loss cost of the proceedings and total claim registered to get Rs. 88,94,584/- from the Insurance Company. The instant Consumer Complaint was admitted in due course and notice was sent to the Insurance Company that is Chief Executive Officer, Branch Manger and Branch Manager claim and by the three Opposite Parties have contested the case by submitting joint W.V and Ld. Advocate Mr. J.P. Pawa has represented the O.P. Nos. 1 to 3 for conducting the case.
The in Written Version the O.P/Insurance Company denied all the material allegations and contended that by suppressing the fact the Complainant has violated the various conditions of Insurance policy and the case become defective for non-impleading the NBCC who happens to be the joint insured of this instant policy. The further case is that the instant policy was issued on good faith on the basis of the proposal form submitted by the Complainant where certain facts was purposefully concealed. That the Complainant has deliberately violated the condition number 1 & 3 of the policy and the Insurance Company has rightly repudiated the claim.
Both parties have tendered their evidences and process of cross-examination was completed through interrogatories and replies all the relevant documents are produced from the end of both parties. The argument of both parties was heard.
Issues:
The following issues are fixed in this case for proper disposal of instant Consumer dispute.
- Is the Consumer Complaint maintainable as per provisions of law?
- Is the Complainant a bonafide Consumer under the provisions of C.P. Act, 1986?
- Has the Complainant any right cause of action to file the Complaint?
- Has there any deficiency of service on the part of the O.P/Insurance Company?
- Is the Complainant entitled to get reliefs as prayed for?
Decision with reasons
(Issue No 1 to 3)
All the first three issues are taken up for disposal at first. Admittedly, the proposed site of project belongs to Government of West Bengal, Education and Training Department who has entered into a contract with a nationalized Construction Company styled as NBCC to construct a building ITI Campus. NBCC invited tender for the alleged project and in response to such tender the Complainant procured the contract and the total project cost was related to 8,70,96,408.00/- and as per the general conditions of contract the Complainant was required to take “constructors all risks insurance policy with third party liabilities” from any recognized Insurance Company in the joint name with NBCC and the entire cost of the Insurance to be borne as per contract by the Complainant Company. Accordingly, after an open quotation the O.P insurance Company was agreed to come into an agreement with the Complainant Company for the CAR Insurance Policy with third party liabilities and the insurance premium was settled at Rs. 75,330/- and the Complainant was agreed with the said agreement by furnishing a proposal form and such proposal form was accepted by the O.P/Insurance Company and received premium amount by Bank cheque to the tune of Rs. 75,330/- on 30.01.2016 and the policy has covered the period between 15.02.2016 and 14.02.2017. During the policy period the project site was inundated with river flood and rain waters due to torrential rain at that point of time and for that reason the Complainant furnished the claim application for recovery of the losses and damages from the Insurance Company by virtue of the said Insurance Policy which was ultimately repudiated by the Insurance Company due to violation of Insurance Conditional Clause on the part of the insured side. The Insurance Company in their Written Version challenged the maintainability of the case on the ground that the said insurance coverage was jointly purchased by NBCC Company and Complainant while the Complainant has registered the Consumer Complaint without NBCC Ltd. as a party to this case and for that reason due to nonjoinder of the necessary party the Consumer Complaint becomes defective. The alleged Insurance Policy was purchased by the Complainant to safeguard his interest in the project site as huge money was paid on the part of the Complainant as contractor and the entire loss has sustained not by NBCC but the Complainant. As a contactor he had to purchase the policy in terms of the said contract with NBCC. So, NBCC is not a necessary party in this case. The Complainant has filed the case in due time and since the claim was repudiated on the part of the Insurance Company, the Complainant has right cause of action to register the instant Consumer Complaint. So, all these three issues are hereby answered in favour of the Complainant.
(Issue Nos 4 & 5)
Both these two issues are hereby taken up jointly for discussion. The assessment report submitted by the Insurance Company before this Bench and the evidence of Assessor Mr. I. Bhattacharjee clearly admitted the fact that there was torrential rain in Siliguri and its adjoining area including the Project site from 21.07.2016 to 24.07.2016 and due to such heavy rainfall the nearest Balason river of project site was overflooded and the flooded waters caused the severe damage in the projected area and the construction materials along with the already constructed area was completely washed away including the base materials from plinth and the foundation work of the project building. This type of rainfall and river flooding was recurred again on 12.10.2016 and in both the occasions the construction work of the project site was clearly affected which caused huge monetary loss to the Complainant Company and the losses was assessed by the IRDA license holder Assessor Mr. I. Bhattacharjee who were deputed by the Insurance Company when the said losses was intimated to the Insurance Company by the Complainant as soon as the events was happened. It is also admitted that there was no delay intimating the incident to the Insurance Company on the part of the Complainant. The Assessor also visited the spot as soon the intimation was received by him. The loss of the Complainant was happened in two occasions and he raised for the first loss claimed Rs. 62,20,244.00/- and for the second loss at Rs. 3,74,340/- while the Assessor assessed the total loss of two incidents Rs. 21,25,980/- for first loss and Rs. 2,34,234.20/- for the second loss. The Insurance Company on the basis of the assessment report of the Assessor has repudiated the claim on the ground that the insured has violated the conditions of the insurance as in the proposal form the Complainant mentioned that the nearest river was situated at distance of about 5 KM from the site area while the real picture is that the projected area is situated on the embankment of river Balason and three sides of the project site area covered with the embankment of river Balason. Now, the question is if we stick on the said assertion on the proposal form that Complainant has intentionally concealed to mention the actual distance between the project site and the Balason river embankment. Then, the mentioning of distance 5 KM appears to be wrong and intentional. The insurance policy conditional clause in this regard are to be noted. The Clause No. 1 of general condition of the policy speaks due observation and fulfillment of the terms of this policy in so far as they relate to anything to be done or complied with by the insured and the truth of the statement and answers in the questionnaire and proposal made by the insured shall be a condition precedent to any liability of the Insurance Company and according to Clause No. 3 insured shall at his own expense take all responsible precautions and complied with all reasonable recommendations of the company to prevent losses and damages or liability or complied with statutory requirements and manufactures recommendations. The Insurance Company contends that no buffer was constructed by the Complainant Company between the river and the work site which could have prevented the reported damage and in this way the Complainant Company has violated the general condition No. 3 of the policy. The Assessor Mr. I. Bhattacharjee (P.W.2) in his report mentioned that after checking the documents in the BLLRO Department and on seeing the map and Survey Report prepared in the year 1958-59 confirmed that the project area is situated 120 mtr away from the Balason river bank. But no documentary evidence is there on the part of the Insurance Company to substantiate the said claim rather we know very well that the map prepared in 1958-59 should not speak the exact position right now about the distance between the river Balason and the project area. The Complainant mentioned the distance about 5 KM whereas the Insurance Company also could not produce any document to prove that the project site is situated within the radius of 120 mtr of the river Balason. The Insurance Company in their pleadings mentioned that the company entered into an insurance agreement of the Complainant purely on good faith posting upon principle of “Uberrima Fides” relying upon the proposal form submitted by the Complainant/insured and which was duly filled up and signed by the director Mr. Agarwal. On the contrary, the Complainant mentioned that the Insurance Agent has visited the spots before entering into the agreement and they have inspected the location and thereafter suggested the company to agree with the proposal form of insurance submitted by the Complainant. The Insurance Company claims that as NBCC a Blue Chip Company under the Government of India was one of the insured in the instant policy and for that reason the company has totally relied upon the information provided by the director of the Complainant Company. The O.P Company also contends that the Complainant Company has not constructed any buffers between the river and the work site which could have prevented the reported damage while the Assessor in his report clearly mentioned that the Complainant Company by virtue of contract was entrusted the liability to construct a new building for ITI Campus under the Education Department of Government of West Bengal and the original contract was made between NBCC and Government of West Bengal, Education and Training Department. The Government of West Bengal instructed the NBCC was entrusted to construct embankment in the space between river Balason and ongoing construction of the new ITI Campus. On the part of NBCC no efforts for construction of such embankment was taken and the Complainant Company had no liability to construct buffer in the embankment of the river Balason. The contractor Consumer Complainant Company as per condition of contract purchased the said CAR policy and he should not be liable for any damage due to heavy rainfall or inundation from the flooded water of river Balason in the projected area. Rather, the Insurance Company at the time of proposal of insurance did not inspect the site very carefully and for that reason blame upon one side is not acceptable and the incident was happened which to be called as “act of God” and for that reason a bonafide contractor should not be penalized from the evidences of both sides it is clearly reflected that due to such natural calamity the two incidents were happened which caused severe losses to the Complainant Company who has purchased the policy by paying the premium amount in due time. So, his claim should not be repudiated. On the other hand, the mode of assessment and the quantum of money settled by the Assessor appears to be genuine and authenticate and such amount should be handed over to the Complainant Company for the loss it has sustained. So, the considered view of the Bench is that in spite of lapses or latches on the part of the Complainant still the Complainant is entitled to be compensated from the Insurance coverage for the losses he has sustained for the torrential and intermittent rainfall and flood with river overflow. The total loss assessed by the Assessor Mr. I. Bhattacharjee are found to be correct and genuine one and such amount should be compensated in favour of the Complainant Company. Ld. Advocate of the O.P relied upon two decisions cited in 2014(4) CPR 729 NC and 2019(1) CPR 446 NC where the repudiation on the part of the Insurance Company was found correct due to violation of the Insurance policy condition by the insured which appeared intentional and malafide. But here in this case no gross malafidy is found on the part of the Complainant. So, in our view, the Complainant should get the right protection within the umbrella of C.P. Act, 1986 as because the repudiation of the claim on the part of the Insurance Company tantamount to deficiency of service. Rather, according to Clause 3 of the General Conditions the Insurance Company had the duty to recommend reasonable precautions to the insured prior to the incident but such type of recommendation was not there on the part of the O.P Company throughout the policy period since the beginning. However, Insurance Company also had to rely upon the remarks of Assessor Mr. I. Bhattacharjee and for that reason the Insurance Company had refused the claim. So, they should not be severely penalized. Thus, all the issues are hereby discussed and concluded with effect that the Complainant has successfully proved the case and well entitled to get relief under the provisions of C.P. Act, 1986.
Hence, it’s ordered
That the instant Complaint under Section 17 of the C.P. Act, 1986 filed by Pave Infrastructure Pvt. Ltd. through its director Mr. Mahavir Agarwal is hereby allowed on contest without any cost. The O.P/Insurance Company are asked to pay Rs. 21,25,980.90/- for the first loss and Rs. 2,34,234.20/- for the second loss to the director of the Complainant Company within two months from the date of receiving the copy of Judgement, failing which 6% per-annum as interest will be imposed upon the total awarded money.
Let a copy of this order be supplied to the parties free of cost.
