The Complainant has filed this case alleging deficiency-in-service by the O.Ps, where O.P No.1 is the Divisional Manager, The New India Assurance Co. Ltd., Vivekananda Marg, Balasore and O.P No.2 is the Branch Manager, State Bank of India, S.M.E Branch, O.T Road, Balasore.

                     Factual matrix of the dispute is that the Complainant is the owner of        the Subarna Jewellery, Room No.13, BRIT Market Complex, Police Line Square, Balasore. The Complainant has availed one cash credit loan from O.P No.2 for the above said Jewellery shop and insurance is done for the stocks of Jewellery with O.P No.1 through O.P No.2, for the period from 24.07.2014 to 23.07.2015, for Rs.9.00 Lacs only. But on 27.09.2014, the Complainant after closing his shop with proper lock and key and keeping the gold ornaments inside the iron chest, went to his house. On 28.09.2014 at about 10 A.M, the Complainant opened his shop, saw the articles were scattered and iron chest was open and back side wall of the shop was broken and subsequently learnt that backside wall of Asharam Bapu’s medicine shop name and styled as “Saraswati Enterprises” was also broken. The Complainant lodged F.I.R before Sahadevkhunta P.S on 28.09.2014 and accordingly, P.S Case No.360 has been registered U/s.457/380 IPC, subsequently registered as C.T No.2244/14. After completion of investigation, the I.O submitted Final report No.75, dt.24.04.2015 as “fact is true, but no clue”. In the meanwhile, the Complainant immediately after occurrence intimated the O.Ps and the O.P No.1 deputed his Surveyor for assessment of loss and accordingly, the Surveyor visited the spot and submitted the report. The O.P No.2 also intimated the O.P No.1 about the burglary/ occurrence vide letter No.33/541, dt.14.10.2014, but the O.P No.1 remained silent instead of settlement. The Complainant submitted Police final investigation report before O.P No.1 on 13.05.2015 as per their letter dt.07.04.2015 and also intimated to Surveyor and Loss Assessor, Investigator and O.P No.2. But, the O.P No.1 instead of settling the claim of the Complainant, refused to settle the claim during October, 2015. As a result, the Complainant could not pay the interest amount debited in his cash credit account with O.P No.2, for which the said account slipped to N.P.A as per letter No.BR/SME/34/603, dt.01.12.2015 issued by O.P No.2 to the Complainant.  

                         Prayer for settlement of insurance claim, award of compensation and cost of litigation and O.P No.2 be directed allowing the Petitioner to run the cash credit account without depositing the interest.

                         The O.P No.2 is set ex-parte on 13.05.2016. Written version filed by the O.P No.1 through their Advocate, where they have denied about maintainability as well as its cause of action.

                         But the true state of affairs is that the Complainant, being the Proprietor of a Jewellery shop known as “Subarna Jewellery” located at Room No.13, BRIT Market Complex, Police Line Square, Balasore made a proposal to the O.P No.1 through O.P No.2 to insure the stock (Jewellery) amounting to Rs.2,50,000/- in Display window and Jewellery amounting to Rs.6,50,000/- in locked safe, thus in total Rs.9,00,000/- in his shop for a period of one year from 24.07.2014 to 23.07.2015 covering the risk of burglary, house breaking and theft etc. This O.P No.1 accepted the proposal and issue the policy subject to the terms and conditions inter-alia that the stocks (Jewellery) would be kept in the locked safe at all times, out of business hours and that the Company would not be liable for loss or damage to the property insured while in window display at night or while kept out of safe after the business hours.

                         The Complainant on 29.09.14 lodged information with this O.P, that there was theft of jewellery from his shop by breaking the shop’s wall in the night of 27/28.09.14 and he requested to take necessary steps for settlement of his claim. The O.P No.1 on receipt of the information, deputed an Investigator, by name, Sri Pramod Kumar Parhi to conduct preliminary investigation of the alleged occurrence and to submit his report. Investigator Sri Parhi, after investigation submitted his report on 15.10.14 and an addendum to his report on 20.10.14. In course of his investigation, he found one big hole on the back side wall of the shop, show case was broken, glass pieces were scattered on the floor, iron chest was opened and there was no visible damage/ broken mark on the iron safe/ Locker, the safe was not forcibly broken or opened for the alleged burglary, key of the Locker was not functioning, iron door welded in front of iron Locker was not carrying any forcible open knock and damage mark was found on drawer of the show case. Sri Parhi came to a finding that the jewellery were in the show case since the iron Locker was disabled and non-operational. The competent Authority of the Company at Regional Office, Bhubaneswar deputed Investigator Sri Sambhunath Pattnaik, Retd. Warrant Officer, Indian Air Force to conduct detail investigation into the reported burglary and to submit his report. Investigator Sri Pattnaik after thorough and detail investigation, submitted his report on 14.02.15. In course of his investigation, he found that the iron chest had two numbers of door i.e. front outer coverage door, which could be closed by using four numbers of locking facilities and he found no damage or deface to the outer cover of the iron safe. He further found that the main door of iron safe was in open condition, the lever of the locking device was in locking position, the locking facilities was not operated by the key of the same iron safe, the locking device was not in working condition, the key of the safe was not working for closing or opening the safe, there was no tampering mark on the face of the iron safe including near to locking device. Use of chemicals for opening the safe lock was not visible as there was no such mark found near to locking device and the iron safe lock was unserviceable since long as because the lever of locking devices was in locking condition. He further found that the display boards were damaged, locking device of display boards were damaged, locking facilities of all most all drawers of the show case were damaged. He came to a finding that the iron safe-cum-iron chest neither suffered any external damage nor it suffered any damage on the face of the said safe nor the locking device found damaged nor found tampered nor any mode of tampering of iron safe was seen, the key of the iron safe was not functioning which established that locking facility of iron safe was not functioning prior to burglary incident and for that reason, the loss of jewellery from iron safe was possible. He also came to a finding that the culprits broke open the locks of display boards, drawers and carried out the jewellery. He also came to a finding that the burglary loss as committed by some unknown culprits from the shop was feasible and possible, but the loss of jewellery from iron safe as claimed for an amount of Rs.6,56,084/- was possible as the safe was remained opened prior to loss. It is relevant to mention here that the Complainant submitted the claim form showing the loss of jewellery valued at Rs.6,56,084/- from the Locker-cum-safe and jewellery valued at Rs.5,12,941/- from the drawer and display rack.

                         The Competent authority of the Company at Regional Office, Bhubaneswar on 17.10.14 also appointed a Surveyor-cum-loss assessor CMA Shiba Prasad Padhi, AIIISLA, FIII, F.C.M.A to conduct survey and to assess the loss and to submit his report. Sri Shiba Prasad Padhi on 20.10.14 inspected the premises, conducted survey and assessed the loss. He assessed the net loss amounting to Rs.8,18,244/- and on his inspection/ survey, he found that the incident occurred when the shop was closed (during non-business hours) and that the iron locker was not in operating condition and the lock was not functioning at all and there was no trace/ evidence of forcible opening of locker. He came to a finding that the insured had kept his jewellery in the display window, display tables, drawers and inside the locker, which was not in operating condition as neither keys were functioning nor there was any trace/ evidence of forcible opening of the locker.

                         The competent Authority of this O.P No.1- Company after taking into consideration of the reports of the investigators Sri Pramod Kumar Parhi and Sri Sambhu Nath Pattnaik, the report of the Surveyor-Cum-Loss Assessor Sri Shiba Prasad Padhi, the report of the Police, the Complainant claim form, the terms and conditions of the Policy and all other relevant documents has repudiated the claim because of the violation/ breach of the Policy exclusion No.12 and special warranty incorporated/ stipulated in the Policy, which states that all property at the premises specified in the Policy schedule shall be secured in locked safe of standard make at all times, out of business hours/ Company shall not be liable for loss or damage to property insured whilst in window display at night or whilst kept out of safe after business hours, which was not performed/ observed by the Complainant. The O.P No.1 intimated the Complainant about the repudiation of his claim by a Regd. letter dt.25.08.15. As stated above, this O.P No.1 is not liable to pay any amount towards any loss sustained by the Complainant because he violated the terms, conditions and stipulation of the Policy.

                         In the facts and circumstances, the complaint be dismissed with costs.     

                        But in the mean while, the O.P No.2 has issued one notice U/s.13 (2) of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act-2002 to the Complainant, for recovery of their dues in full within 60 days from the date of notice i.e. on 20.07.2016.

                        On perusal of the documents available in the case record and also the documents filed by both the contesting Parties, it is noticed that:-

1. The Complainant had insured his stocks (Jewellery ornaments) with O.P No.1 for Rs.9.00 Lacs (Rupees Nine lakhs) only vide Policy No.55080046140700000001 for the period from 24.07.2014 to 23.07.2015 declared/ accepted by the Complainant/ O.P No.1 as "stock at display window in the premises for Rs.2.50 Lacs and stock in locked safe in the premises for Rs.6.50 Lacs (Policy schedule for Jewellers Block Insurance).

2. Shri Pramod Kumar Parhi, Advocate-Cum-Investigator, being deputed by O.P No.1 has opined on 15.10.2014 as "keeping in view of the above mentioned facts and circumstances and after my thorough investigation, spot enquiry and statement of witnesses, I am to opine that the said shop room affected by burglary on 27/28.09.2014 night by some unknown culprits".

3. Shri Sambhunath Pattnaik, Investigator, being deputed by the Regional Office of O.P No.1, situated at Bhubaneswar has submitted/ observed in their achievement column/ para on 14.02.2015, which is narrated hereunder:-

       "On physical verification, verification of the written declaration of the Proprietor, recording the verbal declaration of the Complainant-Cum-Proprietor, verification of surrounding location, verifying the mode and style of operation of culprits, verifying and recording the surrounding location, we came to conclusion that the burglary loss as committed by some unknown culprits from the above said shop is feasible and possible, but the loss of gold ornament and old gold from iron safe as claimed for an amount of Rs.6,56,084/- is possible as the safe was remain open prior to loss. We feel the Proprietor was using the iron safe without use of proper locking facility as provided by the manufacturer of the safe and it is a gross negligent act of the Proprietor of the shop for the loss from iron chest. On the other hand, the loss as claimed from drawers and display boards are caused due to burglary incidence, for which the insured does not have any negligent act, as felt by us. Un considering above facts and figure, we could able to established that the unnecessary liability of rupees 6.5 Lakhs is avoided with documentary evidence".

4. Shri Shiba Prasad Padhi, Surveyor and Loss Assessor, being deputed by the O.P No.1 Regional Office situated at Bhubaneswar, assessed net loss for Rs.8,18,244/- (Rupees Eight lakhs eighteen thousand two hundred forty four) only on 31.03.2015, with a note on loss assessment to be read as "The insured has not provided us copies of VAT returns and Police final report, despite our repeated requests and reminders sent through RP AD. Though the insured has submitted computerized Stock Register, purchase register and sales register for Gold and Silver, the same seems to have been drawn at a later stage in order to produce the same for insurance purpose. The insured could not show us the Registers along with purchase and sale bills during our inspection made on 20.09.2014. Further, the insured has declared that he had kept gold and silver jewellery in display windows, display counters, drawers and Locker. The incident occurred when the shop was closed (during non-business hours). As observed during our inspection and also based on the two investigation reports as shared with us by the underwriting Office, it was evident that the iron Locker was not in operating condition and the lock was not functioning at all. The insured produced a pair of duplicate key, which was not same in shape and size to that of the key which was said to be under use by the insured. The insured in his letter dt.20.09.2014 has also admitted to the fact that there was no visible damage to the locker and both the keys of the locker were not functioning. We are of the opinion that the insured had kept his jewellery in the display window, display tables, drawers and might also be inside the locker, which was not in operating condition as neither the keys are functioning nor there is any trace/ evidence of forcible opening of locker by the culprits. This was a willful and deliberate negligence on the part of the insured not to keep the jewellery inside a locked safe during non-business hours, which is a policy condition under a Jewellers Block Insurance Policy. Considering the above, we are of the opinion that the claim is not admissible and the underwriter has no liability to pay for the said loss as the jewellery was not kept inside the locked safe during non-business hours by the insured. However, the underwriter may review and take suitable decisions for early settlement of claim after considering the Police final report and Policy conditions.

5. The Complainant has already submitted Police final report before the O.P No.1 on 13.05.2015 for Sahadevkhunta P.S Case No.360, dt.28.09.2014 U/s.457/380 IPC, subsequently registered as C.T No.2244/14. The contents of the above said final report is as follows:- “From the above facts and circumstances, I submit FF as FRT No clue U/s.457/380 IPC vide SKPS F.R No.75, dt.24.04.2015, which may kindly be accepted. If get any clue in future, this case will be re-opened”.

6. The O.P No.1 vide their letter No.550800/Misc. Claim/2015/288, dt.25.05.2015 addressed to the Complainant, where they have provided with the clarification of loss of jewellery/ gold/ silver items in the shop due to burglary, date of loss 27/28.09.2014, which is hereunder:-

                        “In view of the above, this is a clear cut breach/ violation of Policy condition No.10, Policy exclusion No.12 and special warranty imposed in jeweller’s insurance Policy. Under the circumstances, Company is not liable for the claim and stands to be repudiated as ‘No claim’. Therefore, you are requested to send us your clarification within 7 (seven) days of date of this letter, falling which we will inform you the status of the claim”. From the above observations of the O.P No.1, it is also noticed that the O.P No.1 has given a chance to the Complainant to reconsider about his claim only after hearing from the Complainant.

                        During hearing and argument stage, Ld. Counsel for the Complainant emphatically argued for settlement of the insurance claim of insured amount in favour of the Complainant by the O.P No.1. On the other hand, the Ld. Counsel for the O.P No.1 vehemently argued that no mark in the iron chest that the iron chest is break open and also the said iron chest was not in operation. Moreover, the Complainant did not perform/ promise the term and conditions as per contract of insurance. But, since the loss is assessed and the stocks declared by the Complainant as per the claim form submitted by him minus stock of jewellery kept outside the iron chest/ locker to be settled as insurance claim to the Complainant. Since window display at night is not covered for insurance claim, therefore the O.P No.1 i.e. Insurance Company do not cover stocks kept out of the safe after business hours and at night, as narrated/ reflected in the “Proposal form for Jewellers Block Insurance”.

                        As per Para-12 of the Policy conditions of the said insurance policy is stated here below: Provided always that the Company shall not be liable for under this Policy in respect of “Loss or damage to property insured whilst in window display at night or whilst kept out of safe after business hours”. Hence, the Order:-  

                                                       O R D E R

                        Having regards to our judgment reflected above, the complaint is allowed with direction to the O.P No.1 to settle the claim of insurance for Rs.6,56,084/- (Rupees Six lakh fifty six thousand eighty four) only and also the claim proceeds be sent to the O.P No.2 towards credit of cash credit account of the Complainant maintained with O.P No.2-Bank within 30 days of communication of this order. Further the O.P No.1 is also directed to pay a sum of Rs.10,000/- (Rupees Ten thousand) only to the Complainant, being the amount of compensation and cost of litigation.

                        Pronounced in the open Forum on this day i.e. the 29th day of November, 2016 given under my Signature & Seal of the Forum.