Per Shri P.N. Kashalkar, Hon’ble Judicial Member 1. This complaint has been filed by a partnership firm M/s.Madhav Gems and its partner-Shri Talsibhai Ramjibhai Monpara alleging deficiency in service on the part of opponent-the Oriental Insurance Co. Ltd. According to the complainants, complainant No.1 is a partnership firm carrying on its business as Diamond Merchant at Opera House, Mumbai. Complainant No.2 is a partner of complainant No.1. Opponent is the Insurance Company and complainant No.1 had insured its business under the Jewellers Block Insurance Policy. The complainants pleaded that somewhere in March 1997 they had obtained a Jewellers Block Insurance Policy from opponent for insuring their business as Diamond Traders and Merchants. The policy issued by opponent was bearing No.121802/46/97/00187 and it was for the period 27/03/1997 to 26/03/1998. The sum assured was `1,50,00,000/- under Section I; under Section II the sum assured was `65,00,000/- and; under Section III the sum assured was `15,00,000/- for which the complainants had paid premium of `89,318/- to the opponent. Memorandum dated 27/03/1997 is at Exhibit-A and Policy is at Exhibit-B. Complainants pleaded that as per usual practice, complainants handed over 405.29 Carats diamonds worth `45 Lakhs on 24/11/1997 to Mr.Vikram (Vicky) Ishwar Naik, Market Dalal (Broker) for selling it to his clients. A Broker is known as ‘Dalal’ in local language of the jewellers. Said goods were handed over to the broker under cover of Jangad Slip dated 24/11/1997 which was duly signed by said broker in acknowledgement of having received the diamonds as mentioned above. Exhibit-C is the said Jangad Slip. 2. The complainants pleaded that Mr.Vicky Naik was well known broker in the trade, who acted as broker for many parties. However, as complainants did not hear from Mr.Vicky Naik about sale of diamonds, they made enquiries with other traders and learnt that other traders had also entrusted diamonds worth `2,83,00,000/- to him and they too were not hearing whereabouts of the said broker. Accordingly, a joint complaint was lodged on 04/12/1997 with D.B. Crime Branch, Mumbai by all the traders through M/s.M. Kantilal & Co. Ltd. Copy of said complaint is at Exhibit-D, wherein it was mentioned that goods of M/s.M. Kantilal & Co. and complainants and other persons worth `2,83,00,000/- were involved in the said missing of Mr.Vicky Naik. M/s.M. Kantilal & Co. also addressed a letter 08/12/1997 to Mr.R.C. Sharma, Joint Commissioner of Police in respect of loss suffered by it and other traders. Exhibit-E is the copy of said letter. Complainants lodged insurance claim with the opponent by letter dated 11/12/1997 notifying them the incident. Complainants mentioned in the said claim that they had suffered a loss of `45 Lakhs since nothing was heard of from Mr.Vicky Naik. The complainants requested the Insurance Company to appoint Surveyor to assess the loss. Opponent addressed them a letter dated 30/12/1997 stating that the loss has been registered under claim No.121802/46/98/0008 and asked them to lodge their complaint with concerned Police Station with giving full details of the loss. Opponent appointed M/s.Mehta & Padamsey Pvt. Ltd. and M/s.J.B. Boda Surveyors Pvt. Ltd. jointly to survey and assess the loss. The complainants gave background of the firm and activities carried out by it as desired by the Surveyors. In addition to criminal complaint lodged by M/s.M. Kantilal & Co., they had also lodged F.I.R. on 06/01/1998 with the Police. The complainants and other traders jointly circulated a public notice offering cash prize of `2,50,000/- to any person informing them about the whereabouts of said Mr.Vicky Naik, the broker. They had submitted all the documents and co-operated with both the Surveyors. In enquiry they had told the Surveyors that broker was not traceable and valuables were not received back from the said broker. The Police had investigated the matter and the Police had obtained summery from the Magistrate that, ‘complaint is true, but person concerned is not traceable’. 3. The complainants approached officers of opponent/Insurance Company. They were told that if the broker is not traced or found for 7 years, then the complainants’ claim would be definitely settled on the presumption that he had been killed causing a loss of the diamonds. The complainants therefore realized that this was an excuse put forth to delay the complainants’ claim on one or other pretexts. The complainants issued a notice dated 07/05/2005 calling upon the opponent/Insurance Company to settle their claim as broker was not traceable for the last 7 years. They had also sent a letter through Advocate Manish Diwadkar to the Chief Secretary of the State of Maharashtra and also to the Commissioner of Police, but the Insurance Company failed to settle the claim despite lapse of over a decade. The complainants therefore again addressed a letter dated 28/07/2007 praying the opponent to reimburse them the loss of `45 Lakhs. Said letter is at Exhibit-CC. Even after receipt of the letter, opponent did not settle the claim within reasonable time though they were supposed to settle the claim within two months from the receipt of Survey Report. According to the complainants, claim is neither repudiated nor settled and therefore, that itself amounts to gross negligence or inadequacy in the nature of services required to be rendered by the opponent and therefore, they filed consumer complaint claiming amount of `45 Lakhs, besides claiming `5 Lakhs as compensation for mental harassment. In support of complaint, affidavit has been filed by partner of complainant/firm. Various documents have been filed in support of the complaint. 4. Opponent filed written version and pleaded that the present complaint is hopelessly time-barred since the incident took place on 24/11/1997 whereas the present complaint has been filed in the year 2009. They also specifically pleaded that the cause of action to file consumer complaint arose on 24/11/1997 and since within two years complaint has not been filed, the complaint should be dismissed with costs. They also pleaded that as per condition of waiver as mentioned in Condition No.20 of the Insurance Policy, it was expressly agreed or declared that if the Company disclaims the liability for any claim hereunder and such claim shall not within 12 calendar months from the date of disclaimer have been made subject matter of a suit in a court of law, then the claim for all the purposes be deemed to have been abandoned and shall not thereafter be recoverable hereunder. The Insurance Company also pleaded that this claim requires elaborate trial and examinations of several witnesses in view of complexities involved in the case and therefore, this Commission has no jurisdiction to try and decide the complaint and on this ground itself, it pleaded that the complaint should be dismissed with costs. 5. Opponent also took up the plea that the insurance was taken for commercial purpose and complainant cannot be said to be a consumer in view of recent amendment introduced in the Consumer Protection Act, 1986 which has been brought into the force from 15/03/2003. 6. Opponent however admitted that the complainants had been issued Jewellers Block Insurance Policy bearing No.121802/46/97/00187 for the period 27/03/1997 to 26/03/1998. They admitted that the complainants informed about the loss vide letter dated 11/12/1997. Upon receipt of the claim intimation, they appointed M/s.Mehta & Padamsey Pvt. Ltd. and M/s.J.B. Boda Surveyors Pvt. Ltd. as Surveyors to verify and assess the loss occasioned to the complainants. Besides complainants, two other traders also reported claim. One was lodged by M/s.M. Kantilal & Co. Ltd. and the other was of M/s.Roomy Exports. According to opponent/Insurance Company, there was no cogent or relevant evidence produced by the complainants to show that Mr.Vicky Naik was indeed a broker for the complainants and he was handed over the diamonds weighing 405.29 Carats worth `45 Lakhs. Insurance Company pleaded that after ascertaining information and documents through the Surveyors, it was found that Mr.Vicky Naik was not traceable nor diamonds were traced. The joint surveyors released their final survey report dated 23/04/2001 giving detailed finding on the claim of the complainants. Surveyors reported that besides complainants, two other parties M/s.Decent Impex and M/s.M.V. Enterprise had handed over diamonds to Mr.Vicky Naik. However, no proof of the same was annexed to the complaint. Surveyors were of the opinion that considering the circumstances under which the diamonds were lost, the claim was not tenable under the policy as broker was absconding/missing. Surveyors concluded that under the exclusion clause No.8, liability of the Insurance Company/Insurer to make payment for the loss does not arise. Said clause No.8 requires that the loss or damage should have been occasioned by theft or dishonesty or any attempt threat committed by or where such loss or damage has been expedited or in any way sustained. The Insurance Company pleaded that the complaint is not tenable on the point of limitation and also as per policy condition of waiver and exclusion. 7. Insurance Company also pleaded that they were not aware that complainants had entrusted diamonds to the tune of `45 Lakhs to one Mr.Vicky Naik. They pleaded that they are not admitting the document termed as ‘Jangad Slip’. They pleaded that they are not aware of the reputation of Mr.Vicky Naik as well known broker as alleged in the complaint. They pleaded that after the loss of diamonds, FIR was lodged by the complainants at very late stage i.e. on 06/01/1998. They denied that they were guilty of deficiency in service. They denied the very fact that they had not settled the claim for several years. The opponents pleaded that they are not liable to compensate the complainants. They pleaded that the complainants were not prompt enough to approach the State Commission when the case is pertaining to missing of their broker in 1997 itself. They denied the liability to make payment of `45 Lakhs for the loss sustained by the complainants and `5 Lakhs for mental harassment it suffered. They therefore, pleaded that complaint should be dismissed with costs. 8. The complainants also filed affidavit in evidence. Affidavit has been sworn by Mr.Talsibhai R. Monpara, partner of complainant No.1. He has reiterated his case as was spelt out in the complaint. Opponent filed affidavit of Mr.K.B. Raut, its Manager of Mumbai. They also enclosed Survey Report which assesses the net loss of `23,35,454/-. 9. We heard submissions of Bharti Narichania, Advocate for complainants and Mr.A.S. Vidyarthi, Advocate for the opponent/Insurance Company. 10. At the outset, we address point of limitation as canvassed by Counsel for the opponent. There is no dispute that M/s.Madhav Gems/complainant No.1 had taken Jewellers Block Insurance Policy and that it was in force from 27/03/1997 to 26/03/1998 and that on 24/11/1997 the loss of precious diamonds worth `45 Lakhs occurred. The same were entrusted by the complainants to its broker Mr.Vicky Naik and that within 3-4 days, he had not reported back to the complainants and to other traders and he went on missing and could not be traced. F.I.R. was lodged by the complainants as well as other traders, who had also entrusted diamonds to the said broker in normal course of their business. 11. It has been canvassed before us by Advocate Mr.Vidyarthi for the Insurance Company that complaint has been filed after a gap of 9 years since accrual of cause of action to the complainants in November 1997. However, we are of the view that the complaint is not barred by limitation, if we consider the Surveyors’ Report sent to the opponent/Insurance Company. Surveyors in their Survey Report clearly opined at para 8.03 at page 253 of complaint compilation as under :- 8.03 We have been informed that the police are still trying their best to trace the missing broker. If he is traced at a later date, and if it is confirmed from the adequate evidences that the diamonds were lost due to hold up/robbery or any such insured peril, then the Insurer’s liability may be considered for an amount of assessed loss of `23,35,454.00 (as shown in para 7.08 of this report). The Insurers if they so desire obtain a copy of the final police report directly. The Surveyors have kept open the issue of liability of the Insurance Company depending upon whether the missing broker Mr.Vicky Naik is found out or whether when the missing broker is found, it is further proved that said Mr.Naik has been subjected to robbery or theft of the valuables/diamonds was committed from his person. The Surveyors are of the view that the Insurer’s liability may be considered for an amount of `23,35,454.00 if it is found that Mr.Vicky Naik was victim of theft or robbery while he was carrying the precious diamonds of the complainants in the normal course of his business. When this is the Surveyors’ recommendation, we hold that the Insurance Company wisely did not send repudiation and necessarily they kept the file open and therefore, in our view the consumer complaint cannot be said to be barred by limitation because the Insurance Company is also of the considered view that in case Mr.Vicky Naik is traced out and it is proved that he was victim of robbery or theft, then claim lodged by the complainants/firm will have to be considered favourably. It is in the light of these peculiar facts, we are of the view that the issue of limitation in this case does not arise as per the conduct of the opponent/Insurance Company itself. 12. Second ground taken by the Insurance Company is about the complaint having been barred by way of waiver as per Condition No.20 of the Insurance Policy. Condition No.20 of the insurance policy reads as under :- “It is also hereby further expressly agreed and declared that if the Company shall disclaim liability to the insured for any claim hereunder and such claim shall not within 12 calendar months from the date of such disclaimer have been made the subject matter of a suit in a court of law, the claim shall for all purposes be deemed to have been abandoned and shall not thereafter be recoverable hereunder.” On bare reading of this condition, it would appear to us that this waiver is not applicable to the present case. In as much as, the Insurance Company has never disclaimed or repudiated the claim of the complainants. They had not sent repudiation letter at all and therefore, Condition No.20 of the policy regarding complaint having been barred by waiver would not apply. So, there is no merit in the objection taken by the Insurance Company in this behalf. 13. The Insurance Company took up the preliminary objection claiming that the claim involved huge correspondence, warrants elaborate trial with examination of several witnesses in view of complexities involved in the case and therefore, this Commission under the summary jurisdiction should not entertain the complaint. However, we are of the view that the complaint involves insurance claim. The claim is huge one but the facts are very simple. No complexity or complications are involved. Jewellers Block Insurance Policy was purchased by the complainants. The complainants had entrusted some diamonds to its broker Mr.Vicky Naik worth `45 Lakhs. Mr.Vicky Naik did not report back and he went missing. His whereabouts are not heard. Police complaint was lodged. Insurance claim was also lodged and till filing of the complaint, Insurance Company had not repudiated the claim. So, we have to simply examine whether in the circumstances, Insurance Company is liable to pay the loss of `45 Lakhs to the complainants or not. So, this is a very simple case requiring no detail examination of several witnesses as alleged by the Insurance Company. So, this objection that we should not decide this complaint is also appearing to be untenable in law and this Commission has got very much right to decide the simple case of this nature as filed by the complainants against the opponent. 14. The ploy of commercial purpose is also pressed into service by the opponent/Insurance Company, but we are of the view that when there is deficiency in service on the part of the Insurance Company, ipso-facto this Commission has got jurisdiction to decide the complaint of this nature involving deficiency in service on the part of the Insurance Company under Section 2(1)(g) of the Consumer Protection Act, 1986. 15. Coming now to the merits of the case, the admitted facts are that complainants had obtained Jewellers Block Insurance Policy in 1997. The policy was in force during the period 27/03/1997 to 26/03/1998. On 24/11/1997 they had entrusted vide Jangad Slip (Exhibit-C) 405.29 Carats diamonds to Mr.Vicky Naik and there is signature of Mr.Naik appearing on Jangad Slip. It is an admitted position that said Mr.Naik did not return and said Mr.Naik had also collected diamonds from M/s.Roomy Exports and M/s.Decent Impex, besides diamonds of M/s.M. Kantilal & Co. and when these parties found that Mr.Vicky Naik was not traceable or his whereabouts were not known, they filed a complaint on 04/12/1997 with D.B. Marg Police Station, Mumbai mentioning therein that M/s.Madhav Gems had entrusted diamonds worth `45 Lakhs weighing 405.29 to Mr.Vicky Naik and he had gone missing. They had also addressed a letter to the Joint Commissioner of Police Mr.R.S. Sharma on 08/12/1997. The complainants thereafter lodged insurance claim with the opponent/Insurance Company. On 06/01/1998 a detailed F.I.R. was lodged by Mr.Mukesh Manjibhai Patel, Director of M/s.M. Kantilal & Co. alleging that Mr.Naik, broker was entrusted with diamonds worth `2,83,00,000/- and he had disappeared with said diamonds and therefore, matter should be investigated. In the F.I.R. it was mentioned that M/s.Madhav Gems had entrusted 405.29 Carats diamonds to Mr.Vicky Naik valued at `45 Lakhs. They had also published an advertisement in Mumbai by circulating pamphlets that Mr.Vikram (Vicky) Naik had gone missing with diamonds from Diamond Bazar and anybody giving intimation of the said person would be given cash prize of `2,50,000/-. Insurance claim was also lodged with the opponent/The Oriental Insurance Company. Joint Surveyors were appointed and the Surveyors assessed the loss of the complainants to the extent of `23,35,454/-. Admittedly, the claim has not been repudiated by the Insurance Company till filing of the complaint nor they had repudiated the claim in their written version. Question is whether the complainants are entitled to get award of `45 Lakhs for the loss of diamonds occasioned due to missing of said Mr.Vicky Naik with the diamonds worth `45 Lakhs belonging to the complainants. 16. We have thoroughly read the policy conditions. Policy condition No.8 requires that loss or damage should be occasioned by theft or dishonesty or any attempt thereat committed by or where such loss or damage has been expedited or in any way sustained or brought about by any loss of the insured’s family members or any servant or traveller or messenger in the exclusive employment of the insured or any customer or broker or broker’s customer angadias or cutters or goldsmith in respect of the property hereby insured entrusted to them by the insured, his or their servants or agents. So, if we read this condition thoroughly and carefully, it requires that loss or damage of the goods should have been occasioned by theft or robbery or any attempt thereat committed. So, theft or robbery must be proved as an essential condition before it can be held that the Insurance Company is liable for the diamonds entrusted by the complainants to its broker in normal course of business. Acting upon Exhibit-C document, we can hold that the complainants had entrusted 405.29 Carats diamonds to Mr.Vicky Naik on 24/11/1997 worth `45 Lakhs. Question is whether he has dishonestly misappropriated the same or whether a theft has been committed in respect of diamonds from his person by use of force. No such evidence has been adduced by the complainants to prove that the loss has occasioned due to theft committed of the precious diamonds worth `45 Lakhs while those were in the custody of their broker Mr.Vicky Naik. In the complaint lodged by M/s.M. Kantilal & Co. dated 04/12/1997 it was simply reported to the Senior Inspector of Police, D.B. Marg Police Station, Mumbai, that as per practice of their trade, they had given goods on Jangad worth `185 Lakhs totalling to 1792.70 Carats to Mr.Vicky Naik on 24/11/1997 due to demand amongst his various clients and after waiting for 3-4 days, when said Mr.Naik was not seen by anybody and he was untraceable. They had contacted him at his residence and in the market and it was found that he had collected diamonds from M/s.Madhav Gems, M/s.Roomy Export, M/s.Decent Impex and M/s.M.V. Enterprise and he was missing and police were requested to do the needful at the earliest to trace out said person. Nowhere in this report dated 04/12/1997, there is mention of theft of diamonds or dishonest retention of diamonds by Mr.Vicky Naik. The complainants and other persons who had given diamonds to the custody of Mr.Vicky Naik did not know what happened to Mr.Naik. So, unless it is proved by the complainants by adducing cogent evidence that loss of diamonds occasioned to them was because of robbery or theft or attempt thereat committed by or where such loss or damage has been expedited or in any way sustained or brought about by any customer of broker or broker’s customer, angadias or cutters or goldsmith in respect of the property hereby insured entrusted to them by the insured, his or their servants or agents. So, proving of theft in respect of diamonds while diamonds were in possession of said Mr.Vicky Naik is sine-qua-non before the Insurance Company can be held liable for the insurance claim involved in this complaint. The Police were unable to trace out said Mr.Vicky Naik. Even if it is held that he is dead since nothing is heard about Mr.Naik for last 7 years, still that cannot ipso-facto mean that said person might have committed theft of diamonds and unless, theft of diamonds or dishonest retention of diamonds by Mr.Vicky Naik is established, no claim under the insurance policy is allowable or can be directed to be paid by the Insurance Company under the insurance policy in question. 17. It is pertinent to note that the Surveyors assessed the complainants/firm loss to the extent of `23,35,454.00. The Surveyors made following observations :- 8.01 The broker who was supposed to have collected diamonds from the Insured is missing/untraceable/absconding with valuables. There is no information about the broker up till today who had taken diamonds from various traders of the market and now after three years there are no chances of tracing him and hence recovery. 8.02 Considering the circumstances under which the diamonds are lost, we are of the opinion that the claim is not tenable under the J.B. Policy issued to and held by the Insured as the broker is absconding/missing. In case he has been killed by someone or he is killed in an accident his body should have been traced. As the broker is missing, there is no exact information available about the valuables/diamonds entrusted to him by various clients. There is no information about what happened to the diamonds, which were reportedly in the custody of the broker and therefore we are of the opinion that the diamonds are lost by the Insured due to dishonesty of the broker. The loss therefore falls under exclusion no.8 of the policy and for which the Insurer’s liability does not arise. 8.03 We have been informed that the police are still trying their best to trace the missing broker. If he is traced at a later date, and if it is confirmed from the adequate evidences that the diamonds were lost due to hold up/robbery or any such insured peril, then the Insurer’s liability may be considered for an amount of assessed loss of `23,35,454.00 (as shown in para 7.08 of this report). The Insurers if they so desire obtain a copy of the final police report directly. 18. It is to be noted that the Insurance Company had not repudiated the claim. But, as per recommendations of the Surveyors they kept the claim alive, so that if in future Mr.Vicky Naik is traced out and if it is found that he was robbed of the diamonds or from his possession the diamonds were dishonestly taken possession of by committing theft, then the Insurance Company may allow the claim lodged by the complainants/firm. It is for this reason too, we are of the view that complaint cannot be allowed in favour of the complainants. 19. In this view of the matter, we are of the strong view that the complainants have not established the liability of the opponent/Insurance Company to pay a sum of `45 Lakhs for the loss they had sustained simply by entrusting the said diamonds worth `45 Lakhs to Mr.Vicky Naik, who is not traceable till this date. There is no presumption in law that said Mr.Vicky Naik had committed theft or somebody had committed theft of diamonds of the complainants, when they were in possession of said Mr.Vicky Naik and unless there is cogent evidence in that behalf, insurance claim as lodged by the complainants cannot be held to be payable by opponent/Insurance Company. In the circumstances, we are finding no substance in the complaint filed by the complainants. Hence, we pass the following order :- -: ORDER :- 1. Consumer Complaint stands dismissed presently. 2. However, liberty is granted to the complainants to pursue the claim with the Insurance Company and/or with Consumer Fora, in case broker is found and if it is found that the broker was subjected to robbery or theft and in that event, decision of this complaint shall not operate as res judicata or bar to file such fresh complaint. 3. Parties are left to bear their own costs. 4. Copies of the order be furnished to the parties. Pronounced Dated 8th February 2011. |
