Chandigarh

DF-I

CC/754/2022

M/s A.K.S Collections - Complainant(s)

Versus

THE ORIENTAL INSURANCE CO LTD - Opp.Party(s)

KARAN MONGA

02 May 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

                                     

Consumer Complaint No.	:	CC/754/2022
Date of Institution	:	22/08/2022
Date of Decision	:	02/05/2024

 

M/S A.K.S Collections, through its proprietor namely Ashish Kumar, Shop No.909, Burail, Sector 45-A, Chandigarh.

… Complainant

V E R S U S

1. The Oriental Insurance Co. Ltd., Registered Office Oriental House, Post Box No.7037, A-25/27, Asaf Ali Road, New Delhi 110002, through its Authorized Signatory.

2. The Oriental Insurance Co. Ltd., Branch at 1193, Phase 3B-2, Mohali, Punjab, through its Authorized Signatory.

3. Pushpinder Singh, Agent/Broker, care of The Oriental Insurance Co. Ltd., Branch at 1193, Phase 3B-2, Mohali, Punjab.

4. The Branch Manager of Oriental Bank of Commerce, Insurance Company, Sector-30D, Chandigarh.

… Opposite Parties

 

CORAM :	SHRI PAWANJIT SINGH	PRESIDENT
	MRS. SURJEET KAUR	MEMBER
	SHRI SURESH KUMAR SARDANA	MEMBER

 

                                                                               

ARGUED BY	:	Sh. G.R. Monga, Advocate for complainant
	:	Ms. Deepa Jain, Advocate for OPs

 

Per Pawanjit Singh, President

1. The present consumer complaint has been filed by M/s A.K.S. Collections, through its proprietor, complainant against the aforesaid opposite parties (hereinafter referred to as the OPs).  The brief facts of the case are as under :-

1. It transpires from the allegations as projected in the consumer complaint that vide rent agreement dated 19.8.2020 (Ex.C-2), complainant, M/s AKS Collections through its proprietor had taken on rent shop No.909, main bazar, Sector 45, Burail, UT, Chandigarh (hereinafter referred to as “subject shop”) from Smt. Jogindero and started running cloth shop in the same.  The complainant got the subject shop insured from OP-1 vide insurance policy (Ex.C-1) which was valid w.e.f. 2.9.2020 to 1.9.2021 Chandigarh (hereinafter referred to as “subject policy”) on payment of requisite premium with sum insured of ₹30.00 lacs.  Prior to that, complainant had got insurance from Future General Total Insurance Solution (Ex.C-3) which was valid w.e.f. 27.8.2019 to 26.8.2020. The complainant also raised CC limit of ₹10,00,000/- from Oriental Bank of Commerce, Chandigarh and has been maintaining the stock register (Ex.C-4) regarding the sale and purchase of all the articles.  The complainant is also having GST No. and paying the GST to the Govt. of India. Earlier the complainant had got the insurance policy from Chola MS General Insurance which was valid w.e.f. 17.11.2017 to 16.11.2018 (Ex.C-6). 

On the night of 25.11.2020 at around 11:20 p.m., complainant got a telephonic message from a worker that the clothes and other articles lying in the subject shop started burning due to fire. Immediately the complainant rushed to the spot and owner of the subject shop had already broken the lock, but, before that the cloths, fans, AC LED, CCTV cameras and DVR were already burnt.  The fire brigade reached the spot and had controlled the fire. The occurrence report recorded by the Municipal Corporation, Chandigarh dated 7.12.2020 is Ex.C-7 whereas the rapat recorded by the Sub Inspector of Chandigarh Police dated 26.11.2020 is Ex.C-8. The complainant had given intimation to the OPs and accordingly they had deputed surveyor, who prepared the loss assessment report (Ex.C-9) on visiting the spot.  Thereafter the complainant also made representation (Ex.C-10) to the Branch Manager of Insurance Company, Sector 30-D, Chandigarh and prior to that had also brought the aforesaid fact to the notice of the OPs vide emails dated 26.11.2020, but, with no success.  The complainant had obtained the subject policy from the OPs just to secure his future life plans, but, the OPs have failed to pay the claim to the complainant despite of that the complainant had suffered a lot due to the fire incident in the subject shop.  In this manner, the aforesaid act of the OPs amounts to deficiency in service and unfair trade practice. OPs were requested several times to admit the claim, but, with no result. Hence, the present consumer complaint.

2. OPs 1, 2 & 4 resisted the consumer complaint and filed their written version, inter alia, taking preliminary objections of maintainability, cause of action and jurisdiction.   However, it is admitted that the complainant had obtained the subject policy from the answering OPs, which was valid w.e.f. 2.9.2020 to 1.9.2021, but, covered only the building, including Furniture, Fixture and Fittings (FFF) regarding which reference was also made in the subject policy.  It is further alleged that the stock of the subject shop was never got insured by the complainant, as such, the complainant is not entitled for the loss of stock/clothes etc.  It is further alleged that the surveyor was deputed by the answering OPs, who had assessed the loss to the tune of ₹57,778/- and as the loss of stocks was not covered under the subject policy, complainant was not held to be entitled for the same. The complainant was asked to accept the claim to the tune of ₹57,778/- assessed by the surveyor, but, it refused to accept the same. On merits, the facts as stated in the preliminary objections have been reiterated. The cause of action set up by the complainant is denied.  The consumer complaint is sought to be contested.
3. In its separate written version, OP-3 has also taken almost similar defence, which has been taken by OPs 1, 2 & 4.
4. Despite grant of sufficient opportunity, rejoinder was not filed by the complainant to rebut the stand of the OP.

2. In order to prove their case, parties have tendered/proved their evidence by way of respective affidavits and supporting documents.
3. We have heard the learned counsel for the parties and also gone through the file carefully, including written arguments.
   1. At the very outset, it may be observed that when it is an admitted case of the parties that the complainant had been running the subject shop, which was got insured from OPs 1, 2 & 4 on payment of requisite premium vide subject policy (Annexure R-1), which was valid w.e.f. 2.9.2020 to 1.9.2021, and the subject shop was gutted by fire on the relevant date, time and place i.e. on the night of 25.11.2020, as is also evident from the copy of rapat (Ex.C-8) and copy of fire occurrence report (Ex.C-7) prepared by the Fire Department, Municipal Corporation, Chandigarh and the claim of the complainant qua the stock burnt in fire has not been considered by the OPs on the ground that the same was not covered under the subject policy and in pursuance to the surveyor report (Annexure R-2), who has approved the claim to the extent of ₹57,778/- only, the case is reduced to a narrow compass as it is to be determined if OPs 1, 2 & 4 are unjustified in not considering the genuine claim of the stock burnt/lost in the fire and the complainant is entitled to the reliefs prayed for in the consumer complaint, as is the case of the complainant, or if the OPs are justified in not considering the claim of the complainant qua the lost/burnt stock in the fire incident and the consumer complaint of the complainant, being false and frivolous, is liable to be dismissed, as is the defence of the OPs.
   2. In the backdrop of the foregoing admitted and disputed facts on record, one thing is clear that the entire case of the parties is revolving around the terms and conditions of the subject policy (Annexure R-1) and the intimation and emails (Annexure R-3) sent by the OPs to the complainant qua the settlement of claim to the tune of ₹57,778/- and the same are required to be scanned carefully for determining the real controversy between the parties.
   3. Perusal of Annexure R-1 clearly indicates that the subject policy was valid w.e.f. 2.9.2020 to 1.9.2021.  In order to determine the fact if the subject policy has covered the risk for stock of the subject shop, the relevant portion of the same is reproduced below for ready reference :-

                        “Risk description : Shops dealing in goods otherwise not provided for.

                        Block description: BUILDING USED AS SHOP

                        SMI Desc           Nature of stock         Sum insured

                        Building incl FFF                               30,00,000 

 

                                xxx                    xxx                    xxx

Cover Wise Details : Cover Name	Sum Insured	Premium
STFI cover	30,00,000	450.00
Fire Basic cover	30,00,000	1,980.00
Earth Quake Cover	30,00,000	450.00
Terrorism cover	30,00,000	450.00

Schedule of premium

TOTAL PREMIUM	5,944.00
STAMP DUTY	0.50
ADD : SGST	535.00
ADD : CGST	535.00
TOTAL AMOUNT	7,014.00

                Total Sum insured in Words : Indian Rupees Thirty Lakhs only.

                Total Premium in Words : Indian Rupees Seven Thousand Fourteen Only.

                                xxx                    xxx                    xxx

                The Insurance under this policy is subject to warranties & clauses otherwise stated herein.

                                xxx                    xxx                    xxx

12.    Stocks (Dwelling, offices, Hotels, Shops etc.)

13.    Material stored in Godown and Silos – Storage of Non-hazardous goods subject to warranty that hazardous goods of Category I, II, III, Coir waste, Coir fibre and Caddies are not stored therein.”

 

4. The learned counsel for the complainant contended with vehemence that as it is clear from the subject policy that it has specifically covered the risk of the shop dealing in goods (stock) including the building as well as FFF (furniture, fixture and fitting), OPs have wrongly not considered the claim of the complainant for the loss of the stock which has already been assessed by the surveyor vide his report (Annexure R-2). 
5. On the other hand, learned counsel for the OPs contended with vehemence that as the subject policy has only covered the building including FFF and the surveyor has assessed the loss to the tune of ₹57,778/-, for which the complainant is entitled, and the OPs have already offered the same to the complainant on the execution of the discharge voucher, there is no deficiency in service on the part of the OPs.
6. There is no force in the contention of learned counsel for the OPs as it is an admitted case of the parties that the subject policy had been issued to the complainant by the OPs/insurer with sum insured of ₹30.00 lacs and as the surveyor himself has assessed the total value of the building as well as FFF to the tune of ₹5,03,559/- i.e. ₹3,60,000/- for the shop and ₹1,43,559/- for the FFF, there was no question of issuing the subject policy by the OPs to the complainant with sum insured of ₹30.00 lacs and the complainant was not expected to get only the rented shop (which was taken on rent vide rent agreement Ex.C-2) insured, without stock, with the sum insured of ₹30.00 lacs on payment of huge premium of ₹5,03,559/-.
7. Not only this, even the risk description in the subject policy specifically refers as “shops dealing in goods otherwise not provided for”.  Learned counsel for the parties were asked to explain the aforesaid clause if the same covers the risk of stock or not for which they have given their own explanations, as per their suitability, without making clear if the same covers the risk of stock or not.  In such a scenario, this Commission has decided to take the assistance of Artificial Intelligence (AI) and finally got the explanation to the aforesaid clause, which is very clear, concise and relevant, as under :-

“Shops dealing in goods not otherwise specified in policy typically refer to stores that sell items that are not explicitly covered or mentioned in insurance policies and these could include specialty items, unique products, or niche markets that aren’t commonly addressed in standard insurance coverage.”

8. Thus, one thing is clear that the OPs, while issuing the subject policy, had also covered the stock of the subject shop, but, cleverly had firstly mentioned the risk description of shops dealing in goods to the complainant and later on mentioned the building including FFF just to mislead the insured while accepting huge amount of premium from the complainant and the said act of the OPs clearly amount to deficiency in service and unfair trade practice on their part.
9. In view of aforesaid discussion, it is safe to hold that complainant has successfully proved the cause of action set up in the consumer complaint and the same deserves to succeed.  OPs are liable to pay the amount of ₹13,99,134/- (loss of stock) + ₹3,95,759/-(loss of building and FFF) = ₹17,94,893/-, as assessed by the surveyor, to the complainant alongwith interest and compensation etc.

4. In the light of the aforesaid discussion, the present consumer complaint succeeds, the same is hereby partly allowed and OPs are directed as under :-

1. to pay ₹17,94,893/- to the complainant alongwith interest @ 9% per annum from the date of claim approval letter i.e. 25.5.2021 onwards.
2. to pay ₹40,000/- to the complainant as compensation for causing mental agony and harassment;
3. to pay ₹10,000/- to the complainant as costs of litigation.

5. This order be complied with by the OPs within forty five days from the date of receipt of its certified copy, failing which, the payable amounts, mentioned at Sr.No.(i) & (ii) above, shall carry interest @ 12% per annum from the date of this order, till realization, apart from compliance of direction at Sr.No.(iii) above.
6. Pending miscellaneous application(s), if any, also stands disposed of accordingly.
7. Certified copies of this order be sent to the parties free of charge. The file be consigned.

02/05/2024 hg	Sd/- [Pawanjit Singh] President
	Sd/- [Surjeet Kaur] Member
	Sd/- [Suresh Kumar Sardana] Member