Haryana

Ambala

CC/257/2022

M/S SOCIETY LEATHER & ALLIED INDUSTRIES - Complainant(s)

Versus

The Oriental Insurance Co Ltd - Opp.Party(s)

Ajay Trehan

06 May 2024

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, AMBALA.

Complaint case no.	:	257 of 2022
Date of Institution	:	12.07.2022
Date of decision	:	06.05.2024

M/s Society Leather & Allied Industries, #171/14, Rama Building, Rai Market, Ambala Cantt-133001, Haryana Through its Proprietor - Mr. Pramod Arora.

……. Complainant

Versus

1. The Oriental Insurance Company Limited Through its Authorized signatory / Managing Director Head Office: A-25/27, Asaf Ali Road, New Delhi - 110002.
2. The Oriental Insurance Company Limited Through its Authorized signatory Divisional Office: 170/2-5, Netaji Subhash Marg, Ambala Cantt - 133 001 (Haryana). Tel. No.: 0171-4090108, 4090100, 4090101.

….…. Opposite Parties

 Before:        Smt. Neena Sandhu, President.

                      Smt. Ruby Sharma, Member,

          Shri Vinod Kumar Sharma, Member.           

 

Present:       Shri Rahul Jain, Advocate, counsel for the complainant

                     Shri Rajeev Sachdeva, Advocate, counsel for the OPs.

Order:        Smt. Neena Sandhu, President.

                    The complainant has filed this complaint under Section 35 of the Consumer Protection Act, 2019 (hereinafter referred to as ‘the Act’) against the Opposite Parties (hereinafter referred to as ‘OPs’), praying for issuance of directions to them to pay the claim amount of Rs.18,18,548/- alongwith upto date interest and compensation to the tune of Rs.5,00,000/- for mental agony and harassment alongwith interest @18% p.a.

2.             Brief facts of this case are that the proprietor of complainant belongs to a reputed Business family based in Ambala who hold a distinguished and significant position in the society and the city. He has been carrying on the business of retail trading of Mobile phones, accessories and other related products for more than 25 years and has a brand name ('Mobile Mall) in the area for the business. The complainant was holding an insurance policy no. 261192/48/2020/63 (Previous policy по. 261192/48/2019/76) issued by the OP. On the fateful day on 30.10.2019, when the employee of the complainant went to the showroom to start the day, he was shocked to see that the wall of the showroom was damaged/dented and the stock in the showroom was missing. He immediately contacted the proprietor of complainant, who upon reaching the incident spot immediately reported to the nearest Police Station. Subsequently, an FIR no.0572 dated 30.10.2019, PS Ambala Cantt was lodged u/s 380, 457; IPC. The proprietor of complainant vigilantly informed the OP about the unfortunate incident of burglary at his showroom on 29/30.10.2019 and initiated the due process for the insurance claim, as stated by the officials of the OPs. Subsequently, Mr. Rajan Sharda R/o #3173, Ist Floor, Sector 27-D, Chandigarh was appointed as the Surveyor & Loss Assessor for the above-mentioned incident who visited the incident spot on the same day i.e. 30.10.2019 and requested the complainant to furnish necessary documents for further proceedings, which was duly submitted in toto by the complainant. The goods amounting to Rs.18,18,548/- approximately were stolen from the premises due to the said incident, the details of which was supplied to the OP. In the case (UCR 1589/2021) titled as State through Pramod Arora Vs. Unknown regarding the above-mentioned FIR, the untraced report was presented before the Ld. Court of Additional Chief Judicial Magistrate, Ambala on 05.08.2021 vide CNR no. HRAM030093622021, which was duly submitted to the OP too. The complainant was shocked upon receiving a letter dated 22.03.2022 from the OP stating, "... The competent authority has approved your claim for Rs.3,24,717/- subject to following formalities...". The proprietor of complainant contacted the officials of the OP regularly via different mediums to know the future course of action, but instead of pacifying the complainant they tried to dilly-dallying the matter with an excuse that they are in constant touch with the senior executives and resultantly, assured the proprietor of complainant to process his claim only if he will keep calm and cooperate. The proprietor of complainant has been requesting the OP for paying the aforesaid outstanding amount of claim along with interest through the medium of telephonic conversation as well as long e-mail trail from the period of Nov' 2019 onwards but to no avail. Ultimately, the complainant sent a legal notice dated 04.04.2022 claiming for the above-mentioned amount. In reply to the said legal notice it was stated by the OPs that  "...requested your client to provide stock registers and the purchase and sale invoices of the mobile and other articles which your client has failed to supply the same...". Alongwith said reply, the OP annexed the survey and assessment report dated 09.12.2020 of the surveyor, Mr. Rajan Sharda and upon the careful perusal of the same, it is clearly revealed that the complaint submitted all the required documents which was annexed by the surveyor himself alongwith his report. Though the policy doesn't mandate the maintenance of stock register but still to co-operate with the surveyor, the claimant appointed CA Jagmohan Seth to furnish all the details including stock, etc. which was duly submitted to the surveyor. The complainant took best possible and reasonable care of all the products, which a prudent owner of mobile shop would rationally do. The complainant installed a closet with proper lock and key facility which accommodates more than 300 pieces of handset with due care and safety. It would be irrational to presume that the complainant or infact, any other shopkeeper will create a strong room or a safety vault for storage of mobile phones. Hence, the present complaint.
3.           Upon notice, OPs appeared and filed written version wherein they took various preliminary objection to the effect that the complaint is not maintainable either in law or on facts and is liable to be dismissed in limine; the complaint is false, frivolous, vague and vexatious in nature and has been made to injure the reputation of the OPs; the complainant has not come to this Commission with clean hands and suppressed the material facts etc. On merits, it has been stated that the OPs deputed a Surveyor namely Ranjan Sharda, Approved Surveyor and Loss Assessor, for the assessment of loss of the complainant and the said surveyor immediately visited the premises of the complainant for the assessment of the loss and requested the complainant to provide Stock Register and purchase and sale invoices of the Mobiles and other articles for verification which complainant has failed to supply the same. The complainant has claimed loss of 119 mobile handsets along with packing boxes. The number of handsets claimed as stolen was observed by surveyor on abnormally high side keeping in view the storage space available in the shop. The complainant has mentioned IMEI numbers of stolen handsets which in absence of purchase, sale invoices and stock record could not be verified. The complainant submitted list of purchase and sale since 01.09.2020 to till 29.10.2020 to the surveyor. The details, information and documents to substantiate their claim was not provided by the complainant in time and surveyor reminded again and again through various registered letter, reminders dated 14.11.2019, 23.11.2019 and 26.11.2019. Keeping in view the volume of business conducted by complainant surveyor has considered 10 days purchases as stock holding in complainant shop. The complainant had purchased stock worth Rs.35,53,177/- since 1.09.2020 till date of incident i.e. 29.10.2020 total 59 days. The average purchase of 10 days is worked out as 3553177 10/59-602230 as stock holding in shop at the time of incident. The complainant did not maintain stock register or submitted purchase and sale invoices for verification in support of items claimed as stolen. Thus a deduction of 25% has been applied on value of stock stolen on account of non submission of purchase and sale invoices and non maintenance of stock record. In mobile handset industries every day a new model by different brand manufacturers is launched. The price of any mobile hand set after few months of its launch decreased. The old models of any brand becomes non saleable because of launch of new models with new features. Accordingly a deduction of 10% each for dead stock and price reduction has been applied. The report prepared by the surveyor is on the basis of actual and physical verification and he assessed that the loss amount is Rs.3,35,479/-. The surveyor mentioned details of each and everything regarding his report. The value of the risk assessed by the surveyor is Rs.4752450/- and the sum insured declared by the complainant was Rs. 36 Lakhs and Rs. 10 Lakhs of garments lying at other shop i.e. total Rs.46 Lakhs therefore the value of the risk was under insured and the Surveyor applied under insurance policy. As such, the surveyor applied average clause the loss assessed is adjusted as 335479*4600000/4752450= Rs.324717/- as per terms and conditions of the policy. As per the surveyor report the OPs rightly approved the claim amount of Rs.3,24,717/- and are still ready to pay subject to completion of formalities by the complainant, mentioned in letter dated 22.03.2022. The parties are bound to follow the terms and condition of the Policy issued for insuring the burglary loss as claimed. The policy in favour of the complainant was issued on the basis of terms and conditions which are operative upon both the complainant and OP. Public money can't be fleeced at the whims of the complainant. Each and every aspect is taken note of it before taking final decision so that the idea and scheme be not defeated.  It is settled law decided by Hon'ble National Commission in case titled National Insurance Co. Surinder Lal Arora reported in 1995 (2) CLT 374 that there is General tendency to lodge false claim before consumer forum as there is no court fees are payable for processing it and filling of such false complaint are abuse of the process of consumer protection act. The OPs arrived at the conclusion after scrutiny of surveyor report and examination of the documents. On receipt of the surveyor report, the OPs approved the claim of the complainant for Rs. 3,24,717/- which was immediately communicated to the complainant vide letter dated 22.03.2022 subject to submission of formalities as mentioned in the said letter. The OPs are still ready to pay the approved claim amount of Rs.3,24,717/- subject to submission of formalities as mentioned in the said letter. Rest of the averments of the complainant were denied by the OPs and prayed for dismissal of the present complaint with costs.
4.           Learned counsel for the complainant tendered affidavit of the Pramod Arora son of Vijay Behari R/o 69B, Gobind Nagar, Ambala Cantt. (Haryana) for M/s Society Leather & Allied Industries, Ambala Cantt. as Annexure C-A alongwith documents as Annexure C-1 to C-14 and closed the evidence on behalf of the complainant. On the other hand, learned counsel for the OPs tendered affidavit of Rameshwar Singh Kaler, Manager TP HUB/Authorized Signatory for the Oriental Insurance Company, LIC Building, Ambala Cantt. and affidavit of Rajan Sharda approved Surveyor and Loss Assessors resident of House No.3173 First Floor, Sector-27-D, Chandigarh, Haryana as Annexure OP/A and OP/B respectively alongwith documents as Annexure OP/1 to OP/9 and closed the evidence on behalf of OPs.
5.           We have heard the learned counsel for the parties and have also carefully gone through the case file.
6.           Learned counsel for the complainant submitted that by deducting substantial amount from the claim amount of Rs.18,18,548/- on flimsy grounds and passing only an amount of Rs.3,24,717/-, the OPs are deficient in providing service.
7.           On the other hand, learned counsel for OPs while reiterating the objections and contentions raised in the written version submitted that the OPs arrived at the conclusion after scrutiny of surveyor report and examination of the documents. He  further submitted that on receipt of the surveyor report, the OPs approved the claim of the complainant for Rs. 3,24,717/- which was immediately communicated to the complainant vide letter dated 22.03.2022 subject to completion of formalities by the complainant, as mentioned in the said letter. He further submitted that on the OPs are still ready to pay the claim amount of Rs.3,24,717/- subject to submission of formalities as mentioned in the said letter.
8.           From the perusal of the surveyor report dated 09.12.2020, Annexure OP/2, it is evident that surveyor after making deduction from the claim amount of Rs.18,18,548/- has approved the claim amount of Rs.3,24,717/-. The said surveyor made the deduction on the ground that:-       
   1. The complainant failed to submit purchase and sale invoices and did not maintain stock record as such deduction of 25% on value of stock stolen on account of non submission of purchase and sale invoices and non maintenance of stock record, has been levied.
   2. In mobile handset industries every day a new model by different brand manufacturers is launched and the price of any mobile hand set after few months of its launch decreased. The old models of any brand becomes non saleable because of launch of new models with new features and accordingly, deduction of 10% each for dead stock and price reduction has been applied.
9.           The first question which arises for consideration is that as to whether the surveyor was right in assessing the value of the goods, by taking the stock to be on the basis of average of purchase price of 10 days and further making deduction of 25% on the value of the stock assessed at the time of theft on the ground that the complainant did not submit purchase and sale invoices and did not maintain stock record.  It may be stated here that we have gone through the survey report and found that at last page of the said report, it has been clearly  mentioned by the said surveyor that following documents are enclosed with the said report, as under:-

 

1. Survey report 2 copies
2. Claim form
3. Copy of Insurance policy
4. Copy of Policy Report
5. List of goods stolen
6. Copies of trading account as on 28.10.2018
7. Copies of Balance sheet for last 3 years
8. Copies of few purchase bills
9. Copies of income tax returns
10. Copies of GST Returns
11. Copies of stock statements submitted to bank
12. List of purchase and sale since 01.09.2019
13. Digital photographs 17 No.s
14. Survey fee bill

 

10.           Thus perusal of documents enclosed with the surveyor report itself falsifies the version of the surveyor and also of the OPs that the complainant failed to submit necessary documents like stock statements, list of purchase and sale invoice and other necessary documents, referred to above. Since the complainant had submitted the copies of trading account, GST returns, Balance sheet for last three years, list of goods stolen and stock statement, thus, without rejecting these documents the estimate of stock to be of 10 days average purchase, could not be applied. The actual value of the loss as per books and documents should have been taken or reason should have been given for not accepting the value as demanded by the complainant. In this view of the matter, the surveyor cannot be said to be right in assessing the value of the loss suffered by the complainant due to theft, thus, the amount of loss assessed by the surveyor is not acceptable.    
11.           The second question which arises for consideration is that as to whether the surveyor was right in making deduction of 10% on the reason that in mobile handset industries every day a new model by different brand manufacturers is launched and the price of any mobile hand set after few months of its launch decreased; that the old models of any brand becomes non saleable because of launch of new models with new features and accordingly, deduction of 10% each for dead stock and price reduction has been applied.  In our considered opinion, once the OPs themselves have insured the total stock kept in the premises of the complainant for an amount of Rs.36 lacs on 29.08.2019 i.e. just before around 2 months of the theft of the insured stock amounting to Rs.18,18,548/-, now after two months of theft on 29.10.2019, the OPs cannot take a ground that 10% deduction is made because the prices of mobile handset decreases after few month and that the old models of any brand becomes non saleable because of launch of new models with new features.
12.           Under above circumstances, it is established that the OPs are deficient in providing service by making such a huge extent of deductions out of the total amount of Rs.18,18,548/-, and on the other hand, passed the amount of Rs.3,24,717/- only.
13.           Considering this fact that surveyor in his report has mentioned that sometimes discount is given to the customers by the complainant which is not reflected in the trading account; that the insured has not assigned value to the list of saved stock and few purchase bills were provided by the complainant, we are of the opinion that if we allow the claim amount to the extent of 75% of the total claimed amount that will meet the ends of justice. It is therefore held that the complainant is entitled to get claim amount of Rs.13,63,911/- out of Rs.18,18,548/-.
14.           In view of the aforesaid discussion, we hereby partly allow the present complaint and direct the OPs, in the following manner:-

1.   To pay the claim amount of Rs.13,63,911/-  (75% of the Rs.18,18,548/-) to the complainant alongwith interest @6% p.a. w.e.f 12.07.2022, the date of filing of the complaint, till its realization.
2.   To pay Rs.8,000/- as compensation for the mental agony and physical harassment suffered by the complainant.  

          The OPs are further directed to comply with the aforesaid directions within the period of 45 days, from the date of receipt of the certified copy of the order, failing which the OPs shall pay interest @ 8% per annum on the awarded amount, from the date of default, till realization. Certified copy of this order be supplied to the parties concerned, forthwith, free of cost as permissible under Rules. File be indexed and consigned to the Record Room.  

Announced:- 06.05.2024

(Vinod Kumar Sharma)	(Ruby Sharma)	(Neena Sandhu)
Member	Member	President