This case has been brought by Managing Director, Cygnet Computers Pvt Ltd, Sri Shiv Nandan Prasad, S/o Late Ganesh Mahto, R/o-201, Sitaram Ganpati Awas, New Punai Chak, P.O-Lal Bahadur Shastri Nagar, P.S-Shastri Nagar, Distt-Patna-800023 against The Branch Manager, Oriental Insurance Co. Ltd. CBO IV, Gangotri Complex, Boring Road, Patna (O.P no.1), The Sr. Divisional Manager, Division-II, Oriental Insurance Co. Ltd, Dr. CP Thakur Complex, Fraser Road, Patna-800001 (O.P no.2) for the following reliefs:
- Opposite Party be directed to modify the policy bond keeping in consononance with the proposal form amounting to Rs. Sixty lakhs in place of Rs. Six lakhs.
- Opposite Party be directed to pay Rs.18,62,529.00 to indemnify the loss sustained with interest @ 10% from the date of payment of premium against the policy till realization.
- Opposite Party be directed to pay compensation Rs. one lakh for loss suffered mental agony etc.
- Opposite Party be directed to allow Rs.10,000 as litigation cost to the Complainant.
The above reliefs have been claimed, on account of the facts moving around in the complaint that this case has been brought to modify or enhancement of payment made by the Opposite Party against the policy no.331103 or to remove deficiency in services, negligence, faults of the Opposite Parties No-1 & 2. The Opposite Parties have not performed/ discharged their legal duties/ obligations according to Insurance Act/ Rules, as also of the Contract Act. The Opposite Parties have compelled the complainant to accept lesser amount. To which the loss incurred due to malafidy, bad intention. On account of the Opposite Parties defaults/ faults/ negligence/ deficiency in services, the complainant has also compelled to fact huge monetary loss, / mental agony/ physical harassment/ unnecessary litigation. Further stated that insured had taken an insurance policy with the Opposite Parties under Burglary policy for the period, 28.7.10 to 27.7.11 with the help of the Opposite Party no.1 of this case. The assured had paid first premium to the Opposite Party no.1 and the Opposite Party no.1 had accepted the same and issued policy bond of lesser amount than proposed amount to the insured. Photocopy of policy bond is annexed as annexure 1. Further stated that the insured had proposed for a policy of Rs. 60,00,000.00 (Rupees Sixty Lakhs) only at the time of filing proposal form. The Opposite Parties have seen and verified all the clauses of the proposal form, which has been written/ mentioned in the proposal form by the proposer in presence of competent authority. The Opposite Parties have not raised any objections at the time of filing the proposal form but at the time of issuing the policy the insurer has wrongfully issued policy of Rs.6,00,000 (Rupees six lakhs) only to the insured without informing to the insured concerned, in other word we can say that the Opposite Parties had full knowledge about the contents of the proposal form written by the prosper. The Opposite Party can not reject/ reduce proposal without informing to the party concerned. Proposal form was filed much earlier with required formalities. Further stated that the Opposite Parties issued policy bond to the insured with certain terms and conditions on date 03.08.11, then only the Complainant came to that the insurer had issued policy for a sum of Rs.6,00,000.00 only against the Rs.60,00,000.00 only proposed sum without disclosing any reason. The Complainant filed a request petition under Right to Information Act 2005 and sought information regarding full details of proposal as to ascertain whether the Complainant had proposed for sixty lakh or not? Further stated that the Opposite Parties have not given proper information to the petitioner which could have established the fact of submitting the proposal form for Rs. 60.00 lakhs by the Complainant. Copy of letter is annexed as annexure 2. Further stated that during life time of the policy burglary incident took plakhe in the night between 30.7.10 to 31.7.10 and Formal F.I.R was lodged against unknown in local police station dated 31.7.10. The total loss of the items in burglary was submitted to the police for total amounting Rs.18,62,529.00 The police investigated and enquired the matter and submitted final form under the eye of law. Copy of F.I.R/ final form/ list of articles carried away in burglary are annexed as annexure no. 3. Further stated that the insured filed claim petition for the aforesaid amount of Rs.18,62,529.00 within time in the office of the Opposite parties for considering and passing the claim in favour of the insured. It is further stated that the act and omission on the part of Opposite Parties amounts to deficiency in service, restrictive trade practice and Unfair Trade Practice. Therefore, the payment dated 15.10.2012 is fit to be rejected or to modify and enhance in favour of Complainant. The Opposite Parties have committed faults due to their own act. It is mandatory duty of the Officers of the Opposite Party no.1 and 2 under the insurance at to inform the proposal before accepting the policy, if, defect appears. The Complainant wanted renewal of the previous policies and handed over the policies, documents to the Opposite Parties in prescribed manner on 21.07.10. But due to negligence/ fault of the Opposite Parties fire policy of Rs.60 lakhs and money insurance policy were renewed but burglary polices were left. Renewed policies paper issued to the Complainant on 27.07.2010. The Complainant had no option but to file a fresh proposal form to the Opposite Party for insuring against burglary for Rs. 60 lakhs. Opposite Party had no legal right to reject proposal form. Further stated that Complainant requested for modification in the policy but the Opposite Parties did not pay any heed to his rightful requests letter dated 2.8.10 and did not consider even the trend of the insurance for the last several years. The insurance for previous years was for Rs.50.00 lakhs for the stock in trade and 10 lakhs for furniture and fixers then from any angle of imagination, it cannot be reduced for Rs.5.0 lakhs only particularly when Rs.10 lakhs was for furniture and fixers. It is a clear proof of negligence on the part of opposite parties in making policy of only six lakhs in plakhe of Rs sixty lakhs and needs interference of the Hon’ble Forum. Further stated that it is important to mention here that the insured had not seen/ got policy bond before incident because the policy was issued after the incident, therefore, the Complainant was not in position to file any objection with regards to sum insured in the policy before the incident which is evident from the facts and circumstances itself. It is humbly submitted and stated that the Complainant filed a letter dated 02 Aug 10 to the Opposite Parties stating full fact very clearly. From Perusal of letter, it appears that the policy holder was not excepted rather surprised that the insurance company has accepted such a minor sum insured amount while the policy was continued since 22.07.2007. The Complainant had always taken Rs. 60-70 lakh burglary insurance policy from the Opposite Parties time to time. There was no reason to reduce the sum insured by the insured. At least the opposite parties should have enquired the matter before issuing policy of such lesser amount. The Opposite Parties have verified the premises time to time and granted policies. Due to faults, mistake of the Opposite Parties, the Complainant has been put to suffer heavy/ huge loss. Photocopy of letter dated 02.08.2010 is annexed as annexure 4. Further stated that so far as letter of subrogation is concerned it is said that same cannot be treated and considered as full and final settlement of the claim. Because the complainant has transferred only the power to the insurer to sue in case of recovery of goods and in case it is recovered/ found then the payment be advance payments in future. From perusal of letter of subrogation, it would be clear that it is stated that in the event of the said property/ vehicle traced at the future date I undertake back the said property and treat the above payment as an advance payment towards the said loss and refund to the Oriental Insurance Co. Ltd, the full sum of Rs.162788.00. On the understanding that the Oriental Insurance Co. Ltd with indemnify me against loss or damage to the said property/ vehicle which occurred to it whilst it was not in my custody or control. Further stated that there are some important questions for consideration here that on what ground the Opposite Parties have granted Rs.6,00,000.00 sum insurance while the Complainant had proposed for 60,00,000.00? Why the insurer has not verified earlier policy? In fact the insured wanted for renewal of the policy in question but due to mistake, fault on part of the Opposite Parties the earlier policy was not renewed in time, therefore, the complainant filed a fresh proposal form. It is also very important to mention here that the Complainant had given a cheque to the opposite party against the required premium. Further stated that the Ld CJM has accepted police form in toto, hence the insurer has no option to go beyond the CJM order. Incident is not doubtful, LD CJM finding was not challenged in any court of law, loss was confirmed therefore, there was no reason to grant lesser amount. Due to faults the Opposite parties, the Complainant has suffered loss. Copy of order of LD CJM Patna is annexed as annexure 6.
It appears from the records that in this case show cause/ W.S has been filed on behalf of Oriental Insurance Company wherein it has been stated that application of the Complainant is not maintainable. It has been stated that burglary standard policy was issued in the name of Complainant by this Opposite Party for a period of 1 year from 22.07.2009 to 21.07.2010 sum assured was for Rs.50 lakhs for stock of Computer, Printer, Laptop etc and Rs.10 lakhs were for furniture, fixture, fitting and Rs.16,545/- was paid by the Complainant for total premium. Annexure A is the policy dated 22.07.2009. The Complainant did not renew the above mentioned policy and purchased another burglary policy for a period of 1 year from 28.07.2010 to 27.07.2011 which was only for Rs.5 lakhs for stock of computers and others and Rs.1 lakhs for furniture and others to which premium amount was paid by the Complainant. Photostat copy of policy dated 28.07.2010 is annexed herewith. It is relevant to mention that there was huge difference between in amount of premium for covering risk of Rs. 60 lakhs and Rs.1 lakhs. The Complainant himself obtained for total sum Rs. 6 lakhs which is evident from payment. So far as the burglary incident is concerned insurance company has already settled the claim. Annexure C is the relevant in this regard. Therefore, this complaint case is false and frivolous and not maintainable and referred Supreme Court Reported in (2000) 10. Lastly submitted that the complaint case is fit to be dismissed.
The main point for consideration in this case is that whether the Complainant is entitled to a claim as prayed for?
Heard both sides. Learned Counsel on behalf of Complainant submitted that as per the facts of the complaint it would transpire that Complainant has been put into trouble unnecessarily as the premium amount whatever it was deposited that was not at all the premium for Rs.6 lakhs rather it was for Rs.60 lakhs. The story about the deposit of the premium will alone say the story about committing illegality with the Complainant. It has also been contented that Complainant just wanted renewal of the previous policies and handed over the policies document to the Opposite Party with prescribed manner on 21.07.2010. But due to negligence and fault of the Opposite Party fire policy of Rs.60 lakhs and money insurance policy was left by the Opposite Party. Opposite Party did not hand over the policy till 26.07.2010 thereafter Complainant came to know only burglary policy have not been renewed. Renewed policy papers renewed to the Complainant on 27.07.2010. Then again finding no option Complainant had filed a fresh proposal form with the Opposite Party for insuring against burglary for Rs.60 lakhs. Previously also the policy was for Rs.6 lakhs but Opposite Party without having any legal right to reject proposal form without informing to the party concern. But no information was given whatever the incident has taken plakhe on 30.07.2010 the Opposite Party had not submitted surveyor report and the insurance company has not raised any dispute regarding the stolen goods in any manner so the Opposite Parties had no valid reasons to reduce rightful claim of the Complainant. The Opposite Party did not consider the claim of the Complainant in right prospective. Policy holder has not accepted that the insurance company has accepted such a minor sum assurance amount while the policy was continued since 22.07.2010. The Complainant had always taken burglary insurance policy for Rs.60 to 70 lakhs from the Opposite Parties time to time. Therefore, there was no reason to reduce the sum insured by the insured. The Complainant was not in a position to file any objection as he had got no policy bond before incident as the policy was issued after the incident. Hence, the objection with regards to sum assured in the policy. It has further been contended that so far as letter of subrogation is concerned that it cannot be considered as full and final settlement of the claim because the Complainant has transferred only the power to the insurer to sue in case of recovery of goods. From perusal of letter of subrogation it would be clear that in the event of said property/vehicle traced in future the Complainant under take to back the said property and treat the above payment as an advanced payment towards the said loss and refund to the Oriental insurance company ltd the full some of Rs.162788.00/-.
The Learned Counsel on behalf of the Complainant in detail further submitted that the usual practice for renewal of the policy was that the Complainant used to send a signed blank cheque as per insurer desire to the concerned authority of the Opposite Party no.1 well in advance. Because the exact renewal premium amount was not known to the Complainant insured. The insurance company used to issue renewal policy after depositing the premium amount through cheque for renewal of two policies i.e. “Standard Fire and Special Peril Policy”. Further submitted that the Opposite Party no.1 issued Standard Fire and Special Peril Policy no.331103/11/2010/94 for the period 22.09.2009 to 21.07.2010 and the sum insured was Rs.60,00,000/- under and Second policy no. 331103/482010/621 for the period 22.07.2009 to 21.07.2010 the sum insured was Rs.60,00,000/-. It is stated that the Opposite Party no.1 issued Standard Fire and Special Peril Policy no.331103/11/2011/127 for the period 22.07.2010 to 21.07.2011 and the sum insured was Rs.60,00,000/-. The burglary policy was not issued although the Complainant as per practice given a blank cheque in the name of The Oriental Insurance Co. ltd. It is submitted that the Complainant went to collect the renewal Insurance Policies from the Branch Office then he could know that only Standard Fire and Special Peril Policy from 22.07.2010 to 21.07.2011 was issued. The Complainant pointed out about the non-renewal of Burglary Policy of stock, Fixtures and Furniture, and then the Complainant was asked by the Opposite Party no.1 to submit fresh proposal form. It is also stated that the Complainant submitted proposal form for issuance of Burglary Policy from 22.07.2010 for sum of Rs.50,00,000/- for coverage of stocks and Rs.10,00,000/- for coverage of Fixture and Furniture total being Rs.60,00,000/-. The officer concerned wrote on the corner of the proposal form for renewal of Policy no.331103/48/2010/621. It is stated that unfortunately in the intervening night of 30/31.07.2010 a burglary took plakhe in the insured premises and burglar took away computer/ laptop and its costly components worth Rs.18,62,529/-. Further stated that the Complainant submitted written information to the Srikrishnapuri Police Station which was registered as Srikrishnapuri P.S Case no.124/10 dated 31.07.2010 U/S 379/461 IPC. The Complainant also informed to the Opposite Party no.1. It is stated that the Opposite Party no.1 issued Burglary Policy no.331103/48/2011/705 for the period 28.07.2010 to 27.07.2011 and the sum insured under stock in trade was Rs.5,00,000/- and Furniture, Fixture and Fittings for Rs.1,00,000/- instead of Rs.50 lakhs and Rs.10 lakhs respectively on 31.07.2010 when they knew about the incident of theft. Insurance company has deliberately issued a wrong Insurance Policy by antedating it after knowing the fact regarding loss due to theft of insured stock. It is stated that the Opposite Party Insurance Company appointed Mr.S.K. Shahi, Surveyor and Loss Assessor who visited the insured premises on 31.07.2010 and 02.08.2010 and as per his requirement the Complainant co-operated the surveyor and gave full assistance and supplied documents. The surveyor submitted surveyor report on 10.02.2011. Said surveyor assessed the loss to the tune of Rs.18,62,529.38 but applied average clause as the sum insured was Rs.5 lakhs under heading stock in trade. It is stated that the Opposite Party insurance company paid Rs.1,68,788/- as against the loss of Rs.18,62,529/-. The Complainant aggrieved with the decision of the Opposite parties filed the present complaint. On notice the Opposite parties appeared. Written statement was filed by Opposite Parties raising only objection that the Complainant has received amount in full and final settlement of the claim. It has lastly been submitted that the main case for consideration is that while proposal was accepted by the Opposite Party no.1 then there was no occasion for the Opposite Party no.1 to issue wrong policy. The Opposite Party insurance company is liable to pay the damage as assessed by surveyor. The insurance company can charge the premium amount on enhance insured amount and relied upon 1994(2) CPR 549 (NC). Further drawn the attention the circular of IRDA dated 24.09.2015 which reads as follows “Where the liability and quantum or claim under a policy is established, the insurers shall not withhold claim amounts. However, it should be clearly understood that execution of such vouchers does not foreclose the rights of policy holder to seek higher compensation before any judicial fora or any other for an established by law.” Further referred III (2016) CPJ 40 (NC) and submitted that once circular is issued by IRDA it is not open to the insurer to contend that discharge voucher in full and final settlement of its claim was submitted by the Complainant and also relied upon the decision Arb. P. No. 459/2015 Worldfa Exports Pvt Ltd. Vs. United India Insurance Co. Ltd. (Decided on 11.12.2015 by Delhi High Court)- Amount received by insured and discharge voucher issued as Full and Final settlement, the Insurance Company is liable if claim and entitlement is higher than the amount received by the insured. (Para 3.3, 3.4, 5.1, 5.5, to 5.10, 6.1 to 7.7, 8.1 and 8.2). Further stated that Civil Appeal no. 8249 of 2022 M/s Texco Marketing Pvt. Ltd. Vs. Tata AIG General Insurance Co. Ltd.- (Para 21, 23 to 29, 30, 31, 35, 36 and 39) A dispute before the Consumer Commission is to be seen primarily from the point of view of the Consumer as against the civil suit. It is only to avoid any possible bottleneck in granting the relief. Lastly contended that Opposite Party be directed to pay the rest of the amount as claimed on account of the policy which was infact opted by the Complainant and also in view of the surveyor report which cannot be denied by the Opposite Party.
Learned Counsel on behalf of Opposite Party submitted that burglary Standard Policy was issued in the name of Complainant by Opposite Party company for a period of one year from 22.7.2009 to 21.07.2010 in which sum insured was Rs.50,00,000 (fifty lakh) for Stock of computer, printer, laptop etc. and Rs.10,00,000/- for furniture, fixture, fitting etc. for which total premium amounting of Rs.16,545/- was paid by the Complainant. The Policy is Annexure-A of the WS of this Opposite Parties. It is stated that the purchased another burglary policy for a period of one year from 28.07.2010 to 27.07.2011 in which sum insured was Rs.5,00,000 (five lakh) for stock of computer, printer, laptop etc. and Rs.1,00,000/- for furniture, fixture, fitting etc. for which total premium amounting Rs.1,324/- was paid by the Complainant. The said Policy is Annexure-B of the WS of this opposite parties. It is stated that the amount of premium had been paid by the Complainant and copy of the policy had been duly received by the Complainant but no objection was raised by the Complainant after receipt of the policy. It is relevant to mention here that there was huge difference between amount of premium for covering risk of Rs.60.00 lakh and Rs.6.00 lakh and the Complainant himself opted for total sum insured of Rs.6.00 lakh, which is evident from payment of Rs.1,324/-. It is relevant to mention here that the Complainant has knowledge regarding payment of lessor amount of premium. The Complainant himself admitted to paragraph no. (f) of complaint that under heading grounds it is mentioned that policy papers were received on 27.07.2010. It is stated that the insurance company settled the claim as per terms and conditions of the policy and paid Rs.1,62,788/- to the Complainant and the same has been received without any protest, which is evident from Annexure-C of WS of this Opposite Parties and also relied the decision of Supreme Court reported in (2000) 10 Supreme Court Cases 334 New India assurance co. ltd. vrs Sri V.P.R and B Rice Mill, in which it has been observed that where assured agrees to accept a certain amount in full and final settlement of his claim then he is bound of his commitment and the same view has been expressed by National Consumer Dispute Redressal Commission in various cases. (Judgment of Supreme Court attached). Lastly submitted that there is no deficiency on service on the part of the O.P.
Having heard the rival contention on behalf of both the sides and after comparison of the submissions and the observations of the Hon’ble courts as referred to here as above, we are of the opinion that in fact there is no denial about the insurance policy. Though it has been objected as discussed and about the story of amount sum assured there are contradiction as indicated but after considering the premium amount so required to be deposited which is enhanced amount than the present premium which alone tells story a volume against the Opposite Party and it supports the contention of complainant. Besides the above the report of surveyor who assessed the loss i.e Rs. 18,62,529 but paid only Rs. 1,68,788 only completely shows a case of deficiency of service by the Opposite Party that, if, the policy was not as per the proposal then it might have been raised by the Complainant at the time of issuance of policy. Not only this but it has also been submitted on behalf of Opposite Party that under the reasonable period defined under rule must have been adopted by the Complainant but after all we are going to consider about the premium amount so deposited and also about making no payment in pursuance of Surveyor report which appears to be surprising. The observation of Hon’ble S.C and others as well as IRDA rules as referred to here above, therefore we consider to allow this complaint case to the extent that Opposite Party is directed at first to correct the policy for which in fact the Complainant had proposed and thereafter made payment of the premium and after considering report of surveyor of which suggested the total loss amount i.e. Rs.18,62,529/- but Rs.1,68,788/- was only paid. The submission on behalf of O.P that once the claim so settled is accepted by the Complainant in a such case the Complainant cannot raise claim for the same in this regard the decision of the Hon’ble court cited on behalf of Complainant has already been referred to here above that, if, the policy has not been opened correctly whatever it was required to open in a such case the plea taken by the Opposite Party is not sustainable. Hence, this complaint case stands allowed with the aforesaid observation.
The Opposite Party is directed to correct the insurance policy as it was proposed on behalf of Complainant connecting to this and payment be made at least for Rs. 18,62,529/- (Eighteen Lakhs sixty-two thousand five hundred and twenty-nine) after deducting Rs. 1,68,788/- as already paid within two months of this order including the 6% interest accrued there on from the date of filing of this case i.e. 19.12.2012. In case of non-payment, Complainant shall be entitled to recover the amount in due course of law.
However, after above, it is specifically observed that whatever the amount as above is required to be paid by O.P to complainant, same shall be paid after deduction of the amount already paid and also after deduction of total premium amount as it was amounting to be paid by the complainant for the aforesaid policy after subtracting the premium amount already paid with the interest accrued thereon (from the date when it was to be deposited).
