1. These are the complaints filed by the Complainants against the Opposite parties under section 12 of the Consumer Protection Act. The grievance of the complainants are that they are the registered partnership concern represented by them as Managing Partners carrying on the business of hulling paddy by obtaining facility of loan of Rs.20,00,000/- and Rs.18,00,000/- respectively from the second Opposite party. The stock available in their godown is hypothecated to second Opposite party as primary security and that the second Opposite party was conducting periodical inspection of the stock stocked by them in the godowns. The second Opposite party has insured the stock in trade belonging to them stored in their godown with first Opposite party out of six godowns, three of the godowns belongs to each of these complainants. On 26.04.2004 at about 6.00 A.M. they received fire accident information in their godowns, they suddenly rushed to the spot and saw their godowns caught fire, then they immediately secured fire force for extinguishing the fire. They have also given complaint to the police regarding the incident on the same day. Second Opposite party has informed the first Opposite party regarding fire incident. The first complainant has stated that he had stored 2000 bags of paddy, each bag containing 75 Kgs. in the first 2 godowns and in the third godown he had stored 1000 new empty gunny bags of the value of Rs.1,00,000/-. The entire stock of paddy bags to the tune of 3,000/- bags of the value of Rs.13,17,250/- perished fully apart from damages to the stock of paddy, 3 godowns were exclusively damaged totally 6 godowns are damaged due to fire incident. They suffered damages to the building at Rs.2,00,000/- each. The surveyor of the first Opposite party on 29.09.2004 without notice to them and the second Opposite party has submitted a report copies of the report were also not given to them. That they did not hear anything from the first Opposite party and second Opposite party informed them that first Opposite party has not settled the claim towards loss in the fire. The surveyor with an intention to mislead got the sample tested showing that only 13% of the burnt stock is paddy and the rest is husk. The Opposite parties are therefore trying to escape from their liability and thus the 1st complainant has claimed Rs.10,37,500/- towards loss of paddy and gunny bags with interest at 18% p.a. and damages of Rs.2,00,000/- in all Rs.15,48,750/- against the Opposite parties.<br /> 2. The second complainant has contended that he had also stored 2000 paddy bags in two godowns each containing about 75 Kgs paddy and stored 1000 empty gunny bags of the value of Rs.1,00,000/- in the third godown. The entire stock of paddy bags to the tune of 2,000/- bags of the value of Rs.9,37,500/- and the empty gunny bags of Rs.1,00,000/- perished fully and it is further repeating what is said by the first complainant and has prayed for awarding Rs.10,37,500/- towards loss of paddy and gunny bags with interest at 18% p.a. and Rs.2,00,000/- towards damages.<br /> 3. The first Opposite party has filed version admitting issue of 2 insurance policies insuring in the stock in trade in the godowns of these complainants and stated that the policy does not cover the risk of loss to the building, denying the contents of para 3 of the complaint has further denied that the complainants had stored 3000 bags of paddy as contended by them in their complaints worth Rs.13,17,250/- and Rs.9,37,500/- respectively and further denied loss of Rs.1,00,000/- each towards the loss to gunny bags. The Opposite party has also denied the quantity of stock in trade that the complainants had in their godown. That they had appointed one Raghuram as Surveyor to assess the loss by visiting the spot, later inspection the surveyor has submitted his report by making certain observations with regard to the cause of the incident and regarding stock in trade that these complainants had in their godowns. The first Opposite party further denying the allegations of deficiency and their liability has stated that the sample was taken by the surveyor, sent to laboratories who have given the report stating that only 13% of the burnt stock was paddy and the remaining was only husk. The first Opposite party further denying his liability has prayed for dismissal of the complaint.<br /> 4. The second Opposite party has filed version admitting to had advanced loan to the complainant and contended that the complainants were irregular in the repayment of the loan. This Opposite party further contending that they had not taken insurance policy, it is the complainant who had insured the stock in trade and when the Manager of their branch inspected the spot, the complainant did not produce stock book of previous day and also stocks statement and thus denying any short of deficiency at their end has prayed for dismissal of the complaint.<br /> 5. During the course of enquiry after hearing both the side and considering that both these complainants are connected to each other filed against the same Opposite parties in volving same allegations for same relief of course for different amounts. Therefore, considering the similarities of the cases both the cases are clubbed on the request of the counsel for both the parties for disposal by common order. Hence, CC 68/06 is clubbed with CC 67/06, evidence is recorded in that case and both the cases are taken up together for disposal of by a common order.<br /> 6. During the course of enquiry into these complaints, both the complainants, one Suresh Balaram for first Opposite party and V.B.Nayak for the second Opposite party have filed their affidavit evidence. The first Opposite party has also got filed affidavit evidence of V.Shyamsundar an investigator who investigated the cause of the fire incident and loss, the affidavit evidence of one S.R.Raghuram a Surveyor and one A.R.Subramanya who is a consultant and analystic services. The complainants, the investigator, surveyor and the analystic expert are subjected to cross-examination. The complainants have produced Xerox copies of insurance policies, police F.I.R. and four stock registers. The first Opposite party has produced original insurance policies. Heard the counsel for both the parties and perused the records. The counsel for the first Opposite party has also filed written arguments.<br /> 7. On the above contentions, following points for determination arise:-<br /> 1. Whether the complainants prove that as on the date of the fire incident they had stocked paddy and gunny bags worth Rs.13,17,250/- in the godown of the first complainant and paddy and gunny bags worth Rs.9,37,500/- in the godown of the second complainant and that day have suffered loss to that extent due the fire incident?<br /> 2. Whether the complainants further prove that the first Opposite party has caused deficiency in their service in not paying the insurance amount to compensate the loss?<br /> 3. To what relief, the complainants are entitled to?<br /> <br /> 8. Our findings are as under:-<br /> Point No.1 : Answered in part in the affirmative.<br /> Point No.2 : Answered in part infavour of the complainant.<br /> Point No.3 : See the final order<br /> <br /> REASONS<br /> <br /> 9. Points No.1 & 2:- There is no dispute between the parties that the complainants in these respective complaints are the Managing partners of the respective Rice Mills. It is also not disputed that the first complainant got insured paddy, rice, raw rice, gunny bags, which were stock in trade with first opposite party for Rs.30,000,00/- and the complaint of the second complainant had also insured the paddy, rice etc., which were stock in trade of that mill with the same op for Rs.28,000,00/- and that there had been a fire incident on 26.04.2004 in the godowns belongings to both the mills in which the paddy and empty gunny bags that these complainants allegedly stocked in their respective godowns were burnt causing loss to them to some extent in that incident.<br /> 10. The complainants have contended as if the fire incident had happened as accidental one or due to the mischief of some miscreants. Whereas the first opposite party has contended that the fire incident is nothing but a creation of the complainants themselves with a view of make a wrongful claim by claiming insurance amount. Parties are not able to substantiate the cause for fire. However, the first Opposite party has tried to demonstrate contending that there were 6 godowns in all in which according to the complainants they had stocked paddy and empty gunny bags in six godowns three each belonging to complainant no.1 and complainant no.2 that there are central bifurcating walls up to the roof level, bifurcating each godown, that the godowns are fitted with rolling shutters and that godowns did not have any electricity supply or installation and submitted that there was no choice of these godowns catching fire at a time. It is further contended that there is no chance of spreading fire from one godown to other as they are all bifurcated with separation walls with rolling shutters and there is no possibility setting fire by miscreants through the doors, as the doors were all of rolling shutters, which were very close to the flooring. The first opposite party has further contended that if any miscreants had set fire to the godowns, they would have set fire to the machineries, which are more value than the stock in trade and that paddy stock kept outside the godowns. The first Opposite party further argued one should have set fire to all the six godowns separately as there is no chances of spreading from one to the other. As there was no scope for accidental fire, if any miscreants had set fire they would not have spared the machineries and the stock kept in the open by the side of the godowns and contended that the incident is the own creation of the complainants. We find some force in the points canvassed by the first Opposite party. Because admittedly machineries are not touched by setting fire. Complainants have also admitted in the cross-examination that the paddy stock, they had kept just outside the godowns were intact are not set fire and there is no electricity supply to these godowns. These facts, though lead to an inference that this fire incident was not due to any act of miscreants or due to electric short circut, but in the absence of any conclusive evidence or materials before us, it is not possible to arrive to an irresistible conclusion that the complainants themselves had set fire to their paddy stock. The first opposite party by relying upon the report of the surveyor and the investigator and the photos they have produced attempted to demonstrate that these complainants allowed the fire to continue for 3 days, they did not make any efforts to extinguish the fire completely, though they had water supply in the premises and they had strewen paddy on the burnt ash in the godown to show as if the entire stock was paddy though according to the first op that stock of paddy consisted of major portion of husk and thereby vehemently argued that the fire mischief is nothing but the mischief of the complainants for a wrongful gain. As stated by us above, as we do not have convincing and clinching evidence before us, as to the cause of the fire incident, it is not safe to uphold the contention of first opposite party, that the complainants themselves had set fire to the godowns by stocking the husk by mixing certain portion of paddy to claim substantial amount from the insurance company. With this we shall have to revert back to the contention of the parties with regard to the quantum of paddy stocked by these complainants in their godowns, its value and to what amount or damages the complainants are entitled to. <br /> 11. The complainants no doubt have insured their stock in trade for substantial amounts but they are not entitled for the entire insured amount, but to actual damages they have suffered. For these, we shall refer to the evidence adduced by the complainants and the other materials placed before us. The first complainant in his complaint and also in the affidavit evidence has stated as under:-<br /> “In three godowns belonging to the complainant, in the first 2 godowns the complainant had stored 2000 paddy bags each bag containing about 75 kgs. of paddy, in the third godown he had stored 1000 new empty gunny bags of the value of Rs.1,00,000/-. The entire stock of paddy bags to the tune of 3000 bags of the value of Rs.13,17,250/- is perished fully.”<br /> The second complainant similarly in the complaint and also in the affidavit evidence has stated as under:-<br /> “In 3 godowns belonging to the complainant, the first 2 godown the complainant had stored 2000 paddy bags, each bag containing about 75 kgs of paddy, in the third godown the complainant had stored 1000 new empty gunny bags of the value of Rs.1,00,000/-. The entire stock of paddy bags to the tune of Rs.2000 bags of the value of Rs.9,37,500/- and empty gunny bags value of Rs.1,00,000/- is perished fully.”<br /> The complainants in support of their claim have produced some registers said to be their stock registers. The first complainant has produced one stock register for the year 2003-04 wherein in his godown as on 31.03.2004 had 4000 bags of paddy stock and that 4000 bags of paddy is shown as the opening balance in the stock from 1st April 2004 and as on the date of the incident i.e. 26.04.2004 after showing hulling of certain bags of paddy shown the closing balance of 3740 bags. Except these two registers the first complainant has not produced any other documents including purchase bills or stock verification report made by the bank authorities to whom the stock in trade had been hypothecated. The complainant has stated as if the concerned Tahasildhar had inspected the stock held and therefore stated that the closing balance of the paddy bags shown in the stock register cannot be doubted. But, it could be seen that fire incident had taken place some where during night of 25.04.2004 and the paddy stock was burning on the morning of 26.04.2004 when the complainants visited the spot, therefore the entry found in the stock register that on 26.04.2004 there was stock of 3740 bags as noticed in that book cannot be believed. Of course, even on 24th and 25th April 2004 stock of paddy is shown as 3740 bags. Surprisingly we do not find any endorsements of any authorities in these books upto the date of incident. The surveyor shown to have initiated on 27.04.2007, which apparently a falsehood, because on 27.04.2004 there could not have been any stock of paddy in the godown leave alone the stock of 3740 bags. Further, it is found that only in the stock register for the year 2004, the concerned Tahasildhar once appears to had inspected the stock and put initials but that is long after the incident. But, no such inspection or endorsement of the Tahasildhar is found in the stock register maintained during the entire year 2003-04. Further, at the bottom of the stock register during April 2004 there is a note that out of 3740 bags of paddy, loss due to fire incident is shown as 2250 bags and the balance is shown as 1631 bags. Therefore, it is not correct for the first complainant to say that all the paddy stock in 3 godowns was burnt. Besides this as shown from the complaint and affidavit evidence of the first complainant, he has stated he had stored 2000 bags of paddy in 2 godowns and 1000 gunny bags in the 3rd godown that means to say he had only stocked 2000 bags of paddy only. But, against this he has further in his complaint and affidavit evidence stated as if the entire stock of 3000 bags of paddy was burnt, besides burning of 1000 gunny bags. Therefore, it is apparently false for the 1st complaint to say that his 3000 bags of paddy were burnt and including the stock of the gunny bags he suffered loss of Rs.13,17,250/-. According to his complaint and affidavit evidence he lost only 2000 bags of paddy only, but in the stock register has shown loss of paddy in the fire incident to an extent of 2250 bags. Besides this the complainant absolutely has not produced a scrap of paper leave alone, the purchase bills to prove that he stocked 1000 empty gunny bags in one of his godowns. All these statements and evidence of the first complainant is inconsistent, contradictory and give scope for suspecting the quantity of paddy lost in the first incident.<br /> 12. Similarly, coming to the claim of the second complainant is concerned, of course he has stated he stocked 2000 bags of paddy in 2 godowns and 1000 empty gunny bags in the 3rd godown and he suffered loss of Rs.9,37,500/-. Similarly, this complainant has also produced 2 stock registers for the year 2003.04 and 2004.05. In the stock register of 2003-04 as on 31.03.2004 paddy stock is shown as 3794 bags. As on 01.04.2004, closing is balance of paddy was brought forward and as on the date of the fire incident on 26.04.2004 balance of paddy is shown as 3690 bags. This stock is shown to have been inspected and endorsed by the Tahasildhar, but that is not at any tune prior to the fire on 25.04.2004 stock of paddy is no doubt shown as 3690 bags and that has been found carried out even till 27.04.2004. This is apparently unbelievable because by the morning of 26.04.2004 itself almost entire paddy stock was burnt and there could not have been any stock of paddy on 26.04.2004. Therefore, the balance shown on 26.04.2004 in our view is nothing but fake. Even on careful perusal of the entries found in these 2 stock registers of both the mills, it is found that all the entries are shown to have been made continuously at one stretch by using the same pen ink and written by the same person, when these 2 each stock registers of both the mills are written over a period of 2 years there must have been chances for using different pen, ink and the writer, style but all these entries are found to have been written as planned to suit a situation. Therefore, these entries also create a doubt on their genuineness. Besides this the stock register of second complainant though on 26.04.2004 shown the stock balance 3690 but this complainant has contended as if he had only stocked 2000 bags of paddy in the godown and all that was burnt. The stock of paddy as pleaded by these complainants is contrary to the stock shown in the stock registers. Apart from that, the second complainant at the bottom of the stock register of the year 2004 he has categorically written as loss due to fire incident is 1500 bags. This again goes against the case of the complainant. Beside this the complainant has also not produced any documents including purchase bills for having purchased 1000 bags and stocked in the one of the godown. Absolutely no acceptable evidence placed before us by these complainants so far as the stocking of empty gunny bags in the godowns. Further, as could be seen from the allegations of these complainants, the material allegations of quantity of stock and damages is found cyclostylic one and that goes to show the convenience of the complainants. The allegations of stock kept in 2 godowns, the quantity of paddy in each gunny bags number of gunny bags kept in thus godowns are similar between these 2 complainants and that give room for inference that the material allegations are collusively prepared and adopted by both. The documents produced by the complainants to prove the paddy stock is not convincing and believable.<br /> 13. Coming to the evidence elicitated in the cross-examination of the first complainant namely N.S.Basavaraju by the advocate for first Opposite party. This complainant in the cross-examination has admitted that he is a income tax assessee, he do not remember the gross profit of their mill for the year 2003 so also in the year 2002. That he has no idea of turn over of their mills. He do not know the quantity o paddy purchased and sold during the year 2004. On the basis of the value of the insurance he has taken he has claimed damages in this complaint. The second complainant namely Nanjundegowda in his cross-examination has stated that his writer used to maintain stock register he do not know how much profit he was earning from his mill, his writer used to maintain account of profit he was earning from mill therefore he do not know.<br /> 14. Further, this second complainant stated that he do not know the basis on which they have made the claim for damages in this complaint and further admitted that they have not produced the bills for having purchased the gunny bags. Having regard to the above evidence of those witnesses as pointed out by us above the stock registers the complainants have produced appears to be make believe one, there is no consistency in the stocks mentioned therein, stocks striked at the end of the stock books and the loss of bags as averred in the complaints and also affidavit evidence. Further as admitted by these complainants in the cross-examination absolutely they have no knowledge of what the stock was what was the income they got during previous years and the exact quantity of paddy that was destroyed due to the fire. The 1st complainant in the cross-examination admitted that on the basis of the insurance he has taken he has claimed damages in this complaint. Similarly, the second complainant also in the cross-examination admitted that he do not know the basis on which they have made the claim for damages in his complaint. Then when these complainants have exhibited their inability of proving the total loss they suffered then we have no option but to infer that there is no basis for these complainants to contend that they lost paddy worth Rs.13 lakhs + in the 1st complainant and Rs.9 lakhs + in the 2nd complaint and hold that these complainants have come up with this complaints to claim damages on speculation on the ground that they have insurance through which they can claim certain damages.<br /> 15. The first Opposite party who is the contesting Opposite party in this case, has stated that on receiving a report of the fire incident a surveyor by name Raghuram.S.R. and investigator by name Shyamsundar were appointed who visited the spot and after observing certain things at the spot videgoraphed the spot and submitted reports suspecting these complainants for the incident, which in our view is not very much material for determining the quantum of loss that these complainants suffered. But, the surveyor after inspection of the spot in presence of these complainants secured the stock registers from the complainants, some audit reports as furnished by the complainants, took samples of the burnt paddy remains and sent those samples for testing the concerned laboratories and has submitted his report. The report of the surveyor namely S.R.Raghuram further discloses that he after verifying some of the documents produced by the complainants found that the stock claimed by the complainants was not tallying with the entries found in the stock registers audited balance sheet and even comparative figure of stock starting from the year 2000-01 to 2003-04, in which in both these mills the stock of paddy was very nominal, but shown increase of stock suddenly for the year 2003-04 and this surveyor after examining all the aspects even by relying upon the entries found in the stock registers of both the mills has taken 3880 bags of paddy supposed to had been stocked in the godown belonging to both the complainants excluding the paddy bags, which are not burnt in the fire kept just outside the godowns in question. Further, the investigator and the surveyor have sworn to in their affidavit having collected samples from the burnt object and sending them for laboratory test. The first Opposite party has got marked the test certificate of Bangalore Test House, Life Guard Laboratories and Ganesh Consultancy and Analytical Services as per Ex.R.9, Ex.R.10 and Ex.R.3 respectively. These laboratories to whom the sample of burnt item was sent for analyzing have after test have given their reports. After examining sample sent wherein the Bangalore Test House given certificate as per Ex.R.9 and stated that out of the sample sent for test they found 7.31% husk and 3.5% of paddy content whereas life guard laboratories to whom another sample was sent has given the report that paddy percentage in the burnt object was found 18% and total ash 82% whereas Ganesh Consultancy and Analytical services has given the report Ex.R.3 who after examining six samples they found more than 80% of husk and remaining percent is of paddy. The first Opposite party has examined one of the analystic agency person by name A.R.Subramanya who has spoken to the test result certificate issued by him as per Ex.R.3 regarding the quantum of husk and paddy burnt. The learned counsel appearing for the complainants though has subjected the investigator, surveyor and Ganesh Consultancy expert for cross examination has not been successful in contradicting them as to what they stated in their affidavit evidence and in their reports. Therefore, the evidence adduced by the first Opposite party through its witnesses has remained unrebutted. With this it is evident that what was burnt in the godowns was not full of paddy stock but contained more than 80% of husk. The surveyor as noticed from his report after leaving out the paddy bags kept outside the godowns taken 3880 quintals of paddy that could be worked out on the basis of the stock register and the reports of the auditors and further considering the laboratories test report that the sample sent for test contained only an average of 13.6% of paddy only has worked out by vomiting the husk percentage and arrived to the conclusion that a total of 517 quintal of paddy is lost in the fire incident and valued that at the rate of 627.37 per quintal and arrived that to a some of Rs.3,24,902/- as a loss i.e. caused to both the complainants. This report of surveyor as could be seen from his cross-examination has not been rebutted. Further, having found that the complainants have absolutely failed to prove exact stock of paddy they had in their godowns and reports of the surveyor since has not been rebutted we have no hesitation to accept the report of the surveyor with some addition as he has adopted 2 methods one is based on the stock books and other documents produced by the complainants and another by volumetric analysis.<br /> 16. The first Opposite party as could be seen which is insurance company with which the complainants have insured the stock in trade and who appointed the surveyor to assess the loss after receipt of the report has failed to pay the amount arrived at by the surveyor. The first Opposite party has not disputed the correctness of the assessment arrived by the surveyor and the loss he has estimated. That being so it ought to have honoured the claim of the complainants to that extent and pay the loss from out of insurance coverage. By not doing so it has in our view caused deficiency in its service. The second Opposite party which is a bank which has financed the complainants on the security of stock in trade against whom there is no allegations or evidence of deficiency in its service as such we do not find any necessity to discuss its role in this issue, therefore the complaint against second Opposite party is liable to be dismissed.<br /> 17. Both the complainants in these complaints though have claimed that they had stocked paddy in 3 godowns each but absolutely there is no specific identification to show that which of the godown belongs to whom. The allegations of stock and other particulars are found common in both these cases and there is no proof that each of them are entitle to a specific amount of insurance. Therefore, each of these complainants are held as equally entitle to share the insurance amount that we are going to order for payment and thus we by taking note of speculative assessment and calculation made by both side proposed to award insurance amount of Rs.4,00,000- together increasing the same from Rs.3,24,902 as assessed by the surveyor. Hence, we answer point no.1 and 2 accordingly and pass the following order:- <br /> ORDER<br /> <br /> 1. The complaints are allowed in part.<br /> 2. The first Opposite party is held liable to pay Rs.2,00,000/- each to each of these complainants 1 and 2 in this case and it is ordered to pay that amount to the complainants with interest at 10% p.a. from 26.04.2004 till the date of payment.<br /> 3. The first Opposite party shall also pay cost of Rs.2,000/- to each of these complainants.<br /> 4. Keep original order in C.C.67/06 and Xerox copy in C.C.68/06.<br /> 5. Return the original documents to the concerned parties.<br /> Give a copy of this order to both parties according to Rules.<br />