Delhi

East Delhi

CC/21/2014

SHRI KRISHNA - Complainant(s)

Versus

U.I.C - Opp.Party(s)

07 Mar 2014

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM (EAST)

GOVT OF NCT OF DELHI

      CONVIENIENT SHOPPING CENTRE, SAINI ENCLAVE: DELHI-92

 

CC. NO.21/14:

 

In the Matter of:

 

M/s Shri Krishna Rice & General Mills,

Opposite Debchik Tourist Complex,

G.T.Road,

Hodal-122 001

Complainant

Vs

1. United India Insurance Co.Ltd.

Regional Office-II,

Core No.1, 2nd Floor, Scope Minar, District Centre,

Laxmi Nagar,

Delhi-110 092

 

2. United India Insurance Co. Ltd.

Divisional Office-14

4, New Colony,

Gurgaon-122 001

Respondent

 

                                                       Date of Admission-24/01/2014

                                                          Date of Order       -10/04/2015

 

ORDER

 

SH. N. A. ZAIDI, PRESIDENT

        This complaint has been filed with the allegation that the complainant insured the stock of finished, semi-finished under process goods, packing material, rice husk, rice bran, raw material, wheat and other items for a total sum of Rs.5,30,00,000/- against burglary under the burglary BP Insurance Policy bearing No.22400/46/10/04/00000237 for the period commencing from 15/11/2010 to 14/11/2011. In the intervening night of 02-03/02/2011, a burglary took place in the factory of the complainant by breaking the back wall and shutter of the Godown and the miscreants took away the stock of Rice Bags. The incident was reported to the Police and FIR No.39 dated 03/02/2011 under section 457/380 of IPC was registered at Police Station, Hodal, District Palwal. The respondent was informed and surveyor, M/s Ravi K. Singhal & Associated Pvt. Ltd., New Delhi, was deputed to assess the loss and claim. The surveyor was provided desired documents. On 11/04/2013 after a prolonged delay in not settling the claim, the complainant was compelled to agree for the payment of their claim after discussion with the surveyor in the sum of Rs.19,89,948/- as per the report of the surveyor dated 05/12/2012. The respondent is not settling the claim and calling for documents through a new appointee investigator, Sh. S.K. Aggarwal, when the entire material was made available to the surveyor and the report was submitted by him on 05/12/2012. The respondent has failed to fulfill their obligation under the policy and deprived the complainant of their lawful claim which amounts to deficiency in service. Complainant has claimed for direction to the OP to pay Rs.19,89,948/- with interest 18% p.a.  thereon from the date of the theft till the date of the payment, Rs. 5,00,000/- as general damages and Rs.20,000/- as litigation expenses.

        The respondent / Insurance Company filed their written statement wherein they have taken the plea that the matter involved complicated question of facts and law which could only be adjudicated before the competent Civil Court. The matter is not covered by the Consumer Protection Act. The policy and cover period have been admitted. As per Condition No.4 the Complainant is under an obligation to provide all the information and assistance in respect of the claim lodged. The claim was lodged. Respondent appointed M/s. Ravi K. Singhal as an investigator who submitted the report on 05/12/2012. The matter was placed before the competent authority and they found various flaws and shortcomings in the report. Thereafter Mr. S.K. Aggarwal was appointed as an investigator. Mr. S.K. Aggarwal collected the documents from the surveyor Sh. R.K Singhal and asked for the various clarifications from the complainant. He finally submitted investigation report dated 23/01/2014 and the claim was repudiated on 28/02/2014. Rest of the allegations has been denied.

        We have heard the Ld. Counsel for the parties and perused the documents placed on record.

        Smt. Vandana Surana Ld. Counsel for the respondent challenged the pecuniary Jurisdiction of this Forum to entertain the present complaint. The complainant has sought the relief of Rs. 19,89,948/- with 18% p.a. interest thereon and Rs.5,00,000/-as compensation which is beyond the pecuniary Jurisdiction of this Forum. Sh. A.K.Soni Ld. Counsel for the complainant has confined his claim to the amount assessed by the surveyor and has given up the claim of compensation. The question of grant of interest and compensation is the discretion of this forum. The amount of interest and compensation although claimed but cannot be sought to admissible unless granted by the court. He further submitted that he will restrict his claim to the principal amount Rs.19,89,948/- which is well within the pecuniary jurisdiction of this Forum. If we look to Section 11 of the Consumer Protection Act the language is very simple and clear. Jurisdiction up to Rs.20 Lakhs consists of the value of goods or services and compensation. It does not include the interest part. Had it been the intention of the legislature to include the interest part in the pecuniary jurisdiction, the legislature would have included interest along with the compensation within the restricted limit of Rs.20 Lakhs. Since it is not so the interest can always be granted if the claim is well within Rs.20 Lakhs. We find substance in the statement of Ld. Counsel for the complainant. The amount claimed is well within Rs.20 Lakhs. This cannot be said that this Forum has no pecuniary Jurisdiction to entertain the present complaint.

        Ld. Counsel for the complainant raised the issue that the respondent has got no Jurisdiction under the Policy of insurance and otherwise under the rules to vary or set aside the surveyor report without providing the proper opportunity of hearing to the complainant. Our attention was drawn to Ex C-1 report which has been submitted by Sh. Ravi K. Singhal & Associates who has based his report after spot inspection and verification of the Stock Register, Audited Balance Sheet, Production Statement, etc. and has concluded that the claim is admissible under the policy issued by the underwriters. This report was considered by the respondent company and in their Claim Note which is dated 27/02/2013, it has been specifically mentioned that all the papers had been submitted by the insured except the final report certified by the Court. Now we have received final report certified by the court dated 18/02/2013 and all the documents seems to be in order. A panel of Ms. Geeta Gupta, Assistant, Ms. Deepika Rani, Administrative Officer, Ms. Kiran Wadhwa, Deputy Manager, and Sh. K. K. Banga, Seinor Divisional Manager has recommended the claim of Rs.19,89,948/-. Ms. Kiran Wadhwa has noted down that as recommended claim may be approved for Rs. 19,89,948/- subject to LOS since the amount exceeds  the financial power of the DCC the file may be forwarded to DRO for approval  and this was approved by Senior Divisional Manager, Mr. K.K. Banga. The question arises if after approval by the Senior Divisional Manager of the claim note all the papers were in place, could the second surveyor be appointed without hearing the complainant and rejecting the first  report and the recommendation by the Senior Divisional Manager and other officers of the respondent company. Smt. Vandana Surana Ld. Counsel for the respondent could not justify the appointment of the second investigator. This burglary took place between the night of 2^nd and 3^rd February, 2011 and the second investigator was appointed roughly after more than two years of the date of the incident of the burglary. It has been argued on behalf of the complainant that it is a malafide action on the part of the respondent so as to deny the legitimate claim of the complainant. The senior officers of the respondent company have agreed with the report submitted by the surveyor. There should be legal justification for rejecting & ignoring the earlier report and for the appointment of the second surveyor and placing the reliance on the subsequent report while deciding the claim. The letter of repudiation says that the subsequent investigator has raised certain points asking for submission of all the documents and the same have not been provided the claim is repudiated. This is directly in contrast to the admission of the respondent company in their claim note which is Ex. C-2 on record wherein they have clearly admitted that all the papers have been submitted by the insured and it is only after satisfaction with all the investigation and documents that the claim was recommended. The counsel for the respondent has failed to justify the repudiation of the claim.

        In view of the above facts the action on the part of the respondent company of repudiation is malafide and with the intention not to pay the legitimate claim. The action of respondents falls within the ambit of unfair trade practice. The claim which was admitted to be due by the same respondent if repudiated and paid and denied is a clear unfair trade practice. The counsel for the respondent has pleaded in their written statement about commerciality of the claim and ouster of Jurisdiction of this Forum to settle this dispute. Suffice is to say that in the present complaint it is not the commercial transaction of the complainant which is in question it is the obligation under the insurance policy which is in issue. The complainant has covered the goods by buying the policy of the insurance for the safety of the goods and not for making any profit out of this insurance. There is no merit in the arguments of respondent, that this case is not triable before the Consumer Forum.

The Insurance Company Claim Panel has submitted its recommendation on 27 Feb 2013. Had this been paid in accordance with the recommendation, the complainant would not have suffered the loss of interest or the profit that he would have earned by the use of this amount in business or Bank. It is contended by the complainant counsel that he is entitled for interest from the date the claim was recommended by the Senior Divisional Manager. We agree with the submission of the claimant Ld. Counsel. The loss sustained by the complainant need to be compensated. We allow 9% p.a. interest upon the amount of the claim i.e. Rs.19,89,940/- from 1^st March, 2013 till the amount is actually paid to the complainant.

We allow this complaint. The respondent is directed to pay to the complainant the amount of Rs.19,89,948/- within the period of 45 days from the date of this order together with 9% p.a. interest thereon from 1^st March, 2013 till it is finally paid. We, further, award the sum of Rs.10,000/- towards the cost of litigation.

 

(POONAM MALHOTRA)                                                 (N.A.ZAIDI)

            MEMBER                                                                     PRESIDENT