STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA
Date of Institution: 11.04.2019
Date of final hearing: 29.08.2024
Date of pronouncement: 05.11.2024
CONSUMER COMPLAINT NO. 107 of 2019
IN THE MATTER OF: -
M/s Dhiman Engineering Works, Factory No. 125, Sector-1, Phase-1, Industrial Area, HSIIDC, Saha, Distt. Ambala through its prop. Gulshan Dhiman, aged 46 years, S/o Sh. Amar Chand, R/o Vill. Gadapur, Distt. Patiala. …..Complainant
Versus
- United India Insurance Company Ltd., Triloki Chambers, Municipal Committee Road, Punjabi Mohalla, Ambala Cantt. through its Manager.
- Canara Bank, Ambala Cantt. through its Manager.
…..Opposite Parties
CORAM: Sh. Naresh Katyal, Judicial Member
Sh. S.C. Kaushik, Member
Argued by:- Mr. Baldev Badhran proxy counsel for Mr. Ravi Kant, counsel for complainant.
Ms. Geeta Chaudhri, proxy counsel for Mr. Vinod Chaudhri, counsel for opposite party No.1.
None for opposite party No.2.
ORDER
NARESH KATYAL, JUDICIAL MEMBER:
Facts are: Complainant for purpose of earning his livelihood through self-employment availed loan of Rs.35.00 lacs under OCC and Rs.30.00 lacs as term loan i.e. Total Rs.65.00 lacs, against his factory-M/s Dhiman Engineering Works, No. 125, Sector-01, Phase-1, Industrial Area, HSIDC, Saha, District-Ambala. Loan was sanctioned on 21.01.2016 by OP No. 2-Canara Bank, who as per plea; assured him that entire building & infrastructure, stock will be got insured by OP No.1/insurer. He spent loan amount on infrastructure, construction of building of factory and spent more than Rs.45,00,000/- in installation of machines in factory. As per plea; he earned sale of goods worth Rs.22,30,111/- from April-2016 till June-2016. On 30.06.2016, due to ‘underground seepage and leakage’; washroom of factory suddenly fell down along with overhead water tank. Resultantly, walls of factory building developed many cracks and building got badly damaged. He contacted OP No. 2-Bank and approached OP No. 1-Insurer for claiming insurance amount and also intimated OP No. 1/insurer through email dated 02.07.2016. When OPs did not help him; he approached Permanent Lok Adalat for public utility service-Ambala for settlement of claim under insurance policy. Complaint filed therein was withdrawn on 11.03.2019 with liberty to file fresh in competent court.
2. Due to damage to the building of factory; his (complainant’s) valuable machinery got damaged and due to that; work in factory remained closed and he suffered huge financial loss, due to which he could not pay installment of bank loan. As per plea; one of the condition for granting loan to him by bank is /was to get premises insured at first; only then loan could be granted. He obtained details of insurance policy No. 1101001115P116556969 from OP No. 2-Bank, under Right to Information Act. Policy was having validity from 31.03.2016 to 30.03.2017 and he came to know that insured amount under it is Rs.60.00 lacs. Despite knowing that complainant’s factory is/was got insured by bank itself, still it (bank) issued notice to him under Section 13(2) of SARFAESI Act. On receipt of notice he met Bank officials and explained circumstances which had led to slowdown his business and requested bank to provide him help for claiming insurance amount under policy and then he would pay loan amount to it (bank), but to no effect. He received notice under Section 13(4) dated 19.09.2018 for taking symbolic possession of secured assets. One Surveyor namely Vishal Aggarwal (having mobile No. 9812037753) of insurer/OP No. 1 visited the spot; took photographs from his mobile phone but went back without disclosing anything to him. As per plea; surveyor refused to make report and this action of insurer/OP No.1 is illegal, amounting to deficiency in service. As per his grievance OP No. 1-insurer had not paid compensation to him though his factory was insured with it which is a lapse on insurer’s part. OP No. 2/Bank also did not discharge its services. He suffered huge loss as production in his factory had stopped and he was not paid compensation under policy. For this reason, he could not repair building of factory in time. By alleging unfair trade practice/deficiency in service and by pleading cause of action; complaint has been filed for issuance of direction to OPs to pay him compensation of Rs.30.00 lacs under insurance policy with 12% interest p.a.; award him Rs.2.00 lacs compensation on account of loss of reputation, loss of business, agony suffered by him and mental as well as physical harassment and also to award him Rs.55,000/- as litigation cost. Text of complaint is supported by complainant’s affidavit.
3. Upon notice, OP No.1/insurer in its defence has asserted that complaint is a blatant misuse of process of law for securing selfish gains. Complainant has been filing one complaint after another in different courts for same cause of action. Initially complaint was filed before Permanent Lok Adalat. Thereafter another complaint titled as M/s Dhiman Engineering Works Vs. Canara Bank was filed before Debt Recovery Tribunal and thirdly complaint has been filed before this Commission. Complaint is misconceived and filed to overreach the law. As per plea; alleged loss was outside the scope and ambit of insurance cover purchased by complainant as ‘peril of seepage’ was not covered under policy in question. Further loss was neither accidental, nor occurred all of a sudden but had occurred over a period of time due to underground seepage which resulted in settling down of floors and as consequence cracks in walls were developed. All this was in the knowledge of complainant and he was apprised in no uncertain terms that his claim was closed as “No Claim”. Claim was rejected after thorough investigation. Insurance policy covered loss directly caused by: storm, cyclone, typhoon, tempest, hurricane, tornado, floor and inundation. Loss in instant case had not been directly caused by any of the perils mentioned above and loss had occasioned due to gradual and continuous underground seepage which fell outside the scope and ambit of insurance cover which resulted in settling down of floors. As per plea; on receiving intimation the claim was processed and surveyor and loss assessor assessed loss of Rs.42,000/- and further advised/recommended to reject the claim as same was not payable due to fact that loss/damage did not fall in the ambit of insurance cover. On these pleas; dismissal of complaint has been prayed.
4. Record reflects that nobody appeared on behalf of OP No.2/Bank in the proceedings of complaint. Defence of OP No. 2/Bank was struck down vide order dated 17.10.2022.
5. Complainant as well as OP No. 1/insurer to this lis; led their respective evidence oral as well as documentary. Complainant has filed affidavit Ex.CW1/A of Gulshan Dhiman and relied upon documents Ex.C-1 to Ex.C-6. Evidence of complainant was closed through his counsel’s statement dated 28.08.2023. OP No. 1/insurer tendered duly sworn affidavit Ex.OP-1/A of its Manager-Sh. Mohinder Dawar and relied upon documents Ex.OP-1 and OP-2. OP No. 1 closed its evidence through statement of counsel dated 24.01.2024.
6. We have heard learned counsel for complainant as well as of OP No. 1-insurer at length and with their able assistance we have minutely examined the material on record.
7. Learned counsel for complainant has contended that complainant is entitled to the amount claimed in the complaint as loss caused to his factory premises is covered under insurance policy issued by OP No.1. It is also urged that complainant suffered loss because his factory was closed for the reasons beyond his control due to leakage and seepage resulted in washroom of the factory premises on 30.06.2016 which had led to sudden fall of overhead tank and developing of umpteenth number of cracks in walls of building thereby severely damaging the entire factory’s infrastructure. It is urged that complainant is also entitled for loss of his business.
8. Refuting above contentions, learned counsel for OP No.1/insurer has urged that ‘standard fire and special peril policy’ does not expressly cover the damage complained by complainant, allegedly caused to his factory premises. It is urged that terms of insurance contract have to be strictly construed and legally there cannot be any deviation qua terms and conditions. It is urged that despite insurer’s surveyor has recommended loss at Rs.42,000/-, yet insurer is not bound to accept its own surveyor’s recommendations, particularly when said surveyor himself has/had recommended for closure of complainant’s claim.
9. Complainant is a proprietor firm. Ex.R-1 is ‘Standard Fire and Special Peril Policy’. Its currency is from 31.03.2016 to 30.03.2017. Insured’s name therein is M/s Dhiman Engineering Works; sum insured is/was Rs.30.00 lacs and premium of Rs.3,510/- has/had been paid with additional premium amounting to Rs.487.50 (Rs.150/- for earthquake plus Rs.337.50 for STFI Cover). Description of risk recites: ON THE RISK OF ONE COMMERCIAL BUILDING USED AS MANUFACTURING UNIT.
10. Sole plea taken by complainant to base his claim is that: in the insured premises; on 30.06.2016, due to underground seepage and leakage; washroom of factory, all of sudden had fallen along with overhead water tank and as a result, walls of factory building developed many cracks and entire building got badly damaged. Complainant has testified this plea through the duly sworn affidavit Ex.CW-1/A of its proprietor Sh. Gulshan Dhiman S/o Amar Chand. There is no plea regarding age of the building, so pleaded either in the entire text of complaint or in the defense of OP No.1/insurer. Element of leakage and seepage in building, is intrinsically related and has direct nexus to the age of building, with no exception to building in question. No evidence, worth the name has been brought on record by complainant in form of report/opinion of an expert of the type of engineer/architect possessing technical expertise in this particular field. Meaning thereby, the integral part of allegations raised in complaint (seepage and leakage) remained on papers alone and unsubstantiated. Mere bald plea taken in complaint cannot be taken as gospel truth on its face value. In law, burden of proof to prove positive pleaded fact lay upon complainant alone and this burden will never shift. Complainant cannot wriggle out from the legal implications flowing from the fact of not discharging the burden of proof, legally lay upon it.
11. Underground leakage and seepage in washroom of factory premises must have/had been noticed by proprietor of complainant firm, even prior to pleaded date of 30.06.2016. Said leakage and seepage in washroom of factory premises cannot escape unnoticed, visually. Underground leakage and seepage in washroom of factory premises cannot be termed as a sudden/unforeseen eventuality so as to pave a way to put halter around the neck of insurer. Complaint is totally silent as to what remedial steps have/had been taken by its proprietor (Sh. Gulshan Dhiman) towards rectifying the element of leakage and seepage in washroom. Curiously enough, complainant due to his own acts of omission and commission has/had put his own factory building to its peril. It is not that in each and every case of alike nature, which reflects lack of overacts by insured expectedly required from him; the insurer become automatically answerable, which otherwise is not.
12. Insurer has pleaded its exclusion from policy on the ground that damage caused to complainant’s building was outside the scope and ambit of insurance policy. It has relied upon Clause-VI of insurance policy which recites that insurance policy covers the loss directly caused by storm, cyclone, typhoon, tempest, hurricane, tornado, floor and inundation and loss in this case has/had not been directly caused by any of the above perils. Loss has/had occasioned due to continuous underground seepage, which fell outside the scope and ambit of policy. As observed above, this Commission has no evidence before it, adduced from complainant’s side thereby stimulating his plea that damage occasioned to his factory premises, particularly to the washroom of factory premises which had allegedly led to falling down of overhead water tank, was instant and sudden. Consequently, OP No.1/insurer has rightly invoked its exclusion from policy in question. Insurance is a binding contract between insured and insurer and no party to it can travel beyond the scope of that contract. Terms and conditions contained therein have to be enforced with precision. In firm opinion of this Commission, legally insurer is not duty bound to answer complainant’s claim in wake of given facts, under policy in question, despite that its surveyor has assessed loss of Rs.42,000/- through its report dated 08.07.2016. In any case, it is a surveyor’s duty to assess the loss. Only insurer has to evaluate within parameters of policy’s terms and conditions as to whether assessed loss is payable to insured or not. Specific case of insurer is that complainant was apprised about closure of claim as “No Claim”. There is no document brought on record by either of the parties to this lis that insured was expressly conveyed about closure of its claim as “No Claim”. Meaning thereby, this Commission has been kept aloof to assess the legal validity of the reasons regarding closure of complainant’s claim as “No Claim”. Insurer/OP No.1 in present case, has all reasons before it to deviate from said report of its surveyor, who nevertheless has also recommended to close the claim as “No Claim”.
13. Insured has set up a case that it has to obtain insurance policy by taking resort of Right to Information Act. This plea of insured has no formidable and acceptable base. Admittedly, the policy in question concerns with insured. Its proprietor cannot be termed as novice and neophyte of ground realities viz-a-viz policy in question. Such like pleas which have tinge of sympathy attached to it are not acceptable in legal parlance.
14. Consequently, this Commission, as a result of ex-facie analysis of all relevant facets of this case has arrived at an inescapable conclusion that present complaint is devoid of merits; same carries no substance. Complainant is hereby non-suited. Complaint traumatizes and hence dismissed. It is ordered accordingly.
15. Application(s) pending, if any stand disposed of in terms of the aforesaid judgment.
16. Copy of this judgment be provided to parties free of cost as mandated by the Consumer Protection Act, 1986/2019. The judgment be uploaded forthwith on the website of the Commission for the perusal of the parties.
17. File be consigned to record room.
Date of pronouncement: 05th November, 2024.
S.C. Kaushik Naresh Katyal
Member Judicial Member
Addl. Bench Addl. Bench
