BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AMRITSAR.

Consumer Complaint No.240-12

Date of Institution:11-04-2012

Date of Decision:16-04-2015 

Khanna Paper Mills Limited, Fatehgarh Road, Amritsar, Punjab (India)

Complainant

Versus

United India Insurance Company Limited, Divisional Office No.1, 3, Madan Mohan Malviya Road, Amritsar, Punjab.

Opposite Party

Complaint under section 12 and 13 of the Consumer Protection Act, 1986 as amended upto date.

Present: For the Complainant: Sh. Deepinder Singh, Advocate

              For the Opposite Party: Sh. P.N.Khanna, Advocate.

Quorum:

Sh.Bhupinder Singh, President

Ms.Kulwant Kaur Bajwa, Member

Mr.Anoop Sharma, Member  

Order dictated by:

Sh.Bhupinder Singh, President.

1. Present complaint has been filed by the complainant  under the provisions of the Consumer Protection Act alleging therein that the complainant company purchased an IAR (Industrial All Risk) policy covering the risk of Rs.920 crores from Opposite Party vide cover note No.200200/11/09/06/00000002. It has an excess clause of Rs.5 lacs. It was a renewal of earlier policy and was valid from 1.4.2009 to 31.3.2010. It covered the risk i)Rs.50 crores above plinth level including permanent fitting and cover against the risk of fire and earth quack with 15% as Escalation, ii)Rs.710 crores covering plant and machinery installed in the insured mill including all its accessories, spares whilst lying in the insured  mill ad details as per pre-inspection report of M/s.J.Lal & Co. and is covered against the risk of fire and machinery break down and earthquake, iii)Rs.160 crores on the stocks of all kinds of paper card board, paper reels, chemical coal, finished and semi finished goods and all other similar tocks  pertaining to insured trade whist stored in or lying godowns, warehouse/ open shed situated inside the factory premises and covered against the risk of fire and earthquake and  15% escalation, iv)fire loss of profit of Rs.5 lacs policy also includes removal of the clause upto 1% of the amount, architect surveyor fees upto 3% of the claim. Terrorists coverage upto Rs. 920 crores.  On 30.1.2010 at 12.20 AM, 3^rd Press Felt KPM-5 got damaged. The Opposite Party was immediately informed in morning as the complainant company runs 24 hours. Since no information of appointment of surveyor was given nor the surveyor  visited the factory premises of complainant for inspection, the complainant being left with no alternative replaced the press felt and retained the damaged Press Felt for inspection of the surveyor. This has been the usual  practice also in earlier cases as the complainant company runs for 24 hours and it  can not stop the production due to damage to the machinery for waiting the surveyor to inspect first and then get the same repaired as the damages will be increased manifold in comparison to loss and the Opposite Party has been paying the claim all alone. Later on, M/s.V.K.Mehta Associates of Amritsar were appointed surveyors who inspected the factory premises and also inspected the damaged Press Felt and called for documents vide their letter dated 5.2.2010. The complainant accordingly complied with the directions of the surveyor and sent him the documents as called for by him vide letter dated 22.3.2010 and lodged a claim of Rs.7,96,600/- on the Opposite Party and requested for early settlement of claim. The Opposite Party after getting the documents alongwith the supporting evidence vide letter dated 22.3.2010 kept sitting over the matter and all of a sudden to the surprise and shock of the complainant repudiated the claim vide their letter dated 30.9.2010 on the flimsy ground that the Press Felt has been replaced before the same getting inspected by the surveyor. Alleging the same to be deficiency in service, complaint was filed seeking directions to the Opposite Party  to pass an award of Rs.11,32,641.60 alongwith interest @ 18% per annum. Litigation expenses were also demanded.
2. On notice, opposite party appeared and filed written version in which it was submitted that the complainant has not shown the damaged Press Felt before replacing to the spot surveyor as well as to the final surveyor.  The complainant company is otherwise stopped by is own act and conduct from filing the present complaint.  It is submitted that as per arrangement made with the complainant company by the Opposite Party, they have been provided with penal of three surveyors namely Mr.Rohit Kapoor, Mr.Tejinder Singh and Mr.Rajesh Kapoor so that as and when any loss is caused to the felt, they can call any of the said surveyors immediately to show the damaged felt before its replacement. However, in the present case, the complainant company has failed to observe the said system and as per report submitted by the spot surveyor Mr.Tejinder Singh as well as  report submitted by the final surveyor M/s.V.K.Mehta Associates, they have clearly confirmed that “Insured has not shown the damaged felt before replacing to the preliminary surveyor although  the said survey was arranged without any delay.” It has been observed that the felt has limited life span of 30 days and the damage in question could have been due to wear and tear which is not payable under the policy conditions and for that reason the complainant company in spite of repeated requests made by the Opposite Party to explain that why the opportunity was not granted to inspect the damaged felt to the preliminary surveyor, but the complainant company has failed to give  any reply  to the said query.    While denying and controverting other allegations, dismissal of complaint was prayed.
3. Complainant tendered into evidence the affidavit of Sh.Sanjay Jain Ex.C1 alongwith documents Ex.C2 to Ex.C35 and closed the evidence on behalf of the complainant.
4. Opposite Party tendered into evidence affidavit of Sh.Gobind Aggarwal, Senior Divisional Manager Ex.R1 alongwith other documents Ex.R2 to R16 and closed the evidence on behalf of the Opposite Party.
5. We have carefully gone through the pleadings of the parties; arguments advanced by the ld.counsel for the parties and have appreciated the evidence produced on record by both the parties with the valuable assistance of the ld.counsel for both the parties.
6. From the record i.e. pleadings of the parties and the evidence produced on record by the parties, it is clear that complainant company got IAR (Industrial All Risk) policy from Opposite Party covering the risk of Rs.920 crores from Opposite Party from 1.4.2009 to 31.3.2010 with excess clause of Rs.5 lacs.   Policy covers the risk of fire and earth quack with Escalation, covering plant and machinery installed in the insured mill including all its accessories, spares etc. and machinery break down and earthquake and all other similar stocks  pertaining to insured trade lying in the godowns, warehouse/ open shed situated inside the factory premises as per cover note No.200200/11/09/06/00000002. On 30.1.2010 at 12.20 AM, 3^rd Press Felt KPM-5 got damaged. The Opposite Party was immediately informed, but no  surveyor  visited the factory premises of complainant for inspection. So, the complainant replaced the Press Felt and retained the damaged felt for inspection of the surveyor because the   complainant company runs for 24 hours and it  can not stop the production due to damage to the machinery. Later on, M/s.V.K.Mehta Associates of Amritsar were appointed surveyors who inspected the factory premises and called for certain documents from the complainant vide letter dated 5.2.2010 which were supplied by the complainant to the Opposite Party vide  letter dated 22.3.2010. The complainant  lodged a claim of Rs.7,96,600/- with the Opposite Party, but the Opposite Party repudiated the claim of the complainant vide letter dated 30.9.2010 on the ground that the Press Felt has been replaced before the same could be inspected by the surveyor. The complainant wrote letter dated 3.1.2011 to the Opposite Party to reopen and reconsider the claim case of the complainant, but the Opposite Party did not pay any heed to the request of the complainant.  Ld.counsel for the   complainant submitted that all this amounts to deficiency of service on the part of the opposite party.
7. Whereas the case of the opposite party is that the complainant has failed to make the compliance of the letter written by the Opposite Party and has also not shown  the damaged Press Felt before replacing the same, to the spot surveyor as well as to the final surveyor.  As per the agreement between the parties, the Opposite Party has provided with penal of three surveyors namely Mr.Rohit Kapoor, Mr.Tejinder Singh and Mr.Rajesh Kapoor so that as and when any loss is caused to the felt, they can call any of the said surveyors immediately to show the damaged felt before its replacement. However, in the present case, the complainant company has failed to observe the said system and as per report submitted by the spot surveyor Mr.Tejinder Singh as well as  report submitted by the final surveyor M/s.V.K.Mehta Associates, they have clearly confirmed that “Insured has not shown the damaged felt before replacing to the preliminary surveyor although  the said survey was arranged without any delay.” It has been observed that the felt has limited life span of 30 days and the damage in question could have been due to wear and tear which is not payable under the policy conditions and for that reason the complainant company in spite of repeated requests made by the Opposite Party to explain that why the opportunity was not given to inspect the damaged felt to the preliminary surveyor, but the complainant company has failed to give  any reply  to the said query. Final surveyor M/s.V.K.Mehta Associates has quantified the loss to the tune of Rs.5,62,885/-, subject to salvage value of Rs.12,885/-.  As such, the gross loss has been assessed to the tune of Rs.5,50,000/-. The loss was due to wear and tear which is not payable under the policy condition. As such excess clause of Rs.5 lacs is applicable with respect to each and every loss. Therefore, after applying the said excess clause, net loss assessed by the said surveyor is only to the tune of Rs.50,000/- and this amount is also not payable because the surveyor has clearly recommended  that as the insured has not cared to show the damaged Press Felt before removing the same inspite of the fact that preliminary surveyor was appointed without any delay. Moreover, the life of Press Felt is also short and it could have been damaged due to wear and tear only. Ld.counsel for the Opposite Party submitted that the Opposite Party has rightly repudiated the claim of the complainant as it falls under the excess clause.   Ld.counsel for the opposite party submitted that there is no deficiency of service on the part of the opposite party.
8. From the entire above discussion, we have come to the conclusion that the Opposite Party has panel of  three surveyors namely Mr.Rohit Kapoor, Mr.Tejinder Singh and Mr.Rajesh Kapoor so that as and when any loss is caused to the complainant company, they can call any of the said surveyors immediately to show the damaged felt before its replacement as is in the present case, but the complainant company has failed to make compliance of the said provision and the complainant has  failed to show the damaged Press Felt before replacement, to the spot surveyor as well as to the final surveyor  appointed by the Opposite Party.  The report submitted by the spot surveyor Mr.Tejinder Singh as well as  report submitted by the final surveyor M/s.V.K.Mehta Associates,  fully confirmed that the insured has not shown the damaged felt before replacing the same, even to the preliminary surveyor although  the said survey was arranged without any delay. Said Press Felt has limited life span of 30 days and the damage in question to the said Press Felt  could have been due to wear and tear which is not payable under the policy conditions. Despite so many requests and letters written by the Opposite Party, the complainant has failed to explain why this opportunity was not given to the preliminary surveyor to inspect the damaged felt. The  complainant  has  also failed to give  any explanation/ reply  to the said query. Final surveyor M/s.V.K.Mehta Associates has quantified the loss to the tune of Rs.5,62,885/-, subject to salvage value of Rs.12,885/- vide report dated 25.09.2010 Ex.R5.  As such, the gross loss has been assessed to the tune of Rs.5,50,000/-.  The complainant did not allow the surveyor of the Opposite Party  to inspect the damaged Press Felt which had life  of only 30 days and same might have been damaged due to wear and tear and as per the policy, the wear and tear of any part of the complainant mill covered under the policy, are not payable by Opposite Party. As such excess clause of Rs.5 lacs is applicable in the present case. After applying the said excess clause, net loss assessed by the said surveyor comes to  the tune of Rs.50,000/-  only as per  surveyor report Ex.R5 and said surveyor report has not been challenged by the complainant nor the complainant could point out any defect in this surveyor report. Final surveyor vide this report Ex.R5 shows the loss  to the tune of Rs.50,000/- only. Moreover, this surveyor has clearly recommended that as the insured has not cared to show the damaged Press Felt before removing the same  to the preliminary surveyor who was appointed  without any delay. It has been held by the Hon'ble National Commission in case Oriental Insurance Co. Ltd. Vs. B. Ramareddy II(2006) CPJ 339 (NC) that surveyor's report is an important piece of evidence. Compensation can be awarded only on the basis of surveyor's report. It has also been held by the Hon'ble Gujarat State Commission in case United India Insurance Co.Ltd and another Vs. Hotel White Rose 2004(3) CLT 494 that surveyor assessment was wrong, burden to prove is on the consumer to establish by producing evidence that what has been left out by the opponents and what has been not correctly and properly assessed by the opponents. As such, we hold that the Opposite Party has rightly repudiated the claim of the complainant.
9. Apart from this ld.counsel for the opposite party submitted that the complainant is running its business in crores of rupees and it has employment having employees in hundreds which is a big establishment and they are doing their business for gains to earn profit and the complainant has obtained the services of the opposite party for its business i.e. for commercial purpose and not to earn livelihood by way of self employment . Moreover the complainant has nowhere claimed itself the consumer qua the opposite party in the complaint. So the complainant is not a consumer under the Consumer Protection Act. Ld.counsel for the complainant could not rebut this plea/averment of the counsel for the opposite party. Rather he admitted that the complainant company is one of the top ten papers mills in India and its business is running into crores of rupees having large employment of Executives, engineers, staff , etc..Ld.counsel for the complainant also admitted that the services of the opposite party have been obtained for the business of the complainant company.
10. So from the entire above discussion, it stands fully proved on record that the complainant obtained the services of the opposite party for its business which is being carried out to earn profits. As such the complainant does not fall within the definition of consumer. It has been held by the Hon'ble Supreme Court of India in case U.P. Power Corporation and Others Vs. Anis Ahmad 2013(3) CLT 227 that where the complainants have electric connections for Industrial/commercial purposes, as such they have obtained the services of the opposite party for commercial purpose.So they do not come within the meaning of Consumer as defined u/s 2(1)(d) of the Consumer Protection Act, 1986. Resultantly this complaint is also not maintainable.
11. Consequently, we hold that the complainant has failed to point out any deficiency of service on the part of the Opposite Party.
12. Resultantly the complaint is without merit and the same is hereby dismissed with no order as to costs. Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room. Case could not be disposed of within the stipulated period due to heavy pendency of the cases in this Forum.

Dated: 16-04-2015.                                         (Bhupinder Singh)                                                                                              President

hrg                                                 (Kulwant Kaur Bajwa)    (Anoop Sharma)

              Member                         Member