Delhi

StateCommission

CC/131/2014

M/S NAYYAR ELECTRONIC WORLD - Complainant(s)

Versus

UNITED INDIA INSU. CO. LTD. - Opp.Party(s)

24 Oct 2016

ORDER

IN THE STATE COMMISSION : DELHI

(Constituted under Section 9 of the Consumer Protection Act, 1986)

Date of Arguments: 24.10.2016

Date of Decision: 02.11.2016

Complaint No. 131/14

 

In the matter of:

M/s. Nayyar Electronic World,

RU-376, Pitam Pura,

Delhi-110088.                                                                                       …..........Complainant

 

Versus

United India Insurance Co. Limited,

Division Office-16,

A-1, Tagore Market,

Kirti Nagar,

New Delhi-110015.                                                                         …….....Opp. Party

                                                                

CORAM

O. P. Gupta, Member (Judicial)

1.     Whether reporters of local newspaper be allowed to see the judgment?                                                               Yes/No

2.      To be referred to the reporter or not?                                                                                                        Yes/No

 

 O.P. Gupta, Member (Judicial)

Judgement

 

1. The case of the complainant is that it was  approached by agent of OP-2 for taking insurance of its shop for the purpose of financial security.  The shop and stock were insured against various risks, in particular burglary and allied perils.  Relevant period covered by the policy was 14.08.2010 to 13.08.2011.  The stocks were hypothecated with the Union Bank of India, Shalimar Bagh, Delhi and complainant was regularly submitting its stocks statement to the bank.  Policy of insurance and terms and conditions were never supplied to the complainant. When he approached OP after loss, he was provided with the copy of computerised documents.

 

2. Unfortunately, on night between 22.04.2011 and 23.04.2011 a theft/burglary took place in the insured premises.  Intimation was given to local police and FIR No.114/11 u/s 457/380 IPC was registered. Intimation was also given to the OP in writing. According to estimate gathered after burglary, value of stolen property was above Rs.22,50,048/-. OP did not take an action till 16^th May, 2016 when reminder was sent.  After receipt of reminder from complainant, OP appointed M/s. K.D. Kohli & Company as surveyor.  The surveyor visited the affected site only on 19.05.2011, witnessed the disaster caused by burglary, took photographs of the entire complex and obtained various documents.  It sent letter dated 20.05.2011 for further documents.  The surveyor recorded the statements of complainant’s partners and staff. Documents required vide letter dated 20.05.2011 were sent alongwith letter dated 26.05.2011.  Surveyor again called for some documents which were provided on 14.08.2011 and 17.08.2011.  The surveyor failed to submit report till August, 2012 whereas as per guidelines of IRDA, surveyor was bound to submit report within two months of the loss.  Assessment of loss was not done by the appointed surveyor.

 

3. Soon thereafter, OP appointed another surveyor/investigator namely Mr. J.B. Sharma who visited the shop, took some documents, made enquiries   but without any result.  He also failed to submit report.  OP appointed third surveyor ie.Ms. Alka Gupta to survey the stolen property.  She visited the place of complainant after about 25 months of loss and took photographs. She made extensive enquiries from the staff and partners of the complainant. She asked for documents, information and details which were provided promptly and diligently.

 

4. The complainant has credible information that first surveyor report was available with the OP in less than one year after loss. However, OP did not show any urgency to settle the claim or provide copy of report of surveyor.  Complainant was asked to give letter of subrogation which was got prepared by him in November, 2011.  Vide letter dated 25.10.2013, OP rejected the claim of the complainant on the plea that cause of loss was burglary and housebreaking was not established. The same was not payable within the scope of subject insurance policy. Hence, this complaint for directing Op to pay Rs.22,50,048/- being the amount of loss suffered, interest @24% per annum from the date of filing claim till date of payment, Rs.1,00,000/- as cost of litigation, Rs.5,00,000/- as compensation for harassment, inconvenience and business loss.

 

5. OP filed WS raising preliminary objections that there was delay of more than six days in intimating loss to the insurance company which was a patent breach of clause 4 of General Conditions of insurance.  The explanation given for the said delay was vague and evasive.  The surveyor was not given alleged damaged/broken locks during his visit to the premises.  Said locks were not found at the spot by the police and hence no seizure memo was prepared. As per burglary policy, there has to be some element of force involved in the loss, the complainant failed to provide stock register for verification and surveyor was not allowed to view computerised accounting software or take out printout of the same.  Notebook wherein complainant maintained record of items was not provided to the surveyor on their first visit.  Documents submitted by complainant lateron were not confirmed by surveyor as authentic. On merits OP repeated the same defence.  It denied that it appointed third surveyor with malafide intension and report to give only a pre-dermined report to appease and please the OP.

 

6. The complainant filed rejoinder and evidence by affidavit.  OP vide affidavit of Lipika Kalra, Sr. Division Manager in evidence.

 

7. The parties filed written arguments.  I have gone through the material on record and heard the arguments. The first plea of the OP is that complainant did not provide damaged/broken locks.  The complainant suitably replied that incident took place on the night between 22.04.2011 and 23.04.2011whereas the first surveyor visited the site on 19^th May, 2011 i.e. after 27 days of the incident.  Complainant could not be expected to keep the premises as it is without getting the locks repaired/replaced. The argument appears to be convincing.

 

8. The next plea of the OP is regarding scope of policy of burglary.  According to it  the present is the case of theft and not burglary. Counsel for OP submitted that burglary must involve element of force.

 

9. The counsel for complainant submitted that FIR was lodged u/s 457 IPC which is lurking house trespass.  Trespass itself includes force and annoyance to complainant.  He relied upon the decision of National Commission in Parvesh Mohan Lal Parmar Vs. Div. Manager, New India Assurance, 2011 National Commission judgement 758 in which it was held that force howsoever slight it may be, is  sufficient to constitute offence u/s 454 IPC.  There need not be direct evidence regarding use of force preceding entry in the premises.   Since the entry was made in the night by breaking open the locks, force must have been used.

 

10. Counsel for complainant also relied upon the decision in Vishal Chandra  Vs. Royal Sundram Alliance General Insurance Co. Ltd. (2016) CPJ 359. It was held that statement of employee of insured made it clear that  unknown thief gained access to insured premises by using force i.e. uprooting main door lock handle/knob t was a case of burglary and repudiation was not justified. The present case is covered in ratio of law laid down in the said judgements.

 

11. I agree with submissions made by the counsel for complainant.  Now remains the question of quantum of loss. According to surveyor report dated 20.09.2012 prepared by the first surveyor, the stock shown was Rs.42,89,483.41 whereas insured amount was less than that. So applying under insured formula 28.01%, net value of loss come to Rs.16,72,472.33.  Further applying the deduction on account of excess claim @5% of assessed loss as per the terms of policy, the net assessed loss was Rs.15,31,848.72. 

 

12. Presuming for the sake of arguments that loss assessed by the surveyor was correct, the OP ought to have paid same to the complainant.  There is no justification for keeping the claim pending for two years and then repudiate the same on filmsy ground.

 

13. As regards, the plea of delay in intimating incident to insurance company, it may be observed that IRDA has already issued Circular dated 20.09.2011stating that insurance company would not repudiate the claim on this ground alone .  Applying said circular National Commission held in National Insurance Co. Vs. Kulwant Singh IV (2014)CPJ 62 that when police has been informed about incident immediately, insurance company would have no better resources to investigate the incident and recover the goods.  Thus, I do not find any merits in the objection of the OP.

 

14. Consequently the OP is directed to pay Rs.15,31,848.72 alongwith interest @12% per annum from the date of claim till date of payment.  The OP will also pay Rs.50,000/- as cost of litigation and Rs.1,00,000/- as compensation for harassment, inconvenience and business loss.  The order be complied with within 45 days.

 

15. Copy of this order be sent to both the parties free of cost.

 

16. File be consigned to Record Room.

 

 

(O.P. Gupta)

Member (Judicial)

                         

 

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