1.      Heard Mr. Roshan Santhalia, Advocate, for the complainant and Mr. Ravi Bakshi, Advocate, for the opposite party. 

2.      Aroma De France (the Insured) has filed above complaint for directing United India Insurance Company Limited (the Insurer) to pay (i) Rs.12545842/- with interest @18% per annum from 03.02.2014 till the date payment; (ii) Rs.500000/-, as compensation for mental agony and harassment; (iii) Rs.1500000/-, as litigation costs; and (iii) any other relief which is deemed fit and proper, in the facts of the case.

3.      The facts as stated in the complaint and emerged from the documents attached with it, are as follows:- 

(a)     Aroma De France (the Insured) was a partnership firm, registered under the Partnership Act, 1932 and engaged in the business of manufacture and supply of Eau De Cologne, Eau De Toilettes, Eau De Perfume, After Shaves Lotions, Deodorants, Gift sets, Air Fresheners, Hair oil and Bath Gels etc., since 30.05.2005. The business of the Insured was expanding, as such, the Insured took a godown at Chiman Badshah Farm, village Dabhasa, Taluka Padra, Vadodara on rent on 15.11.2013, for storage of packing materials. United India Insurance Company Limited (the insurer) was a public insurance company and engaged in the business of providing insurance services to the general public. The Insured obtained “Standard Fire and Special Perils Policy” No.180400/11/13/11/00000472, for the period of 11.12.2013 to 10.03.2014, for a sum of Rs.150/- lacs, on Packing Materials such as Deo & Premium Bottles etc. (list of the stock was attached).

(b)     On 02.02.2014, there was marriage reception of the son of the landlord of the godown at nearby vacant land. For lighting arrangement at the reception place, he had taken electricity connection from main connection of M/s. D.M. Water, a R.O. Plant at adjoining factory. The party continued till 1:30 hours on 03.02.2014. At 4:00 hours on 03.02.2014, the labourers of M/s. D.M. Water and the workers of the Tent House noticed fire, in the godowns of the Insured. They immediately informed the landlord of the godown, fire service station and the local police. The public from the village also gathered there. Fire tenders reached the spot at about 5:00 hours and control the fire till 8:00 hours on 03.02.2014. However, the packing materials being combustible, gutted in the fire, causing loss to the Insured. Local police registered the case and investigated. The police prepared a Panchnama on 04.02.2014 and submitted closer report. 

(c)     The Insured informed the Insurer about the incident and loss caused due to it, on 04.02.2014. The Insurer appointed J.C. Gupta & Company Private Limited, Insurance Surveyor and Loss Assessors Pvt. Ltd, Ahmedabad, as the surveyor for survey and assessment of loss on 04.02.2014. The surveyor inspected the spot on 05.02.2014 and 06.02.2014, took photographs and prepared inventories. The surveyor examined relevant records relating to stock, purchase & sale, bank statements, tax papers etc. The surveyor submitted “Immediate Loss Advice” report dated 15.02.2014, stating that cause of loss was accidental and the Insurer may keep a provision for Rs.one crore. The surveyor submitted Final Survey Report dated 17.12.2014, assessing net loss to Rs.9503836/- payable under the insurance policy.

(d)     The Insurer appointed Protocol Insurance Surveyors & Loss Assessors Private Limited, Delhi as an investigator on 27.02.2015. The Investigator submitted his report dated 08.08.2015, stating that on verification of the documents such as balance sheet, VAT returns, Bank stock statements, purchase & sales ledgers, purchase bills etc. no abnormalities were found. The Investigator recorded statements of Promodhbhai Chimanlal Patel (the owner of godown) and Manish M. Patel (the partner of the Insured) and quoted it, in his report dated 08.08.2015 and submitted to the Insurer for its consideration.

(e)     The Insurer, through email dated 23.07.2015, raised query from the surveyor, in respect of cause of fire and breach of Condition-3 of General Conditions. The surveyor, replied through letter (received by the Insurer on 10.11.2015) (Annexure-R), stating that the fire had occurred due to bursting of electrical cables passing underground of godown. However, the Insurer repudiated the claim through letter dated 09.03.2016, holding that expert report of M/s. R.K. Patel & Company had opined that underground cable should not normally blow off and explode even if it had short circuited. Forensic Science Lab report shows that there was no evidence of short circuit at the place of origin of fire. Police Investigation report shows that electric wires were found in burnt conditions hanging on the northern side wall. In the lease agreement dated 15.11.2013, it has been mentioned that electricity bills of the leased premises would be borne by the landlord. In the declaration, you have stated that there was no electrical connection. As such, you have been changing your statement and there was violation of Condition Nos.1, 3, 6 and 8 of General Conditions of the policy. Then this complaint was filed on 26.08.2016, alleging deficiency in service.

4.      The Insurer filed its written reply on 03.02.2017, in which, issue of policy in question for the period of 11.12.2013 to 10.03.2014 for a sum of Rs.150/- lacs and loss caused to the stock on 03.02.2014 due to fire, have not been disputed. The Insurer stated that as soon as the Insurer got information of the incident on 04.02.2014, the Insurer appointed J.C. Gupta & Company Private Limited, as the surveyor for survey and assessment of loss. The surveyor inspected the spot and submitted “Immediate Loss Advice” report dated 15.02.2014 and Final Survey Report dated 17.12.2014. The Insured admitted that the godown, where the fire took place, was taken on rent for storage of packing materials. There was no electricity supply in the premises. According to Mr. Manesh M. Patel, he was not aware that electricity cable was passing through the premises in flooring area. The landlord, who had taken electricity connection for the reception ceremony from an adjoining factory, was actual tort-feasor and liable for loss. But the Insured had chosen not to proceed against him for the loss. Pramodbhai Chimanbhai, in his affidavit dated 23.06.2015, stated that the connection at the godown was coming from the main connection at R.O. Plant through underground wires. For the reception ceremony of Nikunj Ghanshyambhai Patel, electricity connection was taken from the box of R.O. Plant. Finding contradiction in the statements of the Insured, landlord of the godown and survey report, Investigator was appointed. The Investigator raised doubts over the story put up by the Insured, then the Insurer took opinion from the Expert. The Expert clearly opined that underground cable should not normally blow off and explode even if it had short circuited. The competent authority considered all the materials and reports and found that there was misrepresentation in respect of cause of fire as such repudiated the claim. There was no deficiency in service on the part of the Insurer. The complaint is liable to be dismissed.

5.      The Insured filed Replication, Affidavit of Evidence of Varuchi Goel and documentary evidence. The Insurer filed an Affidavit of Evidence of Gyan Prakash. Both the parties have filed short synopsis.

6.      We have considered the arguments of the counsel for the parties and examined the record. The Insurer relied upon the Expert Report but it has not been produced before us. The surveyor inspected the spot and submitted “Immediate Loss Advice” report dated 15.02.2014 and Final Survey Report dated 17.12.2014. The surveyor found that fire occurred due short circuit of electricity cable passing through underground cable to the adjoining factory of R.O. Plan of M/s. D.M. Water of the floor of the godown. The Investigator also in his report dated 08.08.2015, did not raise any doubt in respect of cause of fire. As stated in the written reply of the Insurer, the Expert had opined that underground cable should not normally blow off and explode even if it had short circuited. Thereafter, the Insurer took clarification from the surveyor, through email dated 23.07.2015 and held a meeting dated 05.10.2015, with him in respect of cause of fire. The surveyor in his letter (received by the Insurer on 10.11.2015) (Annexure-R) supplied the photographs of burnt cable and damaged floor and again re-iterated that fire had occurred due to bursting of electrical cable passing underground to the godown. It is matter of fact that underground cable was laid from the point of main electricity supply to the R.O. Plant of M/s. D.M. Water, which was adjoining to the godown. The surveyor, the Investigator and the Insurer does not dispute it. The surveyor has personally verified the burst and burnt cable and damaged floor and also took its photographs. Thus it was proved beyond all reasonable doubt that fire has caused due to burst and burnt cable and damaging floor. The opinion of the Expert is merely a hypothetic contingency and not actual verification of the cable and floor. No reliance could be placed upon it. The Insurer has wrongly relied upon it to repudiate the claim.      

7.      It is also matter of the fact that at the time of fire incident on 03.02.2014, there was no electricity connection/supply in the godown. Only for the reason that in the lease deed dated 15.11.2013, there was a recital that the landlord would bear the electricity charges, the Insurer is deriving contradiction in the statement of the Insured and the landlord and the lease deed. In the absence of power supply in the godown on the date of incident, there is no contradiction.

 8.     In the written reply a new ground that the landlord, who had taken electricity connection for the reception ceremony from an adjoining factory, was actual tort-feasor and liable for loss. But the Insured had chosen not to proceed against him for the loss. This ground cannot be permitted to be raised in view of judgment of Supreme Court in Galada Power and telecommunication Ltd. Vs. United India Insurance Company Limited, (2016) 14 SCC 161 and Saurashtra Chemicals Limited Vs. National Insurance Company Limited, (2019) 19 SCC 70. Otherwise also it is for the Insurer to realize the amount of damage from tort feasor and for the Insured.

9.      The surveyor and the Investigator did not find any misrepresentation. Condition Nos.1, 3, 6 and 8 are not violated. The Insurer has wrongly invoked these conditions. The surveyor has assessed net loss to Rs.9503836/-, which is payable.

10.    The Insured has reported the loss to the Insurer on 04.02.2014. Under Regulation 9 of The Insurance Regulatory and Development Authority (Protection of Policyholder’s Interest) Regulations, 2002, the Insurer is liable to settle the claim within six months of reporting the loss. Failing which, the Insurer will be liable to pay interest @2% above the market rate. There is no allegation that the Insured has committed delay in supplying the material and evidence. The Insurer is therefore liable to pay interest from 03.08.2014.         

O R D E R

In view of aforementioned discussion, the complaint is partly allowed. The opposite party is directed to pay Rs.9503836/- with interest @9% per annum from 03.08.2014 till the date of payment, within a period of 2 months from the date of this judgment.