O R D E R
(By Sri D.Shankar Rao, Member)
- The brief-facts of the complaint are that the complainant is running a shop by name & style ‘New Dhanalaxmi Confectionary’ at Bichkunda since 10 years. The complainant obtained loan of Rs.4,00,000/- from Syndicate Bank Bichkunda. Being a loanee of the Bank there was a shopkeepers insurance policy from opposite party obtained by bank on be-half of complainant. The opposite party has issued insurance policy bearing No.050701/48/10/34/00000797 valid from 14-10-2010 to 13-12-2011 covering the risks, Fire and allied Perils, Bulgary, House-breaking, Money insurance and baggage insurance including furniture, fixture fittings and stock in trade for total sum insured is Rs.4,00,000/- excluding money and valuables.
That on 19-10-2011 at about 17.00 hours, Suddenly fire accident was took place in the shop in which complainant is sustained loss of Rs.4,39,454/-. Immediately the matter is reported to opposite party and material claim papers are submitted in the office of opposite party. Though the complainant sustained loss of Rs.4,39,454/- but restricted his claim to Rs.4,00,000/- as per policy.
The complainant got issued legal notice to opposite party for settlement of claim. But the opposite party gave wrong reply denying liability. The contention of opposite party is that the cause of fire is illegal storage of fire crackers in the said insured shop which is totally incorrect. It is true that the owner of the premises got registered a criminal case against the complainant in crime No.115/2011 of P.S. Bichkunda and the same was withdrawn after he came to know the real facts and entered into an agreement on 03-04-2012. The complainant has not given any consent to surveyor’s assessment and the assessment @ Rs.90,000/- is totally incorrect. The opposite party has illegally repudiated the claim.
The acts of opposite party amount to deficiency of services and unfair trade practice. Therefore the opposite party is liable to pay the claim amount of Rs.4,60,000/- with interest @ 18% per annum under the policy along with damages of Rs.1,00,000/- for causing physical and mental agony besides cost of the complaint.
2. The opposite party filed its counter and stated that it true that the complainant is a resident of Bichkunda and he is a businessman running a shop by name & style ‘Dhanalaxmi Confectionary’ at Bichkunda since 10 years. The complainant has a license to run the said shop. It is also true that on be-half-of complainant, the Syndicate Bank Bichkunda has obtained a shopkeepers insurance policy from opposite party vide policy bearing No.050701/48/10/34/00000797 valid from 14-10-2010 to 13-12-2011 for covering fire and allied perils covering contents, excluding money and valuables but including furniture, fixture, fittings and stock in trade and Bulgary, House breaking covering all contents in the shop premises. The sum insured is Rs.4,00,000/- apart from these risks, money insurance in counter / till is covered to an extent of Rs.4,000/-. The liability of opposite party is strictly covered by the terms and conditions of the policy. The complainant has no license to sell fire crackers. Fire crackers are prohibited goods and for selling those goods special license is necessary from the Government. Therefore the phrase ‘Stock in trade’ does not include every goods including prohibited goods. The business of the complainant shall relate to confectionary products and selling fire crackers is not his business.
The opposite party has no personal knowledge of alleged fire accident occurred on 19-10-2011 at about 17.00 hours in the insured shop. It is incorrect to state that the complainant sustained loss of Rs.4,39,454/-. It is true that the matter is intimated to opposite party on 20-10-2011 and subsequently submitted relevant documents. Soonafter, received information, the opposite party appointed a Surveyor S.Mohan Reddy on the same day on 20-10-2011 and he visited the insured shop on very same day. He made local inquiries, physical inspection of insured shop and assessed the loss at Rs.90,000/- and submitted his report on 12-06-2012. When the Surveyor inspected the burnt debris of insured shop, he found that apart from confectionaries, the insured was also storing paints, Electric goods, ceiling Fans, stationery, oils and flammable and inflammable items. He observed that the cause of fire is fire crackers which are stored illegally without any license, which is a breach of conditions of the policy. The real owner of premises Mohd. Khaja gave report to police stating that a fire accident took place on 19-10-2011 due to illegal storage of fire crackers without license. As such a criminal case bearing FIR No.115 of 2011 was registered against complainant in P.S. Bichkunda. Later it seems that the matter was compromised and entered into an agreement on 3-4-2012. It shall not be interpreted in terms of compromise between complainant and building owner. However the facts remains that the complainant stored illegally the fire crackers without any license in the insured shop. The opposite party promptly repudiated the claim through a letter dated 18-06-2012 which is valid, legal, and as per terms and conditions of the policy. All other allegations have been denied. Therefore the complaint is liable to be dismissed with costs.
3. During enquiry the complainant filed his evidence affidavit as PW1 and got marked Exs.A1 to A7 documents and closed his evidence. The opposite party has filed the evidence affidavit of their Deputy Manager Nanchari Narsaiah as RW1 but it was eschew on their requested memo. Thereafter the opposite party has filed the evidence affidavit of their assistant T.Rajendra Sharma as RW2 and got marked Exs.B1 to B15 documents and also filed the evidence affidavit of Sama Mohan Reddy Surveyor as RW3 and got marked Ex.B16 document and closed their evidence.
4. Heard Arguments.
5. The points for consideration are:-
1) Whether there is any deficiency of Service on the part of opposite party in repudiating the claim under the policy ?
2) To what relief?
6. Point No. 1: There is no dispute that the complainant is running shop under the name & style “New Dhanalaxmi Confectionary” at Bichkunda since 10 years. It is also not disputed that the shop of complainant was having shopkeepers insurance policy obtained by Syndicate Bank, Bichkunda from the opposite party vide policy bearing No.050701/48/10/34/00000797 in Ex.A1 (B1) for sum insured Rs.4,00,000/- for a period from 14-10-2010 to 13-12-2011 for covering fire and allied perils.
The fire accident was took place in 19-10-2011 at 17.00 hours in the insured shop in which the complainant is sustained loss of Rs.4,39,454/- is disputed.
The case of the complainant is that a fire accident was took place on 19-10-2011 at about 17.00 hours in his shop in which he is sustained loss of Rs.4,39,454/- but he restricted his claim to Rs.4,00,000/- as per policy. Instead of settlement the claim, the opposite party has repudiated the claim on a ground that there is illegal storage of fire crackers in the insured shop is illegal without any valid reason. The assessment of loss at Rs.90,000/- by Surveyor is totally incorrect and without consent.
The contention of opposite party is that the complainant has a license to run the shop for selling confectionary products but not fire crackers. Fire crackers are prohibited goods but selling those goods, there should be a required license is necessary from the Government. However the phrase “Stock-Trade” does not include every goods including fire crackers. The liability of the opposite party is strictly covered by the terms & conditions of the policy. The real owner of the premises Mohd Khaja filed a criminal case bearing No.115 of 2011 against complainant in P.S. Bichkunda stating that the fire accident took place on 19-10-2011 due to illegal storage of fire crackers in the insured shop without license. Later it might be compromised by entering into an agreement on 3-4-2012 between complainant and building owner. However the facts remains that the complainant stored the fire crackers illegally without license in the insured shop. The surveyor inspected the burnt debris of insured shop, he found that there was also storing paints, electric goods, Ceiling Fans, stationery, oils and Flammable and inflammable items and observed that the cause of fire is illegal storage of fire crackers without any license. The surveyor assessed the loss at Rs.90,000/-. The opposite party promptly repudiated the claim which is valid, legal and as per terms & conditions of the policy.
In order to prove the case, the complainant has filed his own evidence affidavit as PW1 and got marked Exs.A1 to A7 documents supporting to his case.
The opposite party also filed the evidence affidavit of their Assistant T.Rajendra Sharma as RW2 as RW1 evidence affidavit of their Deputy Manager Nanchari Narsaiah was eschew on his retirement on their request and also filed the evidence affidavit of Surveyor Sama Mohan Reddy as RW3and relied upon Exs.B1 to B16 documents in order to prove their contention.
We have heard the arguments of counsel for the parties and perused the exhibits on both side and the entire case record. Ex.A1 (B1) is the shop keepers insurance policy No.050701/48/10/34/00000797 for a period from 14-12-2010 at 15.00 hours to midnight of 13-12-2011 issued by opposite party in favour of complainant’s shop. Ex.A2 (B2) is the fire accident information letter dated 20-10-2011 issued by complainant addressed to opposite party. Ex.A3 (B3) is the fire insurance claim Form. Ex.A4 (B5) is the legal notice issued by complainant. Ex.A5 (B6 & B8) is the reply notice dated 24-7-2012 issued by opposite party. Ex.A6 (B15) is the agreement document dated 03-04-2012. Ex.A7 is the judgement of criminal case dated 30-05-2013 in CC No.11 of 2012 on the file of JMFC Bichkunda in Crime No.115 of 2011 of PS Bichkunda. Ex.B4 is the estimation of loss prepared by complainant on 12-11-2011. Ex.B7 is the reply notice acknowledgement from complainant. Ex.B9 dated 18-06-2012 is the claim repudiation letter issued by opposite party. Ex.B10 dated 12-06-2012 is the Surveyor’s report along with loss assessment. Ex.B11 is bunch of 40 photographs taken by Surveyor showing the fire accident of insured shop. Ex.B12 is the eenadu news paper clippings regarding the fire accident of insured shop. Ex.B13 is the FIR No.115 of 2011 dated 20-10-2011 issued by P.S. Bichkunda. Ex.B14 is the Forensic science Laboratory report dated 17-11-2011 addressed to Sub-Divisional police Officer, Bodhan, Nizamabad district. Ex.B16 is the C.D. containing photographs in Ex.B11 taken by Surveyor.
The complainant has simply pleaded that the fire accident was took place on 19-10-2011 at 17.00 hours in the insured shop and he sustained loss of Rs.4,39,454/-. But the opposite party took a plea that the fire accident was occurred in the insured shop due to illegal storage of fire crackers without license and assessed the loss only for Rs.90,000/-. Therefore the burden of proof is shifted to opposite party to prove its plea.
On perusal of entire record of the case, the opposite party took the plea on the strength of a criminal case in crime No.115 of 2011 of P.S. Bichkunda which registered against complainant in Ex.B13, news paper chippings in Ex.B12, the RW3 Surveyor report in Ex.B10 and the report of Forensic Department in Ex.B14. Except RW3 Surveyor report in Ex.B10, all other documents in Ex.B12, B13 and B14 are part and parcel of the police investigation. The claim of the complainant under the policy was repudiated on 18-06-2012 as per in Ex.B9 after the gap of 8 months from the date of fire accident. By that time there were no findings over the police investigation. Ex.A7 is the copy of judgement of Judicial First Class Magistrate Court Bichkunda wherein the Magistrate gave his findings over the police investigation. That the prosecution has proved the fire broken in the insured shop of the complainant on 19-10-2011 but the prosecution has failed to prove that the said fire broke was due to explosion of explosives stored by complainant in his insured confectionary shop. Further there are no details of the samples seized by investigating officer for chemical examination whether that seized samples took from the insured shop of complainant or from the house of one Gopala Rao which is situated besides to the insured shop of complainant. The chemical examination report of Forensic department in Ex.B14 which relied by opposite party and placed the same before Forum also a part and parcel of police investigation. Further the RW3 Surveyor’s report in Ex.B10 is also prepared based upon police investigation in connection with the fire accident took place in the insured shop of complainant. The opposite party have not examined atleast a single person of the neighbour residents of insured shop before the Forum though it is mentioned in the Survey report in Ex.B10 that the Surveyor has enquired with the local people regarding fire accident. Hence we are of the considered view that the opposite party has not acted independently for investigation over the fire accident occurred on 19-10-2011 in the insured shop of complainant but they totally depend upon police investigation. In the light of findings in Criminal case judgement in Ex.A7, the police investigation have been failed. No record is placed before the Forum that the police agency preferred any appeal / Revision over the judgement in Ex.A7 which was pronounced on 30-05-2013. Therefore we are of the considered view that the opposite party has failed to prove his plea that the fire accident was occurred on 19-10-2011 at 17.00 hours in the insured shop of complainant only due to illegal storage of fire crackers. Consequently, the repudiation of the claim under the policy as per in Ex.B9 is not correct and proper, and for which there is deficiency of service on the part of opposite party. The point No.1 is answered in favour of complainant.
7. Point No. 2: In view of finding in point No.1, the next issue is that what was the exact loss in the fire accident, how much the complainant would be entitled under the policy?
In order to prove the loss, the complainant has relied upon Ex.A3 (B3) claim Form and Ex.B4 estimation of loss which submitted by complainant to the opposite party. We have perused and scanned the Ex.A3 (B3) & Ex.B4 documents. Ex.A3 (B3) is showing only figure as Rs.4,40,000/- as loss mentioned by complainant. Ex.B4 is showing estimation of loss of confectionary products, item by item to a tune of Rs.4,39,454/- which prepared and submitted by complainant. Both Ex.A3 (B3) & Ex.B4 have not supported any purchased bills from whole-sale seller or atleast authenticated stock Register as on the date of fire accident. Hence we are in opinion that the loss to a tune of Rs.4,39,454 in fire accident on 19-10-2011 in insured shop as per Ex.A3 (B3) & Ex.B4 documents are not to be considered as correct and proper. The complainant has not adduced any other evidence than the evidence in Ex.A3 (B3) & B4 documents for assessing the genuine loss in the fire accident. Therefore we are of the considered view that the loss at Rs.90,000/- in the fire accident on 19-10-2011 in insured shop as assessed by RW3 who is an independent Surveyor as per his report in Ex.B10 is a valid assessment.
The complainant has not placed any record into the case, how he sustained damages of Rs.1,00,000/-. Hence the complainant is not entitled for any relief of damages except the loss in fire accident to a tune of Rs.90,000/- under the policy. Accordingly the point No.2 is also answered in favour of complainant.
In view of aforesaid findings in point No.1 & 2, we are of the considered view that the opposite party is liable to pay the loss of Rs.90,000/- which occurred in the fire accident on 19-10-2011 in the insured shop as assessed by RW3 Surveyor as per the report in Ex.B10 with interest and costs of the complaint.
8. IN THE RESULT, the complaint is allowed in part as under:
- The opposite party is directed to pay Rs.90,000/- as per Ex.B10 with 9% interest per annum under the policy in Ex.A1 (B1) from the date of repudiation on 18-06-2012 till realisation to the complainant.
- The opposite party is also directed to pay Rs.2,000/- to the complainant towards cost of the complaint.
Typed to dictation, corrected and pronounced by the Member in Open Forum on this the 29th day of October 2014.
