Haryana

Karnal

CC/606/2021

M/s Gopal Rice Mills - Complainant(s)

Versus

United India Insurance Company Limited - Opp.Party(s)

Ramesh Chaudhary

01 Jan 2024

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KARNAL.

                                                        Complaint No. 606 of 2021

                                                        Date of instt.27.10.2021

                                                        Date of Decision:01.01.2024

 

M/s Gopal Rice Mills, Shambli Road, Nissing, District Karnal through its partner Shri Gaurav Singla son of Shri Jai Narain.

 

                                               …….Complainant.

                                              Versus

 

United India Insurance Company Limited, Branch office, near Bus Stand, G.T. Road, Karnal through its Branch Manager.

 

                                                                  …..Opposite Party.

 

Complaint Under Section 35 of Consumer Protection Act, 2019.

 

Before   Sh. Jaswant Singh……President.       

      Sh. Vineet Kaushik…….Member

      Dr. Suman Singh……Member

          

 Argued by: Shri Randhir Singh Mann, counsel for complainant.

                    Shri Virender Adlakha, counsel for the OP.

 

                    (Jaswant Singh, president)

ORDER:  

 

                The complainant has filed the present complaint Under Section 35 of Consumer Protection Act, 2019, against the opposite party (hereinafter referred to as ‘OP’) on the averments that complainant M/s Gopal Rice Mills is a registered partnership firm and the present complaint has been filed through one of its partner Shri Gaurav Singla. The complainant firm had purchased a Standard Fire and Special Perils Policy from the OP, bearing no.1107011118P112600789, valid from 28.12.2018 to 27.12.2019. The sum insured was Rs.25,00,00,000/- for stock of Rice, paddy, Bardana, wooden crates, Tarpaulin and other allied product/stock of insured parade lying/stored anywhere in the premises of said Rice Mill. However, an endorsement no.1 dated 16.05.2019 was made vide which it was declared and agreed by the OP that w.e.f.16.05.2019 the following changes have been incorporated in the above mentioned policy.

All other terms, conditions and warranties remain unaltered

Risk location address	Description of  risk	Description items type	of changes items description	Change from	Change to
Gopal Rice Mills, Sambhli Road Nissing, Karnal Strate Haryana pin-132001	Rice Mill	Building including plinth and foundation	On complete building of Ricemill with godown and sheds and any other construction within premises	0.00	34,000,000.00

 

On 27.07.2019 at 5.00 p.m., there was heavy rain, violent wind and storm, due to which the shed had collapsed. A tractor which was parked under the shed was also damaged due to falling of shed on it. About 100Ft.x 60ft. of the shed was completely destroyed. The loss on account of collapsed shed was about 9 lakhs, bardana loss Rs.1,00,000/-, tractor repair Rs.25,000/- foundation repair Rs.50,000/-, total net loss Rs.10,75,000/-. The said loss is fully covered under the said insurance policy in question. The OP was duly intimated by the complainant on 27.07.2019, vide its written letter and the claim was lodged by the complainant on the next day i.e. 28.07.2019. On receipt of intimation, a surveyor was appointed by the OP, who visited the premises of the complainant and physically verified the factum of incident and assessed the loss and recorded the statements. The complainant submitted all the relevant documents i.e. original insurance policy, news paper cutting, endorsement dated 16.05.2019, claim form as required by the surveyor, balance sheet, trading account of last three years duly certified by C.A.,  provisional balance sheet and trading account as on the date of loss duly certified by CA, detail of total stock rice, paddy, bardana, wooden crates, tarpaulins and other allied products on the date of loss with value, bank account statement and stock statement submitted to the bank for the last one year, copy of present site plan, copy of ownership deed, claim bill with supporting documents. It is further averred that surveyor also demanded the copy of FIR and valuation report of building from the approved valuer, but there was no loss of life in the said incident, hence the police has not lodged the FIR. The valuation report has already been submitted at the time of insurance of building. Thereafter, complainant received a letter dated 31.10.2019, vide which OP declined the claim of the complainant on the false and flimsy ground that the operation of peril, cause under which the loss occurred i.e. normal rain fall, which is not covered under the scope of policy. Due to this act and conduct of the OP, complainant has suffered mental pain, agony and harassment and as well as financial loss. In this way there is deficiency in service and unfair trade practice on the part of the OP. Hence this complaint.

2.             On notice, OP appeared and filed its written version raising preliminary objections with regard to maintainability; locus standi; cause of action and concealment of true and material facts. On merits, it is pleaded that the loss occurred on 27.07.2019 at 5.00 p.m. and intimation of this loss was given to the insurer at the same time and claim form lodged on 29.07.2019 was without valuation of loss from a certified valuer and self assessed rough estimate of the loss of Rs.10,75,000/-. It is further pleaded that complainant-firm had purchased a standard fire and special perils policy form the OP, vide its policy/cover note no.1107011118P112600789, commencing from 28.12.2018 to 27.12.2019. The complainant has alleged that on 27.07.2017 at 5.00 pm., there was heavy rain violent wind and storm, due to which the shed had collapsed and a tractor which was parked under the shed got broken by falling of shed Kenchi. About 100Ft.x 60ft. of the shed was completely destroyed. The loss on account of collapsed shed was about 9 lakhs, bardana loss Rs.1,00,000/-, tractor repair Rs.25,000/- foundation repair Rs.50,000/-, total net loss Rs.10,75,000/- and the OP was duly intimated by the complainant on 27.07.2019 and the claim was lodged on 28.07.2019 and all the required documents were submitted whereas there was no storm, having heavy rains and violent winds, therefore loss was not covered under the Standard Fire and Special Perils policy. It is further pleaded that the OP appointed Shri Vikas Bansal, Surveyor, loss Assessor and Consultant, vide letter dated 29.07.2019 to assess the loss to Building of M/s Gopal Rice Mills, who visited the insured premises on 29.07.2019 at about 2.30 p.m.  alongwith Shri Sudesh Ji, Senior Branch Manager, Karnal after  collecting all the necessary information from the office and fixing an appointment with Shri Shashi Bhushan Ji of M/s Gopal Rice Mills. The affected building shed, its foundation, bardana and tractor of the insured was thoroughly inspected. There was normal rain on Saturday, i.e. on 27.07.2019 at 5.00, due to which paddy open shed from front side was damaged. As per statement of insured, the rice mill was in working since 1987. The damaged building area was constructed in the year 2012. They purchased the mill in 1999 and after that they purchased the adjoining land and constructed this shed. The area of the shed is 100 feet x60 feet which collapsed. The tractor, Bardana and paddy are not covered under the alleged policy. As per the report of surveyor, the salvage of cemented sheets and iron pillar/bar and angle 30 Qtls. has only scrap value on the open market is Rs.55000/-. The assessed loss after depreciation for building’s boundary wall, comes to Rs.2,30,010/- and after adjusting the salvage to the tune of Rs.55,000/-, net assessed loss for building’s boundary wall comes to Rs.1,75,010/- and the net adjustment in account of policy clause Rs.25000/-, the amount comes to Rs.1,50,010/- only subject to terms and conditions of the insurance policy. It is further pleaded that complainant does not fall under the definition of consumer. As per terms and conditions, the normal rain is not covered under the Standard Fires and Special Perils Policy. Insured has not provided police report, metrological Department Report, copy of present site map and valuation report of building from the approved valuer as well copy of FIR, till date inspite of various telephones and emails dated 10.08.2019, 23.08.2019 and 13.09.2019., hence the claim is not maintainable as per terms and conditions of the policy and on the basis of report of surveyor Vikas Bansal, the OP repudiated the claim of complainant. There is no deficiency in service and unfair trade practice on the part of the OP. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

3.             Parties then led their respective evidence.

4.             Learned counsel for the complainant has tendered into evidence affidavit of complainant Ex.CW1/A, copy of resolution dated 26.10.2021 Ex.C1, copy of insurance policy Ex.C2, copy of statement of insured Ex.C3A and Ex.C3B, copy of claim form Ex.C4, copy of statement of accountant Ex.C5, copy of statement of Sher Singh Ex.C5A, copy of estimate Ex.C6, copy of newspaper cutting Ex.C7, copy of repudiation letter dated 31.10.2019 Ex.C8, copy of partnership deed Ex.C9, copies of bill Ex.C9/A to Ex.C20 and closed the evidence and closed the evidence on 01.06.2022 by suffering separate statement.

5.             On the other hand, learned counsel for the OP has tendered into evidence affidavit of Raj Kamal Saini, Assistant Manager Ex.OPW1/A, affidavit of Vikas Bansal, B.E. Associate Ex.OPW2/A, cop y of insurance policy Ex.OP1, copy of intimation dated 27.07.2019 Ex.OP2, copy of claim form dated 29.07.2019 Ex.OP3, rough estimate Ex.OP4, copy of letter of surveyor dated 30.09.2019 Ex.OP5, copy of survey report dated 05.08.2019 Ex.OP6, photographs Ex.OP7, copy of statement of Shashi Bhushan Ex.OP8, copy of newspaper cutting Ex.OP9, copies of emails dated 10.08.2019 and 13.09.2019 Ex.OP10 and Ex.OP11, copy of claim note Ex.OP12, copy of repudiation letter dated 31.10.2019 Ex.OP13 and closed the evidence on 12.07.2023 by suffering separate statement.

6.             We have heard the learned counsel of the parties and perused the case file carefully and have also gone through the evidence led by the parties.

7.             Learned counsel for complainant, while reiterating the contents of the complaint, has vehemently argued that the complainant’s firm purchased a Standard Fire and Special Perils Policy from the OP. On 27.07.2019 at 5.00 p.m., due to heavy rain the shed was completely collapsed. The complainant’s firm has suffered loss to the tune of Rs.10,75,000/- on account of collapsed shed. The intimation was sent to OP  on the same day and the claim was lodged by the complainant on the next day i.e. 28.07.2019. On receipt of intimation, a surveyor was appointed by the OP for assessment of loss. The complainant submitted all the relevant documents to the OP for settlement of the claim but the surveyor of the OP also demanded the copy of FIR and valuation report of building from the approved valuer. There was no loss of life in the said incident, hence complainant did not lodge the FIR. The valuation report has already been submitted at  the time of insurance of building. The claim of the complainant’s firm has been repudiated by the OP, vide letter dated 31.10.2019 on the false and flimsy ground and lastly prayed for allowing the complaint.

8.             Per contra, learned counsel for the OP, while reiterating the contents of written version, has vehemently argued that complainant-firm had purchased a standard fire and special perils policy from the OP. The complainant has alleged that the loss on account of collapsed  shed due to heavy rain on 27.07.2019 at 5.00 p.m. whereas there was no storm, having heavy rains and violent winds, therefore, loss was not covered under the policy. The OP appointed Shri Vikas Bansal, Surveyor, loss Assessor and Consultant, vide letter dated 29.07.2019 to assess the loss of building alongwith Shri Sudesh Ji, Senior Branch Manager and fixing an appointment with Shri Shashi Bhushan Ji of M/s Gopal Rice Mills. The affected building shed, its foundation, bardana and tractor of the insured was thoroughly inspected. There was normal rain on Saturday, i.e. on 27.07.2019 at 5.00, due to which paddy open shed from front side was damaged. The tractor, Bardana and paddy are not covered under the alleged policy. As per the report of surveyor, the salvage of cemented sheets and iron pillar/bar and angle 30 Qtls. has only scrap value on the open market is Rs.55000/-. The assessed loss after depreciation for building’s boundary wall, comes to Rs.2,30,010/- and after adjusting the salvage to the tune of Rs.55,000/-, net assessed loss for building’s boundary wall comes to Rs.1,75,010/- and the net adjustment in account of policy clause Rs.25000/-, the amount comes to Rs.1,50,010/- only subject to terms and conditions of the insurance policy and prayed for dismissal of the complaint.

9.             We have duly considered the rival contentions of the parties.

10.           Admittedly, complainant’s firm had purchased a standard fire and special perils policy from the OP. It is also admitted that complainant’s has suffered loss during the subsistence of the insurance policy.

11.           The claim of the complainant has been repudiated by the OP, vide repudiation letter Ex.C8/Ex.OP13 dated 31.10.2019 on the following ground, which is reproduced as under:-

“The operation of peril/cause under which the loss occurred i.e. normal rain fall which is not covered under the scope of the policy.

Hence, claim has been repudiated”.

 

12.           The claim of the complainant has been repudiated by the OP on the abovesaid ground. The onus to prove its version was relied upon the OP but OP has miserably failed to prove the same by leading any cogent and convincing evidence. The OP has alleged that complainant has not provided metrological report to prove his version. If the OP is of the view that there was normal rain and metrological report was required in that event OP should have obtained the said report from the concerned department.  But OP did not obtain the said report and burden was shifted to the complainant just to escape from their liability.

13.           Complainant has alleged that his firm has suffered loss to the tune of Rs.10,75,000/-. The onus to prove his version was relied upon the complainant. To prove his version the complainant has relied upon rough estimate Ex.C6, which is reproduced as under:-

        Shed   100’x60’=6000x150=9,00,000/-

        Bardana 2500x40               =1,00,000/-

        Tractor expenses 25000/-   =  25,000/-

        Foundation expenses          =  50,000/-      

                                                =10,75,000/-   

                                        For Gopal Rice  Millls

                                        Sd/-Shashi Bhushan

                                                29.07.2019

 

 14.          The said estimate has been prepared by the Shashi Bhushan on behalf of the firm. The abovesaid damage estimate was not  prepared by the Technical/Valuation Expert. Moreover, the said estimate is a photocopy and complainant has not examined the person, who had prepared the said estimate. Hence, the said estimate has no value in the eyes of law.

15.           The loss of the complainant’s firm was assessed by Vikas Bansal, B.E. Associate (Fire), Fellowship Insurance Institute of India and Surveyor, Loss Assessor and Consultant and he submitted his report Ex.OP5 dated 30.09.2019 and assessed the loss of building, which is reproduced as under:-

Sr. no.	Estimate (Rs.)	Assessment (Rs.)
Shed100’x60’=6000’ @ 150/- per sq.	9,00,000.00	6000 sq. feet @ 50/- per sq. feet) 3,00,000.00
2500 bags Bardana 2500 bags @ 40/- each	1,00,000.00	Not allowed
Tractor repair	25,000.00	Not allowed
Foundation Repair	50,000.00	Not covered
Total	10,75,000.00	3,00,000.00

 

 

 

The area of the shed was 100’x60’=6000’ sq. feet and estimated cost was Rs.9,00,000/- but surveyor of the OP has assessed the said loss for the tune of Rs.3,00,000/- only and also made further depreciation @ 23.33% and assessed the loss after depreciation for Rs.2,30,010/- and also deduct of Rs.25,000/- on account of general exclusion clause, which are not justified because  surveyor of the OP has already made a huge deduction while assessing the cost of shed. Hence, the depreciation made by the surveyor of the OP on the basis of presumption and assumption, which is arbitrarily and unjustified.

16. Further,  Hon’ble Punjab and Haryana High Court in case titled as New India Assurance Company Ltd. Versus Smt. Usha Yadav & others 2008 (3) RCR (Civil) 111, has held as under:-

“It seems that the Insurance Companies are only interested in earning the premiums which are rather too stiff now a days, but are not keen and are found to be evasive to discharge their liability. In large number of cases, the Insurance companies make the effected people to fight for getting their genuine claims. The Insurance Companies in such cases rely upon clauses of the agreements, which a person is generally made to sign on dotted lines at the time of obtaining policy. This is, thus pressed into service to either repudiate the claim or to reject the same. The Insurance Companies normally build their case on such clauses of the policy, but would adopt methods which would not be governed by the strict conditions contained in the policy”.

17.           Keeping in view, the ratio of the law laid down in aforesaid judgments, facts and circumstances of the present complaint, we are of the considered view that act of the OPs while repudiating the claim of the complainant amounts to deficiency, which is otherwise proved genuine one.

 18.          The complainant’s firm has claimed Rs.10,75,000/ and in this regard complainant’s firm has only relied upon the rough estimate. On the other hand, the surveyor of the OP has assessed the  total loss to the tune of Rs.3,00,000/-. Hence, complainant is entitled for the said amount alongwith interest, compensation for mental agony and harassment and litigation expenses.

19.            In view of the above discussion, we partly allow the present complaint and direct the OP to pay Rs.3,00,000/- (Rs. three lakhs only) as loss assessed by the surveyor alongwith interest @ 9% per annum from the date of repudiation of the claim i.e. 31.10.2019 till its realization to the complainant. We further direct the OP to pay Rs.25,000/- to the complainant on account of mental agony and harassment suffered by him and Rs.11,000/- for the litigation expense. This order shall be complied within 45 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated:01.01.2024     

                                                                  President,

                                                       District Consumer Disputes

                                                       Redressal Commission, Karnal.

 

(Vineet Kaushik)        (Dr. Suman Singh)

                     Member                        Member