BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM FATEHABAD.

                                                            Complaint No.38  of 2015.                                                                                               

                                                             Date of Institution:12.03.2015.                                                                                       

                                                            Date of Decision:28.02.2017          

M/s Thakar Dass Nand Gopal shop No.81, Anaj Mandi, Fatehabad Tehsil & District Fatehabad through its partner Virender Gupta.

                                                                                                ........Complainant.                                                   Versus

1.United India Insurance Company Limited through its Divisional Manager, Divisional Office, First Floor Oriental Bank of Commerce, City Thana Road, Sirsa Tehsil & District Sirsa.

2.Branch Manager, United India Insurance Company Limited through its Branch Office shop No.75, behind Anaj Mandi, Fatehabad Tehsil & District Fatehabad.

            ……….Opposite Parties.

                        Complaint U/s 12 of Consumer Protection                                          Act, 1986 as amended upto date

Before:                 Sh.Raghbir Singh, President.                                                Smt.Ansuya Bishnoi,Member.

Present:                 Sh. R.K.Tayal, counsel for the complainant.                                                         Sh. U.K.Gera, counsel for OPs.         

ORDER

                                    The complainant firm M/s Thakar Dass Nand Gopal (hereinafter to be referred as complainant) has filed the present complaint against the opposite parties (hereinafter to be referred as OPs) on the averments that  it is a partnership firm and is engaged in business of cotton  ginning and pressing and is running industry/ factory in the name of M/s Shiv Krupa Cotton Industry, at Bhuj Nalia Road village Sanosara Taluka Abdasa District Bhuj-Kutchh (Gujrat)  by taking it on lease for the last 3-4 years in its premises Unit No.1-48 K.M. Stone Naliya Road, Village Sanosara, Taluka Abdasa District Bhuj-Kutchh (Gujrat). It has been further averred that the complainant got insured all kind of stock of cotton (un-ginned, ginned with allied material) in the compound of above said M/s Shiv Kurpa Cotton Industries with OP No.2 United India Insurance Company Limited through its Branch Office Fatehabad Tehsil & District Fatehabad i.e. OP No.2 vide several policies i.e. Standard-fire and Special Perils Policy which are as follows:

It has been further averred that the insurance polices were obtained for insuring  all kind of cotton stocks of Kapas &/or Narma &/or Cotton seed &/or FP Cotton Bales &/or Lint Cotton &/or Tarpaulin &/or Hessian &/or Cloth  &/or Patti &/or any such type of property of the insured whilst stored  at the opened compound &/or in open heaps &/or in open yards &/or attached  &/or in detached Godowns situated in the compound of M/s Shivkrupa Cotton Industries situated at above said address is covered under Fire Policy.

2.                     It has been further averred that on 25.04.2013 when all the departments were closed after doing routine work then at about 9 p.m. fire broke out in the cotton godown and in order to avoid the further loss alarm was raised and power supply was switched off. The workers had tried to control the fire but when no fruitful result came out then assistance from fire station of Adani Enterprises limited situated at village Bitta was sought but the fire tender reached at the spot after 30 minutes.  It has been further averred that it took 1 ½ hours in controlling and extinguishing the fire completely. The cause of out breaking of fire could be due to electric short circuit. The police of police station Naliya reported the matter vide DDR No.13 dated 26.04.2013.

3.                     It has been further averred that complainant intimated the incident to the nearest Branch Office of the OPs i.e. United India Insurance Company Limited, Gandhi Dham immediately and thereafter intimation was given to the Branch Manager of United India Insurance Company Limited, Gandhi Dham.  Thereafter, surveyor G.P.Dave & sons Jam Nagar having branch office at Gandhi Dham, inspected the spot on 27.04.2013 in order to assess the loss and damage caused to the stock of Ginned Cotton and during the process of investigation the surveyor had prepared site plan and also done the videography with photographs of the spot.  It has been further averred that the complainant had submitted claim form along with requisite documents as per the demand of the surveyor who after conducting survey gave preliminary loss advice dated 28.04.2013 to the OPs. Thereafter, the surveyor assessed the loss to the tune of Rs.9,74,606/-  as grand total payable after deducting notional salvage deductable on account of excess as per policy of insurance to the insured i.e. complainant vide survey report dated 28.05.2013 duly received by the OPs  in the month of June, 2013.

4.                     It has been further averred that the complainant requested the OPs to settle the claim but it lingered on the matter on one pretext or the other despite receiving of written request dated 08.10.2013 but when the Ops did not pay any heed then the complainant further made other written requests dated 18.03.2014, 18.04.2014 and 11.07.2014 to settle the claim in question.  It has been further averred that vide letter dated 18.07.2014 the OPs informed the complainant about repudiating of the claim with the remarks “That the loss does not fall within the ambit/preview of the insurance cover given”.  The complainant got served legal notices upon the OPs but in reply thereof the OPs also refused to settle the claim of the complainant.

5.                                 It has been further averred that thereafter the complainant obtained copies of surveyor report and other correspondence through Right to Information Act and found that the surveyor was pressurized to give second report/corrigendum in order to repudiate the claim by showing  that the claim does not fall under the coverage of policies despite the fact that the policies are of standard fire and special peril. It has been further averred that Industrial/manufacturing risks Code 63, rate Code 22, Cotton Gin and Press Houses covered by Section 4 of Tariff Advisory Committee  which says that  “The scope of risk as per TAC is as under Rate provided in this Section are for the entire insured property  in the same industrial compound i.e. all process areas, storage areas, offices, utilities, miscellaneous blocks, pipe lines, roads, compound wall, cables, street lights etc. It has been further averred that the OPs-insurance company have wrongly and illegally repudiated the claim despite receiving of premium, which amounts to deficiency in service and unfair trade practice on their part. In evidence, the complainant has tendered affidavit of Sh.Virender Gupta, as Ex.CW1/A and documents Ex.AC1 to Ex.AC48.

6.                                 On notice OPs appeared and contested the claim of the complainant by filing joint reply wherein several preliminary objections such as cause of action, locus standi and estoppal etc. have been taken. It has been further submitted that cotton in the open compound or in open heaps, or in attached in open yards or in detached godowns situated in the compound was covered under the policies in question but the premises where fire broke out was the process house and same was not covered under the policies as the complainant had not taken the insurance for process unit/process house. It has been further submitted that cover notes were earlier issued in the name of complainant and its sister concerns for other locations and in those policies process house was covered and adequate premium was paid but in this case the covered premises was open yard/ godown and not the process house. The OPs-insurance company has rightly repudiated the claim of the complainant as the surveyor G.P.Dave & Sons had given its report after thorough investigation wherein it has been opined that the process house was not covered under the policies taken by the complainant.  There is no deficiency in service on the part of the OPs. Other allegations made in the complaint have been controverted and prayer for dismissal of the complaint has been made. In evidence, the OPs have tendered affidavit of Sh.Prahalad Sharma, Branch Manager as Ex.R1 and documents Ex.R2 to Ex.R52.

7.                          Learned counsel for the complainant argued that fire had broken out in the cotton godown on 25.04.2013 and regarding this DDR No.13 dated 26.04.2013 (Annexure C24) had been recorded and even the surveyor G.P.Dave & sons in his report dated 28.04.2013 (preliminary loss advice) (Annexure A27) has also opined that goods lying in the cotton godown were affected  due to fire and he also assessed/estimated the loss to the tune of Rs.10,04,957.00 approximately  (Estimated loss based on stock record). He further argued that as per Industrial/manufacturing risks Code 63, rate Code 22 (Section 4 of Tariff Advisory Committee)  Cotton Gin and Press Houses are covered under the policies purchased by the complainant from the OPs and the scope of risk as per TAC is that Rate provided in this Section are for entire insured property  in the same industrial compound i.e. all process areas, storage areas, offices, utilities, miscellaneous blocks, pipe lines, roads, compound wall, cables, street lights etc.  In support of his contention learned counsel for the complainant drew the attention of this Forum towards schedule of Standard Fire and Special Perils Policies (Ex.AC2, Ex.AC4, Ex.AC6, Ex.AC8, Ex.AC10, Ex.AC12, Ex.AC16 and Ex.AC19) wherein it has been mentioned that Risk/Rate Code No.as 063/22.  He further argued that complainant had paid the premium as per Risk/Rate Code No.063/22 which was covering entire property lying in the same industrial compound but now the OPs have repudiated the claim on the ground that the process house was not covered under the insurance policies purchased by the complainant.

8.                                 Per contra, learned counsel for the OPs argued that the insurance company has rightly repudiated the claim of the complainant as the process house was not covered under the policies because its cover was not  purchased by the complainant. He further argued that in other cover notes issued to the complainant earlier for other locations cover was obtained for the process house by the complainant by paying requisite premium but in the present case it has not done so.

9.                            After hearing learned counsels for the parties and going through the material available on the case file we are of the considered view that the OPs-insurance company has wrongly and illegally repudiated the claim of the complainant.  Learned counsel for the OPs has stressed that the process house where the fire had broken out was not covered under the policies in question purchased by the complainant. This plea taken by the learned counsel for the Ops is quite contradictory because in the bottom line of the para No.2 of the reply on merits of reply to the complaint it has been mentioned that The covered premises was the open yard or the Godown and not the process house but the surveyor in his Preliminary loss Advice (Ex.AC27) has mentioned that Subject matter insured/items affected Cotton Stock/ 4 Nos. FPB & 96.56 Qntl. of Ginned Cotton stock in Cotton Godown.  The surveyor in Ex.AC32 has also mentioned that the risk covered is as per risk code 063/22 which is cotton Gin & Press House  and the policies have been issued as per Section IV of the Tariff.  It is strange that when the insurance company has issued the policies in question and received the premium as per Industrial/manufacturing risks Code 63, rate Code 22 (Section 4 of Tariff Advisory Committee) which was covering entire insured property  in the same industrial compound i.e. all process areas, storage areas, offices, utilities, miscellaneous blocks, pipe lines, roads, compound wall, cables, street lights etc.  then how it is denying its liability of indemnifying the loss sustained by the complainant due to breaking out of fire for the reasons best known to it.  It is well established on the case file that the loss to the goods were occurred in the cotton godowns and not in the processing house  and this fact is authenticated by the surveyor appointed by the OPs-insurance company in its preliminary loss report. Even if for the sake of arguments, if we presume that the fire had broken out in the process house even then the insurance company cannot deny its liability to indemnify the loss suffered by the complaint as the policies had been issued as per risk Code 063/22 keeping in view the section IV of the Fire Tariff which reads as under:

Industrial/manufacturing risks Code 63, rate Code 22, Cotton Gin and Press Houses covered by Section 4 of Tariff Advisory Committee  which says that  “The scope of risk as per TAC is as under Rate provided in this Section are for the entire insured property  in the same industrial compound i.e. all process areas, storage areas, offices, utilities, miscellaneous blocks, pipe lines, roads, compound wall, cables, street lights etc.

10.                        Another surprising factor which this Forum has noticed that fire had broken out on 25.04.2013, spot survey was done on 27.04.2013 and the surveyor had submitted its report with the OPs on 07.06.2013. However the claim of the complainant was repudiated vide letter dated 18.07.2014 i.e. after a lapse of more then one year. Therefore, the Ops had not decided the claim of the complainant within stipulated period of one month as per sub Clause 5 of the Regulation No.9 which proves deficiency and unfair trade practice on the part of OPs-insurance company. On this point reliance can be taken from case law titled as National Insurance Company Limited Vs. Rajesh Kumar Kalia 2013 (2) CLT 417 (PB), wherein Hon’ble PSCDRC has held that claim not decided/repudiated within 30 days from the date of receipt of the survey report as per sub Clauses 5 of the Regulation No.9 Deficiency in service by insurer. In another case titled as M/s Shital International Vs. United India Insurance Company Limited 2012 (1) CLT 326 (Pb.), Hon’ble PSCDRC has also held that Settlement of claim not offered to the insured within 30 days which is mandatory as per regulation 9 No copy of the surveyor report was sent to the insured within 30 days of the receipt of the same-complaint allowed.

11.                        Keeping in view the above discussed facts and the legal factual position, this Forum has no hitch to reach at conclusion that the complaint deserves acceptance. It is ordered accordingly.  The Ops are directed to pay a sum of Rs.9,74,606/- as assessed by the surveyor in its report (Ex.AC30) along with interest @ 6 % per annum from the date of filing of the complaint till its realization. Order be complied within one month on receiving of copy of order. A copy of this order be supplied to both the parties free of cost.  File be consigned after due compliance.

Announced in open court:                                                                 28.02.2017                                              

  (Raghbir Singh)                                                                                                                 

  President,                                                                                                                 

District Consumer Disputes                                                                                          

  Redressal Forum, Fatehabad.

                                                                                                                            (Ansuya Bishnoi)                                                                                                                                                                                                           Member