BEFORE THE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT  HYDERABAD.

FA  404 of 2012  against CC 145/2011, Dist. Forum, Guntur

Between:

1)  Babu Medical Distributors

Rep. by its Managing Partner

Shaik Habeeb, S/o. Jani  Saheb

Shop D.No. 11-4-131,

4th Line, Raja’s Garden,

Near TTD Kalyanamandapam

Guntur.

2)  Shaik Jani Basha

S/o. Babu  Saheb

Partner of Babu Medical Distributors

D.No. 13-4-37, Guntur Varithota

4th Line, Guntur.                                        ***                         Appellants/

                                                                                                Complainants

And

United India Insurance Company Ltd.

Rep. by its Branch Manager

Branch Office-I,

Nagarjuna Complex

4/7, Brodipet, Guntur. 

                                                                    ***                         Respondent/

                                                                                                Opposite Party

Counsel for the  Appellant :                        M/s. Shaik Karimullah

Counsel for the  Respondent:                     M/s.  N. Parameswara Reddy

CORAM:

                              SMT. M. SHREESHA, PRESIDING MEMBER

&

                              SRI  S. BHUJANGA RAO, MEMBER

TUESDAY, THE THIRTEENTH DAY OF AUGUST TWO THOUSAND THIRTEEN

ORAL ORDER:  (Per Smt. M. Shreesha, Member)

***

1)                Aggrieved by the order in CC No. 145/2011 on the file of the Dist. Forum,  Guntur the complainant preferred  this appeal.

2)                The brief facts  as  stated in the complaint are that  the complainants  who are the partners of  Babu  Medical Distributors  had obtained  a ‘Shopkeepers  Insurance Policy  covering  the  premises bearing No.  11-4-131, Rajagarden, 4th line, Guntur for the period from 3.6.2008 to 2.6.2009 among other things covering the risk of ‘Burglary, house breaking (All contents in the shop premises stated at the above address) for an amount of Rs.  9 lakhs.    While so, on 31.1.2009   at about 8.00 p.m.  the complainants closed the shop and went to their houses.    The complainants submit that on the next day i.e., on 1.2.2009 at about 12.00 noon when the complainants came to the shop to receive the stock, on opening the shutter   they found that some of the medicines were missing.   They submit that some unknown offenders opened the locks with fake key and committed theft of costly medicines.  The complainants lodged a complaint with Kothapet Police Station on 1.2.2009 at 2.00 p.m.  and the same was registered as Crime No. 20/2009 u/s 461, 389 of IPC.    The complainants also informed the respondent insurance company about the theft and claimed an amount of Rs. 3, 38,541/- towards loss of medicines.   The opposite party appointed a surveyor-cum-investigator   Sri CH.  Veera Babu who submitted his report in the month of October, 2010.   The complainants submit that the opposite party informed that on receipt of permission from higher authorities they would settle the claim.  But unfortunately on 21.3.2011 they repudiated the claim stating that ‘there is no burglary which means forcible entry into the business premises. Since the loss is not covered under the scope of our policy, the claim is not payable.  We are closing the file.’  The complainants submit that the opposite party repudiated the claim unjustifiably and that they are entitled to an amount of Rs. 3, 38,541/- towards loss of medicines covered under the policy.   Alleging that the repudiation of claim amounts to deficiency in service the complainants filed this complaint praying for a direction to the opposite party to pay Rs. 3, 38,541/- with interest @ 12% p.a., from the date of theft till the date of realization and costs.

3)                The respondent/opposite party insurance company filed written version denying the allegations made by the complainants.   The opposite party  while admitting issuance of policy  valid from 3.6.2008 to 2.6.2009 covering the risks described  under the policy, contended that the  complainants had paid  premium to cover  the risk ‘Burglary, Housebreaking’ under the policy  subject to terms and conditions  referred to in the policy.   The term defined under the policy reads as follows:

          ‘Burglary and/or Housebreaking  shall mean theft involving entry into or exit from the insured premises  forcible and violent means  theft or following assault  or violence or theft thereof  to the insured or any employee of the insured member  of the insured’s family.’

4)                 The opposite party submits that unless the ingredients of terms burglary, housebreaking shall be existed and visible at the premises they need not indemnify the loss suffered by the insured.   Admittedly there was no forcible entry into or exit from the insured premises and violent means of theft had occurred.   The alleged theft of medicines by using duplicate/fake key   is not covered under the policy.   The manner in which the theft had occurred leads to suspicion and speaks volume about the alleged theft.   The complainants did not state the exact loss of medicines in the complaint lodged with the police.   The opposite party submits that after thorough investigation and the facts stated by the complainant came to the conclusion that the alleged theft is not covered under the policy and rightly repudiated the claim.   There is no deficiency of service on their behalf and prayed for dismissal of the complaint with costs. 

5)                The Dist. Forum after considering the evidence placed on record i.e., Exs. A1 to A22 and Exs. B1 & B2 and the pleadings put forward dismissed the complaint. 

6)                Aggrieved by the said order, the complainant preferred this appeal.

7)                Both sides filed written arguments in support of their respective contentions.

8)                The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

9)                The facts not in dispute are that the complainants had obtained a ‘Shopkeepers Insurance Policy covering the premises bearing No.  11-4-131, Rajagarden, 4th line, Guntur for the period from 3.6.2008 to 2.6.2009 among other things covering the risk of ‘Burglary, house breaking (All contents in the shop premises) for an amount of Rs.  9 lakhs evidenced under Ex. A7.   The complainants   on noticing that theft had taken place in the shop lodged an FIR with police evidenced under Ex. A1.   The police after investigation submitted final report evidenced under Ex. A2 referring the case as ‘Undetectable’ and requested the Hon’ble Court to close the C.D.   The claim made by the complainant was repudiated by the opposite party  vide Ex. A5 letter dt. 21.3.2011 on the ground that :

          “As per final report (Case Diary) some unknown  offenders  opened the locks with fake key committed theft of costly medicines.  There is no burglary which means  forcible entry into the business premises.  Since the loss is not covered under the scope of our policy, the claim is not payable.” 

10)               At this juncture it is pertinent to note that Section-II- ‘Burglary  and House Breaking Contents’  of the policy reads as follows:

          “The company will indemnify the  insured  in respect of loss or damage  to the contents  whilst contained in the insured premises  burglary and/or/ housebreaking.”

          Special Exceptions:  The company shall not be liable in respect of :

Loss  or damage by  burglary  and/or house breaking  where any  employee of  the insured or member of the insured’s  family concerned as principal or accessory. 

Loss of or damage to livestock, motor vehicles and pedal cycles.

Loss of or damage  to money, securities  for money-stamps, bullion, deeds, bonds, bills of exchange, promissory note, stock, share certificates, business books, manuscripts, documents of any kind, unset precious stones and jewellery  and valuables, and specifically declared.”

11)               It is pertinent to note that the definition of  Burglary and Housebreaking relied on by the opposite party  has not been mentioned in the policy issued to the  complainant.  

12)              We may state that the  Hon’ble  Supreme Court in  United India Insurance Company Ltd. Vs. Hirachandrai Chandan Roy reported in AIR 2004 SC 2004   at para-17 observed as follows :

17. But before parting with the case we would like to observe that the terms of the policy as laid down by the Insurance Company should be suitably amended by the Insurance Company so as to make it more viable and facilitate the claimants to make their claim. The definition is so stringent in the present case that it gives rise to difficult situation for the common man to understand that in order to maintain their claim they will have to necessarily show evidence of violence or force. The definition of the word burglary should be given meaning, which is closer to the realities of life. The common man understands that he has taken out the Policy against theft. He hardly understands whether it should precede violence or force. Therefore, a policy should be a meaningful policy so that a common man can understand what the meaning of burglary is in common parlance. Though we have interpreted the present policy strictly in terms of the policy but we hope that the Insurance Companies will amend their policies so as to make them more meaningful to the public at large. It should have the meaning which a common man can easily understand rather than become more technical so as to defeat the cause of the public at large.
 

Thus it is clear that the insurance company consequent on the aforementioned observation of the Apex Court suitably  amended the conditions to make the policy more meaningful. 

13)               The National Commission while dealing with a similar case  in Surjit J. Jain Vs. New India Assurance Company in R.P. No. 2190 of 2007 decided  on 8.5.2007 held that:

“So far as the second issue pertaining to the absence of force, threat or violence while committing the act of burglary through lock picking is concerned, we agree with the Counsel for Petitioner that this issue is squarely settled by the judgment of this Commission in M/s Mono Industries Vs. New India Assurance Co. Ltd. – 2008 NCJ 353 (NC)  in which the National Commission had observed as follows:

“It appears that the judgment rendered by the Apex Court in the case of United India Insurance Co. Ltd. Vs. Harchand Rai Chandan Lal is misunderstood by the Insurance Company. In the said case, it has been held that 'theft from the premises by forceful and violently' would mean entry by use of any force, however slight it may be. As such, an entry obtained by picking the lock or forcing back the catch by means of an instrument involves the use of violence.”

In Mono Industries case it  has been clearly ruled that an entry obtained by picking the lock or forcing back the catch by means of an instrument involves use of violence.  In the instant case, since the entry to the business premises was by picking the lock, this judgment is very much relevant and respectfully following the same and in view of the reasons given in the foregoing paras, we are of the view that the order of the State Commission cannot be sustained on both counts and the same is set aside.  The order of the District Forum is restored and the Revision Petition is allowed.  Respondent/Insurance Company is directed to pay the Petitioner, Rs.7,62,500/- together with interest @ 6% from 14.10.2005 i.e. the date of filing of the complaint, Rs.1,000/- towards mental agony and harassment and Rs.1,000/- as litigation costs within six weeks from the date of receipt of this order failing which the entire amount will carry interest @ 9% from the date of filing of the complaint till realization.”

14)               Apart from that we observe from the record that the insurance company did not file their own surveyor-cum-investigator report.  An adverse inference could be drawn for not filing the said report.   We also observe from the final report of the police Ex. A2 that no suspicion was attributed against the complainants for theft of valuable medicines.  

15)               Taking into consideration the facts and circumstances of the case and in the light of judgements of the Apex Court and the National Commission, supra, we are of the considered opinion that the complainant is entitled to the amount claimed as the opposite party did not file any material to negate the claim made by the complainants.   The complainants also filed  Ex. A11  monthly VAT  Returns showing the purchases and  sales made during the relevant period to establish their case.  Therefore the order of the Dist. Forum cannot be sustained. 

16)               In the result this appeal is allowed in part setting aside the order of the Dist. Forum.   Consequently the complaint is allowed in part directing the  opposite party insurance company to pay Rs. 3,38,541/- with interest @ 9% p.a., from the date of repudiation i.e., from 21.3.2011 till the date of payment together with costs of Rs. 5,000/-.  Time for compliance four weeks. 

1)      _______________________________

PRESIDING MEMBER 

2)           ________________________________

MEMBER  

*pnr                                                                               13/08/2013

UP LOAD – O.K.