BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION
C.C. No. 65/2007
C. Obaiah, S/o. C. Obaiah,
Age: 50 years, D.No. 14-530-7,
Mydukur, Kadapa. *** Complainant
The Regional Manager
Bajaj Allianz General Insurance Co. Ltd.
608 & 609, II Block,
White House, Begumpet,
Hyderabad. *** Opposite Party
Counsel for the Complainant: M/s. M. Azmathulla
Counsel for the OP: M/s. V. Gourisankara Rao
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
SMT. M. SHREESHA, MEMBER
SRI K. SATYANAND, MEMBER
MONDAY, THIS THE TWENTY SECOND DAY OF JUNE TWO THOUSAND NINE
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
1) This is a complaint filed u/s 17 of Consumer Protection Act claiming Rs. 27 lakhs covered under the policy besides Rs. 8,45,000/- towards damages and Rs. 5,000/- towards compensation together with interest and costs.
2) The case of the complainant in brief is that he is the registered owner of Tata Hitachi Ex. No. 300 L.C excavator. He has been using it for his own contract works. He is eking out his livelihood on the earnings from the excavator. It was insured with the opposite party insurance company for Rs. 27 lakhs valid from 12.2.2007 to 11.2.2008. While so, on 30. 5. 2007 at about 1.30 hours, the excavator was damaged in a fire accident at the contract site at
Manchalakatta of Gadivemula mandal. It was set fire by the unknown persons and on report police registered it as a case in Crime No. 22/2007 u/s 435 I.P.C. There was total damage to the machinery. When informed, the insurance company appointed one Mr. E. Mukund, Insurance Surveyor & Loss Assessor to assess the loss. He assessed it as total loss. The insurance company sent the machine to an authorised dealer of TELCO which in turn estimated the loss at Rs. 28, 35,118/-. Despite repeated requests and legal notice, the insurance company did not settle the claim. He was getting income of Rs. 1.50 lakhs per month. He hired the excavator machines from Sri B. Madhusudhan Reddy and Sri Govardhan Reddy for four months and he was forced to spend huge amounts towards hire which he otherwise could have earned had the insurance company settled the claim earlier. Therefore, he claimed Rs. 27 lakhs covered under the comprehensive insurance policy, besides Rs. 8, 45,000/- towards damages, and Rs. 5,000/- towards compensation together with interest and costs.
3) The insurance company resisted the case. It alleged that the complainant is not a consumer and he has not hired the services for consideration. Complicated questions of fact and law are involved which cannot be decided by this Commission in summary way. It has to be determined by a competent civil court. The complainant purchased the excavator for commercial purpose to make profit. The services are hired for commercial purpose. It does not attract definition of ‘consumer’ u/s 2(1) (o) of Consumer Protection Act. It admitted that it has issued a comprehensive insurance policy as alleged by the complainant. One Mr. E. Mukund was appointed as preliminary surveyor who visited the spot and inspected the same and submitted his report mentioning that engine assembly with auxiliaries including cooling system were burnt. Later a final surveyor Sri Y. Venkatesh Reddy was appointed. He inspected the vehicle at the workshop of M/s. C. L.
Engineering Equipment Works, IDA Kukatpally and observed that the cause and nature of accident was not co-related with the nature of damages. The parts that were burnt could not be identified with the model. The span of life of the affected parts was completed. The general condition of the machine was very poor and needed overhauling. The repairer approximately estimated at Rs. 24, 98,625/- and as per his estimation it worked out to Rs. 5 lakhs. The claim was highly exorbitant. Therefore, he is not entitled to the amounts claimed. The complainant hastily filed this complaint even before settlement of claim, and therefore it prayed for dismissal of the complaint with costs.
4) The complainant in proof of his case filed his affidavit evidence and that of B. Chengal Reddy, Proprietor of M/s. C. L. Engineering Equipment Works and got Exs. A1 to A5 marked. Refuting their evidence the insurance company filed the affidavit evidence of its Deputy Manager. The respondent insurance company filed preliminary and final survey reports which are marked as Exs. B1 & B2.
5) The points that arise for consideration are:
i) Whether the complainant used the machinery for commercial purpose and therefore not entitled to clutch the jurisdiction of this Commission?
ii) Whether the complainant is entitled to the amount covered under the policy? If so, to what amount?
iii) Whether the complainant is entitled to compensation? If so, to what amount, and to what relief?
6) It is an undisputed fact that the complainant insured the excavator machine with the opposite party for Rs. 27 lakhs valid from 12.2.2007 to 11.2.2008 evidenced under comprehensive policy Ex. A1. The complainant alleges that on the night of 29/30.5.2007 some unknown offenders poured petrol on the machine and set fire due to which the entire machine was burnt sustaining a loss of Rs. 40,45,000/-. The complainant gave a report to police under Ex. A2 basing on which the police registered a case in Crime No. 27/2002 u/s 435 I.P.C. It is not known as to what happened to the police investigation. The complainant informed the said fact to the insurance company which in turn appointed one Mr. E. Mukund, Insurance Surveyor & Loss Assessor. For the offence that took place on the intervening night of 29/30.5.2007 he visited the spot on 30.5.2007 at about 2.00 p.m. He observed:
a) Please ascertain any pre-risk inspection carried as the general condition of the machine appears to be poor.
b) Number of camps is working surrounding this site, and the insured’s location is not an isolated one.
c) This is first of its kind of this nature of loss involving fire on account of malicious act at project sites.
The insurance company shifted the machinery to the workshop M/s. C. L. Engineering Equipment Works, IDA, Kukatpally, R.R. Nagar, Hyderabad. It appointed another surveyor Sri Y. Venkatesh Reddy by his report Dt. 31.10. 2007 opined that the cause and nature of accident is not co-related with the nature of damages. The parts which are fitted are not identified with the particular model. It has to be identified from the manufacturers only basing on manufacturing date and model. He did not shift the complete vehicle. Only control valve and engine and its related parts were shifted to work shop. The general condition of the vehicle is very poor and needed overhaul. The repairer issued approximate estimate at Rs. 24, 98,625/-, while he assessed at Rs. 5,00,000/-. Though he mentioned that the matter could be discussed with the insurer obviously no such discussion was taken place.
7) The fact remains that none of the surveyors made subsequent investigation to find out the nature of the damage that was caused to the machinery. They did not append any report of M/s. C.L. Engineering Equipment Works where machinery was kept. On the other hand the complainant filed estimation/quotation issued by the very M/s. C. L. Engineering Equipment Works to an amount of Rs. 24, 98,625/-. The surveyor though estimated at Rs. 5, 00,000/- tentatively, could not provide any material for his estimation, more so, in the light of Ex. A3 estimation/quotation issued by M/s. C.L. Engineering Equipment Works.
8) PW2 B. Changal Reddy, Proprietor of M/s. C.L. Engineering Equipment Works filed his affidavit evidence mentioning that Tata Hitachi Ex-300 excavator was brought to his workshop which he observed was damaged by fire. While the first estimation/quotation was for Rs. 2,45,492/- towards overhauling charges for some of the parts, he issued quotation/estimation for Rs. 24, 98,625/- towards costs of the totally damaged parts of the vehicle which required total replacement. He also stated that the originals were submitted to the insurance company.
9) The respondent insurance company did not file any affidavit evidence or documents to substantiate their contention that cause and nature of accident was not co-related with the nature of damages, and the parts fitted were not identified with the particular model. They did not seek any expert opinion to state that the condition of the vehicle was poor and that it needed overhauling. From the record, we can see that they have not whole-heartedly contested the matter except appointing one surveyor after another. The authorities or the surveyors did not find out as to the investigation made by the police nor they directed the investigators to find out the truth or otherwise of the objections taken by them. Even in the counter it did not allege that it would settle the claim except stating that the claim was made hastily.
There is no point in further elaborating on this, except stating that evidence of PWs 1 & 2 was not contradicted. Since PW2 to whom the machinery was sent confirmed that the value of damage is worth Rs. 28,35,118/-. we have no option except to award the insured amount. Since the very policy was taken for Rs. 27 lakhs the complainant cannot claim more than the insured amount.
10) However, the claim of Rs. 8,45,000/- towards loss of income was not substantiated. No evidence was filed in order to prove that he has hired the excavators from one B. Madhusudhan Reddy and Govardhan Reddy and thus incurred huge amounts. He could have filed his account books or other documents which reflect the amounts spent by him. We may also mention herein that the parties are not adducing evidence before the Consumer Fora or this Commission solely on the ground that they are summary in nature. However, it does not absolve from leading evidence in order to grant relief which the parties seek. Therefore the claim for Rs. 8,45,000/- is rejected.
11) In the result the complaint is allowed in part directing the insurance company to pay Rs. 27 lakhs with interest @ 6% p.a., from the date of damage i.e., 30.5.2007 till the date of payment together with costs computed at Rs. 5,000/-. Rest of the claims are rejected. Time for compliance four weeks.
Dt. 22. 06. 2009.
APPENDIX OF EVIDENCE
WITNESSES EXAMINED FOR
COMPLAINANT OPPOSITE PARTIES
DOCUMENTS MARKED FOR COMPLAINANT:
Ex. A1; 12.02.2007 Certificate-cum-policy schedule.
Ex. A2; 30.05.2007 FIR in Crime No. 22/2007
Ex. A3; 07.09.2007 Estimation/Quotation for Rs. 2,45,492/-
Issued by CL Engineering Equipment Works
Ex. A4; 09.10.2007 Legal notice got issued by complainant to
Ex. A5; 09.10.2007 RPAD receipt and acknowledgement.
DOCUMENTS MARKED FOR OPPOSITE PARTY:
Ex. B1; 08.06.2007 Preliminary Report of Mr. E. Mukund,
Insurance Surveyor & Loss Assessor.
Ex. B2; 31.10.2007 Final report of Mr.Y. Venkkatesh Reddy.
Surveyor & Loss Assessor.
Dt. 22. 06. 2009.