Complaint No.64/20.05.2008
Decided on : 15.04.2009


R.C. Industries, Jawaharke Road, Mansa through Sh.Amrit Pal S/o Sh. Parkash Chand, partner of the firm.


..... Complainant.


VERSUS


Manager, United India Insurance Company Limited, Gaushala Road, Mansa.




..... Opposite Party.


Complaint under Section 12 of the
Consumer Protection Act, 1986.
.....


Present: Sh.S.K.Singla, Advocate counsel for the complainant.
Sh.S.P.Gupta, Advocate, counsel for the opposite party.


Quorum: Sh.P.S.Dhanoa, President.
Sh.Sarat Chander, Member.
Smt.Neena Rani Gupta, Member.


ORDER:-

Sh.P.S. Dhanoa, President.


This complaint has been filed, by M/s R.C.Industries, through its partner Sh.Amrit Paul son of Sh.Parkash Chand against Manager, United India Insurance Company Limited, Mansa, under Section 12 of the Consumer Protection Act, 1986 (hereinafter called the 'Act') for giving direction to the opposite party to pay a sum of Rs.3 lacs on account of claim alongwith interest at the rate of 12 percent with further direction to pay Rs.20,000/- on account of compensation and a sum of Rs.10,000/- as costs of filing of the instant complaint.
2. Briefly stated the case of the complainant is that he alongwith


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Shamlal S/o Sh.Roop Chand and Murti Devi W/o Sh.Shivji Ram are the partners of the complainant firm, who got insured the transformer installed in the premises of the complainant firm of capacity of 400 KW and other goods from the opposite party and made payment in the sum of Rs.18,104/- on account of premium. The said transformer developed defect and the opposite party assessed the damage, after receipt of information thereof, but has not settled the claim for a period of more than one year before filing of the instant complaint. The premium was collected by the opposite party treating the value of the transformer as Rs.3 lacs, but now the opposite party is treating the value thereof as Rs.4 lacs with intent and to defeat the interest of the complainant, as such, there is deficiency in service on his part, and complainant has been subjected to mental and physical harassment due to withholding of his claim by him. Hence this complaint.



3. On being put to notice, opposite party filed written version, resisting the complaint, by taking preliminary objections; that the complainant has no cause of action, to file the complaint; that the complainant, is not the 'consumer' within the purview of its definition given in the Act and the opposite party is ready and willing to pay him a sum of Rs.30,000/- on repair basis as per report of the Surveyor Ext.OP-1, and a sum of Rs.3 lacs on total loss basis minus Rs.1.50 lacs on account of depreciation, a sum of Rs.3000/- on account of Excess clause and another sum of Rs.10,500/- on account of conveyance,dismantling and installation charges and has applied proportionate deduction of Rs. 1,27,500/- as per terms and conditions of the insurance policy from the amount of depreciation worked as Rs.1,70,000/- by the Surveyor. On merits, it is denied that Sh.Amrit Pal, has any right to file the complaint on behalf of the insured firm. However, the factum of securing of insurance policy No.200403/44/5/31/0 025 for the period 12.10.2005 to 11.10.2006 is not disputed, but it is submitted that complainant was also interested for


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settlement of his claim on Total Loss Basis and Repair Basis and the opposite party has written him letters dated 20.11.2007, 4.12.2007 and 10.12.2007 asking him to convey his consent and to execute discharge voucher, but he failed to do so. As such, there is no deficiency in service on the part of the opposite party on account of which compensation may be awarded to the complainant. Rest of the averments, made in the complaint, have been denied, and a prayer has been made, for dismissal of the same, with costs.



4. On being called upon by this Forum, to do so, the learned counsel for the complainant tendered his affidavit, Exhibit C-1, and copies of documents Ext.C-2 and C-12 and closed his evidence. On the other hand, learned counsel for the opposite party has tendered into evidence copies of documents Ext.OP-1 to OP-5 and closed evidence on their behalf.



5. We have heard the learned counsel for the parties and gone through the oral and documentary evidence, adduced on record, by the complainant alone.


6. At the outset, Sh.S.K.Singla, Advocate, learned counsel for the complainant has submitted that the surveyor appointed, by the opposite party, to assess the loss, has given contrary report, by holding that cost of replacement of the damaged transformer of the complainant firm, is Rs.4 lacs, but inspite of the same, he has reduced the amount on account of depreciation at the rate of 50 percent although 'Insured Declared Value' had been calculated after reduction of quantum of depreciation. Learned counsel argued that surveyor appointed by the opposite party was not entitled to reduce any amount on account of Excess Clause, average, conveyance, dismantling and installation and depreciation, as such, reliance cannot be placed on his report even if complainant has not examined any report. Learned counsel further argued that the complainant is entitled to payment of entire amount of policy because it is case of total



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damage of his transformer installed in the premises of the complainant firm which has occurred during the validity period of insurance policy, as admitted by the surveyor of the opposite party because of which they cannot escape liability on the basis of biased report given by him to make payment of claim of meagre amount. Learned counsel urged that complainant has been subjected to mental and physical harassment due to deficiency in service on the part of the opposite party, as such, he is also entitled to payment of compensation as prayed for in the complaint.



7. On the other hand, learned counsel for the opposite party Sh. S.P.Gupta, Advocate, has submitted that Surveyor is the best person whose report cannot be brushed aside by the Forum unless there is some patent irregularity or illegality.

Learned counsel has submitted that the report of the surveyor has gone uncontroverted because the complainant has not examined any expert to establish that he has suffered more loss than the amount worked out by the Surveyor of the opposite party in terms of insurance policy or the same is arbitrary. Learned counsel has also drawn our attention to letters written to the complainant by the opposite party offering to make him payment on Total Loss Basis or on Repair Basis, and has argued that the complainant has failed to convey his consent and to execute discharge voucher, as such, he cannot plea deficiency in service on the part of the opposite party. Learned counsel urged that in view of the conduct of the complainant, he is not entitled to payment of any amount on account of compensation especially when opposite party is still ready and willing to settle the claim as per report of the Surveyor provided he deposits, the salvage of the transformer and transfers all his rights therein, in its favour.




8. Admittedly, the complainant got the transformer of capacity of 400 KW installed in the premises of his firm insured from the opposite party vide insurance policy No.200403/44/5/31/0025 and made payment in, the sum of Rs.18,104/-, on account of premium and policy was valid for
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the period 12.10.2005 to 11.10.2006. It is also not disputed that complainant is the partner of his firm or that damage to the transformer installed in the premises of his firm has occurred during the period of validity of the insurance policy. The opposite party has offered him to pay a sum of Rs.30,000/- on 'Repair Basis' as per report of the Surveyor Ext.OP-1, and a sum of Rs.3 lacs on 'Total Loss Basis' minus a sum of Rs.1.50 lacs on account of depreciation, a sum of Rs.3000/- on account of Excess clause and a sum of Rs.10,500/- on account of conveyance,dismantling and installation charges and another sum of Rs. 1,27,500/- on account of proportionate deduction from amount of depreciation out of 'Insured Declared Value'. The firm of the complainant disclosed the value of his transformer as Rs.3 lacs at the time of issuance of policy. Learned counsel for the parties have gracefully conceded in the course of arguments that as per terms and conditions of the policy, depreciation was permissible at the rate of 50 percent of Insured Declared Value. As per report of the surveyor of the opposite party ,Ext.OP-1, who has not been examined by the opposite party, the replacement value of type of transformer installed in the premises of the complainant firm at the time of his submission of report was Rs.4 lacs. Keeping in view the said fact he has reduced the amount of Rs.1,34,802/- from the amount of loss assessed by him. After said reduction he was not entitled to deduct the amount from Insured Declared Value to the extent of Rs.1,50,000/- on account of depreciation at the rate of 50 percent as per terms and conditions of the policy. The insurance policy has not been placed on record by either of the parties to the complaint to enable us to interpret them. In his report Ext.OP-1, Surveyor of the opposite party has held that, after holding enquiry from the market, salvage value of the transformer installed in the premises of the complainant firm, comes to Rs.1.70 lacs on which proportionate deduction of Rs.1,27,500/- to be made to the extent of ¾ share., The complainant, has not produced any evidence, to establish that



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market value of salvage of the transformer has been over estimated by the surveyor of the opposite party. In the absence of any repair bill, and any evidence to the contrary, report of the surveyor of the opposite party has to be accepted so far as value of salvage is concerned. However. the reduction of amount by him on account of Excess Clause in the sum of Rs.3,000/- and another sum of Rs.10,500/- on account of conveyance, dismantling and installation charges and a sum of Rs.1,27,500 on account of depreciation cannot be justified even if the complainant has not examined any expert. Since there is error on the face of the report of the surveyor of the opposite party,therefore, their plea cannot be accepted that there is no deficiency on his part in settlement of claim preferred under the policy by the complainant on behalf of his firm.



9. The opposite party has not disputed the fact that transformer installed in the premises of the complainant firm was a case of complete damage. Even this fact has been admitted by his surveyor in his report. In his letter Ext.C-12, the opposite party has even offered to make payment of Rs.1.31.802/- on 'Repair Basis' and has informed the complainant that in such a situation, damaged transformer worth Rs.1,70,000/- will be his own property, but in other letters complainant has been offered Rs.30,000/- on 'Total Loss Basis' subject to deposit of salvage and execution of discharge voucher. In his letter dated 13.12.2007 Ext.C-5, dated 7.12.2007 Ext.C-8, complainant has demanded payment of Rs.1,70,000/- in terms of letter of opposite party bearing No.PLD:07/1961 dated 20.11.2007 Ext.C-12, but vide his letter dated 7.12.2007 Ext.C-8 he has demanded a sum of Rs.1,79,736/ as full and final settlement of his claim. The opposite party has also produced letter dated 20.11.2007 Ext.OP-2 written on behalf of complainant firm by Sh.Ludher Ram pressing for payment of Rs.1,30,000/- on the basis of the report of the surveyor of the opposite party. These facts cannot be ignored by us because they support the report of the Surveyor of the opposite party regarding extent of loss and cost of salvage.



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10. For the aforesaid reasons, we accept the complaint and direct the opposite party to pay a sum of Rs.3 lacs to the complainant under the
insurance policy, secured by his firm, on behalf of the partners, provided he deposits the salvage of the transformer and execute letter of subrogation relinquishing all rights and transfer them in favour of the opposite party. In case he fails to do so within the period of one month from the date of receipt of the copy of this order, then the opposite party shall be at liberty to deduct a sum of Rs.1,70,000/- on account of salvage from the amount of claim. The complainant shall be further entitled to payment of Rs.2,000/- on account of compensation, for physical and mental harassment.