FA/780/2013

For the Appellant          : Mr. Salil Paul, Advocate

                                         : Mr. Sahil Paul, Advocate

For the Respondent      : Mr. Navneet Kumar, Advocate

FA/849/2013

For the Appellant           : Mr. Navneet Kumar, Advocate

For the Respondent       : Mr. Salil Paul, Advocate

                                         : Mr. Sahil Paul, Advocate

1.      Heard Mr. Salil Paul, Advocate, for New India Assurance Company Limited and Mr. Navneet Kumar, Advocate, for Chemical Corporation of India, in both the appeals.

2.      Above appeals are cross appeals, arise out of the order of State Consumer Disputes Redressal Commission, Delhi dated 17.07.2013, passed in CC/278/2008, partly allowing the complaint and directing the Insurer to pay Rs.10/- lacs, as insurance claim, Rs.20000/- for mental agony and Rs.5000/- as cost of litigation.

3.      The office has reported 25 days delay in filing FA/780/2013. The appellant has filed IA/7031/2013 for condonation of delay. Cause shown is sufficient. Delay in filing the appeal is condoned. The office has reported 58 days delay in filing FA/849/2013. The appellant has filed IA/7740/2013, for condonation of delay. Cause shown is sufficient. Delay in filing the appeal is condoned.

4.      Chemical Corporation of India (the appellant) in FA/849/2013 filed IA/9788/2016, for adducing additional evidence in the appeal. This Commission rejected IA/9788/2016, vide order dated 02.05.2017, observing that if at the time of final hearing, the Bench feels that any document was required for disposal of the appeal, it may ask for that document from the parties. In view of above observation, the counsel for Chemical Corporation of India, again pressed the application and argued that due to error on the part of the advocate, appearing before State Commission for the complainant, no evidence was filed as such evidence filed in the appeal along with IA/9788/2016 be admitted for ends of justice.

5.      When the case was listed on 14.07.2009, before State Commission, the counsel for the complainant stated that there was no need of filing of rejoinder and evidence. When the case was listed next on 27.08.2009, the counsel for the complainant stated before State Commission that he would supply the copy of the evidence to the opposite party and file the same during course of day. But neither copy of evidence was supplied to the opposite party nor was filed. S.K. Jain, sole proprietor of the complainant who survived till 09.07.2011 and after his death, his heirs did not make effort to file the evidence before State Commission. Supreme Court in Jiten K. Ajmera Vs. Tejas Co-operative Housing Society, (2019) 6 SCC 128, held that Consumer Foras can admit additional evidence in the appeal. But in N. Kamalam Vs. Ayyaswami, (2001) 7 SCC 503, held that additional evidence cannot be permitted to be adduced so as to fill in the lacunae or to patch up the week points.

6.      In view of observation of this Commission in the order dated 02.05.2017, we are examining the evidence sought to be filed in the appeal. The complainant has filed (i) Affidavit of Gopi Chand, the security guard, (ii) Affidavit of Mrs. Shalley Jain, the daughter of the proprietor, (iii) Copy of Ration Card of Gopi Chand, (iv) Newspaper report dated 09.12.2005, as published in Amar Ujala, (v) Repudiation Letter dated 27.02.2008, (vi) Reply of the complainant dated 30.04.2008 to the repudiation letter, (vii) Copy of reminder dated 15.10.2008, sent by the complainant, (viii) Copies of electricity Bills of the factory at premises 60-A, Industrial Area, Sikandarabad, (ix) Statement of Account of stock as submitted to Central Bank of India on 15.12.2005, (x) No Dues Certificate dated 13.01.2014, issued by Central Bank of India, (xi) Telephone Bills, (xii) Original Freight receipts and (xiii) Letter dated 17.01.2005 issued by Agricultural Department.         

7.      Some of the documentary evidence are already on record. Except Statement of Account of stock as submitted to Central Bank of India on 15.12.2005, other documents are wholly irrelevant for the controversy involved in this case. Date of incident is night of 07-08.12.2005. If in the Statement of Account submitted on 15.12.2005, i.e. after the incident of theft/burglary, the complainant shows stock of Rs.4476273/- then, it is either incorrect as according to own case, entire stock were stolen or it was a deliberate attempt to create evidence. In any case, it is a document subsequent to the date of incident as such it is not relevant to decide the controversy involved in the appeal. Affidavits of Gopi Chand and Mrs. Shalley Jain amounts to fill in lacunae in evidence and not admissible as additional evidence. We do not find any reason to admit these evidences at this stage.

8.      Chemical Corporation of India (the Insured) filed CC/278/2008 for directing New India Assurance Company Ltd. (the Insurer) to pay Rs.2596000/- as the insurance claim, Rs.15/- lacs, as compensation for mental agony and (iii) Rs.one lac as litigation costs. It has been stated in the complaint that the Insured was sole proprietorship firm and engaged in the business of manufacture and sale of chemicals, from its factory premises situated at 60/02, UPSIDC, Sikandarabad, Bulandshahar. The Insured obtained Burglary & House-Breaking Insurance Policy No311300/46/95 /00559, for the period of 02.09.2005 to 01.09.2006, for Rs.41/- lacs from the Insurer. In the factory premises, raw material and finished product were lying worth Rs.2596000/- and the same was stolen in the night of 07-08.12.2005. The complainant lodged FIR No.469/2005 u/section 380 IPC at police station Sikandarabad. The incident was also published in local newspapers on 09.12.2005. The banker of the Insured, through letter dated 09.12.2005 and the Insured, through letter dated 11.12.2005 informed the Insurer about the aforesaid incident. After information, the officers of the Insurer and the surveyor appointed by the Insurer inspected the factory premises and recorded statements of security guard on duty and other witnesses. When the Insured asked for payment of insurance claim, he was informed that the claim would be processed, which would take some time. The Insurer sent a letter dated 27.02.2008, declining payment of insurance claim on the ground that the police did not submit charge sheet under Section 457 IPC; there were contradiction in statements of Gopi Chand, watchman and Sanjay Kumar Jain, the proprietor. The Insured through letter dated 30.04.2008, explained the entire situation and requested to reconsider the claim. The Insured also gave a reminder through letter dated 15.10.2008 but the Insurer did not respond to the aforesaid letters. The Insured personally met with the officers of the Insurer on 20.11.2008 and requested for payment of the claim, which was denied by them. Then this complaint was filed.

9.      New India Assurance Company Ltd. (the Insurer) filed written reply and contested the complaint. It has been stated by the Insurer that on receiving information of the incident, the Insurer appointed R.G. Verma, New Delhi as the surveyor. Who conducted survey and submitted his report dated 17.09.2007, stating that Insurer liability was not attached as the Insured has based his claim on fabricated and manipulated entries in the record, without producing original records. Along with the complaint for lodging FIR, no list of stolen materials was given. The Insured supplied the list of stolen goods to the police for first time on 30.12.2005. In support of the claim, the Insured supplied the Purchase Bills, in which address of 358/1, Mehrauli, Ghaziabad were mentioned. At initial stage, the Insured took a ground that Books of Account was stolen by the thieves but produced later on, which raised a grave suspicion on its genuineness. There were contradiction in statements of Gopi Chand, watchman and Sanjay Kumar Jain, the proprietor and the Manager. The claim of the Insured was repudiated through letter dated 27.02.2008. As per terms and conditions of the policy, the theft following upon an actual forcible and violent entry from the premises is only covered under the policy. Cause of action has not arisen within the territorial limits of this Commission. The Insured has claimed Rs.2596000/- but no document has been filed to prove the aforesaid claim.   

10.    The Insured did not file Rejoinder and Affidavit of Evidence. The Insurer filed Affidavit of Evidence of Amit Mishra, Senior Divisional Manager of the opposite party. State Commission, vide impugned judgment dated 17.07.2013, held that as the main gate of the factory was opened after snatching keas from watchman, locks of the factory premises were broken and then theft was committed as such theft was covered under the policy. Repudiation of the claim amounted to deficiency in service. The claim was highly excessive and manipulated. The facts that the complainant could not supply list of stolen goods to the police for two-three weeks; the surveyor did not find any mark of almirah kept in the office and electric power point for operating computer, could not be brushed aside. State Commission, without examining any record quantified the loss to Rs.10/-. On these findings, the complaint was partly allowed and the Insurer was directed for payment as stated above. Hence these appeals are filed.

11.    We have considered the arguments of the counsel for the parties and examined the record. Sanjay Kumar Jain, the proprietor of the complainant, in his written complaint given to the police has stated that “in the night of 07-08.12.2005, unknown thieves have stolen motor pump, machine pullia, belt, kate of the machines, raw materials, finished goods, computer etc. from his factory premises at A-60/02, Sikandarabad. Watchman Gopi Chand informed him about the incident in morning”. The complainant in his letter dated 11.12.2005 to the Insurer stated that “we are going to inform you that on 07.12.2005, at our factory M/s. Chemical Corporation of India, A/60/2, UPSIDC, Sikandarabad, Dist-Bulandshahar at night, some thieves entered in our factory & Valuable Machinery/Raw Material & Finished goods ect. have stolen. There is direct loss of above Rs.25/- lacs”. In paragraph-3 of the complaint, the complainant stated that in the factory premises, raw material and finished product were lying worth Rs.2596000/- and the same was stolen in the night of 07-08.12.2005. The complainant lodged FIR No.469/2005 u/section 380 IPC at police station Sikandarabad. In entire complaint, exercise of force by the thieves upon watchman or breaking open of locks has not been alleged. State Commission, only on the basis of newspapers report has recorded finding that the main gate of the factory was opened after snatching keas from watchman, locks of the factory premises were broken and then theft was committed as such theft was covered under the policy. Newspapers reports are not admissible in evidence. Finding of the State Commission ignoring the initial version of the complainant in FIR, in his letter dated 11.12.2005 wrote to the Insurer and in the complaint is illegal and cannot be accepted. There is absolutely no allegation that theft was committed after breaking open of locks or in exercise of actual forcible and violent entry of and/or exit from the premises. Such a theft is not covered under the policy.

12.    Operative clause-(a) of Burglary & Housebreaking Insurance Policy provides that any loss of or damage to property or any part thereof whilst contained in the premises described in the schedule hereto due to Burglary or House-breaking (theft following upon an actual forcible and violent entry of and/or exit from the premises) and Hold-up. Supreme Court in United India Insurance Company Ltd. Vs. Harchand Rai Chandan Lal, (2004) 8 SCC 644, held that theft should have been proceeded with force or violence as per terms of insurance policy. In order to substantiate a claim, an insured has to establish that theft or burglary took place, preceding with force or violence and if it is not, then the insurance company will be well within their right to repudiate the claim.

13.       The policy provides coverage “on stock of all kinds of agro based chemical product, agro chemical pesticides, Finish/Raw/ Semi-finished goods, goods in process & allied goods stored at A-60/2, UPSID, Sikandarabad, Bulandshahar. Insurance claim of Rs.2596000/- has been set up, which included costs of raw materials, the address of whose Purchase Bills were mentioned as 358/1, Mehrauli, Ghaziabad. The Insured took plea that 358/1, Mehrauli, Ghaziabad was taken by him on rent and had been vacated in 2001 and although in purchase bills 358/1, Mehrauli, Ghaziabad were mentioned but the goods were delivered by the transporters at 60/2, UPSID, Sikandarabad, Bulandshahar. Insured did not adduce any evidence to prove this fact that consignments addressed to 358/1, Mehrauli were actually delivered to his factory premises. If the premises 358/1, Mehrauli had already been vacated in 2001, then mention of address of this premises, on every purchase bill was highly improbable. The claim included the goods stored at the location other than the insured place. This was a fraudulent misrepresentation. If there was fraudulent misrepresentation, then it itself is a valid ground for repudiation of whole claim. State Commission has also found that the claim was highly excessive and manipulated. State Commission has not recorded any basis for awarding Rs.10/- as the Insurance claim. Direction in this respect is based upon conjectures and surmises. Supreme Court in Oriental Insurance Company Limited Vs. Mahendra Construction, 2019 SCC OnLine SC 541, held that contract of insurance is a contract of uberrima fides and suppression of material fact, vitiates the insurance policy and is a good ground for repudiation.   

ORDER

In view of the aforesaid discussions, FA/780/2013 is allowed. The order of State Commission dated 17.07.2013, passed in CC/278/2008 is set aside. CC/278/2008 is dismissed. FA/849/2013 is dismissed. The parties shall bear their own costs.