Punjab

Ludhiana

CC/20/363

Balour Singh Prop of M/s Nanak Enterprises - Complainant(s)

Versus

New India Assurance Co.Ltd - Opp.Party(s)

Manoj Kumar

26 Apr 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:  363 dated 21.12.2020.                                                       Date of decision: 26.04.2024. 

 

1. Balour Singh Proprietor of M/s. Nanak Enterprises, Hari Singh Nalwa Guru Chowk, Raikot, District Ludhiana.       
2. M/s. Nanak Enterprises, Hari Singh Nalwa Guru Chowk, Raikot, District Ludhiana through its Proprietor Balour Singh.                                                                                                               ..…Complainants

                                                Versus

1. New India Assurance Company Limited, Branch Raikot, District Ludhiana, through its Branch Manager/Authorized Person;
2. New India Assurance Company Limited, The Mall, Mall Road, Ludhiana, through its Branch Manager/Authorized person.

                                                                             …..Opposite parties 

Complaint Under Section 35 of the Consumer Protection Act, 2019.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainants            :         Sh. Nitin Kapila, Advocate.

For OPs                          :         Sh. Rajeev Abhi, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Shorn of unnecessary details, the facts of the case are that complainant No.1 being the proprietor of complainant No.2 firm is running cloth showroom for earning his livelihood and had taken franchisee of Monte Carlo Company for his exclusive purpose and started the shop from 05.05.2018. The complainant availed insurance policy from the OPs vide policy No.36110248180600000003 w.e.f. 08.05.2018 to 07.05.2019 by getting his stock insured up to Rs.50,00,000/-. The complainant stated that he used to purchase readymade garments from Monte Carlo and used to send the same in retail to the customers. As per purchase records, the complainant purchased the material to the tune of Rs.33,00,000/- approximately, out of which goods worth Rs.1,00,000/- were sold to different customers and rest of the material was lying in the shop for sale.

                   The complainant further stated that on 12.05.2018, he went to his house after closing the shop at 09.15 PM. In morning, one Ramneek Ahluwalia who resides near his shop informed him that shutter of showroom is lying broken and glass door is also broken. The complainant immediately went to his shop and found that all the goods/clothes, hosiery, garments and goods lying on boxes have been stolen by some unknown person. The complainant informed the police regarding theft, for which an FIR No.58 dated 13.05.2018 under Section 457, 380 IPC was registered at P.S. City Raikot. Intimation was also given to the OPs and claim was lodged with the OPs by providing all the required documents. The complainant further stated that the police failed to arrest the accused and filed untraced report which was accepted by Sh. Karamvir Singh Maju, JMIC, Jagraon vide order dated 11.06.2019. According to the complainant, the loss as per proposed theft claim was assessed of Rs.17,86,689/- but in the first week of December 2019 the OPs had only sanctioned the claim of Rs.8,16,300/- without any justification, explanation and application of mind. The complainant further stated that he several times approached the OPs and wrote several letters and Emails with request to reinvestigate his genuine claim and to make payment of actual loss but the OPs failed to make the payment of balance amount of loss suffered by the complainants. Even the OPs did not send any reply to the letters and Emails. The complainants claimed to have suffered mental pain, physical harassment, etc. due to deficiency in service on the part of the OPs for which they are entitled to compensation. In the end, the complainants have prayed for issuing direction to the OPs to make the payment of balance amount of claim of Rs.9,70,389/- along with compensation of Rs.25,000/-.

2.                Upon notice, the OPs appeared and filed written statement and assailed by complaint by taking preliminary objections on the ground of maintainability; lack of jurisdiction; concealment and suppression of material facts; the complainant being estopped by his own act and conduct from filing the complaint etc. The OPs stated that on receipt of the claim, it was registered, entertained and processed. The complainants obtained Shopkeepers Insurance Policy bearing No.3611024818060000003 w.e.f. 08.05.2018 to 07.05.2019. According to the OPs, the insurance policy is a contract in itself and the parties are bound by the terms and conditions of the policy and nothing can be added or abstracted out of it. CA Rajiv Arora, an IRDA approved and licensed surveyor and loss assessor, 321-A, Medical Enclave, Amritsar was appointed to assess the loss of theft in the premises of M/s. Guru Nanak Enterprises, Hari Singh Nalwa Chowk, Raikot, Ludhiana. The surveyor personally inspected the premises, took the photographs and other documents and prepared and submitted his report dated 03.10.2018 by assessing the loss to Rs.8,17,059/- subject to terms and conditions of the policy and underwriters accepting their liability. The OPs further stated that Sh. Manoj Goyal, Surveyor and Loss Assessor, resident cum office No.122, Basti Gobindgarh, Ward No.5, Moga was appointed for verification of letter of FIR who personally visited Police Station (Rural), Raikot and collected the statement from City Police Station, Raikot. He prepared his report dated 20.11.2019 and submitted the same with the OPs. The OPs further appointed M/s. Royal Associates, Investigating & Detective Agencies, Sector 13 Market, Urban Estate, Kurukshetra to investigate the burglary loss at M/s. Guru Nanak Enterprises. The investigator made thorough investigation, recorded the statement, took the photographs and documents and prepared and submitted his report dated 27.07.2018.

                   The OPs further stated that after receipt of report of CA Rajiv Arora dated 03.10.2018, report of Sh. Manoj Goyal dated 20.11.2019 and report of M/s. Royal Associates dated 27.07.2018, they scrutinized the documents placed on claim file and after due application of mind by their officials, the competent authority of New India Assurance Co. Ltd. had duly considered the report of the surveyors and investigators, the claim of the complainant was settled and paid for Rs.8,16,300/- in full and final settlement of the claim in terms of assessment made by CA Rajiv Arora, the surveyor and loss assessor. The complainant handed over the photocopy of cancelled cheque No.000070 dated 05.12.2019 of HDFC Bank Ltd., Ludhiana Road, Raikot of account No.50200031176640 for crediting the claim amount of Rs.8,16,300/- in his account. The said amount of Rs.8,16,300/- was accepted by the complainants voluntarily, unconditionally, without any protest and without reserving any right to recover any further amount under the claim. The OPs further stated that after settlement of the claim, the complainant is no more a consumer and the relationship between the consumer and service provider comes to an end.

                   On merits, the OPs reiterated the crux of averments made in the preliminary objections and facts of the case. The OPs have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

3.                In evidence, the complainants tendered affidavit of Sh. Balour Singh as Ex. CA and reiterated their averments of the complaint. The complainant also placed on record documents Ex. C1 to Ex. C76 and closed the evidence.

4.                On the other hand, the counsel for the OPs tendered affidavit  Ex. RA of Ms. Ritu Rani, Branch Manager, The New India Assurance Co. Ltd., Branch Office, Raikot, District Ludhiana as well as affidavit Ex. RB of Sh. Rajiv Arora, Chartered Accountant, an IRDA approved and Licensed Surveyors and Loss Assessor, 321-A, Medical Enclave, Amritsar and affidavit Ex. RC of Sh. Kashmir Singh, Prop. of M/s. Royal Associates, Investigating and Detective Agency, SCF No.132, 1^st Floor, Sector 13 Market, Urban Estate, Kurukshetra along with documents Ex. R1 to Ex. R165 and closed the evidence. 

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written reply along with affidavits and documents produced on record by both the parties.

6.                The complainants, who used to run a retail cloth showroom, had taken franchisee of M/s. Monte Carlo Fashions Ltd. and started dealing in business of readymade garments after inaugurating its showroom on 05.05.2018. The complainants also availed Shopkeepers Insurance policy from the OPs having effective coverage from 08.05.2018 to 07.05.2019 for a sum assured of Rs.50,00,000/-. In the intervening night of 12/13.05.2018 theft of stocks was committed which was noticed by the neighbour Ramneek Ahluwalia in the morning of 13.05.2018. FIR No.58 dated 13.05.2018 Ex. C19 = Ex. R7 and R82 under Section 457/380 IPC was lodged at Police Station City Raikot. On receipt of intimation, M/s. Royal Associates, Investigating & Detective Agencies, Kurukshetra was appointed as investigator who visited the spot, took photographs and documents and finally prepared the report on 27.07.2018 Ex. R67. Also, CA Rajiv Arora, an IRDA approved Surveyor and Loss Assessor was appointed as surveyor and loss assessor who also personally inspected the premises, took photographs and in his report dated 03.10.2018 Ex. R3 assessed the loss to be Rs.8,17,059/-. The factum of FIR was also got verified from M/s. Manoj Goyal who vide his report dated 20.11.2019 Ex. R162 verified the same. After scrutinizing the reports, the OPs approved and paid an amount of Rs.8,16,300/- out of total claim of Rs.17,86,689/-.

7.                Now the point of consideration arises that whether partial settlement of claim to the tune of Rs.8,16,300/- out of total claimed amount of Rs.17,86,689/- was justified or not?

8.                In his report Ex. R3, CA Rajiv Arora made certain observations which are reproduced as under:-

                   “OUR INSPECTION:

After being appointed by the insurer, We went to the premises of the insured and found that burglary had taken place. The sign of Forcible entry was present The Saved stocks was counted by us and photos/videos was taken. The insured was asked to give us detail of loss as well as detail of goods lying before burglary which was given to s after some delay.

UTMOST GOOD FAITH

 The Insured has acted with Utmost good faith and also acted as if not insured.

                   OUR ASSESSMENT

The empty space and volumetric analysis was done by us and we found that the Loss claimed by the Insured was exaggerated. Even the Investigator has said in his report That the goods on display were looted while goods lying in boxes were saved We did volumetric analysis of the goods that can be kept on display and found that The Loss claimed by the Insured was exaggerated. The Insured had claimed loss of Rs.16.80 Lakhs and saved stocks was to the tune of Rs.12.67 Lakhs. The Saved stock was in Boxes. It is quite obvious that the stock in boxes was not touched by the burglars otherwise these boxes could also have been stolen. Thus it is assumed that goods in Display were only stolen. We found that 50% Loss claimed by the  Insured could have been displayed so done our Assessment Accordingly Computation of Stock Loss Assessment sheet. The Investigation report of M/s. Royal Associates has also been read by us and relied upon.

IMPORTANT OBSERVATIONS

1.CCTV NOT INSTALLED

2.OPENED JUST FEW DAYS BACK

3.RENT DEED ABSENT

4.ELECTRICITY BILL IN THE NAME OF OWNER

5.THE INSURED SIGNED AGREEMENT WITH MONTE CARLO ON 01/05/2018 TO OPEN EXCLUSIVE SHOW ROOM AT RAIKOT

THUS GROSS LOSS ASSESSED COMES OUT TO AS BELOW

The saved stock as claimed by the Insured was lying in boxes and if we believe His version then only stocks at display were burgled. Even Investigator has pointed on this. The Insured exaggerated the Loss but did one mistake by not giving the detail of loss in pieces and value in FIR leaving it open for him to give the same list after sometimes. This list was later on given after a lapse of around 3 months to the police and the police stamped it but whether it was made part of the original FIR as addendum could not be verified by us. The Insured must get the same verified before settling the claim.

 

				pcs	Cost
Stock as per Trading Account				5008	2948272
Stock saved				2425	1267991
Gross Loss Claimed				2583	1680281
Gross Loss Assessed				2583	1680281
Stock on Display				1291	840140.5
assumed to be 50%
based on Investigators report
and volumetric analysis
Gross Loss Assessed				1291	840140.5
Less Saved stock at display					35000
Under Insurance
VAR			Rs.29.48 Lakhs
Sum insured			Rs.55 Lakhs
Under Insurance Not applicable					0
Gross Loss Assessed after UI					805140.5
Excess as per Policy					0
Net Loss Assessed stocks					805140.5
Add Plate Glass allowed					11919
Net Loss Assessed both stock
And plate glass					817059.5

 

The Insured also claimed plate glass loss of Rs.11919/- The same was fully allowed by us.

OUR RECOMMENDATION:

We have Assessed the Net Loss to the tune of Rs817059/- (Eight Lakhs Seventeen Thousand fifty nine only) and we recommend the same be paid to the Insured subject to the terms and conditions of the policies and underwriters accepting their liability and subject to following condition.

1.The Detail of Loss in pieces as well as value is not mentioned in FIR Later on after a gap of around 1 months i.e. on 16/06/2018 the Detail was given to the police. Though this is duly stamped but whether This has been made part of the original FIR could not be verified by us The Insurer may get the same verified from the investigator before settling the claim.”

9.                CA Rajiv Arora visited the shop in question on 13.05.2018 and found the occurrence of commission of theft to be genuine and observed that the insured has acted with utmost good faith. The saved stocks were counted by him and photos/videos were taken but no inventory of counted saved stock was prepared nor the same was made part of his report by CA Rajiv Arora. There is not even a passing reference of particulars of saved stock in the report itself. The observations of the investigator that details of loss as well as details of goods lying before burglary was given to him after some delay gets contradicted with the hand written document dated 13.05.2018 Ex. R86 wherein the goods scanned, dispatched and in transit has been mentioned. The loss of 2802 pieces has been specifically mentioned. Under the head Our Assessment, he dubbed the claim of the complainant as exaggerated. The investigator himself presumed without any substantive evidence that the stock in boxes were not touched by the burglars and the stocks of display were found to have been removed.  He further claimed that it is presumed that goods in display were only stolen. Even while making assessing loss in tubular form, the investigator assumed the stock on display to be of 50%. So by his own findings, the assumptive factor has played a dominant role in assessing the net loss.

10.              The investigator observed in recommendations part that the detail of loss in pieces as well as in value has not been mentioned in FIR which was mentioned after a period of one month. It is a settled law that an FIR is not required to be an encyclopedia of all events. The very purpose of registering the FIR is to set the criminal law in motion. Perusal of FIR Ex. C19 = Ex. R7 and R82 shows that complainant No.1 Balour Singh author of the FIR, specifically mentioned in the FIR that the displayed precious readymade clothes as well as hosiery readymade received from the company which were packed in cartons has been stolen by unknown thieves. It is apposite to mention that the complainants inaugurated the readymade business showroom on 05.05.2018 and the occurrence took place a week thereafter and despite this, every minute details of the saved stocks, stocks in transit and stolen articles were provided to the investigator on 13.05.2018 itself. So as such, the recommendations and the observations of CA Rajiv Arora defies all logic. The first version as reflected in FIR Ex. C19 = Ex. R7 and R82 is with regard to the theft of displayed articles as well as stocks packed in cartons. So the prompt version rules out any manipulation or fraudulent intent of the complainants. More so when the investigator, loss assessor and even the officials of the OPs have not doubted the bonafides of the complainants. As such, the report Ex.  R3  which is based upon conjectures and surmises, cannot said to be have fairly assessed the net loss.

11.               The Hon’ble Supreme Court of India in New India Assurance Co. Ltd. & Ors. Vs M/s. Mudit Roadways in 2023 INSC 1022 made the important observations with regard to the value of report of the surveyor in para No.42 to Para 44 of the judgment which are reproduced as under:-

“VALUE OF A SURVEYOR’S REPORT

42. According to the Insurance Act 1938, an approved surveyor's assessment is necessary for a claim. The claimant however contends that the surveyor's report is not definitive. The key question is the extent to which the report is binding and under what conditions can it be overridden in. To address this, Section 64(UM)(4) of the Insurance Act, 1938 can be usefully read which concerns surveyors and loss assessors:

64-UM. (4) No claim in respect of a loss which has occurred in India and requiring to be paid or settled in India equal to or exceeding twenty thousand rupees in value on any policy of insurance, arising or intimated to an insurer at any time after the expiry of a period of one year from the commencement of the Insurance (Amendment) Act, 1968, shall, unless otherwise directed by the Authority, be admitted for payment or settled by the insurer unless he has obtained a report, on the loss that has occurred, from a person who holds a licence issued under this section to act as a surveyor or loss assessor (hereafter referred to as “approved surveyor or loss assessor”):

Provided that nothing in this sub-section shall be deemed to take away or abridge the right of the insurer to pay or settle any claim at any amount different from the amount assessed by the approved surveyor or loss assessors”."

43. The above provision mandates that claims above Rs. 20,000 must be initially assessed by an approved surveyor. It is noteworthy that the insurer has the discretion to settle the claim for a different amount, than what is assessed by the surveyor.

44. In New India Assurance Co. Ltd. v. Pradeep Kumar (supra), the court addressed whether one had to accept payment based on the surveyors' assessment or could provide independent evidence to support higher costs for replacement and repairs. The court's pertinent conclusion is as follows:

“22. In other words although assessment of loss by approved surveyor is a prerequisite for payment or settlement of claim of twenty thousand rupees or more by insurer, yet surveyor's report is not the last and final word. It is not that sacrosanct that it cannot be departed from; it is not conclusive. The approved surveyor’s report may be basis or foundation for settlement of a claim by the insurer in respect of loss suffered by insured but such report is neither binding upon the insurer nor insured.”

12.              The counsel for the OPs has contended that the amount was accepted by the complainants without any protest and complainants could have returned the received amount in order to lodge protest with the OPs and as such, now the complainants are estopped from challenging the assessment. However, the counsel for the complainants refuted the above said contentions by stating that it was directly sent to the account of the complainants through RTGS and mere acceptance of partial amount does not amount to relinquishing the remaining claim.

13.              Perusal of Ex. R60 shows that although it bears the receipt of the complainant at two places but it does not bear the signatures of the complainants. There is no proof that the form was filled by complainant No.1 or on his behalf. There are Emails and letters on record written by the complainants expressing the reservations to the amount so assessed. So it cannot be calculated that the amount was accepted without any protest or murmur. In these circumstances, in our considered view, it would be just and proper if the opposite parties are made to pay the remaining claim amount of Rs.9,70,389/-  (Rs.17,86,689-Rs.8,16,300=Rs.9,70,389/-) to the complainants  with interest @8% per annum  from the date of filing of the present complaint till date of actual payment along with composite costs and compensation of Rs.20,000/-. 

14.              As a result of above discussion, the complaint is partly allowed with an order that the opposite parties shall pay the remaining claim amount of Rs.9,70,389/-  (Rs.17,86,689-Rs.8,16,300=Rs.9,70,389/-) to the complainants  with interest @8% per annum  from the date of filing of the present complaint till date of actual payment. The opposite parties shall further pay a composite compensation of Rs.20,000/- (Rupees Twenty Thousand only) to the complainant. Compliance of order be made within 30 days from the date of receipt of copy of the order. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.       

15.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

 

(Monika Bhagat)                              (Sanjeev Batra)               Member                                         President  

Announced in Open Commission.

Dated:26.04.2024.

Gobind Ram.