DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

BATHINDA

C.C. No. 267 of 11-09-2017

Decided on : 18-11-2021

M/s D M Industries, Village Guru Sar Sehna Wala, Dabwali Road, Bathinda, through its Sole Prop. Pardeep Mangla aged about 42 years S/o Sh. Din Dayal Mangla R/o H. No. 335, Home Land Enclave, Opp. Lake-3, Goniana Road, Bathinda.

........Complainant

Versus

1. The New India Assurance Co. Ltd. Branch/Micro Office, Gurdwara Bhai Jagta Ji Street, Goniana.

   .......Opposite party

    

2. Corporation Bank, Branch Office, Bank Street, Old Satta Bazar, Bathinda 151 001 through its Branch Manager

.....Performa Opposite Party

Complaint under Section 12 of the Consumer Protection Act, 1986

QUORUM

Kanwar Sandeep Singh, President

Sh. Shivdev Singh, Member.

Smt. Paramjeet Kaur, Member

Present

For the complainant : Sh. Naresh Garg, Advocate.

For opposite parties : Sh. Sunder Gupta, Advocate, for OP No. 1

Sh. Gaurav Aggarwal, Advocate, for OP No.2

ORDER

Kanwar Sandeep Singh, President

1. The complainant Pardeep Mangla, Sole Prop. of M/s. D M Industries (here-in-after referred to as complainant) has filed this complaint U/s 12 of Consumer Protection Act, 1986 (Now C.P. Act, 2019, here-in after referred to as 'Act') before this Forum (Now Commission) against New India Assurance Co. Ltd., and another (here-in-after referred to as opposite parties).

2. Briefly stated, the case of the complainant is that the complainant Pardeep Mangla is the sole Prop. of M/s D.M. Industries, who runs the business of manufacturing and repairing of power & distribution transformers at Bathinda, for his livelihood. The complainant firm was having its cash credit Limit account of Rs.1,00,00,000/- with opposite party No. 2 (Performa Opposite Party No.2) at Bathinda under Cash Credit Limit and no claim or relief lodged against them.

3. It is alleged that the complainant purchased Insurances (For Fire etc.) of the stocks for the amount of Rs.1,00,00,000/- from opposite party No. 1 and paid premium amount of Rs.8,821/-. The opposite party No. 1 issued Insurance Certificate No.36060711160100000064 w.e.f. 12-09-2016 to 11-09-2017. The said Insurance certificate issued by opposite party No.1 for the stocks lying in the factory and in process against fire, shock and earthquake etc..

4. It is further alleged that on 03-04-2017, in the evening, about 20 Pcs. of Transformers were under process for removing moisture and the same were kept in heating chamber. The total process hours were 12-15 hours for removing the moisture. On the next day morning i.e. 04-04-2017, when complainant came to factory premises, he found that due to some fault in heating chamber 8Pcs. of the Transformers, which were under process, totally burnt. In the CCTV, it was found that at about 12.00 midnight, smoke started emanating from the closed doors of chambers and then engulfed in whole production Hall. It was also got recorded in DVR of CCTV system. The chamber was opened by workers and it was found that 8 nos. bare transformers had been badly burnt. On further checking, it was found that due to some snag in thermostat (which maintains temp. in between 60-70 degrees), heating temperature inside the chamber had increased manifold resulting in burning of 8 Pcs. transformers. Intimation of loss was given to opposite party No. 1 in the morning of 04-04-2017 regarding stocks damaged in process and opposite party No. 1 appointed Mr. Arun Mehta as a Surveyor. He demanded various documents alongwith claim form. The complainant submitted duly signed claim form, estimate of loss with each details and rates of the raw material etc. to the said surveyor as required by him. The complainant also provided list of stocks lying in the chamber at the time of fire. The surveyor checked CCTV recording and also took pictures of 8 damaged transformers, the loss of which comes to the tune of Rs.6,37,200/- but the said surveyor, with malafide intention only mentioned 6 transformers badly damaged whereas in the pictures it can be clearly seen that 8 Pcs damaged. The original pictures clicked by Surveyor are in possession of Surveyor and opposite party No. 1.

5. It is also alleged that surveyor is the man of opposite party No. 1 and working under their thumb and is habitual of reducing the claims drastically and harassing the insured in routine manner. In this case also, he is doing the same thing and did not listen to the request of complainant regarding burning of 8 transformers and prepared report as per wish of their master i.e. Insurance Company. The said surveyor also drastically reduced the rate of raw material. The complainant raised protest with opposite party No.1 and also with surveyor on telephone regarding wrong assessment by reducing the rates of raw material and number of damaged transformers from 8 to 6, then the official of opposite party No. 1 and said surveyor openly stated that they will not pay single penny to complainant and they have full power to reduce the same and if complainant protested, they have power to reject the total claim. The complainant suffered loss to the tune of Rs.6,37,200/- in the above said loss. He requested opposite party No. 1 many times for paying the loss, but they did not listen.

6. It is pleaded that opposite party No. 2 charged interest on the Cash Credit Limit of Rs. 1,00,00,000 @ 18% P.A. with compounded monthly rests, from the complainant.

7. It is also alleged that the complainant received a photocopy of letter dated 03-05-2017 (No claim letter) vide which the opposite party No. illegally rejected the claim of Rs. 6,37,200/- of complainant on flimsy grounds. Due to non-payment of claim amount of Rs.6,37,200/-, complainant is suffering heavy damages on account of interest @ 18% p.m. as well as suffering mental agony and pains for which he claims compensation to the tune Rs.1.00 Lac.

8. On this backdrop of facts, the complainant has prayed for directions to the opposite party No. 1 to pay claim amount of Rs.6,37,200/- with interest @ 18% P.A. alongwith compensation to the tune of Rs.1,00,000/- besides Rs. 50,000/- as litigation expenses.

9. Upon notice, the opposite parties appeared through their respective counsel and filed written reply. In separate written reply, opposite party No. 1 has taken legal objections that complainant obtained Standard Fire and Special Pearls Policy bearing No.36060711160100000064 effective from 12-09-2016 to 11-09-2017 for Sum Insured of Rs. 1,00,00,000/- and copy of Insurance policy along with its terms and conditions was duly supplied to complainant. Both the parties are bound by the terms and conditions of insurance policy. After receipt of intimation regarding the alleged loss/ fire of the insured premises Er. Arun Mehta, Surveyor and Loss Assessor was deputed to survey the damages and assess the loss, caused by fire, which allegedly took place on 03-04-2017 at midnight in the heating chamber of the insured premises. The said surveyor inspected the insured premises in the presence of Sh. Pardeep Mangla on 06-04-2017 and submitted his report dated 13-04-2017 with opposite party No.1 and in the cause of fire, the surveyor has mentioned that loss has occurred due to short circuit while stocks of winded 8 Nos. 63 KVA capacity transformers were placed in oven/heating chamber for drying, which is not covered under the policy condition and is one of the exclusion Clause-7 of the General Exclusion of the fire and special peril policy, which reads as under:-

   "Loss, destruction or damage to any electrical machine, apparatus, fixture or fitting arising from or occasioned by over-running, excessive pressure, short circuiting, arcing, self heating or leakage of electricity from whatever cause (lighting included)..

10. It is mentioned that since complainant himself has admitted in his verbal statement before the aforesaid surveyor that factory was closed during night hours on 03-04-2017 and only heating chamber incorporating 8 Nos. 63 KVA bare transformer assemblies was in operation for 12 hours just to remove moisture contents from assembled units, at about 12 midnight, smoke started emanating from the closed doors of chamber and same then engulfed whole production hall and got recorded in DVR of CCTV system, which clearly shows that fire has occurred to the transformers during heat/drying while lying in the heating chamber and badly damaged. So complainant himself admitted that aforesaid fire has occurred while the electric transformers were being in drying process in the heating chamber, as such the claim of complainant is not payable as per aforesaid exclusion clause.

11. It is pleaded that after receipt of survey report, opposite party has rightly repudiated the claim of the complainant vide letter dated 03-05-2017 on the ground that claim is not admissible as cause of loss is not payable (heating and drying process) and the said letter is effectively legal as per the terms and conditions of the policy.

12. Further legal objections are that the complainant carried on commercial activities to earn huge profits as such complainant is not consumer under the 'Act'. That the complainant is estopped by his own act and conduct to file the present complaint. That the complainant has not approached this Commission with clean hands, rather has suppressed the true and material facts and documents. That the complainant has got no locus-standi or cause of action to file the present complaint. That the amount of compensation claimed is highly excessive and exorbitant one and that the present complaint is false, frivolous and vexatious to the knowledge of the complainant as such the same is liable to be dismissed with special costs.

13. On merits, the opposite party No. 1 has admitted that the complainant is proprietor of D.M. Industries, but denied that he has installed the said industry for his livelihood

14. It is pleaded that along with Insurance policy, terms and conditions of Standard Fire & Special Peril Policy were also supplied to the complainant. It is denied that 20 Pcs. of transformers were under process for removing moisture and were kept in heating chamber. As per record and as per intimation given, only 8 pcs of transformers were under process for removing moisture, and fire took place in the heating chamber and the transformers have been damaged in the heating chamber and as per Clause-7 of General Exclusion, Insurance company is not liable for the same.

15. It is also pleaded that surveyor has assessed the loss to the damaged transformers to the tune of Rs.2,07,829/- but since the claim is not covered under the policy, as damaged has been caused to the property while undergoing any heating or drying process, so claim of the complainant has been rightly repudiated. After controverting all other averments, the opposite party No. 1 prayed for dismissal of complaint.

16. The opposite party No. 2 in its separate written reply took legal objection that complaint is not maintainable qua opposite party No. 2.

17. On merits, the opposite party No. 2 has submitted that complainant Pardeep Mangla is the sole proprietor of M/s. D M Industries, who availed cash credit limit of Rs. 99,00,000/- from opposite party No. 2 on interest @9.90% p.a. In the end, the opposite party No. 2 prayed for dismissal of complaint.

18. In support of his averments, the complainant has tendered into evidence his affidavit dated 15-1-2018 (Ex. C-1), photocopy of Standard Fire & Special Perils Policy (Ex. C-2), photocopy of estimate of loss (Ex. C-3), photocopy of letter dated 8-9-2017 (Ex. C-4) and closed the evidence.

19. In order to rebut the evidence of complainant, opposite party No. 1 has tendered into evidence photocopy of letter dated 3-5-2017 (Ex. OP-1/1), photocopy of claim form (Ex. OP-1/2), photocopy of Standard Fire & Special Perils Policy (Ex. OP-1/3), photocopy of policy schedule (Ex. OP-1/4), photocopy of final survey report (Ex. OP-1/5), affidavit dated 10-5-2018 of Ashish Pal (Ex. OP-1/6), photocopy of terms and conditions (Ex. OP-1/7) and closed the evidence.

20. The opposite party No. 2 has tendered into evidence affidavit dated 6-11-2017 of Nachhattar Singh (Ex. OP-2/1), affdavit dated 25-4-2018 of Gupin Suri (Ex. OP-2/2), photocopy of Sanction Letter dated 30-4-2016 (Ex. OP-2/3) and closed the evidence.

21. We have heard learned counsel for the parties and gone through the record.

22. There is no dispute that complainant obtained Standard Fire and Special Pearls Policy bearing No. 36060711160100000064 effective from 12-09-2016 to 11-09-2017 for a Sum Insured of Rs. 1,00,00,000/- (Ex. C-2) and paid premium of Rs. 8821/-. Fire took place on 03-04-2017 at midnight in the heating chamber of the insured premises. The complainant intimated the loss to opposite party No. 1 and they deputed Er. Arun Mehta, Surveyor and Loss Assessor to survey the damages and assess the loss. The said surveyor inspected the insured premises on 6-4-2017 and assessed the loss to the tune of Rs. 2,07,829/-. The opposite party No. 1 repudiated the claim of the complainant vide letter (Ex. OP-1/1) on the ground that claim is not admissible as cause of loss is not payable (Heating & drying process).

23. A perusal of policy in question ( Ex. C-2) reveals that insured obtained said policy covering the risk of “On stocks and stocks in process” for Rs. 1,00,00,000/-. Under Special Conditions, it is mentioned “Stocks of raw materials, finished, semi-finished goods or stocks in process or manufactured stock of power distribution transformers or transformers oil and allied goods, meaning thereby that stock in process is also insured under the policy.

24. The opposite party No. 1 has repudiated the claim of the complainant taking shelter of Exclusion Clause-7 of the General Exclusion of the fire and special peril policy. The complainant has denied receipt of policy terms and conditions. The opposite party No. 1 failed to produce on record that terms and conditions of policy were supplied to complainant alongwith policy. Thus, complainant is not bound by the terms and conditions which were not supplied to him. Moreover, a perusal of Exclusion Clause 7 reveals that it excludes the loss to that particular machine due to which fire took place and not other machinery which damaged due to fire. In the case in hand, surveyor in his survey report has also opined under the head 'observations about loss' that due to malfunctioning of thermostat of heating chamber, temperature inside drier chamber might have got increased manifold and same then caused damages as well as burning of 6 nos bare transformer assemblies. Therefore, in this way, loss to bare transformer assemblies cannot be denied by opposite party No. 1 by taking shelter of exclusion clause 7.

25. Keeping in view the facts, circumstances and the evidence placed on file by the opposite parties this Commission is of the considered opinion that loss suffered by complainant is insured under category stocks in process as the drying process comes under the stocks in process and denial of claim by opposite party No. 1 on flimsy grounds amounts to deficiency in service on its part.

26. Now coming to the quantum of loss suffered by complainant. The surveyor has assessed the loss to the tune of Rs. 2,07,829/- whereas as per complainant the loss suffered by him is 6,37,200/-. The complainant has not placed on file any document to challenge the rate of material allowed by surveyor while assessing the loss. The surveyor has assessed the loss after inquiring the rates from market. The complainant has also not placed on file any document to prove that he actually suffered loss of 8 transformers. Hence, in such circumstnaces, the complainant is held entitled to claim amount as assessed by surveyor with interest.

27. Resultantly, this complaint is partly allowed with Rs. 10,000/- as cost and compensation against opposite party No. 1. The opposite party No. 1 is directed to pay to complainant Rs. 2,07,829/- with interest @ 9% w.e.f. 3-5-2017 (date of repudiation) till the date of payment.

28. The compliance of this order be made by the opposite parties jointly and severally.

29. The complaint could not be decided within the statutory period due to heavy pendency of cases.

30. Copy of order be sent to the parties concerned free of cost and file be consigned to the record.

    Announced:-

    18-11-2021

    (Kanwar Sandeep Singh)

    President

     

     

    (Shivdev Singh)

    Member

     

    (Paramjeet Kaur)

    Member