1.      This Revision Petition No.363 of 2017 challenges the Rajasthan State Consumer Disputes Redressal Commission, Jaipur (‘the State Commission’) order dated 08.11.2016 which partially allowed FA No. 187/2015 and reduced the quantum of compensation awarded by the District Consumer Disputes Redressal Forum, Bhilwara, Rajasthan (‘the District Forum’) vide order dated 06.01.2015 in CC No. 166/2013.

2.      For convenience, the parties are referred to as placed in the original Complaint before the District Forum.

3.      Brief facts of the case, as per the Complainant, are that a fire incident occurred on 19.01.2013 due to a short circuit which destroyed his stock of cattle feed, machinery, and business records. The incident was promptly reported to police, fire brigade, and insurance company. All necessary documents, including stock statements approved by the bank and duplicate purchase bills for cattle feed worth ₹3,58,330/-, were submitted to the surveyor. Despite submitting all documents required, the claim was arbitrarily settled for a meagre ₹36,700/- without proper justification. The assessed stock value was ₹7,94,000/- as verified by the bank on 07.01.2013, and subsequent purchases made and the total thus was ₹11,82,330/-.

4.      Being aggrieved by the limited compensation, the complainant filed a consumer complaint before the District Forum and sought payment of ₹8,93,300/- along with 12% interest, ₹50,000/- for mental agony, and litigation costs.

5.      In written version before the District Forum, OP-1 acknowledged verifying stock worth ₹7,94,000/- on 07.01.2013 but was unaware of subsequent purchases. As the stock & machinery were hypothecated, any claim settlement amount should be credited to the loan account. They denied any liability for the claim as the responsibility lies solely with the insurance company. OP-2 Insurer averred that the stock and other items were not completely destroyed in the fire. The complainant failed to provide proper records like stock registers and account books. They observed policy breaches such as no fire-fighting equipment and inadequate security measures. The claim was settled for ₹36,700/- as per the surveyor's report and as per policy terms. They asserted that the claim was inflated and lacked substantiation

6.       The learned District Forum, vide order dated 06.01.2015, partly allowed the complaint and directed the OP-2 as under:

“12. Consequently, the complaint of the complainant is partly allowed and opposite party No. 2 Insurance company is directed to pay Rs.3,00,000/- (Rs. Three Lakh) additional amount within 2 months of the order along with interest @ 6% per annum from the date of filing the complaint before this Forum i.e. 16.07.2013 till payment. Since, what is the position of the loan account of opposite party No. 1 is not known to us, hence before depositing the amount into the loan account the consent of the complainant shall be taken. If the complainant submits any no objection certificate from opposite party No. 1 then it will be paid to him. Rs. 2000/- (two thousand) shall be paid to the complainant by opposite party No.2 Insurance Company on account of litigation expenses. This shall also be paid within 2 months.”

                                                  (Extracted from translated copy)

7.      Being aggrieved by the order, OP-2 – Insurer filed an Appeal and the State Commission, vide order dated 08.11.2016 partially allowed the Appeal and reduced the quantum of compensation as under:

  “There is no dispute about the fact that these are stock statements submitted to the Punjab National Bank in which declaration has been made by the complainant- respondent himself but stock has never been verified by the bank and from the perusal of these stock statements it cannot be gathered that after inspection the bank has found the stock of particular amount as mentioned in the above documents. Hence, these documents have no evidentiary value to show the stock on a particular date. Furthermore reliance has been placed on bank statement in which on 16.1.2013 the stock of Rs. 6,13,380/- has been shown but as stated earlier this statement of account carries no weight as the bank has never verified the stock of the complainant and even the statement of account is not duly verified by the Punjab National Bank. In view of the above it can very well be concluded that complainant has remain utterly failed to prove the available stock on the date of incident. The surveyor has assessed the loss after spot inspection and on other material and which was assessed at the tune of Rs.52,320/- but the Forum below has allowed the claim of additional Rs.3 lakhs which is arbitrary and perverse. In view of the fact that surveyor report is important piece of evidence and it should be relied unless proved contrary. The loss assessed by the surveyor at the. tune of Rs. 52,320/- is allowable to the complainant.

  Hence, in view of the above discussion, the appeal is partially allowed and instead of Rs.3 lakhs the complainant will get an amount of Rs. 52,320/- minus Rs.36,700/- i.e. Rs.15,620/-. The other conditions need no interference. In view of this the appeal is disposed of accordingly.”

8.      In his arguments, the learned Counsel for the Petitioner/ Complainant reiterated the grounds in the Revision Petition and the complaint and asserted that a fire caused by a short circuit destroyed the complainant's stock of cattle feed, machinery, and business records on 19.01.2013. The incident was reported promptly to police, fire brigade, and the insurance company. All necessary documents, including stock statements approved by the bank and duplicate purchase bills for cattle feed worth ₹3,58,330/-, were submitted to the surveyor. Despite submitting the required documentation, the claim was arbitrarily settled for a meagre amount of ₹36,700/- without proper justification. The assessed stock value was ₹7,94,000/- as verified by the bank on 07.01.2013, and subsequent purchases brought the total to ₹11,52,330/-. He sought to payment of ₹8,93,300/-, 12% interest as compensation, ₹50,000/- for mental agony and litigation costs. He relied on United India Insurance Company Ltd. vs. N.T. Babu, III 2014 CPJ 108 (NC); and New India Assurance Co. Ltd v Protection Manufactures Pvt. Ltd., II (2010) CPJ 40 (SC) in support of his arguments.

9.      In his arguments, learned Counsel for Respondent No.1/ OP-1 -Bank acknowledged verifying the stock worth ₹7,94,000/- on 07.01.2013 but was unaware of subsequent purchases made, if any, by the Complainant. He claimed that since the stock and machinery were hypothecated, any claim settlement amount should be credited to the loan account. He denied any liability for payment of the claim, stating the responsibility lies solely with the insurance company.

10.    In his arguments, learned Counsel for Respondent No.2/ OP-2 -Insurance Company asserted that the stock and other items were not completely destroyed in the fire. The complainant failed to provide proper records like stock registers and account books. Policy breaches such as no fire-fighting equipment and inadequate security measures were also observed. He further argued in favour of the impugned order passed by the State Commission and sought to dismiss the Revision Petition. He has relied upon Shiv Villas Resorts Pvt. Ltd. v. United India Insurance Co. Ltd., FA/53/2014 decided by this Commission; OIC v. Vijaya Srinivasa Cotton Company, 2009 (4) CPJ 52; Ankur Sharma v. United India Insurance Co. Ltd., 2013 (1) CPJ 440; United India vs. Harchand Rai Chandan, Civil Appeal No.6277/2004 decided by Hon’ble Supreme Court; Oriental Insurance Co. Ltd. vs. Sony Cherian decided on 19.08.1999 decided by the Hon’ble Supreme Court in support of his arguments.

11.    I have examined the pleadings and associated documents placed on record, including the orders of the learned District Forum and learned State Commission and rendered thoughtful consideration to the arguments advanced by the learned Counsels for both parties.

12.    The main issue to be determined in the case is the quantum of compensation tenable under the policy for the loss claimed by the Petitioner/ Complainant.

13.    It is undisputed that, during the course of the policy in question, the Petitioner had preferred a claim for loss occurred to the tune of Rs.16 Lakh. On receipt of the claim, Respondent No.2/OP-2 appointed a Surveyor. And, the Surveyor’s Report dated 11.05.2013 assessed the loss to the tune of Rs.52,320/-. In the case of Sri Venkateshwara Syndicate Vs. Oriental Insurance Company Limited (2009) 8 SCC 507, the Hon’ble Supreme Court has further observed as under:

1. The assessment of loss, claim settlement and relevance of survey report depends on various factors. Whenever a loss is reported by the insured, a loss adjuster, popularly known as loss surveyor, is deputed who assess the loss and issues report known as surveyor report which forms the basis for consideration or otherwise of the claim. Surveyors are appointed under the statutory provisions and they are the link between the insurer and the insured when the question of settlement of loss or 17 damage arises. The report of the surveyor could become the basis for settlement of a claim by the insurer in respect of the loss suffered by the insured. There is no disputing the fact that the Surveyor/Surveyors are appointed by the insurance company under the provisions of Insurance Act and their reports are to be given due importance and one should have sufficient grounds not to agree with the assessment made by them. We also add, that, under this Section the insurance company cannot go on appointing Surveyors one after another so as to get a tailor made report to the satisfaction of the concerned officer of the insurance company, if for any reason, the report of the Surveyors is not acceptable, the insurer has to give valid reason for not accepting the report. Scheme of Section 64-UM particularly, of sub-sections (2), (3) and (4) would show that the insurer cannot appoint a second surveyor just as a matter of course. If for any valid reason the report of the Surveyor is not acceptable to the insurer may be for the reason if there are inherent defects, if it is found to be arbitrary, excessive, exaggerated etc., it must specify cogent reasons, without which it is not free to appoint second Surveyor or Surveyors till it gets a report which would satisfy its interest. Alternatively, it can be stated that there must be sufficient ground to disagree with the findings of Surveyor/Surveyors. There is no prohibition in the Insurance Act for 18 appointment of second Surveyor by the Insurance Company, but while doing so, the insurance company has to give satisfactory reasons for not accepting the report of the first Surveyor and the need to appoint second Surveyor.”

14.    The Hon’ble Supreme Court in Khatema Fibres Ltd. v. New India Assurance Company Ltd., 2021 SCC OnLine SC 818, decided on 28.09.2021 has held that:

“32. It is true that even any inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law or which has been undertaken to be performed pursuant to a contract, will fall within the definition of the expression ‘deficiency’. But   to come within the said parameter, the appellant should be able to establish (i) either that the Surveyor did not comply with the code of conduct in respect of his duties, responsibilities and other professional requirements as specified by the regulations made under the Act, in terms of Section 64UM(1A) of the Insurance Act, 1938, as it stood then; or (ii) that the insurer acted arbitrarily in rejecting the whole or a part of the Surveyor’s Report in exercise of the discretion available under the Proviso to section 64UM(2) of the Insurance Act, 1938.

37. Two things flow out of the above discussion, They are (i) that the surveyor is governed by a code of conduct, the breach of which may give raise to an allegation of deficiency in service; and (ii) that the discretion vested in the insurer to reject the report of the surveyor in whole or in part, cannot be exercised arbitrarily or whimsically and that if so done, there could be an allegation of deficiency in service.

38. A Consumer Forum which is primarily concerned with   an allegation of deficiency in service cannot subject the surveyor’s report to forensic examination of its anatomy, just as a civil court could do. Once it is found that there was no inadequacy in the quality, nature and manner of performance of the duties and responsibilities of the   surveyor, in a manner prescribed by the Regulations   as to their code of conduct and once it is found that the report is not based on adhocism or vitiated by   arbitrariness, then the jurisdiction of the Consumer Forum to go further would stop.”

15.    In the recent case of National Insurance Co.Ltd. Vs. M/s Hareshwar Enterprises Pvt. Ltd. & Ors., Civil Appeal No.7033 of 2009 decided on 18.8.2021, 2021 SCC Online SC 628, the Hon’ble Supreme Court has been held as under :

“17.......Therefore, in the facts and circumstances herein the surveyors report was submitted as the natural process, the conclusion reached therein is more plausible and reliable rather than the investigation report keeping in view the manner in which the insurer had proceeded in the matter. Hence, the reliance placed on the surveyor’s report by the NCDRC without giving credence to the investigation report in the facts and circumstances of the instant case cannot be faulted. In that view, the conclusion reached on this aspect by the NCDRC does not call for interference.”

“18. … Having considered this aspect, the rate of interest to be awarded in normal circumstance should be commensurate so as to enable the claimant for such benefit for the delayed payment. There is no specific reason for which the NCDRC has thought it fit to award interest at 12% per annum. Therefore, the normal bank rate or thereabout would justify the grant the grant of interest at 9% per annum. Accordingly, the amount as ordered by the NCDRC shall be payable with interest at 9% per annum instead of 12% per annum. To that extent, the order shall stand modified…”

16.    The surveyor report does not reveal any impropriety which entails any rectification in its consideration.  On careful perusal of material on record including the surveyor report which indicates appropriate scrutiny and verification of the documents in question and deliberations above as well as the established precedents of the Hon’ble Supreme Court, in my considered view, the learned State Commission had rightly granted the award of Rs.52,320/- as assessed by the Surveyor vide report dated 11.05.2013. Thus, the order passed by the State Commission does not suffer any illegality or material irregularity and the same is upheld.  Consequently, the present Revision Petition No.363 of 2017 is dismissed. There shall be no order as to costs.

17.    All pending Applications, if any, stand disposed of accordingly.