DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION: BHADRAK : (ODISHA).
Consumer Complaint No. 09 of 2018.
Date of hearing : 03.10.2023.
Date of order : 18.12.2023.
Dated the 18th day of December 2023.
Sri Balaram Rout,
Prop. M/s. Maa Tarini Chuda Mill,
At/Po:-Chadheya, Via:- Barapada,
PS:- Bhadrak (R), Dist:- Bhadrak.
………….. Complainant.
-:Versus:-
1. The Branch Manager, UCO Bank, Jalanga Branch
At/Po:-Jalanga, Via:- Madhab Nagar,
P.S:- Bhadrak (R), Dist:-Bhadrak.
2. The Branch-In-Charge,
Reliance General Insurance Company Ltd.,
2nd Floor, 5 Janpath, Unit- 3, Bhubaneswar- 751001
.…………Opposite parties.
P R E S E N T S.
1. Sri Shiba Prasad Mohanty, President,
2. Smt. Madhusmita Swain, Member.
Counsels appeared for the parties.
For the Complainant : Sri Debasis Nayak, Advocate,
For the O.P. No. 1 : Sri Chittaranjan Nath, Advocate,
For the O.P. No. 2 : Sri Pradipta Kanungo, Advocate.
J U D G M E N T.
SRI SHIBA PRASAD MOHANTY, PRESIDENT.
In the matter of an application filed by the complainant alleging deficiency of service against the Opposite Parties under Consumer Protection Act, 2019.
Fact of the case is that, the complainant is a poor, innocent qualified educated unemployed person & belongs to rural area. Complainant for earning his livelihood has applied for financial assistance for his service unit to the O.P.No.1 under Prime Minister’s Employment Generation Programme (PMEGP). Prior to apply under PMEGP the complainant has successfully undergone Entrepreneur Development Programme. Complainant for his Chuda Mill unit requires the loan for the amount of Rs.25,00,000/- under Rural area & applied the application form under PMEGP in the year 2012-13 & after considering the same O.P.No.1 has been pleased to sanctioned the amount of Rs.9,50,000/- (As Term Loan Rs.7,60,000/- & Working Capital Rs.1,90,000/- by the Bank under PMEGP Scheme & O.P.No.1 assured him to enhance the limit. Complainant was assured by the O.Ps & believes in the company’s good will & reputation the O.P.No.1 had given a proposal to the complainant to insure the unit with the O.P.No.2 as per sanction advice, O.P.No.1 duly insured the unit with O.P.No.2 at the cost of the complainant and the O.P.No.2 accept the premiums & also complainant had duly signed as per the terms & conditions and privileges agreed on the policies. O.P.No.2 issued two (2) Nos. of policies i.e. “Burglary & House Breaking Insurance Policy” bearing No. 2402262911000301 and said policy reveals that insured period for 1 year from 23.08.2016 to 22.08.2017 for an amount of Rs.10,00,000/- & “Reliance Standard Fire & Special Perils Policy” bearing No. 2402662111036794 and the said policy reveals that insured period for 1 year from 23.08.2016 to 22.08.2017 for an amount of Rs.10,00,000/-. As the sum insured for the amount of Rs.4,00,000/- for Plant & Machinery & Rs.6,00,000/- for the Stock & Stock in process. On 19.03.2017 due to heavy rain & wind the damaged was caused to the stock & asbestos of the factory building of the complainant. The stock of Chuda, Chuda Rice worth of Rs.2,20,000/-& asbestos sheets along with structure worth of Rs.2,75,000/- has been damaged. The said incident was communicated to the O.P.No.1 & the information was given to the O.P.No.2 Insurance Company about such damage. Complainant lodged the claim form before the O.Ps, approached to the O.P.No.2 for disbursement of claim amount & submitted all the requisite documents to the O.Ps. O.P. No.1 appointed one M/s. McLarens Insurance Surveyors & Loss Assessors India Pvt. Ltd., Bhubaneswar for survey & evaluate the loss caused to the damage of complainant’s unit. Complainant approached & went to office of the O.Ps to expedite the genuine grievance for early settlement of claim. Instead of settlement of claim, complainant suddenly received a bomb sell of letter dtd.13.04.2017 whereby the O.P.No.2 repudiated the genuine claim of the complainant in fictitious & colourable plea without providing the copy of surveyor’s report. O.P.No.1 has hypothecated the Plant, Machineries, Factory shed, Stock of Raw Materials, Finished Goods & other current assets as a primary security. As per sanction/advice of O.P.No.1 the assets created out of Bank’s fund & other movable/immovable fixed assets risks of fire, theft, burglary, malicious damage & SRC risks & natural calamities etc. with Reliance Insurance Company under corporate agency at borrowers’ cost. Complainant has prayed to direct the O.Ps to disburse the claim amount of Rs.4,95,000/- with 12% interest per annum for the period from date of repudiation i.e. 13.04.2017 till realization of the amount.
O.P.No.1 submits that, complainant has applied a loan under PMEGP Scheme before the D.I.C. Bhadrak. The loan proposal was approved by the D.I.C. & referred to the O.P. Bank for sanction. After verification & maintaining all formalities, the loan proposal of the complainant was sent to the Zonal office at Cuttack for sanction. The Zonal authorities after verifying the documents & maintaining all formalities have sanctioned the loan to the complainant. Complainant has brought a quotation from one “GAYATRI FLOOR MILLS” at Charampa. As per the quotation the O.P. has disbursed the loan to the complainant & issued a Draft for Rs.5,51,000/- for supply of machineries & the accessories as per the quotation to the complainant. The Chuda Mill machinery along with accessories has not been supplies to the complainant. The role of Gayatri Floor Mill comes under purview of criminal proceeding. The O.P. has sanctioned the total loan amount of Rs.9,50,000/- from which Term Loan of Rs.7,60,000/- & working capital loan amount of Rs.1,90,000/-. Due to non- delivery of Chuda Mill Machinery by the Gayatri Floor Mill, Charampa, the complainant could not avail the working capital loan amount of Rs.1,90,000/- as the Chuda Mill Unit of the complainant was not running or working. On dated 20.03.2017, complainant has filed an Insurance Claim petition before the O.P. No.1 & the O.P. No.1 without any delay has intimated the same to the Insurance Authority i.e. O.P.No.2 on the same day. After receiving the complaint O.P.No.2 made inquiry & survey regarding the claim of complainant. After investigation & survey the O.P.No.2 has denied to settle the claim of the complainant as it was not genuine & true claim & falsely made by the complainant. O.P.No.1 has instructed the complainant to submit his stock statement before O.P. but complainant never submitted the same. There was no stock in the possession of complainant. After receiving the insurance premium, the Insurance Company issued the policy bond to the complainant by the O.P.No.1. The complainant has filed this case in false, imaginary & vexatious grounds which is not maintainable. The O.P. is not liable for any harassment, humiliation & personal damage of Rs.4,00,000/- as the O.P. is not responsible.
O.P.No.2 submits that, as per the proposal for insurance submitted by the complainant for insurance, insurance policy bearing No. 2402662111036794 was issued covering the risk period from dtd.23.08.2016 to 22.08.2017 under Reliance Standard Fire & Special Perils Policy. On receipt of intimation by the complainant/insured with regard to the damage of his stock as well premises, the O.P. had immediately deputed the Surveyor Mc. Larens Global Claims Services for survey & loss assessment in the matter. After due survey & inspection report was submitted on 05.04.2017. During physical inspection along with insured’s representative from the spot, it is observed that Chuda Mill was under construction & the asbestos sheets along with its structure were blown away due to heavy wind. Complainant has opted cover for Plant & Machinery & Stock of Rice, Chuda & Husk, whereas damage occurred to insured’s factory building which is under construction. The loss does not fall under scope of the policy & the O.P. is free from any liability. The factory building is not covered under the Standard Fire & Special Perils Insurance Policy opted by the insured. The claim was not covered under the policy. The repudiation is also intimated to the complainant vide letter dt.13.04.2017. There is no deficiency in service on the part of the O.P. and complainant is not entitled to get any relief against the O.P. as claimed.
Having heard the rival contentions and material available in the record, this commission finds that the OP No.2 insurance company is normal parlance should have inquired the premises of the proposed unit to be insured before insuring the same. After insuring the same by taking the premium, the insurance company cannot shirk from its responsibility to compensate the loss caused to the complainant’s unit terming the same to be breach of contract. Once the OP Insurance Company has received the insurance premium, there is no escape from the liability to compensate the complainant for whatever loss has been caused to him. However, the complainant has failed to bring in any evidence of existence of Plant, Machineries, Stock of Raw Materials, Finished Goods & other current assets in to the record. The surveyor deputed by the OP Insurance company has reported that the asbestos sheets along with its structure were blown away due to heavy wind. Part of the term loan of Rs. 7,60,000/- must have been expended in erecting the shed meant for Chuda mill which has been blown away in the cyclone. The complainant has to repay the loan which he has incurred from the OP No.1. So, the OP Insurance company needs to compensate the complainant on non-standard basis.
O R D E R.
In the result, the complaint be & same is partly allowed. The OP No.2 Insurance Company is directed to pay the complainant 25% of the term loan i.e. Rs. 7,60,000/- which comes to Rs.1,90,000/- within 60 days from the date of order. If the OP No.2 fails to pay the same within the stipulated period, it shall pay the amount along with 6% interest till the actual date of payment. No order against OP No.1. No order of cost against any party.
This order is pronounced in the open Court on this the 18th day of December 2023 under my hand and seal of the Commission.
