Before the District Consumer Dispute Redressal Commission [Central District] - VIII, 5th Floor Maharana Pratap ISBT Building, Kashmere Gate, Delhi
Complaint Case No.-327/12.09.2016
M/s Rakeh Paper Company, A-993, Chawri Bazar, Delhi,
[through its Proprietor, Sh. Pradeep Goel s/o Late K.C. Goel
r/o A-2/171, Paschim Vihar, New Delhi-110063] …Complainant
United India Insurance Co. Ltd., DMA Building DMA Road,
Darya Ganj, Delhi-110002 ...Opposite Party
Date of filing: 12.09.2016
Date of Order: 17.11.2023
Quorum: Shri Inder Jeet Singh, President
Ms. Shahina, Member -Female
Inder Jeet Singh , President
1.1. (Introduction to case of parties) – The complainant/Insured has grievances of deficiency of services and of unfair trade practice against OP, since the complainant took private car package policy vide policy no. 0417003115P100551850 w.e.f. 15.04.2015 to 14.04.2016 (hereinafter referred as insurance policy) from Insurer/OP in respect of car bearing registration no. DL-01-CM-3797, (briefly ‘the vehicle’). On 11.07.2015 the vehicle was stalled underpass near Azadpur Sabzi Mandi because of rains in the rainy seasons, its engine stalled and stopped all of sudden. The complainant informed the Insurer and also lodged claim, however, the valid claim was not settled and all of a sudden a meager amount of Rs. 1,61,303/- were credited in the account of complainant against bills amount of Rs. 5,69,657/-. That is why, the complaint for balance insurance amount of Rs.4,08,354/-, besides compensation of Rs. 50,000/- towards distress and mental agony, award of Rs. 1,00,000/- for loss of business hours of complainant, costs of complaint and other reliefs.
1.2. The OP has opposed the complaint in strong wordings on the ground the complaint is false, it is filed to extort money under the garb of compensation and no cause of action remains after exhausting remedy of redressal before Ld. Insurance Ombudsman Delhi, who dismissed the complainant’s complaint on 18.01.2016 (the operating part of findings of Ld. Insurance Ombudsman is also reproduced in para 5 of preliminary objection in the written statement). The claim was processed as per norms, the surveyor’s report was also considered and accordingly the claim was reimbursed to the extent admissible. The complainant is not entitled for any further relief being claimed, for want of deficiency of services or unfair trade practice.
1.3. It is relevant to mention here, the OP has filed detailed written statement under the heading of ‘preliminary objection’ and ‘reply on merits’. As per matter of record, the reply on merits is exactly not reply to facts to the corresponding paragraphs of the complaint but general narration of OP’s own plea/case. Therefore, the case of parties will be narrated as per pleadings.
2.1. (Case of complainant) –The complainant is a proprietorship firm of Sh. Pradeep Goel, who authored the complaint. The complainant took insurance policy of the vehicle from the OP. It is zero depreciation policy and complainant paid insurance premium of Rs.58,774/-. During the currency of insurance policy, the complainant suffered damages on 11.07.2015 that there were rains being rainy seasons and when complainant was taking the car through underpass near Azadpur Sabzi Mandi at slow speed of 20 kmph, the engine of vehicle suddenly stalled and stopped; the traffic was moving very slow due to small water-logging. Since the engine of vehicle was stopped, the car was towed to the BMW workshop for checking and repairs. The OP was informed, who appointed the surveyor and to estimate the damages caused. On 25.07.2015, the complainant was informed that cashless facility was not being allowed to the complainant and complainant has to bear the expenses of repairs of the car.
2.2. Initially, the surveyor was not willing to promptly inspect the vehicle and he delayed inspection but it was conveyed to the complainant to get the repair started on his own costs and the surveyor will visit later-on to inspect the car. On 25.07.2015, the complainant was finally informed that cashless facility was not being allowed and complainant has to bear the expenses. The repair of car was then started after 25.07.2015 but by that time enormous damage was caused to the vehicle due to delay tactics and callous attitude adopted by the OP and its surveyor. There was corrosion and more damage in the engine part, because of want of inspecting the vehicle promptly, which also accelerated the repair cost. The repairs of the car were completed by the workshop after 27.08.2015 and bills of Rs. 5,69,657/- was raised towards the repair of the car.
2.3. The complainant handed over all original bills to the surveyor Sh. Amarjit Duggal on 31.08.2015, when the car was surveyed after completion of repairs. The complainant had paid all the bills of repairs despite it was ‘nil depreciation without excess’ policy and complainant was not required to pay a single penny towards any repairs, except the processing charges. The OP had also charged addition amount under the policy for providing cover on ‘nil depreciation without excess’ basis, however, no such facility was provided to the complainant. The complainant was in continuation of the previous policy of the vehicle and that is why no claim bonus of 20% was granted, which also means that complainant has been maintaining the vehicle so good during the previous year and there was no occasion to lodge any claim.
2.4. The complainant informed the OP on 11.07.2015 about the damage caused, the surveyor was appointed on 15.07.2015 but he delayed it and asked the BMW service centre to commence the repairs without official inspection. The complainant was informed that cashless repair of the damage car would not be allowed and complainant was not informed to what extent damages would be covered, this conduct of officials of OP and of surveyor was non-responsive. It was 17.07.2015 when BMW Service Center asked for dismantle of engine but the surveyor did not give any clear approval, whether or not this would be covered by the OP, consequently the complaint was forced to get the car repaired by paying money from this own pocket. Therefore, on 25.07.2015, the complainant informed the OP about dismantling of engine and also asked to take the photograph of the car, despite it the surveyor did not go to the service station but informed the complainant over telephone that claim is rejected as damages were due to water and insurance company does not cover any damages caused to car due to water.
2.5. The complainant got the vehicle repaired at his own cost. He also wrote letter/ email showing its anguish on the treatment given and about deficiency of services by OP. On 05.11.2015, the OP very quietly and surreptitiously transferred an amount of Rs.1,61,303/- in the bank account of complainant but it was partial claim amount. The complainant was not informed by the OP about funds transferred or the reason for want of giving entire bills amount vis-à-vis no detail/ breakup on the basis of which amount of Rs. 1,61,303/- was approved against bill of Rs.5,69,657/-. OP has also not provided copy of surveyor report. The complainant was constrained to file RTI on 08.06.2016 but OP gave incomplete reply that too without supplying copy surveyor report; which is matter of correspondence and email exchanged.
2.6. At the time of taking insurance policy, there were big promises and tall claims of providing cashless facility and other services by the OP but the same proved false. The OP has acted under mala-fide intention by refusing entire valid repair costs, thus complainant issued legal notice but no result. There is deficiency of services on the part of OP, besides negligence in discharging the duties. That is why the complaint.
2.7. The complaint is accompanied with DVAT form no. 56 showing name of the complainant being proprietorship firm, copy of RC of vehicle, insurance policy money receipt, copy of retail invoice, claim form, retail invoices, the correspondence and email exchanged including letter dated 09.11.2015 requesting the OP to reconsider claim of balance amount of Rs. 4,08,354/- & letter dated 29.06.2016 issued by OP, copies of application in respect of RTI.
3.1 (Case of OP)- As appearing, the OP does not deny the facts narrated in sub-paragraph 2.1 above, however, the OP denies other allegations of complaint, including the facts narrated in other sub-paragraphs above.
3.2. The OP is an insurance company, a Government of India undertaking and it is governed by Insurance Act, 1938 and the IRDA Act, 1999, therefore, claim of insured can be paid if it is within the four corner of policy, its terms and conditions. But the present complaint is baseless, false and abuse of process of law. It is filed to harass, blackmail, extort money and to malign OP. The process of Consumer Forum cannot become a tool in the hands of those persons, who filed complaint to extort money under the garb of compensation. No cause of action has accrued in favour of complainant and against the OP. Moreover, the complainant has exhausted the remedy of redressal of his grievances before the office of Insurance Ombudsman Delhi, who dismissed the complaint by order dated 18.01.2016 (as detailed with operating part of order in para 5 of the preliminary objection).
3.3. The contract of insurance is a contract of indemnity only and its object is to place the insured, after losses, in the same financial position as far as possible. It prevents the insured from making a profit out of his loss or gaining any benefit or advantage. Whereas, the complainant along-with the workshop of BMW tried to earn profit out of loss by producing exaggerated estimate of loss. Moreover, many spares shown in the estimate, requiring replacement, were not considered to be damaged due to an accident, e.g. engine block, set bolts, mechanical B, bearing shell upper, bearing shell lower etc. The complainant has tried to submit exaggerated estimate of loss of Rs. 6,03,143.41/- against assessed loss of Rs. 1,61,303.94/-, which cannot be allowed by the insurance company.
3.4. The surveyor assessed the loss on the basis of cause of accident to the vehicle. Surveyor is technically qualified for his job and he has assessed the losses correctly. The OP has acted on the basis of technical assessment of the loss made by him in his report. The total parts replacement and labour allowed by the surveyor comes out to Rs.1,61,303.94/- and the same was reimbursed to the complainant, by informing to the complainant vide letter dated 02.02.2016.
Hence, the complaint is misleading and it is misinterpreting the whole purpose of insurance, terms and conditions of policy at its own convenience. The complaint is liable to be dismissed for want of any deficiency in the services.
3.5. The reply is supported with copy of order dated 18.01.2016 of Insurance Ombudsman Delhi (in case Sh. Mayank Aggarwal vs TATA AIG General Insurance Co. Ltd.), copy of surveyor report dated 10.09.2015, and OP’s letter dated 02.02.2016 (being response to complainant’s letter 09.11.2015).
4.1 (Evidence)- Sh. Pradeep Goel, Proprietor, M/s Rakesh Paper Company led its evidence by detailed affidavit with the support of all documents filed with the complaint.
4.2. On the other side, OP led its evidence by filing detailed affidavit of Sh. Chandan Singh, Divisional Manager, with the support of documents filed with the reply; para 6 of the affidavit refers and reproduces operating part of order dated 18.01.2016 (which was mentioned in paragraph 5 of preliminary objections of written statement).
5.1. (Final hearing)- At this juncture, the complainant and the OP have filed their written arguments, which are blend of pleading and evidence.
5.2. The parties were also given opportunity to make oral submissions, therefore, Ms. Soniya Kumari, Advocate [being associate of Sh. Navneet Goel, Advocate] for complainant made the oral submissions. During the course of submissions, the complainant has relied upon the law laid down in New India Assurance Co. Ltd. vs Narvir R. Parmar (dod 26.02.2019 NC, New Delhi), its paragraph 10 has been being pari-materia to the present case, it reads as:-
“10. We have perused the insurance policy issued by the petitioner-company to the complainant. The said policy while covering damage due to flood, cyclone, hailstorm, etc., does not exclude the loss to the vehicle due to hydro static lock. In the absence of such an exclusion, the insurance company will have to reimburse cost of repair of the vehicle on account of damage by heavy rains and flooding irrespective of whether the said loss occurred due to hydro static lock or for some other reason. If despite IRDA permitting charging of an extra premium of reimbursement in respect of loss due to hydro static lock the petitioner- company did not charge such a premium, it is only itself to blame for such a situation because the policy issued by it while granting insurance against damage due to flooding, etc., did not exclude the loss/ damage to the vehicle on account of the aforesaid reason. Therefore, in our opinion, in a damage of this nature, unless expressly excluded, in the insurance policy, damage to the vehicle on account of hydro static lock would also be covered for the purpose of reimbursement. For this reason alone the petitioner-company must necessarily fail.”
5.3. There were no oral submissions on behalf of OP. However, the record and written arguments will be considered.
6.1 (Findings)- The case and contention of both the sides are considered, keeping in view the material on record in the form of oral narration of the parties, the documentary record (especially insurance policy, tax invoices and surveyor report) besides the case law presented.
6.2.1. The OP has taken a strong objection that complainant had exhausted the remedy before Insurance Ombudsman and it is left with no remedy, inclusive of the present complaint, it is not maintainable. However, this contention of OP is opposed by the complainant on the basis of facts and feature of his complaint and other record.
6.2.2. It needs to look plainly at the record as it is, more particularly para 5 of the preliminary objections of the written statement, para 6 of the affidavit of Sh. Chandan Singh, Divisional Manager, United India Insurance Co. Ltd. and para 5 of written argument of OP that complainant has exhausted remedy in the form of complaint before Insurance Ombudsman and his complaint was dismissed on 18.01.2016. Whereas Annexure-A (page no. 6) to the reply is that order of 18.01.2016 and this order was passed in case no. ‘GI/TATA AIG/ 210/15 under the title Mayank Aggarwal vs Tata AIG General Insurance Co. Ltd’. But. the present complainant is M/s Rakesh Paper Company. It is not fair on the part of OP that the present complainant Mr. Rakesh Paper Company had exhausted the remedy before Insurance Ombudsman or his complaint was dismissed.
The original syntax (in para 5 of preliminary objection), the narration is in respect of complainant but subsequently the OP tried to improve by writing ‘one complainant’ (in para 6 of affidavit of evidence and para 5 of written argument) as a camouflage. It is a case of clever drafting by the OP but the OP is attributing blames on the complainant. Therefore, OP’s own record does not support its own plea that complainant had exhausted remedy before Insurance Ombudsman or because of it there is no cause of action in favour of complainant.
Moreover, even after exhausting the remedy before Insurance Ombudsman, still the complaint will be maintainable before the Consumer Fora since the rights are created by the statute. This contention of OP is disposed off against the OP.
6.3. By taking into account totality of the circumstances, the following conclusions are drawn:-
(i) The episode of stalling of the vehicle all of a sudden is not disputed. The vehicle was towed to the BMW Service Centre and its repair is also not disputed. The surveyor had inspected the vehicle and his report dated 10.09.2015, proved by OP is also not disputed.
(ii) According to OP, the complainant along with workshop of BMW tried to earn profit out of loss by producing exaggerated estimate of loss vis-à-vis admissible claim was allowed, keeping in view the surveyor report. The OP acted upon the surveyor report being given by a competent surveyor after technical assessment of the losses.
Whereas, the surveyor in his report dated 10.09.2015 does not make any expression that the estimate of loss was on exaggerated but he reports that the liability component was discussed with the underwriter (i.e. OP herein) and then report was given. The surveyor also mentions in his report that vehicle was repaired at authorized dealers of M/s BMW Motors. There is no observation or finding by the surveyor that the complainant along with the officials of BMW tried to earn profit out of the loss.
The material in surveyor’s report reflects that OP itself is introducing in the written statement the imaginary and self-serving imputations against the complainant by mentioning so, which were never part or opinion of the surveyor.
In fact, the surveyor’s mentioning that detail of liability was discussed with the underwriter/OP, it clearly manifests there was meeting of mind of OP and the surveyor before rendering the report by surveyor.
(iii) According to OP the admissible claim was allowed and remaining claim was not within the preview of terms and conditions of insurance policy; there are many spare parts shown in the estimates, they were not considered being not covered or the same were beyond the policy. It has been projected in the light of order dated 18.01.2016 that complainant had not opted ‘engine secure’ add to the risk cover, consequently it was not covered under the policy. The parties are bound by the terms and conditions of the policy. But, the complainant opposed it vehemently that the vehicle was stalled and stopped all of a sudden because of rain and water, huge premium was paid and risk was covered, the complainant was never told that risk is not covered.
Its answer can also be traced in the record. The complainant has filed insurance policy cover with the complaint/ affidavit of evidence. But OP has not filed insurance policy cover or the proposal form to show that engine component was not covered under the policy. Had it been the case of OP that is not covered under the terms and conditions of the policy, the OP was required to establish that particular terms and conditions of the policy, also to mention so in the letter while partly allowing the claim. Why OP with-held it, if so existing? Why OP had not proved it? What prevented the OP to prove them, especially extraneous material was repeated but relevant fact and document was not proved by OP.
Moreover, surveyor in his report recites the subject insurance policy number or amount is not payable for certain items/parts but nowhere terms or conditions of the policy were mentioned, which excludes admissibility of specific parts or items. On page 3 of the surveyor report, the surveyor repeats expression ‘engine assy checking not payable’ and in respect of other items on page 2 and 3 of such report, expression ‘not payable’ but without explaining the reasons for its ‘not payable’. What prevented him to specify, when other factors were being mentioned. To say, the OP is invoking ‘exclusion clause’ for certain items to be not covered but that ‘exclusion clause’ has not been proved by the OP nor risk being not covered under the policy.
In addition, the ratio of law laid down in New India Assurance Co. Ltd. vs Narvir R. Parmar case (supra) applies to the situation of this case that OP failed to establish the exclusion clause or risk was not covered.
(iv) The complainant has proved tax invoices in respect of repairs and labour charges in respect of damage to the vehicle and the repairs was done at authorized service centre of BMW. The complainant had furnished the original bills/ invoices to the surveyor.
The surveyor report mentions estimates in the report, the total amount of Rs. 6,03,143.41/- (i.e. cost of parts of Rs.5,46,827+ labour charges of Rs. 56,316/). The complainant claims total amount of Rs. 5,69,657/- on the basis of bills etc.
(v) The vehicle was insured for IDV of Rs. 25,00,000/- and premium was also paid accordingly. However, the claim of complainant was of Rs. 5,69,657/- which has been proved by the complainant in respect of repairs/spare parts/labour of the damaged vehicle, covered under the policy but the complainant was partly paid claim amount of Rs. 1,61,303/- and the remaining claim amount of Rs. 4,08,354/- was not settled by the OP.
6.4.1. In view of the above, it is held that complainant has succeeded to establish the valid claim of balance amount of Rs.4,08,354/- against OP and for want of reimbursement of the total valid claim, it amounts to deficiency of services on the part of OP.
6.4.2. The complainant has claimed interest at the rate of 18% pa on the claim amount, however, the complainant could not establish to be part of contract, or otherwise, interest at the rate of 18% pa would be payable. However, the complainant has relied upon New India Assurance Co. Ltd. vs Narvir R. Parmar case (supra), wherein interest at the rate of 6% pa was confirmed. Accordingly interest at the rate of 6% pa from the date of complaint till realization of the amount is determined in favour of the complainant and against the OP.
6.4.3. The complainant claims compensation of Rs. 50,000/- towards distress and mental agony, but without elaborating as to how the amount of Rs. 50,000/- has been computed. By considering the nature of vehicle insured, the constant efforts of complainant to pursue claim and to convince the OP/surveyor to do needful in time in respect of damaged vehicle, which result into inconvenience and harassment to complainant, thus the ratio of New India Assurance Co. Ltd. vs Narvir R. Parmar case (supra) applies, wherein compensation of Rs.50,000/- was allowed, therefore, compensation of Rs. 50,000/- is allowed to meet both ends in this case.
6.4.4. The complainant also claims award of Rs.1,00,000/- in lieu of loss of business hours, however, it is not within the preview of insurance policy to cover business hour losses vis-à-vis determination of compensation under paragraph 6.4.3. also does leave scope to allow this request of the complainant. Therefore, complainant’s request for award of Rs.1,00,000/- in lieu of loss of business hour is declined.
6.4.5. The complainant was constrained to file the complaint to seek reimbursement of his valid balance claim, complainant has not quantified the costs, therefore, costs of Rs. 10,000/- is determined in favour of complainant and against the OP.
7. Accordingly, the complaint is allowed in favour of complainant and against the OP while directing the OP to pay amount of Rs. 4,08,354/- along with interest @ 6%pa from the date complaint till realization of amount, besides compensation of Rs. 50,000/- and cost of Rs. 10,000/- in 30 days.
In case the amount is not paid within 30 days, then OP will be liable to pay interest @ 8% pa on amount of Rs. 4,08,354/-.
8. Announced on this 17th November 2023 [कार्तिक 26, साका 1945]
9. Copy of this Order be sent/provided forthwith to the parties free of cost as per rules for compliances.
[Shahina] [Inder Jeet Singh]
Member (Female) President