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Judgment
Sudip Ahluwalia, Member
This Appeal has been filed by Baldev Alloys Pvt. Ltd. under Section 19 of the Consumer Protection Act, 1986 against the impugned Order dated 04.12.2014 passed by the State Commission, Chhattisgarh in Complaint No. 13 of 2014, vide which the Complaint filed by the Appellant was dismissed.
The Appellant secured a Standard Fire and Special Perils Insurance Policy from The New India Assurance Co. Ltd. on 29.11.2011, covering various assets at their factory premises. Following heavy rainfall on 20.07.2012 and 21.07.2012, the insured premises experienced flooding, leading to substantial damage to the factory and its stock. The Appellant promptly notified the Respondent No. 2 about the incident on 23.07.2012 and filed a claim of Rs. 70,30,274/-. A Surveyor Report dated 11.02.2013 assessed the net loss at Rs. 46,46,905/-. However, after a significant delay of about 8 months, the Respondent No. 2 requested the Appellant to sign and return a blank Discharge Voucher to process the claim. The Appellant complied but received a settlement of only Rs. 39,27,504/-. Objecting to this, the Appellant demanded a review of the settled claim via a letter dated 07.05.2013. Dissatisfied with the Respondent Insurance Company's actions, the Appellant lodged a complaint before the State Commission in Chhattisgarh.
The State Commission dismissed the Complaint vide the impugned Order dated 04.12.2014. The relevant extracts of the impugned Order are set out as below –
“34. In the instant case, the authorized signatory of the complainant company himself signed the document discharge voucher (OP-9). The complainant is a Private Limited Company and Shri M.K. Som is authorized person for signing and verifying the documents on behalf of the complainant company. It appears that Shri M.K. Som is a highly educated person and therefore, generally it is not possible that he signed blank document (Discharge Voucher) without going through the contents of the same. Therefore, the plea taken by the complainant that the authorized signatory of the complainant signed the discharge voucher in blank form, is not acceptable.
In the instant case, the complainant has not been able to prove that Discharge Voucher (OP-9) was executed by the complainant in unavoidable circumstances or under coercion or in blank form and he was in the need of money. From perusal of tire discharge voucher, it appears that the complainant had freely consented for accepting the amount of Rs.39,27,504/- and accepted the same in his free will.
The complainant received a sum of Rs.39,27,504/- form the OPs (Insurance Company) in full and final satisfaction of its claim, therefore, the complainant is not entitled to get any amount as mentioned in the relief clause of the complaint.
In view of the aforesaid discussions, the complaint filed by the complainant being devoid of any merits, is liable to be and is hereby dismissed. Parties will bear their own cost of the complaint.”
Aggrieved by the Order of the State Commission, the present Appeal has been filed, raising the following contentions –
a. That the State Commission erred in not appreciating that discharge of contract and liability of the insurer by way of the Discharge Voucher is void ab initio as the consent of the Appellant was obtained under misrepresentation and fraud. The discharge voucher was signed by the Appellant due to assurances given by the Respondents that the entire claim amount would be settled;
b. That the State Commission erred in not appreciating that discharge voucher was prima facie invalid and signed by the Appellant as blank and unfilled. The Appellant was made to sign blank and unfilled discharge voucher form as a condition precedent for settlement of claim;
c. That the State Commission failed to appreciate that the Complainant had in fact suffered loss to the tune of Rs. 70,30,274/- due to unexpected rainfall and inundation that happened in the factory and office premises of the Appellant;
d. That the State Commission failed to appreciate that there was no letter or undertaking duly signed by the Appellant stating that their claim has been duly satisfied and discharged by them.
Ld. Counsel for the Appellant has argued that the State Commission had erroneously passed the impugned Order dated 04.12.2014 dismissing the complaint. The State Commission did not go into merits and detailed evidence placed on record and relied only on the Discharge Voucher, observing that the Appellant had signed the discharge voucher therefore it would amount to discharge of liability of the insurer under the insurance contract; That the Hon’ble Apex Court as well as this Hon’ble Commission, in a plethora of judgments have observed that a contract of discharge of liability entered under misrepresentation, fraud and coercion shall be void ab initio and unenforceable in the eyes of law; The Ld. Counsel for the Appellant has cited the cases of “National Insurance Co. Ltd. v. M/s Boghara Polyfab Pvt. Ltd., CA No. 5733 of 2008”; “National Insurance Co. Ltd. v. Rajan Sood, 2014 SCC OnLine NCDRC 443” and “National Insurance Co. Ltd. v. Vasavi Traders, I (2008) CPJ 487” in support of his contentions.
Ld. Counsel for the Respondents has argued that there is no infirmity whatsoever in the findings of the State Commission, both on facts and law in its impugned Order dated 04.12.2014; That the State Commission passed a detailed and reasoned order after duly considering the facts, terms and conditions of the contract of insurance and analysing the evidence placed before it; That when the Appellant lodged a claim of loss due to heavy rain inundation, the Respondents appointed Surveyor and Loss Assessor. The Appellant had taken an undue long time to submit the requisite information and documents to the Surveyor; That on receipt of the Survey Report, the Respondents examined and considered the same and found it by and large in order as per norms except for certain variations. The Respondents approved the claim for Rs. 39,27,504/- and the payment of the amount was released after obtaining the requisite documents; That in order to make undue gain, the Appellant raised the issue of “blank discharge voucher” and the State Commission after considering the submissions and evidence, rightly held that the signatory to the discharge vouchers is a highly qualified executive of the company and as such the version of the Appellant in this regard cannot sustain; That the question regarding sanctity of Survey Report was discussed in “United India Insurance Co. Ltd. and Ors. v. Roshan Lal Oil Mills Ltd. and Ors., (2000) 10 SEC 19”. Further, regarding settlement of the claim, the State Commission rightly relied on the Hon’ble Apex Court’s Order in “United India Insurance Co. Ltd. v. Ajmer Singh Cotton & General Mills, II (1999) CPJ 10 (SC)”.
This Commission has heard both the Ld. Counsel of the Appellant and Respondents, and perused the material available on record.
The grievance of the Appellant/Complainant is that the Ld. State Commission did not consider its contention that the Complainant had accepted the offer of the Insurance Company only under coercion being in need of money. The overall facts and circumstances however do not indicate the correctness of this submission. It may be mentioned that there was a difference of an amount of around Rs. 7,70,000/- from the final assessment made by the Surveyor which was of Rs. 46,96,905/-, while the amount offered and paid by the Insurance Company was Rs. 39,27,504/-.
It transpires that in the amount calculated by the Surveyor, there was an assessment of loss to the boundary wall of the Complainant’s building of Rs. 2,81,250/- only. However, perusal of the Sum Insured Summary in the relevant Insurance Policy goes to show that the sum insured on the building compound wall was zero. To that extent the amount of Rs. 2,81,250/- clearly ought to have been excluded from the loss assessed by the Surveyor. The other difference of an amount exceeding Rs. 4,61,000/- was in relation to assessment of loss on Sponge Iron, which was calculated by the Surveyor on the basis of prevailing price of the said Item at the relevant time, whereas according to the Insurance Company, the settled principle for calculating indemnity is that –
“Materials in the process of being manufactured in factories and workshops, the value is calculated by adding to the purchasing price of the raw material and other materials on the working day prior to the date of loss or damage, manufacturing expenses incurred upto that day and proportionate share of general expenses. Provided the value so calculated shall not exceed, in no way, the value of manufactured goods on the day proceeding the working day of loss”
There is certainly logic in this contention raised on behalf of the Respondent which led to reduction of loss compensation for value of Sponge Iron.
Even otherwise, as already noted in the earlier Order dated 5.7.2023, the representative of the Appellant/Complainant who signed on the Discharge Certificate happens to be Chartered Accountant in his own right, and nothing could have prevented him from endorsing his simple objection of “Acceptance under Protest”, in accepting the amount delivered by the Insurance Company.
For the aforesaid reasons, this Commission finds no grounds to interfere with the well-reasoned Order of the Ld. State Commission.
The Appeal is therefore dismissed. Parties to bear their own costs.
Pending application(s), if any, also stand disposed off as having been rendered infructuous.