JAI KISHAN SHARMA vs United India Insurance Co. Ltd.

MR. Jai Kishan Sharma, complainant for short, was running a stone crusher at Badarpur in the year 1991-92. He had obtained a machinery breakdown policy from the United India Insurance Company Ltd. for Rs. 7 lacs for the period 9.1.91 to 8.1.92. This amount included insurance to the tune of Rs. 2.33 lacs on account of a component called Jaw Crusher with which we are concerned in this case. On 16.1.91, the Jaw Crusher breakdown. On the same day, the complainant informed the Insurance Company in writing. The Insurance Company appointed M/s. Select Surveyors on the same day. The machinery concerned was inspected and for further examination the complainant was advised to shift the Jaw Crusher to the Vishwa Karma Foundry and Engineering Works which had fabricated the machine for opening the same and seeing the condition of the two bearings. The machine was, accordingly, taken to the manufacturer and the two bearings were also found to have been damaged. Repairs were carried out and the Jaw Crusher was re-fitted on 26.2.91. The complainant submitted a bill for Rs. 1,13,292/- on account of repairs. The Surveyor submitted his detailed report dated 30.7.91 in which he recommended settlement on payment of Rs. 54,795.20 as adjusted value of the loss. The Insurance Company entertained doubts about the timing of the accident especially as entered in the log-book and, accordingly, appointed MR. J.K. Sharma, name- sake of the complainant, as second Surveyor. The second Surveyor visited the crusher on 19.2.92, possibly after the repairs had been either completely carried out or substantially carried out and submitted his report dated 21.2.92. The sec-and Surveyor raised doubts on several aspects of the claim. On a consideration of the said report, the Insurance Company repudiated the claim by letter dated 31.3.92. The present complaint was filed on 8.4.93 claiming Rs.1,13,292/- as the amount spent on repairs with 24% interest and further compensation on account of mental agony suffered by the complainant.

IN the written version, it has been stated that the INsurance Company having repudiated the claim, the Commission had no jurisdiction and the complainant could have his remedy, if any, in the Civil Court. The main contention is that the log-book, which is required to be maintained under the terms of the insurance policy, showed discrepant timing with regard to working of the machine on the one hand and the time of the alleged accident on the other hand. The log-book had been apparently tampered with by making alteration and addition therein in the relevant entries, and it was, thus, rendered totally un-reliable. It was denied that the first Surveyor Mr. C.K. Jain had recommended Rs. 86,000/- as the amount payable to the complainant. We have heard the complainant, who argued in person and Mr. Praveen Nigam, Advocate for the OP and have carefully gone through the records.

Mr. Praveen Nigam, learned Counsel for the OP stated that the Branch Manager of the Insurance Company had gone to the complainant with the cheque-book and had offered to pay him the amount recommended by the first Surveyor in full and final settlement of the claim. The offer was, however, not accepted by the complainant. According to Mr. Nigam, therefore, whatever decision is made in the present complaint, the Insurance Company should not be saddled with liability to pay interest or other compensation. The complainant denied that any such offer was made to him. Admittedly, the offer was not made in writing nor was this fact referred to either in reply to the legal notice sent through Counsel or in the affidavit of either Mr. B.S. Chopra, Deputy Manager of Mr. Rajesh Bhasin, Manager of the Insurance Company placed on record. On the contrary, the clear persistent and categorical case of the OP is that the complainant was trying to practise a fraud on the Insurance Company on the basis of the forged and fabricated entries in the log-book and the claim had been duly considered and repudiated.

A careful perusal of the reports of the two Surveyors Mr. C.K. Jain of the Select Surveyors on the one hand and of Mr. J.K. Sharma, the second Surveyor, on the other hand, shows that the report of Mr. C.K. Jain is first in point of time well reasoned. After taking into consideration the relevant facts and the Surveyor had advantage of personally seeing the damaged parts both before opening the pitman which is the costliest component of Jaw Crusher and which had broken-down. As against the report of the first Surveyor, the report of the second Surveyor is full of conjectures and surmises and Mr. J.K. Sharma, the Surveyor, carried out the inspection after repairs had been completely or near completely carried out and did not have the advantage of seeing the damaged machinery for himself. The only question left is, whether the Insurance Company had sufficient bona fide reason to reject the report of the first Surveyor without seriously applying its mind or they had justification for doing so. The only reason suggested in this behalf is, that in the log-book, the complainant appeared to have altered the existing entry and made some additions in order to support his claim. We have closely examined this aspect of the question. The material entry in the log-book is dated 16.1.91. In the log-book against each date the time of starting the machine and the time when it was stopped for the day was required to be mentioned. In the last column remarks, if any, are entered. The argument of Mr. Nigam proceeds that on the relevant date i.e. 16.1.91, the starting time for the machine was noted as 6 a.m. In the remarks column the following occurs: "Accident 3 p.m. se 5 p.m. chalaya. Pitman machine chalte samay hi boring dhunan de kar band ho gaya." The case of the OP is that the starting point of the machine at 6 a.m. was altered to 5 a.m. and the aforesaid entry in the remarks column was added at a later stage. After hearing both the sides and careful consideration, we find that, in fact, the remarks column entry starts in front of the entry for 15.1.91 which is one line above the starting entry for 16.1.91. The remarks column entry is written in Hindi in five plus lines and, therefore, covers the space in front of not only 15.1.91 but also 16.1.91 and 17.1.91 which also occur on the same page one below the other. In other words we have no doubt that the remarks column entry is made against the date 15.1.91 and has no relevancy as far as 16.1.91 is concerned. The admitted case of both sides is that the break-down took place on 16.1.91. The matter can be viewed from another angle. We ask ourselves whether the complainant stood to gain anything by making the said additional entry. The categorical reply would be in the negative. On the contrary, the said entry would make things little difficult to understand and would not advance the case of the complainant. We, therefore, firmly think that there is no question of making any additional entry. The entry had been made a day earlier and it related to mal- functioning of the pitman component of the Jaw Crusher. The later entry of 16.1.91 regarding starting of the machinery at 6 a.m. or 5 a.m. affirms that in fact the trouble noticed a day earlier had either been set-right or did not persist and the machine started as usual. The difference between the reported time and the accident at 5 a.m. and the entry of starting the machine at 6 a.m. can be easily understandable as such timings are given on the basis of the rough estimate and not necessarily after consulting the watch. The log-book appears to have been maintained by some junior employee of the complainant. In fact, when we put the said entries to the complainant, he was unable to decipher as to in whose hand the entry was made. He only could say that it was one of his junior employees who was charged with the duty of making such entries.

WE are, therefore, clearly of the view that the repudiation in this case was not bona fide, after due application of mind and consequently, this is a clear case of deficiency in service. WE, therefore, allow the complaint and direct the Insurance Company to pay Rs. 54,795.20 alongwith interest @ 18% p.a. w.e.f. 1.11.91 till date of payment. WE have chosen this date as report of the first Surveyor was submitted on 30.7.91 and it would be reasonable to allow about three months time to the Insurance Company to have processed the claim. In view of the award of interest, we do not think that any further amount should be given by way of additional compensation. The respondent shall also pay Rs. 1,500/- as costs of the complaint. A copy of this order be conveyed to both the parties. Complaint allowed.