Kanhaiya Lal Prakash Chand vs New India Assurance Company Limited & Anr.

This revision petition has been filed by M/s. Kanhaiya Lal Prakash Chand, petitioner against the order dated 12.4.2012 of the State Consumer Disputes Redressal Commission, Rajasthan (in short ''the State Commission'') passed in Appeal Nos. 967/ 2010 and 957/2010. 2. Brief facts of the case are that the petitioner/complainant was having a shop of food grains and general merchandise at CHA-5, Suraj Pole, Anaj Mandi, Jaipur. The complainant had obtained cash credit limit from the opposite party No. 2/respondent No. 2 and hypothecated the stocks to the opposite party No. 2 bank. The stocks were insured with opposite party No. 1/respondent No. 1 under the Standard Fire and Special Peril Policy No. 330205/22/05/00254 which was valid from 27.5.2005 to 26.5.2006. Policy covered foodgrains, dal, bessan, suji and other similar goods. There was a fire in the shop on 2.11.2005. On intimation, the Insurance Company appointed a surveyor, who visited the shop on 3.11.2005 and 4.11.2005. The surveyor submitted his report on 27.1.2006. The survey assessed the loss of Rs. 60,544, but recommended that since the stocks damaged were stored and/or lying just out of insured premises which requires additional specific coverage and declaration thereof, hence liability is out of the scope of policy. The respondent No. 1 on 6.3.2006 informed the complainant that the goods of complainant were not stocked inside the shop and it was stocked outside, for that reason as per conditions of policy the risk was not covered and the claim of complainant was repudiated. 3. Aggrieved with the repudiation of claim, the complainant filed consumer complaint before the District Consumer Protection Forum, Jaipur-II, Jaipur, (in short ''the District Forum''), which was resisted by the opposite part No. 1 on the ground that the claim was not payable because the terms and conditions of the policy have been violated. The District Forum decided the complaint vide its order dated 15.4.2010 as under: "Resultantly, the complaint of the complainant is accepted against the respondent Insurance Company and respondent Insurance Company is ordered to pay, the complainant a compensation of Rs. 60,544 towards mental agony and financial loss to pay 8% per annum interest on the compensation from 5.9.2006 the date of filing the complaint and for expenses of complaint to pay Rs. 1,500. On non-payment of the amount of compensation within a period of 1 month, the respondents shall have to pay the complainant interest @ 10% per annum." 4. Aggrieved with the order dated 15.4.2010 passed by the District Forum, the complainant preferred an appeal before the State Commission. The opposite party No. 1/respondent No. 1 also preferred appeal against the order of the District Forum before the State Commission. These appeals were No. 967/2010 and 957/2010 respectively. The State Commission decided both the appeals by a common order dated 12.4.2012, whose operative portion is as follows: "Thus, the appeal No. 957/2010 filed on behalf of the Insurance Company is rejected. The appeal No. 967/2010 filed by the complainant is partly allowed and the order of learned District Forum is modified to the extent that out of total valued loss, deduction of Rs. 15,000 has been made, that is rejected and the total amount of loss assessed to Rs. 75,544 has to be paid by the Insurance Company to the complainant. Rest of the order is maintained as such. The Insurance Company shall comply with this order within a period of one month from the date of the order Otherwise 10% interest shall be payable." 5. Being aggrieved with the order of the State Commission, the complainant has filed the present revision petition. 6. Heard the learned Counsel for the parties and perused the record. 7. The learned Counsel for the petitioner argued that the surveyor has not considered the loss of goods kept outside the shop and in the adjacent space, which was duly part of the shop as the same was properly enclosed. The stocks were stored and kept in the open space with temporary shed with roof of G1 Sheet and sides covered with iron grill. Under the Rules for Dwellings Offices, Hotels, Shops etc. of the Tariff Advisory Committee, Mumbai, it is dearly mentioned that: "2. Stocks belonging to the insured stored in the open area adjacent to the insured''s premises are held covered." 8. Thus, according to this Rule the stocks lying outside, but adjacent to the shop will be treated as covered under the insurance and there was no need for any additional specific coverage as reported by the surveyor in his recommendation. 9. Learned Counsel for the petitioner also stated that neither the surveyor nor the Fora below have considered the statement of goods that was being sent regularly to the mortgagor bank/respondent No. 2. There can be no better authentic list of items stored in the shop than these statements. These statements clearly show that the stocks were to the tune of about Rs. 25,00,000. All the stocks were completely burnt in the fire. 10. It was further mentioned by the learned Counsel for the complainant that the complainant had requested a Chartered Accountant Mr. Tarun Aggarwal to examine the surveyor''s report and he has submitted his report dated 17.9.2008. It has been clearly stated in his report that: "1. The surveyor in their report had not stated the quantity or value of goods available in shop on date of survey. 2. The details regarding quantity or value of goods lying outside or inside the shop was not provided. 3. The surveyor had rejected the goods lying outside the shop without stating its quantity or value. 4. The basis on which the quantity accepted from assessment of loss point of view is not clear. From report it is not clear which stock items along with quantity was lying inside the shop or outside the shop and how they have reached the quantity of item subject to loss. 5. There is huge difference in quantity claimed and quantity accepted by surveyor." 11. It has also been recommended in his report that: "On basis of above in my opinion the loss claimed by insured should be payable on grounds as referred above." 12. On the basis of this report, the learned Counsel emphasised the inadequacy of the surveyor''s report and pleaded that the total loss as claimed which is supported by the statements submitted to the mortgagor/bank should be allowed. 13. The learned Counsel for respondent No. 1 stated that there is no provision to appoint any surveyor or Chartered Accountant to verify or examine the report of the surveyor appointed by Insurance Company and no value can be attached to the report of Mr. Tarun Aggarwal dated 17.9.2008. The learned Counsel further pointed out that the address of the insured premises as mentioned in the policy is CHA-5, Suraj Pole, Anaj Mandi, Jaipur, and area outside the shop obviously is not covered under the insurance policy. The learned Counsel further pointed out that there was no fire inside the actual shop and the surveyor has assessed the total loss including the loss to goods lying outside the shop. 14. The learned Counsel for the respondent No. 2 pleaded that his party has no role in deciding the claim of the complainant. His only interest was that the loan taken by the complainant should be recovered. 15. We have carefully considered the arguments advanced by learned Counsel for the parties and have examined the record. There is no doubt that the stocks of food grain, dal, bessan, suji and other similar goods were insured under the policy, which was valid from 27.5.2005 to 26.5.2006. The incident of fire took place on 2.11.2005 and therefore, the incident is covered in the policy period. The address of the insured premises in the policy is written as CHA-5, Suraj Pole, Anaj Mandi, Jaipur. The surveyor appointed by the Insurance Company has given his report on 27.1.2016. The following portions of the surveyor report are important and, therefore, are reproduced below: Situation of Loss: Damaged/affected stocks were stored and/or lying just out of the insured shop in cement platform being not allotted to insured but unauthorised encroachment was done by insured for storing their stocks. Cause and Occurrence: As reported that probably due to electric short circuiting, stocks stored and/or lying outside the shop caught fire and damaged by fire as well as water sprinkled by fire tenders. Nature, Extent of Damage: A huge quantity of stocks was found stored out of the shop, we carried out detailed segregation of burnt/partially burnt and water damaged stocks and observed that stocks stored and/or lying on left side have damaged in this fire as per details mentioned in the assessment All the affected stocks were segregated immediately and because of instant action by insured lot of quantity could be saved even from affected bags i.e. damaged quantity was taken out and fresh was kept aside, which has not been taken into consideration for assessment." 16. From the above, it is clear that the surveyor has considered the loss occurred in the stocks kept outside the shop in the open. Though the Insurance Company has denied the claim on the basis of violation of terms and conditions of the policy because the stock was kept outside the shop, it is clear that surveyor has considered the damage to even the stock kept outside the shop, 17. We agree with the contention of the learned Counsel for the respondent No. 1 that there is no provision for appointing another surveyor or Chartered Accountant to examine the report of the surveyor appointed by the Insurance Company. In the present case, the surveyor/Chartered Accountant appointed by the complainant has given his report on 17.9.2008 i.e. after roughly 3 years of the incident and after roughly 2½ years of the surveyor''s report dated 27.1.2006. Obviously this Chartered Accountant/surveyor appointed by the complainant has not seen the scene of the incident and the damage occurred, whereas the surveyor appointed by the Insurance Company has visited the spot just on the next day of the incident. Therefore, the report of the Chartered Accountant/surveyor appointed by the complainant has no fact-finding authenticity. Otherwise also, this report has no value in the eyes of law. Even on merits this report has not clearly given any substantial shortcoming in the report of the surveyor appointed by the Insurance Company. Mr. Tarun Agarwal Chartered Accountant, in his report has said that the surveyor in his report has not stated the quantity or value of goods available in shop on date of survey. But, the surveyor in his report dated 27.1.2006 has clearly stated under the column ''Value at Risk'' that ''the total value of all stocks available with insured was found well within stipulates sum insured i.e. Rs. 25.00 lacs, being almost equal to the stocks reflected in Bank stock statements i.e. Rs. 21,21 lacs. This also negates the assertion of the complainant that the surveyor has not taken into account the statements of stocks submitted to the mortgager bank. 18. Thus, we have seen that the surveyor has considered the total loss pertaining to the goods damaged in the fire accident including those lying outside the shop. The surveyor has also considered the statements of stocks being submitted to the mortgagor bank. In fact, the petitioner complainant has himself not been able to clearly prove the damage to the stocks except for filing of the report of a Chartered Accountant Mr. Tarun Agrawal dated 17.9.2008. The complainant has not been able to show any discrepancy or inaccuracy in the report dated 27.1.2006 of the surveyor. We have also found that the report of Mr. Tarun Agarwal, the Chartered Accountant, has not found substantial lacuna in the report dated 27.1.2006 of the surveyor. Moreover, this report is not having any legal value. Thus, we find no basis to disbelieve the report dated 27.1.2006 of the surveyor appointed by the Insurance Company. The Hon''ble Supreme Court in its judgment Sri Venkateswara Syndicate v. Oriental Insurance Company Limited & Anr., Ill (2009) CPJ 81 (SC)=II (2010) SLT 664=(2009) 8 SCC 507, has observed that: "31. The assessment of loss, claim settlement and relevance of survey report depends on various factors. Whenever a loss is reported by insured, a loss adjuster, popularly known as loss surveyor, is deputed who assesses 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 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. 32. There is no disputing the fact that the surveyor/surveyors are appointed by the Insurance Company under the provisions of the 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 officer concerned 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." 19. The Hon''ble Supreme Court in Sikka Papers Limited v. National Insurance Company Limited and Ors., III (2009) CPJ 90 (SC) = (2009) 7 SCC 777, has laid down that- "Insurance Act, 1938 - Section 64-UM--Surveyor/Loss assessor''s report-Weightage to be given-Held, Though not the last word, yet there must be legitimate reason for departing from report-No infirmity found in surveyor''s report and therefore held, Insurance Company rightly admitted claim as per the report." 20. From the above two judgments of the Hon''ble Supreme Court, it is clear that the report of the surveyor appointed by the Insurance Company should generally form the basis for the insurance claim until the same is disputed and not acceptable on the basis of any material irregularity or discrepancy, which is not the case in the present revision petition. The State Commission has already allowed the claim by liberally interpreting the surveyor''s report and we find no justification for not accepting the surveyor report. 21. Based on the above discussion, we find no illegality, material irregularity or jurisdictional error in the order dated 12.4.2012 of the State Commission, which calls for any interference from this Commission. Accordingly, revision petition is liable to be dismissed for want of any merits. 22. Consequently, the Revision Petition No. 2673 of 2012, M/s. Kanhaiya Lal Prakash Chand v. The New India Assurance Company Limited & Anr., is dismissed with no order as to costs. Revision Petition Dismissed.