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Judgment
V.K.Jain, J.
The complainant who is engaged in the business of manufacturing and trading of pulses, obtained an insurance policy from the respondent to the extent of Rs.1,00,00,000/- in respect of the stock kept in his factory premises. The aforesaid sum was later on increased to Rs.1.5 Crores. As per the version given by the insured to the surveyor, due to heavy rains in the factory on 30.07.2014 and 31.07.2014, the stock of goods kept in his factory was damaged/destroyed. He also informed the surveyor that due to contact with inundated contaminated water, goods upto 3-4 feet became wet and damaged. The surveyor assessed the loss to the complainant at Rs.35,01,597/- which was not acceptable to him. He is therefore, before this Commission seeking compensation of Rs.14,875,751/- from the insurer alongwith compensation quantified at Rs.1 Crore. He is also seeking waiver of the interest on the loan taken by him from OP No.2 Union Bank of India.
The complaint has been resisted by both the OPs. In its written version, OP No.1 has admitted the issuance of the policy to the complainant and stated that at the time the site was visited by the Branch Manager of OP No.2 alongwith other officials and surveyor, it was found that the shutters of the factory had been broken and very few quantity of dal (pulse) was lying on the ground outside the factory. The insured informed the surveyor that shutter was broken and some dal (pulse) was taken by local people. The insured was advised to lodge an FIR with respect to the alleged theft of the dal (pulse), but he did not comply with the aforesaid advice. It is also alleged that the insured had already started shifting the stock even before inspection by the aforesaid team. It is further alleged in the written version filed by the insurer that the complainant did not furnish proof with respect of tukdi (broken pieces) and cattle-feed and therefore, re-imbursement in respect of the aforesaid two items was not allowed by the surveyor. It is also alleged that the insurer had offered a sum of Rs.35,01,596/- to the complainant but he refused to accept the said amount.
The surveyor assessed the loss to the complainant on the basis of volumetric analysis taking the stock upto the height of 3 feet as the damaged stock. The following table was prepared by the surveyor giving the volumetric analysis of the stock which was damaged due to rain waters:
The summary of volumetric is as under:
Bag Size (50kg)
3X1.5X0.75 in cft
Bag Volume
3.375 cft
Bag Size (30kg)
2.0X1.5X0.6 cft
Bag Volume
1.8 cft
Particulars
Area in sqft
Height of water in ft
Volume cft
No.of ags derived
Actual Number of bags @80% of derived bags
Maximum affected quantity in kg during flooding (which can be stored upto the water level)
Remarks
A
1740
3
5220
1547
1237
61866.67
Raw
B
1080
3
3240
960
768
38400.00
Tukdi
C
120
3
360
107
85
4266.67
Daal
D
120
3
360
107
85
4266.67
Daal
E
120
3
360
107
85
4266.80
Daal
F
1036
3
3108
Cattle
1727
1381
41440.00
feed
3643
154506.80 Kg
Rate :
For raw stock of masoor, we have found last invoices which was at Rs.52/Kg, though the insured has claimed on average rate @ 51.50/Kg, we have considered the average rate. For Finished stock, the insured has submitted average sales rate including gross profit @ 6.80%. We are deducting GP % from the same to arrive at the cost.
The following is the table showing assessment of loss made by the surveyor:
ASSESSMENT OF LOSS:
Serial No.
Particulars
Quantity in Kg
Rate
Amount in Rs.
Allowed Quantity in Kg
Rate
Allowed Amount in Rs.
1
Cattle feed
7938
9
71442
-
-
No proof
2
Masoor Daal
174245
59.5
10367578
12800
55.45
709758
3
Masoor raw material
80290
51.5
4134935
61867
51.50
3186133
4
Tukdi
7942
38
301796
-
No proof
270415
14875751
3895891
Less Salvage
210000
3685891
Less Policy Excess @ 5%
184295
Net Assessed Loss in Rs.
3501597
The loss to the complainant comprised stock of raw masoor, dal masoor, tukdi (broken pieces) and cattle-feed. As per the volumetric analysis made by the surveyor, there were 1,547 bags of raw masoor. He however, made a deduction of 20% from the quantity of the masoor kept in the bags and allowed the claim only for 61,867 kg. In the absence of any explanation for taking 20% out of the aforesaid derived quantity and taking the actual number of bags to be 80% of the derived bags, the deduction made by the surveyor cannot be sustained. Therefore, 25% of the assessed amount needs to be added to the assessment made by the surveyor in respect of raw material. The amount payable to the complainant for raw material after addition of 25%, would come to Rs.39,82,666.25p as against Rs.31,86,133/- awarded by the surveyor.
As per the volumetric analysis made by the surveyor, 321 bags of dal were derived by him. Again, he took the actual number of bags to be 80% of the derived bags, without explaining why 20% of the 321 bags had been excluded from consideration. The surveyor assessed the loss in respect of masoor dal at Rs.7,09,758/-. 25% of the aforesaid amount needs to be added to the assessment so made by the surveyor and therefore, the amount payable to the complainant in respect of masoor dal will come to Rs.7,09,758/- + 25% i.e. Rs.8,87,197.5p.
The surveyor awarded no amount in respect of tukdi (broken pieces) and cattle-feed, on the ground that no proof was submitted. The report of the surveyor however, is silent as to what proof sought by him from the insured was not submitted. As per the volumetric analysis made by him, the volume of cattle-feed was 3,108 cft whereas the volume of tukdi (broken pieces) was 3,240 cft. He assessed the loss in respect of the tukdi (broken pieces) at Rs.38,400/- after making a deduction of 20% from the derived bags but did not award any amount for the tukdi (broken pieces) on the ground that no proof was submitted. Again, he did not specify what proof sought by him was not furnished by the insured. Therefore, I am of the opinion that the complainant, in addition to re-imbursement for the loss of dal and masoor raw material, is also entitled to re-imbursement for the tukdi (broken pieces) and cattle-feed. The complainant who is present in the court clarifies that no invoice in respect of tukdi (broken pieces) and cattle-feed could be available since these are the by-products derived during the process of converting raw masoor into masoor dal. The complainant therefore, is entitled to a sum of Rs.3,01,796/- + 25% i.e. Rs.3,77,245/- in respect of the loss of the tukdi (broken pieces).
As far as the cattle-feed is concerned, as per the volumetric analysis made by the surveyor, the volume of the cattle-feed was 3108 cft. The quantity of cattle-feed comes to 7,938 Kg as per the second table prepared by the surveyor whereby the loss to the complainant was assessed. The complainant has claimed Rs.9 per Kg for the cattle-feed. There is no reason to reject the aforesaid rate and therefore, I hold that the complainant is entitled to a sum of Rs.71,442/- in respect of the loss of the cattle-feed.
For the reasons stated hereinabove, I hold that the complainant is entitled to the following amounts:
(i) For cattle-feed, Rs.71,442/-.
(ii) For tukdi (broken pieces), Rs.3,01,796/- + 25% i.e. Rs.3,77,245/-.
(iii) For masoor dal, Rs.7,09,758/- + 25% i.e. Rs.8,87,197/-.
(iv) For masoor raw material, Rs.31,86,133/-+ 25% i.e. Rs.39,82,666/-.
Thus, the gross loss to the complainant comes to Rs.53,18,550/-. After deducting salvage amounting to Rs.2,10,000/- and policy excess calculated @ 5% amounting to Rs.1,84,295/-, the amount payable to the complainant comes to Rs.49,24,255/-.
In view of the above, the OP is directed to pay a sum of Rs.49,24,255/- to the complainant, alongwith interest on that amount @ 9% per annum w.e.f. six months from the date of submission of the claim till the date of payment. Since the stock had been hypothecated with Union Bank of India and the amount payable by the complainant to the bank is stated to be Rs.1,88,00,000/-, the whole of the aforesaid amount shall be paid by the insurer to OP No.2 Union Bank of India which shall credit the same in the account of the complainant. The complaint stands disposed of accordingly.