New India Assurance Co. Ltd vs M/s Span Packaging & Anr

Subhash Chandra, Presiding Member

This revision petition under section 21 (B) of the Consumer Protection Act, 1986 (in short, the ‘Act’) assails the order of the State Consumer Disputes Redressal Commission, UP, Lucknow (in short, ‘State Commission’) in Appeal No. 1512 of 2009 dated 29.05.2012 arising out of order dated 28.07.2009 of the District Consumer Disputes Redressal Forum, Gautam Budh Nagar (in short, ‘District Forum’) in Complaint No. 59 of 2008.

Briefly stated, the facts of the case as stated by the petitioner, are that the respondent/complainant had taken a Standard Fire and Special Peril Policy from the petitioner for the period 04.03.2007 to 13.03.2008 covering goods kept in his premises at W-22, Sector 11, Noida for Rs 12,00,000/-. The policy was taken through respondent no. 2, Corporation Bank, with whom the goods were hypothecated. On the night of 26/27.03.2007 a fire broke out in the factory premises at D-62, Sector 7, Noida which was put out by the Fire Brigade and the Police Station, Sector 20, Noida was also informed. On 28.07.2007 the petitioner was intimated who deputed Piyush Associates, Surveyor & Loss Assessors to assess the loss to the said premises. The preliminary survey report mentioned that the policy in force was a renewed policy and that the address in both was shown as W-22, Sector 11, Noida. The risk covered was mentioned as manufacture of card board boxes including stock of corrugated boxes for Rs 12,00,000/- and the assessment of loss indicated that no details of raw material were available and details in the bank statement did not tally with the audited balance sheet as on 31.03.2006. It was also reported that complete details of stock were not provided and the details provided when verified by an independent Chartered Accountant was valued at Rs 16.81 lakhs which was considered disproportionately high as stocks held by the respondent was approximately Rs 6 lakhs. The surveyor calculated the loss at Rs 6,00,709/- and based upon the burnt paper collected on site, worked out the loss to be Rs 5,71,355/-. The net loss was worked out as Rs 5,60,674/- on the basis of the higher amount after calculation of salvage value, under insurance for sub-standard claim and policy excess. The Surveyor’s report noted that the insured had intimated the change in address on 07.03.2007 to his bankers (respondent no. 2) but no documentary evidence was provided for its receipt either by the bankers or the insurers (petitioner).

Respondent no. 1, vide letter dated 22.11.2007, informed the Divisional Manager, New India Assurance Co. Ltd that he had personally intimated the change in address through a letter dated 05.07.2007 and that respondent no. 2 (Bank) had informed the petitioner/insurance company vide letter dated 15.03.2007 about this. The petitioner deputed Madan Lal Sharma, Surveyor & Loss Assessor to investigate the change in address. Respondent no. 2 informed the petitioner that as it did not maintain any inward register, and as the letter was sent by hand, it was unable to confirm the date on which the letter conveying change in address was received from respondent no.1. The Surveyor, Madan Lal Sharma reported that no concrete evidence had been found in the records of the Bank/respondent no. 2 to substantiate respondent no. 1’s claim of having conveyed the change in address to the petitioner. The claim was therefore repudiated on 30.01.2008 on the ground that neither the insured nor their bankers had conveyed the change in address. Consequently, all benefits under the policy stood forfeited and the claim was not payable on account of violation of the terms and conditions of the policy.

The petitioner states that although the consumer complaint no. 59/2008 filed by respondent no. 1 before the District Forum claiming Rs 20 lakhs from the petitioner was contested by it, the District Forum allowed the same and vide order dated 28.07.2009 ordered payment of Rs 10,00,000/- along with interest at 9% p.a. within 2 months till date of actual payment with Rs 30,000/- as compensation for mental harassment and Rs 3,000/- towards costs. Appeal no. 1512 of 2009 was filed by the petitioner before the State Commission on the ground that no information regarding the change in address had been provided. However, this appeal was dismissed on 29.05.2012 and cost of Rs 10,000/- was awarded to respondent no. 1. This order has been impugned in this Revision Petition on the grounds that the fora below wrongly connected the appointment and deputation of the surveyor to the current factory premises with the change in address since this was based upon the information of the fire accident. It is the case of the petitioner that as the loss did not occur at the place mentioned in the policy, even the loss amount of Rs 5,60,674/- assessed was not payable and the claim was repudiated. It is contended that the State Commission’s order is mechanical and arbitrary which is liable to be set aside. It is contended that respondent no. 2/Bank had also failed to establish that the change of address had been notified to the petitioner prior to the date of peril as it was duty bound to do. Reliance is placed on the order of this Commission in Oriental Insurance Co. Ltd. Vs. P R Automobile Oil Mills & Anr. 1 (2010)CPJ 83 NC. It is prayed that the impugned order be set aside.

Respondent no. 1 in his reply has contended that there is no material irregularity or jurisdictional error in the impugned order warranting interference by this Commission under section 21(b) of the Act in view of the concurrent findings of the fora below. The repudiation of claim by the petitioner is contended to be illegal and arbitrary and based on falsehood as the change in premises was duly intimated much prior to the fire incident by respondent no.1 to the petitioner and respondent no. 2. It is contended that the impugned order is reasoned and valid which should not be interfered with.

I have heard the learned counsel for both the parties and carefully considered the material on record.

The case of the petitioner is that the change in address of the premises of respondent no.1 had not been intimated to it either by respondent no. 1 or 2 prior to the incident of the fire. Therefore, based upon the report of its Surveyor, the claim had been repudiated by the petitioner for valid and cogent reasons. It is argued that the letter intimating change in address dated 15.03.2007 had not been delivered to it either by the insured (respondent no.1) or its banker (respondent no. 2) prior to the occurrence of the peril. Accordingly, the policy stood violated and all claims thereunder were forfeited. In so far as the claim amount was concerned, even the calculation by the surveyor was not admissible consequently. On the contrary, it is contended by respondent no.1 that the change in address had been duly intimated to the petitioner by him through its banker/respondent no. 2 with whom the goods and stock was hypothecated. It is also contended that this was done prior to the fire accident and the surveyor had accepted that the fire was a covered peril. He also contends that the petitioner having deputed the surveyor to the current address of the factory had acknowledged the change in the address of the insured premises. Finally, it is argued by respondent no.1 that in view of concurrent findings on facts by the fora below, the role of this Commission under section 21 (b) of the Act was curtailed, as per the settled position of law.

From the foregoing, it is manifest that there are concurrent findings on facts by the District Forum and the State Commission. The petitioner has not brought out any material irregularity in the orders of the fora below. This Commission, in exercise of its revisional jurisdiction, is not required to re-assess and re-appreciate the evidence on record when the findings of the lower fora are concurrent on facts. It can interfere with the concurrent findings of the fora below only on the grounds that the findings are either perverse or that the fora below have acted without jurisdiction. Findings can be concluded to be perverse only when they are based on either evidence that have not been produced or based on conjecture or surmises i.e. evidence which are either not part of the record or when material evidence on record is not considered. The power of this Commission to review under section 21 of the Act is therefore, limited to cases where some prima facie error appears in the impugned order. Different interpretation of the same set of facts has been held to be not permissible by the Hon’ble Supreme Court.

The Hon’ble Supreme Court in Mrs Rubi (Chandra) Dutta vs M/s United India Insurance Co. Ltd., (2011) 11 SCC 269 has held that:

“23. Also, it is to be noted that the revisional powers of the National Commission are derived from Section 21 (b) of the Act, under which the said power can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order, and only then, may the same be set aside. In our considered opinion there was no jurisdictional error or miscarriage of justice, which could have warranted the National Commission to have taken a different view than what was taken by the two Forums. The decision of the National Commission rests not on the basis of some legal principle that was ignored by the Courts below, but on a different (and in our opinion, an erroneous) interpretation of the same set of facts. This is not the manner in which revisional powers should be invoked. In this view of the matter, we are of the considered opinion that the jurisdiction conferred on the National Commission under Section 21 (b) of the Act has been transgressed. It was not a case where such a view could have been taken by setting aside the concurrent findings of two Fora.”

Reiterating this principle, the Hon’ble Supreme Court in Lourdes Society Snehanjali Girls Hostel and Ors vs H & R Johnson (India) Ltd., and Ors (2016) 8 Supreme Court Case 286 held:

“17. The National Commission has to exercise the jurisdiction vested in it only if the State Commission or the District Forum has either failed to exercise their jurisdiction or exercised when the same was not vested in them or exceeded their jurisdiction by acting illegally or with material irregularity. In the instant case, the National Commission has certainly exceeded its jurisdiction by setting aside the concurrent finding of fact recorded in the order passed by the State Commission which is based upon valid and cogent reasons.”

Again, the Hon’ble Supreme Court in T Ramalingeswara Rao (Dead) Through LRs and Ors vs N Madhava Rao and Ors, dated 05.04.2019 held as under:

“12. When the two Courts below have recorded concurrent findings of fact against the Plaintiffs, which are based on appreciation of facts and evidence, in our view, such findings being concurrent in nature are binding on the High court. It is only when such findings are found to be against any provision of law or against the pleading or evidence or are found to be perverse, a case for interference may call for by the High Court in its second appellate jurisdiction.”

From the records it is apparent that the petitioner has challenged the impugned order on the very same grounds which were raised before the District Forum as well as the State Commission in appeal. The concurrent findings on facts of these two foras are based on evidences led by the parties and documents on record. The present revision petition is therefore an attempt by the petitioner to urge this Commission to re-assess, re-appreciate the evidence which cannot be done in revisional jurisdiction. Learned counsel for the petitioner has failed to show that the findings in the impugned order are perverse.

Foras below have pronounced orders which are detailed and have dealt with all the contentions of the petitioner. It is seen that the orders of these fora are based on evidence on record.  In view of the settled proposition of law that where two interpretation of evidence are possible, concurrent findings based on evidence have to be accepted and such findings cannot be substituted in revisional jurisdiction, this petition is liable to fail.

I therefore, find no illegality or infirmity or perversity in the impugned order warranting interference. The present revision petition is, therefore, found to be without merits and is accordingly dismissed.