New India Assurance Company Ltd. vs Kakali Sengupta & Anr.

This revision petition has been filed by the insurance company challenging the order of the State Commission dated 29.6.2016 whereby their appeal No.92 of 2016 against the order dated 17.03.2016 of the District Forum in Complaint No.100 of 2009 was dismissed.

In the present revision petition, the petitioner has not disputed the fact that the respondent had a valid insurance policy at the time when the fire had broken out in her premises and that she had filed the claim. It is also an admitted fact that upon receiving the claim, the insurance company had first appointed Sh. B. K. Bhardwaj to do the preliminary investigation in the matter and based on his report surveyor Mr. S. K. Sadhu was appointed who submitted his report, wherein he had calculated that the fire has been accidental and calculated the loss at Rs.15,83,979/- . He in his report has advised the insurance company to get the loss re-calculated by a CA and the insurance company appointed Mr. Satbir Singh Bhatiya who also happened to hold a surveyor licence. Mr. Satbir Singh Bhatiya, after his inquiry into the matter, calculated the loss at Rs.11,94,516/-. The insurance company even did not honor the loss assessed by Mr. Satbir Singh Bhatiya and sanctioned this amount to the complainant, rather they offered a sum of Rs.8,83,322/- and asked the complainant to settle their loss at this amount. The complainant did not accept this offer and filed the complaint.

In their written version filed before the District Forum, the insurance company took the plea that the report of the surveyor Mr. Satbir Singh Bhatiya should be accepted and had failed to give any justification for offering a sum of Rs.8,83,322/- to the complainant for settling her dispute. Parties led their evidences before the District Forum. Interrogatories were also served upon the insurance company. After going through all the documentary evidences on record and evidences led by the parties, the District Forum accepted the loss assessed by the first surveyor and accordingly granted the appropriate relief.

Aggrieved by the findings of the District Forum, the insurance company filed the appeal and raised the similar contentions that the assessment made by the second surveyor i.e. Mr. Satbir Singh Bhatiya should be accepted and that the same should be awarded to the complainant. This contention was, however, not accepted by the State Commission and the State Commission dismissed the appeal vide impugned order dated 29.6.2016.

This Order has been challenged by the insurance company before this Commission and has raised the similar objections that the loss assessed by Mr. Satbir Singh Bhatiya CA cum surveyor who was appointed in view of the advice of the first surveyor Mr. S. K. Sadhu ought to be accepted and the impugned order be modified accordingly.

Learned counsel for the complainant however has submitted that this Commission has no jurisdiction to reappreciate the evidences and substitute its opinion, especially when the concurrent findings of District Forum as well as of State Commission are well reasoned. It is also submitted that the law does not permit the insurance company to arbitrarily appoint the surveyors till they get the favorable report. It is submitted that in the facts and circumstance of the present case, their existed no circumstance, whether appropriate or expedient, to appoint a second surveyor because the first surveyor had considered all the documents produced before him and asked by him and he had thereafter given a very well-reasoned report. It is further argued that only because the first surveyor has casually mentioned for getting the loss reassessed by a CA, it does not ipso facto authorizes the insurance company to appoint a second surveyor. Fora below have been correct in accepting the loss occurred to the complainant in fire and assessed by the first surveyor i.e. Mr. S. K. Sadhu and has also rightly rejected the report of Mr. Satbir Singh Bhatiya, the second surveyor cum CA. It is argued that the Act of the insurance company arbitrarily offering Rs.8,83,322/- and asking complainant to settle at this amount, is violative of contract.

It is a settled preposition of Law that in a revision petition, this Commission has a very limited jurisdiction. It is not permitted to re-appreciate and reassess the evidences on record and substitute the findings on facts with its own opinion. Unless the findings are perverse, this Commission is estopped from interfering with the concurrent findings of the Fora below. A finding can be said to be perverse when it is not based on any evidence or where any material evidence on record has not been taken into consideration while giving the findings. Unless either of the situation exists, this Commission does not have power and authority/jurisdiction under the law to interfere with the concurrent findings on facts by Fora below. This Commission can also intervene where there are jurisdictional error committed by the Fora below.

It has been held by Hon'ble Supreme Court in numerous cases including "Rubi (Chandra) Dutta Vs. United India Insurance Co. Ltd. - (2011) 11 SCC 269" as under:

"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".

Again in "Lourdes Society Snehanjali Girls Hostel and Ors. Vs. H&R Johnson (India) Ltd. and others, (2016) 8 Supreme Court Cases 286," the Hon'ble Supreme Court has reiterated the same principle and has held as under:

"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."

In T. Ramalingeswara Rao (Dead) Through L.Rs. and Ors. Vs. N.Madhava Rao and Ors. decided on 05.04.2019 passed in Civil Appeal No. 3408 of 2019, the Hon'ble Supreme Court has 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."

The only issue among the parties is whether the Fora below were right in rejecting the assessment made by the second surveyor Mr. Satbir Singh Bhatiya and granting relief on the basis of the report of Mr. S. K. Sadhu. The District Forum had considered and the contentions of the parties in detail on this issue and has held as under :

OP examined two witness they are as S.K. Sadhu, S. S. Bhatiya. In his statement Mr. S. K. Sadhu clearly said that he has been deputed by the OP No.1 to assess the loss because I am a licencee, being licence No. LA 2467. (Motor fire and Misc.) and in his report dated 18.8.08 Mr. Sadhu asses the total loss of Rs.15,83,979/- which is tagged with the evidence of S.K Sadhu. The OP witness No.2 Satbir Singh Bhati deposed that he is a licencee surveyor having licence No.SLA 21654 for fire, marine and Misc. Mr. S. S. Bhatia also stated that the Books of accounts and stock register were not available. Mr. Bhatia submitted his report dated 4.6.2009 assessing a total loss of Rs.11,94,516/- which has been marked as A. In reply to interrogatory filed by the Complainant the OP witness Mr. Bhatia informed that his category in the fire is 'c' grade Licencee and in reply to the question whether you or Insurance Company have received any IRDA permission or order for reassessment on the surveyor report of Mr. S.K Sadhu, Mr. S. S. Bhatia said that became he is a Charter Accountant and surveyor and being expert for the same. In his reply to question 18 of the interrogatory Mr. Bhatia clearly said that he has not even visited financing bank i.e. SBI, Moubhander Branch OP No.2 as the policy has been purchased through him. The stock statement submitted by the complainant to Bank has not been verified by him. Mr. Bhatia also attached copy of licence which has clearly said that he has been appointed as to act as a surveyor and loss assessor up to 3.11.2018 for category in fire and Marin Sea.

Issue No.2 : This issue is the most important issue, hence it is taken up first discussion. On the basis of pleadings evidence and documents produced by the complainant and Ops, we are of the opinion that in this case the OP No.2 SBI has got no liability against the claim of the complainant.

So far as the OP No.1 New India Assurance Co. Ltd. Ghatsila Branch is concerned, it has not disputed fact that the complainant shop is the name and style, M/s Kakali Sales Agency was insured against the fire by OP No.1 and within the insurance coverage period loss was caused to the said shop by fire. The OP No.1 has only disputed with regard to the quantum of loss which is payable to the complainant. Admittedly three surveyors were appointed by OP No.1 to assess the Loss. They were Mr. B. K. Bharadwaj who was appointed to conduct preliminary investigation and later on Mr. S. K. Sadhu and subsequent to him Mr. S. S. Bhatia were appointed on surveyors to assess the loss by fire. There is fire report of Ste Fire Officer, Jharkhand Ranchi dated 27.2.2008 addressed to Branch Manager (OP No.1) New India Assurance Co. Ltd. In which estimated loss has been mentioned to the tune of Rs.17,00,000/- which has been marked as Ext 4, further it transpires that Mr. S.K. Sadhu in his report assessed the loss by fire to the tune of Rs.15,83,979/- which is tagged with the evidence of OP witness No.1 hence this document is also admitted by the OP. OP witness No.2 Mr. Satbir Singh Bhatia loss assessor has in his evidence and in his report (Ext A), has assessed the loss to the tune of Rs.11,94,516.65 paise. We further find according to document filed by the complainant (Ext. 9) that Mr. S. K. Sadhu is the B Grade surveyor and Mr. Satbir Singh Bhatia is 'c' grade surveyor who is lower in category to Mr. S. K. Sadhu. Further according to IRDA revised financial cap for surveyor it is mentioned that in the case of fire portfolio, category 'c' limit of Rs.10,00,000/- (Ten lakh) would be reduced to Rs.5,00,000/- category B existing limit of Rs.25,00,000/- to Rs.20,00,000/- and for Category A the limit would be above Rs.5,00,000/- instead of Rs.10,00,000/-. Therefore we find that Mr. S. K. Sadhu being category "B" surveyor was well within his jurisdiction to assess the loss caused by the fire in the said shop of the complainant.

Further the Ld. Lawyers for complainant placed reliance on the decisions of the Hon'ble National Consumer Disputes Redressal Commission, New Delhi, reported in 2012 (1) CPR 242 (NC) and 2012 (2) CRP 152 (NC). We have gone through the above decisions of the National Commission, New Delhi, we find that OP No.1 has expanded no reason as to why it appointed the second loss assessor when the first loss assessor was superior in category and was well within pecuniary jurisdiction to assess the loss nor OP No.1 has submitted any chit of paper pertaining to permission of the IRDA.

Hence, we come to the conclusion that OP No.1 has acted in violate of the rule as laid down for appointment of second loss Assessor. We further find that neither report of Surveyor No.1 S.K. Sadhu nor reported of Surveyor No.2 S. S. Bhatia was accepted by the OP No.1 but instead OP No.1 took its own arbitrary decision to offer the settlement amount of Rs.8,83,322/- to the complainant without any basis which was refused by the complainant and it amounts to deficiency in service on the part of OP No.1. Therefore, in our view the amount of loss assessed by the surveyor Mr. S. K. Sadhu amounting to Rs.15,83,797/- is illegally acceptable for the ends of justice and this amount is payable to the complainant by the OP No.1 in addition to amount for pain and suffering and for litigation cost. And the complainant is entitled to claim this amount from OP No.1. Therefore, this issue is decided in favour of the complainant and against OP No.1.

Similar contentions raised before the Appellate Court had also been dealt with by the State Commission in the impugned Order. The relevant paragraphs are reproduced as under :

In reply to the interrogatories filed by the Complainant, the second surveyor Mr. S. S. Bhatiya admitted that his licence was under category 'C' in fire. Further in reply to the question, whether he or the Insurance Company got any IRDA permission or order for reassessment on the report of the first surveyor Mr. S. K. Sandhu, he gave an evasive reply that he was a chartered accountant and a surveyor expert in the field of fire. Moreover he admitted that he did not even visit the Financing Bank; and that the stock statement furnished by the Complainant to the Bank was not verified by him.

Furthermore from the documents filed on behalf of the Complainant it was clear that the first surveyor Mr. Sandhu was Grade 'B' surveyor, who was competent to assess the loss up to Rs.20 lacs; whereas the second surveyor Mr. Bhatiya was Grade 'C' surveyor, who could assess loss only up to Rs.5 lacs. Thus the second surveyor was not competent to assess the loss in question.

There is nothing to show that the Insurance Company rejected the report of the first surveyor. It has not explained why it appointed the second surveyor. However it was argued that the second surveyor was a chartered accountant and, therefore, he was appointed. Such argument cannot be accepted. Only because the second surveyor was a chartered accountant he did not become competent to assess the loss in question which was beyond his limit of Rs.5 lacs. Further on such argument the report of the first surveyor Mr. Sadhu who was competent to assess the loss, could not be brushed aside.

Furthermore the Insurance Company was required to take approval from IRDA for appointment of second surveyor but no such approval has been brought on the record.

Further, it is not shown, on what basis the Insurance Company arrived at the purported settlement amount.

Thus, it has to be held that the Insurance Company wrongly appointed the second surveyor.

In the present case, learned counsel for the insurance company argues that the insurance company is well within its right, conferred under Section 64 UM (2) of the Insurance Act, 1938, to appoint a second surveyor where it is appropriate and/or expedient and has also relied on the findings of the case reported in 2009 (8) SCC 507 titled as Sh.Venkateshwar Syndicate -vs-Oriental Insurance Company Ltd. There is no dispute to the fact that the law permits the insurance company to appoint a second surveyor in appropriate and expedient circumstance. However, in the present case, the insurance company has failed to point out any such circumstances which necessitate the appointment of second surveyor. The only instance which they have relied upon is the observation made by the first surveyor in his report dated 18.08.2008 in the column "Remarks". The relevant portion of the same is reproduced as under :

REMARKS :-

Insured has arranged copy of required documents and submitted to me.

The price of items damaged has been provided to me after getting my reminder.

The assessment of loss made by me has been done keeping in view to maximum precision.Insurer may take the help for computation of different account documents by any account specialist for confirmation.

This portion of the record of Mr. S. K. Sadhu clearly shows that the first surveyor has duly considered all the documents provided to him and on the basis of all those documents, he had calculated the loss. It is a fact proved on record that second surveyor Mr. Satbir Singh Bhatiya did not consider all the relevant papers and also did not give any justification before submitting its report. It is also a proved fact that Mr. Satbir Singh Bhatiya was Grade 'C' surveyor whose limit was to assess the loss up to Rs.5 lakhs only. Therefore, he was even disqualified to do the said job at the first place since the loss assessed in this case was more than five lakhs and it could not have been appointed. The conduct of the insurance company itself shows that they had not been acting fairly but had been acting callously and in violation of the spirit of the Insurance Act and the contract between the parties. It is a fact that though they had appointed a second surveyor but has not even accepted its opinion and had arbitrarily and without any basis or justification sanctioned a sum of Rs.8,83,322/- towards loss and asked the complainant to settle their loss at this amount.

From the above, it is apparent that the impugned order is passed on the proved facts in the present case. The law of the land has also been followed. There is no jurisdictional error pointed out either. Both the Fora below have written a very well-reasoned orders. Taking into consideration all the aspects of the case, I found no illegality or infirmity in the impugned order. The present revision petition has no merit and the same is dismissed with no order as to cost.

Vide Order of this Commission dated 03.02.2017, the insurance company was directed to deposit 50% of the awarded amount with the District Forum. The said amount alongwith up to date interest, accrued thereon, should be released to the complainant immediately on submission of an application. Complainant is free to file the execution for the balance amount, in case the same is not paid by the insurance company within a period of six weeks.