Subodh Choudhary vs NEW INDIA ASSURANCE CO LTD

MR. Subodh Choudhary, Petitioner herein, has filed the present revision petition being aggrieved by the order of the State Consumer Disputes Redressal Commission, Bihar (hereinafter referred to as the ''State Commission'') in First Appeal No. 546 of 2004 in which the New India Assurance Co. Ltd. and Another, were Respondents.

THE facts of the case according to the Petitioner are that he started a brick kiln industry after taking a loan of Rs. 6 lakh from the Madhubani Kshetriya Gramin Bank (Respondent No. 2) and which in turn got the industry insured with Respondent No. l for a period of one year w.e.f. 25.6.2002. On 24.7.2002 due to heavy rains in the area, Petitioner''s brick kiln industry suffered excessive damage and the Petitioner immediately informed the Respondent/Insurance Company who in turn informed the Petitioner/Bank about the incident. A Surveyor was appointed by the Respondent/Insurance Company who came to the site, took photographs and assessed the loss. However, after 4 months the Respondent/Insurance Company informed Respondent No. 2 that since the insurance cover was only in respect of the stock of bricks of which there was no proof of any damages, and the claim was rejected.

BEING aggrieved, Petitioner filed a complaint before the District Forum requesting that the Respondent/Insurance Company be directed to pay the claim of Rs. 4,37,500 (i.e. the loss incurred) with interest @ 18% per annum from the date of claim, Rs. 25,000 for mental agony and Rs. 2,000 as litigation costs.

THE District Forum after hearing both parties allowed the complaint by accepting the contention of the Petitioner that the copy of the insurance policy was never given to either Respondent No. 2 nor to the Petitioner and even before the District Forum despite directions, this document was not filed and instead only an extract of the insurance policy was filed to indicate that only the stock of bricks was insured. On the other hand when a bank advances a loan of Rs. 6 lakh, then it would obviously take an insurance, to cover the entire industry and not only the stock of bricks which would be only a fraction of the loan amount. Therefore, the contention of Respondent No. l that only the stock of bricks was insured and not the brick industry, is not acceptable. District Forum further observed that the Petitioner had filed a report of an Engineer/Surveyor which had estimated the loss to the brick kiln industry at being Rs. 4,37,500. Accepting this amount, the District Forum therefore directed the Respondent No. l to pay a sum of Rs. 4,37,500 to Respondent No. 2 (Bank) which would credit the same for setting off the loan of the Petitioner. Any balance, if any, from this amount would be paid to the Petitioner.

AGGRIEVED by this order, the New India Assurance Co. Ltd., Respondent No. l, filed an appeal before the State Commission which allowed the appeal and set aside the order of the District Forum by relying on the cover-note of the insurance policy filed by the Respondent/Insurance Company which clearly stated that only the stock of bricks was insured for Rs. 6 lakh and that the insurance covered the risk of fire (and not floods). The State Commission further observed that as per the Evidence Act when the contents of a contract are produced in writing, only the document can be shown as proof of the contract and no oral evidence is admissible to contradict the contents of that document. In the present case, the policy bond clearly indicated that it was only stock of bricks, which was insured and that too covered the risk of only fire. Therefore, the Insurance Company rightly rejected the claim.

HENCE, the present revision petition.

LEARNED Counsel for both parties made oral submissions. Counsel for Petitioner contended that Respondent No. l had never issued and given the full insurance policy and had only made available a cover-note of the policy. Further, as rightly observed by the District Forum, it would make little sense for the Respondent/Bank to have taken an insurance policy to cover only bricks which are not likely to get destroyed by fire or floods and it is actually the brick kiln industry which was insured. The State Commission, therefore, erred in only taking the cognizance of the cover-note of the insurance policy and accepting the contention of the Respondent/Insurance Company. Counsel for Respondent No. l brought to our notice the insurance document on record clearly stating that only the stock of bricks was insured against fire and this document had been accepted by Respondent No. 2 as well as Petitioner and the scope of this document cannot now be enlarged. Counsel for Respondent No. 2 (Bank) admitted that it had accepted the order of the District Forum and had not appealed against it before the State Commission.

WE have heard learned Counsel for the parties and have gone through the evidence on record. We agree with the State Commission that the cover-note issued by the Respondent/Insurance Company has to be taken cognizance of because it has listed out the details pertaining to the insurance policy taken by Respondent No. 2 (i.e. the Bank) to cover the loan sanctioned to the Petitioner. In this document, it is clearly stated that the insurance is only for stocks of bricks and that the sum insured is Rs. 6 lakh. It is further confirmed from this document that the risk cover includes only fire and not any other calamity e.g. flooding. We also agree with the State Commission that as per the Indian Evidence Act (Section 91) when the contents of a contract are reduced to writing only that document can be shown as proof of the contract and no oral evidence is admissible to contradict the contents of that document. In the present case, the insurance policy cover-note clearly specifies that it was only the stock of bricks which was insured and that too against the risk of fire. Under the circumstances, we agree with the State Commission that it is not legally tenable to go beyond the scope of insurance policy. Therefore, the Respondent/Insurance Company was justified in rejecting the claim.

THE contention of the Petitioner that the loss was assessed by a Surveyor at Rs. 4,37,500 which apart from being factually incorrect since this was not the assessment of the Surveyor but of an Engineer appointed by the Petitioner, is also of no help to the Petitioner in view of the reasons cited above. We, therefore, uphold the order of the State Commission and dismiss the revision petition with no order as to costs. Revision Petition dismissed.