JAISHREE INDUSTRIES Vs. NATIONAL INSURANCE CO LTD.

JUDGEMENT

(1.) THE present complaint has been filed by the complainant under Section 17 of the Consumer Protection Act, 1986 for damages to the extent of Rs. 45 lacs for the loss of its goods and stock consequent to fire which took place in its premises.

(2.) THE brief facts pertaining to the present complaint are that the complainant firm M/s. Jaishree Industries (hereinafter referred to as ˜the complainant) has been carrying its business on Plot No. 215, Sunder Nagar, Ajmer Road, Jaipur in the vicinity of Plot No. A -89, where M/s. Vaibhav Craft Pvt. Ltd. is located. The complainants business has been financed since the year 2000 by the non -petitioner No.3. The State Bank of Bikaner and Jaipur (hereinafter referred to as ˜the bank). The bank has extended cash credit limit and over draft facility to the complainant against the hypothecation of its entire stock lying in the godown of the complainant. The bank is having a Bank assurance tie -up agreement with the non -petitioner Nos. 1, 2 , the National Insurance Company (hereinafter referred to as ˜the Insurance Company) under which the bank got the goods and stock of the complainant insured since the year 2000. The proposal forms for taking the insurance were prepared and signed by the bank on behalf of the complainant and the premium was deducted from the cash credit account of the complainant firm. The complainant got two Standard Fire and Special Peril Policies for an amount of Rs. 20 lacs and Rs.25 lacs respectively. The first policy was for a period from 27.12.2005 to 26.12.2006 and the second policy was for a period from 21.3.2006 to 20.3.2007. A fire broke out at around 0030 to 0045 a.m. on the intervening night of 30.9.2006 and 1.10.2006 in the godown of the complainant, which engulfed the entire stock. The fire was so intense that it could be controlled at around 8 a.m. on 1.10.2006 with the help of 16 fire brigades. The entire stock of the complainant firm was burnt and converted into coal. M/s S.K. Bakliwal & Co., the Surveyor determined the loss to the extent of Rs. 50,84,709 but after deducting 12.5% VAT, the damage was brought down to Rs. 40,99,272 and again after deducting some other amounts, the claim was put down to Rs. 31,69.722. The complainant submitted its claim for the loss and damages and sent many reminders to the Insurance Company but no action was taken for 17 months and ultimately the Insurance Company vide its letter dated 4.2.2008 repudiated the claim. of the complainant on the ground that the subject matter and the premises of the complainant were not covered under the policy. The bank officials inspected and verified the stock physically every month and the bank worked as an agent of the Insurance Company in getting the stock insured for the complainant. The Insurance Company repudiated the claim on technical ground that the address of the complainant firm was given by the bank as 89A, Sunder Nagar, Ajmer Road, whereas the stock was in fact lying at Plot No. 215, Sunder Nagar, Ajmer Road, which is in the vicinity of Plot No. A89. The proposal forms were filled up and signed by the bank officers after physically inspecting and verifying the stock. The officers of the Insurance Company were also liable to inspect and verify the stock of the complainant before issuing the policies and hence the claim of the complainant cannot repudiated on technical ground that the stock and premises, where the fire took place, as not insured. Therefore, the complaint be allowed.

(3.) THE non -petitioner Nos. 1 and 2, the Insurance Company, denied the allegations made in the complaint and submitted that the complainant firm was not carrying its business since the beginning at Plot No. 215 and the place of business of the complainant had been given out to be at Plot No. A89, Sunder Nagar, Ajmer Road, Jaipur and at no point of time before the occurrence of the fire on 1.10.2006 the place of business of the complainant had been stated to be anything other than A89 , Sunder Nagar, Ajmer Road. In the proposal forms and in the insurance policies since the very beginning, the complainant had given its address and place of business as Plot No. A89 and it never informed either the bank or the Insurance Company about change of place of business from Plot No. A89 to Plot No. 215. From the very beginning, the complainant had been dealing in with the manufacturing of wooden furniture but it changed its business from manufacturing to the trading of wood, plywood and laminates, etc. but this fact was also not brought in notice of the Insurance Company till date. The place of business of the complainant in its registration certificate, in electric connection, in income tax returns, audit reports, CST and VAT returns has consistently be shown to be as Plot No. A89 and not Plot No.215, where the fire took place. The place of fire and the stock which was kept at Plot No. 215 has not been covered by the insurance policies and hence the claim of the complainant has rightly been repudiated by the Insurance Company. Therefore, the complaint be dismissed.