RAJENDRA SILKS Vs. UNITED INDIA INSURANCE COMPANY LIMITED

JUDGEMENT

(1.) THE complainant was running textile shop in the name and style of Rajendra Silks at Coimbatore. He has insured the shop along with the goods under Fire Policy for a period of one year from 18.9.1997 to 17.9.1998. The sum insured was Rs. 75,00,000/ - on silk items, Rs. 10,00,000/ - on cotton items. The risk covered was stocks of cotton and silk items.

(2.) ON 14.2.1998, there was a bomb blast in the premises on account of the communal terrorism in which the building, machineries, furniture, fittings, stocks and all documents were completely and totally destroyed. There was also loss of lives of some of the employees. A complaint was also registered in connection with the terrorist act in Coimbatore Police Station B -1 in F.I.R. 200/98. The total value of loss incurred by the complainant was around Rs. 85,00,000/ -. The complainant made a claim to the opposite party. The Surveyor inspected the property only on 18.2.1998 and called for documents to prepare the report. It being a fire insurance policy of indemnity, the opposite parties are expected to complete the loss assessed with least delay and settle the claim. Though the claim was lodged on 16.2.1998 itself, there was delay in settlement of claim. On account of the delay to finalise and settle the claim, the complainant had been put to considerable financial and mental strain. The opposite party made a payment of Rs. 40,00,000/ - on 7.4.1998 which was nearly after 55 days from the time of loss. They again made a payment after repeated requests and reminders from the complainant a sum of Rs. 16,39,700 on 17.8.1998 and the balance of Rs. 28,40,574/ - on 11.1.1999. Due to the delay in receiving the claim amount, the complainant had to sell his properties at a distress sale in order to meet the urgent needs of his debtors. Thus, there is deficiency in service on account of which the complainant prays for damages in a sum of Rs. 6,92,886/ - towards loss of interest in settling the claim and a sum of Rs. 7,50,000/ - as compensation for loss of business and mental agony.

(3.) THE opposite party disputed the claim of the complainant. They have stated that there was no delay and that as claim was for a huge sum and as different types of goods have to be assessed on the basis of inward, outward movement of the stock by verifying registers, Bank statements, etc., it could not be settled early. Thus, they plead that there is no deficiency in service. They further contend that when the claim was for Rs. 85 lakh the complainant called for a payment of Rs. 40,00,000/ - namely about 50% of the loss as partly. Since accounts have to be gone into and as it was stated that the accounts were all lost the opposite parties have to engage the services of Chartered Accountants and utilize their services to assess the damages. As per the finalisation of settlement by Surveyor C.J. Rao and Co., and another Surveyor M/s. Srivatsan Surveyors Pvt. Ltd., a final adjustment to the satisfaction of the complainant was arrived and thus the opposite parties have done their best. According to the requirements for obtaining a licence under Section 64UM1(D) of Insurance Act, a person who has practised as a Surveyor before 26.10.1968 or a person who holds a degree of a recognized university in any branch of Engineering or is a Fellow or Associate member of the Institute of Chartered Accountants of India or the Institute of Cost and Works Accounts of possessed actuarial qualifications or holds degree or diploma of any recognized University or Institute in relation to Insurance or holds a diploma in Insurance or possess such a technical qualification, they alone can be appointed as Surveyor. Hence, the insurer is required to appoint a licensed Surveyor who possesses any of the above qualifications. They do not have administrative control over the functioning of the Surveyor. The 1st instalment of Rs. 40,00,000/ - was paid on 7.4.1998, the sum of Rs. 16,39,700/ - paid on 17.8.1998 and the sum of Rs. 28,40,574/ - was paid on 11.1.1999. There has been no inordinate delay at all. The allegation that the complainant had to undergo untold sufferings and loss of avoidable interest and business loss due to delay are imaginary. Similarly, the claim for interest @ 24% for the delay of 11 days and 132 days for the 2nd payment and 279 days for the final payment is untenable. It is not the complainant s case that the final total settlement is less than his entitlement. Therefore, in such circumstances, the opposite parties pray that the complaint be dismissed with cost.