UNITED INDIA INSURANCE CO LTD Vs. MILAP TELECOM

JUDGEMENT

(1.) This appeal arises out of judgement in complaint case no. 69/2000 rendered by the Gujarat State Consumer Disputes Redressal Commission (in short 'the State Commission'). By the impugned judgement, the complaint was partly allowed, directing the appellant (insurer) to pay an amount of Rs.7,04,375/-to the complainant (respondent) with interest @9% p.a. from 14.03.2000 until realisation of the amount and also Rs.5,000/-being cost of the proceedings.

(2.) For sake of convenience, the parties may be referred to hereinafter as per their nomenclature in the complaint case before the State Commission. Milap Telecom is the original complainant and the United India Insurance Company Ltd. (appellant) is the insurer and original opposite party before the State Commission. There is no dispute about the fact that Milap Telecom is a business firm engaged in rendering services as a private telephone exchange. It had set-up infrastructure of the private telephone exchange which comprised of one EPABX (Electronic Private Automatic Branch Exchange) with the capacity of 256 lines, eight incoming lines and eight outgoing lines with 200 extensions with billing software and FCBC (Float Current Boost Charger), a battery of 45 amperes and MDF (Main Distribution Frame). The EPABX was purchased by Milap Telecom for Rs.13,20,000/-under invoice no. 12337 dated 9.06.1997. There is no dispute about the fact that Milap Telecom submitted a proposal form to the insurer with intention to cover the EPABX system against fire peril. The machineries and accessories were insured for a sum of Rs.14 lakh. The insurer issued 'Fire-A Policy' dated 18.08.1999. The validity period of the policy was upto 17.08.2000.

(3.) Briefly stated the case of Milap Telecom - complainant is that minor fire broke out in the private telephone exchange on 14.01.2000 at about midday. The incident occurred on day of Makarsakranti which was a holiday. None was present in the premises because traditionally the proprietor as well as the employees had gone out to participate in game of flying kites. After about half an hour Mukesh Sharma visited the premises for routine check-up and noticed that loose smoke was emanating from the machinery. He immediately switched off electrical power supply of the exchange and went to house of the proprietor. A telephone consultant was called at the place of the incident. The telephone consultant located the cause of fire as due to short circuit in the main transformer of FCBC and because of the fact that 230 volts of AC had entered in the exchange which was compatible only for 48 volts of DC. The loss of EPABX mainly was, therefore, caused. The mother board of the exchange and the line control cards in the exchange were damaged beyond repairs. The insurer was informed orally by giving telephonic message. So also, written intimation was given to the insurer. A surveyor by name Mr. Thomas Jacob visited the place of the incident. He took various photographs, conducted necessary inquiry and surveyed the damaged parts of the machinery. Proprietor of Milap Telecom lodged complaint with the Police on 15.01.2000. The Police conducted spot panchnama and necessary inquiry. Milap Telecom had also taken another fire insurance policy from New India Assurance Company Ltd. The surveyor gave advice to proprietor of Milap Telecom to waive the claim under the subsequent policy of New India Assurance Co. Ltd. Proprietor accordingly issued letter dated 27.01.2000 to New India Assurance Co. Ltd. and waived the claim available under that Policy. Though certain clarification was sought from proprietor of Milap Telecom and was given, ultimately, by letter dated 07.03.2000 the insurer repudiated the claim. Consequently, Milap Telecom issued a legal notice dated 18.04.2000 calling upon the insurer to settle the genuine claim. The non-settlement of the claim under the Policy is the reason as to why for the complaint was filed.