SARVODAYA ASHRAM Vs. NEW INDIA ASSURANCE CO LTD

JUDGEMENT

(1.) This complaint has been filed by the complainant M/s. Sarvodaya Ashram alleging negligence and deficiency of service on the part of the respondent, New India Assurance Company.

(2.) THE case made out in the complaint by the complainant is that they had obtained a Floating Policy from the respondent Insurance Company valid on renewal basis from 30.5.1991 to 29.5.1992 for Rs. 1.30 crores covering 14 different locations as per annexure to the policy, which according to the complaint covered the complainants stock wherever they be, including those moved from Godown to the Exhibition sites in different towns in the State of U.P. for which the respondent Company charged 50% extra premium. On the night of 22nd - 23rd October, 1991, a fire broke out at the Exhibition site in NOIDA destroying all the goods there. The incident was immediately reported to the police, Fire Brigade authorities and the respondent Company intimating loss of Rs. 40 -50 lakhs. It is also the case of the complainant that, on assurances given by the Development Officer of the respondent Company and others that floater policy shall cover all the risks covered by the policy in specified buildings or in open situated, in more than one city/town/village but within one State only by charging 50% loading over and above the highest rate applicable to any risk subject to the condition that no Floater Policy can be issued in respect of immovable property. With the understanding that though goods within the specified towns/villages/areas of one State in the case of U.P. shall be covered by the Insurance Policy, they willingly paid 50% extra on the ordinary Fire Policy cover to get the Floater Policy. Since the fire incident took place in one of the specified town i.e. Noida, hence it was covered by the policy and the respondent Company should have immediately settled the claim. The complainant also relied upon a letter dated 3.10.1992 written by its Secretary to the respondent Company notifying them, to extend the existing policy cover to another associated showroom in Noida opened by them, whose insurance cover shall be Rs. 50.00 lakhs. While maintaining the overall policy cover of Rs. 1.30 any, these Rs. 50.00 lakhs cover shall come from their Central Store Estate, Etah, where the policy cover was for Rs. 60.00 lakhs, which after the adjustment shall be left with a cover of Rs. 10.00 lakhs only. Complainants have also mentioned in the complaint that they have come to know that respondents had appointed Surveyors who had assessed the cost at Rs. 29,73,432.35 yet their claim is not being settled even to that extent in spite of repeated requests, reminders, personal meetings at different levels to settle the claim, their claim has not been settled. It is in these circumstances that the complainant filed the complaint before us alleging deficiency in service by not settling their claim and now praying for award of Rs. 60,70,976.60 comprising of Rs. 29,73,452.35 on account of loss of goods, Rs. 23,97,524.25 on account of interest @ 20% on the said amount and Rs. 7.00 lakhs on account of loss of reputation.

(3.) IN the rejoinder filed by the complainant they reiterated their understanding of the Fire Floating Policy based on assurances given by the officers and staff of the respondent Company. According to them whenever they went for a new location, they immediately intimated the respondent Company. In the instant case they intimated the respondent Company about the new site for seeking cover under the same policy for which they did not get any reply. They presumed that their proposal has been acepted and went ahead with at the exhibition ground sales. An attempt is also made to raise the fundamental issue that if modus -operandi and benefits between the two policies i.e. the ordinary/fixed policy and the First Floater policy are the same, then what is the difference between these two policies warranting charging of 50% extra premium ? According to him letter issued on 3rd was genuine and reached there in time but the respondent Company took its own time in responding and the unfortunate fire incident in between i.e. on 22 -23rd October, 1991 gave them an alibi to rebut their letter and hence rebut their claim.