VASALAKSHMI ENTERPRISE Vs. UNITED INDIA INSURANCE CO LTD

JUDGEMENT

(1.) THE complainant, Vasalakshmi Enterprises has filed this petition claiming compensation amounting to Rs. 16 lakhs along with interest @ 20.75% with quarterly rests from 3.9.1996 till the date of realisation along with compensation of Rs. 2 lakhs towards inconvenience, hardship and mental agony and costs of Rs. 10,000/-. This claim is based on the three insurance policies, taken by the complainant. The complainant has got tobacco store at several places and in that connection he had taken three policies. The first policy is for the sum of Rs. 25 lakhs taken on 10th May, 1996 to cover the risk and perils relating to stock of all varieties of tobacco in all forms stored at premises No. 13/45/1, GNT Road, Tangutur, Distt. Prakashan. The second policy was taken on 16.7.1996 for a sum of Rs. 5 lakhs to cover the risk and perils relating to stock of all varieties of tobacco in all forms stored at premises of M/s. Allied Tobacco Packers Pvt. Ltd., Tangutur, from 16.7.1996 to 11.9.1996. The third policy for a sum of Rs. 10 lakhs covered the risk and peril relating to stock of all varieties of tobacco in all forms stored at premises of M/s. Allied Tobacco Packers Pvt. Ltd., Tangutur from 19.8.1996 to 18.11.1996. Thus, the complainant had taken three policies to cover the peril and risk to the tune of Rs. 40 lakhs in all. The fire took place on the night of 2/3.9.1996 at the insured premises. The complainant company lodged FIR No. 83/96 dated 3.9.1996 and informed the insurer. One, Mr. D. Satyanarayana was appointed the Surveyor to estimate the loss sustained by the complainant. The Surveyor estimated the loss of Rs. 14,13,455/- on 29.10.1996. On 25.2.1997, Branch Manager recommended the claim for a sum of Rs. 14 lakhs. However, on 18.8.1997, the Insurance Company offered a sum at Rs. 6,90,918/- towards full and final settlement subject to payment of premium of Rs. 2,779/-. A representation was made on 29.11.1997. The Andhra Bank, the Bankers of the complainant, who had advanced a huge sum of about Rs. 80 lakhs or so against the stock kept and stored at the premises also requested the Insurance Company to settle the claim for Rs. 14 lakhs as was mentioned in the previous letter. Since the matter was not settled despite notice dated 4th April, 1998, the complainant filed the complaint for the recovery of the aforesaid amount and compensation and costs.

(2.) THE United India Insurance Company, inter alia, contested the matter on three grounds, Firstly, that since the present complaint was in respect of quantum of claim, as per the terms and conditions of the policy the matter should be got redressed through arbitration proceedings. The second objection is that it was a non-standard claim for there was breach of certain conditions. Third objection is that the Surveyor has appropriately calculated the loss suffered in view of the under insurance. It was also pointed out that the complainant by letter dated 16.7.1996 had transferred the risk of the extent of Rs. 6,10,000/- from the insured premises to their godown at M/s. Padamja Enterprises at 13/48/2, Western Side of GNT Road, Tangutur.

(3.) THIS indicated as if they had received only cover note. The Bank also supported the complainant about their recommendation to pay Rs. 14 lakhs.