CAMELLIA PACKAGES PVT LTD Vs. ORIENTAL INSURANCE COMPANY

JUDGEMENT

(1.) The complainants had been running its business of corrugated boxes, sheets etc. since 1989 at premises 76, Industrial Area, Phase II, Chandigarh. The premises were got insured according to the Policy No. 151877 dated 24.2.92 for Rs. 7.50 lacs for raw material, finished, semi-finished goods etc. and Policy No. 151887 dated 16.3.92 in the sum of Rs. 5.56 lacs for machines, office furniture, fixtures, Typewriters. T.V. etc. On 24.4.92 a fire broke out at the premises of the complainant and the entire raw material, finished goods, fittings even machinery, fixtures and furnitures were reduced to ashes. The occurrence was reported to the Insurance Company Respondent No. 1 on the following working day i.e. 27.4.92. The required information was also communicated to the Andhra Bank and Delhi Financial Corporation on 27.4.92 from which sources the complainant had obtained loans in respect of first policy. The claim for Rs. 9.50 lacs was made and in respect of the second policy the claim for Rs. 2.33 lacs was made. The respondent Insurance Company took about nine months for approval of the first claim against Policy No. 151877 and only a sum of Rs. 4,22.565.00 was sanctioned and in respect of the second policy no compensation has been offered. The respondent did not settle the claim within the stipulated period of three months except a sum of Rs. 4,22,565.00 against the claim of Rs. 9.50 lacs, against Policy No. 151877. The claim made by the complainant is briefly described as under :

(2.) In the reply filed on behalf of the respondent the occurrence of fire is not disputed. However it has been denied that the entire machinery, raw material, finished goods, fittings, fixtures and furntiure was wholly reduced to ashes. According to the report of Loss Assessor, Lt. Col. R.K. Sehgal (Retd), the loss assessed was Rs. 5,13,418.42. There is a letter in the hand of the complainant wherein the loss was considered and settlement was arrived at a sum of Rs. 5,13,418.42 and this is Annexure R-A. It shall be useful to reproduce this hand-written letter which is as under :

(3.) In the case of the complainant there were two policies one was for Rs. 7.50 lacs dated 24.2.92 and the second was for Rs. 5.56 lacs dated 16.3.92. The respondent has paid only a sum of Rs. 4,22,565/- whereas even if the consent letter Annexure R-A on which the respondent has relied upon is to be taken into consideration as a whole the respondent was required to pay the sum of Rs. 5,13,418.42 and not merely Rs. 4,22,565.00. The plea raised on behalf of the respondent as regard the second policy its liability was only 50% and that the respondent was liable to pay only a sum of Rs. 40,576 /- being 50% because the premises were also insured with another Insurance Company known as New India Assurance Company has no merit in view of the settlement arrived at through Annexure R-A.