NATIONAL PROCESSORS Vs. NATIONAL INSURANCE COMPANY LTD

JUDGEMENT

(1.) The National Commission vide order dated August 6, 1996 in appeal "m/s. National Processors V/s. National Insurance Co. Ltd. " remanded the case to this Commission for de novo disposal after allowing both the parties opportunity to adduce such further evidence oral as well as documentary which they may wish to produce. It was further observed that the question of loss said to have been suffered by the insured as a result of burglary also required to be examined in a more detailed manner. Earlier, the State Commission vide order dated September 22, 1993 had dismissed the complaint, holding that the claim was repudiated by the Insurance Company bona fide and the complainant must fail to seek redressal with summary jurisdiction of the Consumer Protection Act. Thus, after remand both the parties were called upon to produce additional evidence. They have produced affidavits and documents.

(2.) The complainant, National Processors, Amritsar is engaged in the business of processing of yarn, finishing of shawls etc. by undertaking job work for local manufacturers. The complainant had taken two insurance policies from National Insurance Company. One in 1989 for Rs.4 lacs, the period of that policy was from September 28, 1989 to September 27, 1990. The other was for Rs.1 lac for the period January 12, 1990 to January 11, 1991. "the stocks in trade pertaining to business of cloth and yarn or shawls or similar property held in trust by the insured and raw material and chemicals at Banke Behari Land, Batala Road, Amritsar as stored or lying in the factory were covered under the policy for loss or damage by fire, burglary. Likewise the stocks of yam, dyes and the chemicals and all kinds of described goods in trust as well as stored or lying in the insured's premises, built up of first class construction at Banke Behari Lane, Batala Road, Amritsar were insured. On the night intervening 4th and 5th of March, 1990, burglar took place in the factory premises. The Insurance Company was promptly informed and so was the police on March 5, 1990. Copies of the report lodged with the police and its translation, Annexures 'a' to 'c' were produced. About 2400 Shawls and 350 kgs. of woollen thread was alleged to have been taken away by the miscreants. The complainant claimed Rs.3,28,047/- on account of loss of 2460 shawls and Rs.73,561.74 for loss of 354.300 kgs. of yarn, as per list of articles Annexure 'd'. The claim form submitted by the complainant to the Insurance Company is Annexure 'e'. The Insurance Company appointed M/s. S. S. B. Surveyor and Consultant Pvt. Ltd. , Chandigarh as Surveyors. A detailed survey was conducted on March 7, 1990 at the factory premises. Several documents were called, which were supplied to the Surveyors as per Annexures T' to 'k'. Copy of the list of documents furnished to the Surveyor is Annexure 'l'. In November, 1990, the complainant was again asked to furnish duplicate copies of some of the documents which were again furnished as Annexure 'm' and 'n'. The police had filed the case as untraced vide report dated August 1, 1990, which was also submitted subsequently. As per information, the Surveyors had submitted the report but instead the Insurance Company appointed D. C. Sharma, Integrated Security Corporation of India, Chandigarh on January 22, 1991, who visited the factory premises and sought further information all over afresh. He was also supplied necessary documents, Annexures 's' to 'gg'. Mr. Sharma twice visited the factory premises in January and April, 1991. He demanded further information, which was again supplied. The complainant continued visiting the office of the Insurance Company but the claim was not settled. Legal Notice in February, 1992 was issued to the Insurance Company through Advocate but to no effect. The complainant had to settle with his customers and had to borrow money from the Bank at a greater interest and he suffered a sum of Rs.3 lacs as damages on account of loss suffered, mental torture, harassment and humiliation etc. Thus he filed the complaint before the District Forum, Amritsar claiming Rs.4,16,008.71 as price of the goods plus interest to the tune of Rs.2.25 lacs on account of delayed payment @ 24% p. a. interest and a sum of Rs.3 lacs on account of loss suffered in business, mental discomfort, harassment etc. Costs of" Rs.11,500/- of the complaint were also claimed.

(3.) The Insurance Company contested the complaint 'inter alia pleading that the claim filed by the complainant was repudiated vide their letter dated May 21,1992 that on verification, it was found that no claim was payable. Thus, it was not open to the District Forum to reopen the matter. On merits, it was pleaded that firstly M/s. S. S. B. Surveyor was appointed to survey the loss and thereafter M/s. Integrated Security Corporation of India was appointed to investigate the claim who had submitted a detailed report, rejecting the claim. Thus, there was no deficiency of service. It was also denied that this was the case of unfair trade practice. There was no inordinate delay in assessing the loss and rejecting the claim. The delay occurred on account of the fault of the complainants themselves, who did not submit necessary documents to the Investigator as would be apparent from the report of Investigator. It was admitted that the two policies were issued by the Insurance Company, one for Rs.4 lacs and the other for Rs.1 lac. It was denied that any information was received regarding the alleged burglary. Lodging of First Information Report was admitted. The theft of shawls and woollen threads as per details given in the complaint was denied as having been taken away by the miscreants. It was alleged that the complainants themselves have removed these goods to commit fraud with the Insurance Company to get the payment on the basis of false claim. It was however, admitted that the claim was lodged with the Insurance Company. Correspondence between the complainant and Surveyors and Investigators was broadly admitted, however, it was stated that the complainants did not furnish the requisite information asked for. It was denied that assurance was given to settle the claim. It was also denied that the claim was withheld with an ulterior motive. The entire basis of rejection or repudiation of the claim was the report of the Investigator, Annexure R-2. The burglary was not proved nor the loss. Alternatively in para 16, it was pleaded that loss if any occurred was only to the extent of Rs.1,83,170/- as per report of the Surveyor. Even that was not proved. Both the parties produced their evidence on affidavits and documents. As already stated even after remand, additional evidence was produced. An opportunity of cross examining Sham Sunder and Piare Lal, whose affidavits have been produced, was also allowed, whose affidavits had been produced before remand.