Alibhai Badruddin Contractor vs UNITED INDIA INSURANCE CO. LTD.

COMPLAINANT /Appellant has filed this Appeal against the judgment and order dated 31.8.2007 passed by the State Consumer Disputes Redressal Commission, Gujarat (in short, ''the State Commission'') in Complaint No. 79/96 wherein the State Commission partly allowing the complaint has directed the Respondent Insurance Company to pay a sum of Rs. 3,76,538 to the Complainant with interest @ 9% p.a. from the date of complaint, i.e. 17.5.1996 till payment. Rs. 2,000 were awarded towards costs. Facts:

Complainant/Appellant was doing business of sheet metal fabrication work in the factory situated in Ahmedabad. It obtained a ''fire policy'' from the Respondent for its factory for the period from 5.12.1992 to 4.12.1993 for Rs. 16,00,000 as under:

IN the month of December, 1992, during the riots in Ahmedabad, factory of the Appellant was attacked and damage was caused to the factory premises, furniture, fixture, plant, machinery and entire factory was looted by rioters. Complaint was lodged with the Amraiwadi Police Station. On receiving the information, Respondent appointed Surveyor, R.J. Jajpura to assess the loss. Surveyor submitted his final report on 23.6.1994 assessing the loss as under:

Voucher for Rs. 2,92,872 sent by the Respondent towards the settlement of the claim was returned by the Appellant as the loss of stock assessed by the Surveyor was Rs. 17,367.30 against the claim of Rs. 5,73,700. An arbitrator was appointed to settle the dispute between the parties but they could not proceed further for want of communication from the Respondent. Complainant, being aggrieved, filed the complaint before the State Commission claiming an amount of Rs. 5,37,700 for loss of stock, Rs. 1,48,037.28 for the loss of machines and accessories, Rs. 34,901.16 as damage caused to the building, Rs. 95,579.12 being the loss of furniture/fixture, Rs. 1,00,000 for compensation for mental torture, Rs. 50,000 as costs and expenses for the litigation and Rs. 50,000 for loss of business along with interest @ 21% from the date of incident till payment.

RESPONDENT , on being served, entered appearance and filed its written statement contesting the complaint, inter alia, on the grounds; that as the Surveyor had assessed the damage, there was no deficiency in service on their part and for any other relief the Appellant ought to have approached the Civil Court for its remedy; that as per terms of policy, the matter should have been referred to the Arbitrator; that in spite of repeated demands, the Appellant had failed to supply separately the costs incurred in manufacturing finished products from the material purchased by it and labour cost incurred in job work so that the correct position of the stock of material could be worked out; that the method of reflecting the correct stock position as stated by the Appellant was illusive as it included profit in job work where there was no movement of material and no consumption of material; that the amount claimed by the Appellant cannot be accepted; that the figures provided from the record of Sales Tax Assessment Order and Income Tax Returns could not be considered as truly reflected and correct stock at the time of the incident in the factory; that as per the balance sheet, the stock had never exceeded Rs. 1,05,000, therefore, the say of the Respondent that on the date of incident stock was worth Rs. 6,84,625 could not be believed.

DURING arguments, it was admitted by the Appellant before the State Commission that it did not dispute the loss assessed by the Surveyor, R.J. Jaipura with regard to machines, building and furniture and it was challenging the loss of stock assessed at Rs. 17,367.30 by the Surveyor. Since, the dispute was regarding the stock on the date of incident only, State Commission vide its order dated 31.3.2005 appointed a Court Commissioner/Surveyor, Shailesh Shah to reassess the damage after verifying all the documents on record. The said Surveyor/Court Commissioner submitted his detailed report to the State Commission on 9.1.2006 assessing the loss of stock at Rs. 98,020. State Commission accepting the report of the Court Commissioner/Surveyor, Shailesh Shah, partly allowed the complaint and directed the Respondent Insurance Company to pay a sum of Rs. 3,76,538 to the Complainant with interest @ 9% p.a. from the date of complaint, i.e. 17.5.1996 till payment. Rs. 2,000 were awarded towards costs. State Commission observed as under:

The complainant had produced the opening stock and purchase during the years 1988, 89, 90, 91, 92 and 1993. From 1988 -91, the purchase during the year has not exceeded Rs. 10,00,000. Purchase during the year 1992 has gone to Rs. 42,00,000 and in 1993 till the date of the incident, purchase has gone to Rs. 27,00,000. The figures show wide difference in the purchase during the year and previous year. This is also evident from the report of the Surveyor that in the year 1992 quarterly report of sales tax returns were filed only after the incident Therefore, these two incidents speak volumes about the genuineness of the version of the complainant. Accounting method for the purpose of stock of previous years and present year is in disputed. The complainant has challenged how the accounts for the stock can be calculated when the papers of Sales Tax returns, Income Tax and Balance Sheet are available; whereas the Surveyor has considered the method which is not acceptable to the Complainant. This is not a simple matter of adding or subtracting something here and there; but this is a matter of accounts and accountancy and like settlement of accounts between the parties. So, from our point of view, this matter of accounts which requires to be settled between the parties rather than the simple arithmetic method of adding and subtracting. There is a difference of opinion regarding the accounts and method of accounts between the parties. In those cases, the Commission or Forum will not enter into that arena. In the matter of accountancy and matter of accounts and settlement of accounts, Forum or Commission will not enter into the arena. Report of Surveyor is an important piece of evidence which is required to be given due weightage. Hence, the Surveyor appointed by the Commission by name Shri Shailesh A. Shah who has submitted his report as per the order of the Commission, in that case the report has to be believed and amount awarded for the loss of stock deserves to be awarded to the Complainant. Therefore, as Shri Shailesh Shah has estimated the loss to the tune of Rs. 98,020, said amount is required to be awarded to the complainant for the loss of stock.

Respondent Insurance Company has accepted the order passed by the State Commission and did not file any appeal. However, Appellant/Complainant, being aggrieved, has filed the present seeking enhancement of the compensation.

WE have heard the learned Counsel for the parties at length. Learned Counsel appearing for the Appellant contends that the Surveyor appointed by the Respondent has assessed the loss to the stock at Rs. 17,367.30 whereas the Surveyor/Commissioner appointed by the State Commission has assessed the loss to the tune of Rs. 98,020. Both the Surveyors have admittedly relied upon the documents furnished by the Appellant but there is huge difference in the assessment of the loss with regard to stock; that on the date of incident, the stock was Rs. 5,73,700 but for the reasons best known to the Surveyors, both the Surveyors have not accepted the damage to the stock considering the value of the stock at the time of damage and loss; that the Surveyor/Commissioner appointed by the State Commission has given his report assessing the loss to the stock at Rs. 98,020 under influence of the Respondent Insurance Company; that the Appellant has given the details of working of stock from Sales Tax Assessment Orders and Returns; that according to the Appellant the opening stock on 1.4.1992 was Rs. 1,24,872 and the material purchased during the year 1992 -93 was Rs. 27,44,373 and the freight and octroi paid was Rs. 2,995; that, therefore, the stock comes to Rs. 28,99,196; that the gross sale during that year was Rs. 36,02,917; that the labour charges of Rs. 5,32,934 and sales tax of Rs. 1,22,171 was paid and deducted from the gross sale of Rs. 36,02,971; that the material consumed was 75.35% average and that comes to Rs. 22,21,176 till the incident and deducting that amount from the amount of Rs. 28,99,196 the stock on the date of incident comes to Rs. 6,78,020; that the Appellant received the stolen material from the police department amounting to Rs. 1,10,925; that the value of stock on the date of incident comes to Rs. 5,73,700.

AS against this, learned Counsel for the Respondent supports the order passed by the State Commission. The facts of the case are not disputed before us. Appellant has accepted the valuation of the Surveyor appointed by the Respondent with regard to the loss to the machines, building and furniture. The only dispute remains with regard to the assessment of the stock on the date of accident. Appellant claimed the loss to the stock at Rs. 5,73,700. However, the Surveyor appointed by the Respondent assessed the loss to the stock at Rs. 17,367 which was not acceptable to the Appellant. Since, there was dispute with regard to the value of the stock on the date of incident, the State Commission to resolve the dispute appointed Shailesh Shah as Surveyor/Court Commissioner to re -assess the loss. He verified all the records supplied by the Appellant and assessed the loss to the stock to the tune of Rs. 98,020. The State Commission accepted his report and awarded the compensation accordingly. The plea taken by the Appellant that the Surveyor/Commissioner has given the report under influence of the Respondent cannot be accepted as an affidavit to this effect was filed by the Commissioner before the State Commission. Apart from this, the State Commission has observed that from 1989 -91, the purchase during the year has not exceeded Rs. 10,00,000. That the purchase during the year 1992 has gone to Rs. 42,00,000 and in the year 1993 till the date of incident, purchase has gone to Rs. 27,00,000. The figures showed wide difference in the purchase during the year and previous years. It is also evident from the report of the Surveyor that in the year 1992 the quarterly report of sales tax returns were filed only after the incident. There was also difference between the methods of calculating the value of stock by the Appellant and the Surveyor. The State Commission has rightly rejected the method of calculating the value of the stock by the Appellant. The Report of Commissioner appointed by the Surveyor has not been placed on record. In our considered view, Appellant has failed to refer to any document to justify his claim for enhancement of the compensation awarded by the State Commission. For the reasons stated above, we do not find any merit in the appeal and dismiss the same with no order as to costs.