ASHOK CONSTRUCTION CO. vs National Insurance Co. Ltd.

THIS is a complaint filed by M/s. Ashok Con- struction Company through its partners against the opposite parties under S. 12 read with S. 17(1)(a)(i) of the Consumer Protection Act, 1986 ("the Act" herein) on 29.8.89. Facts as stated in the complaint are these:

THE complainant is a registered partnership firm duly registered with the Registrar of Firms, Rajasthan Jaipur in the year 1985. Its partner are (1) Shri Ashok Singhal and (2) Shri Kishore Kumar Singhal, Partners took a loan of Rs. 2,00,000/- from the Bank of Rajasthan, opposite party No. 3 (in the complaint it is mentioned as proforma party opposite party No. 3) under hypothecation agreement. It was a condition of the loan that the hypothecated goods are to be duly insured. THE Rajasthan Bank proforma party got the hypothecated goods insured for the complainant on 29.12.86 with opposite party No. 2 (National Insurance Co. hereinafter referred to as insured) under two separate cover notes. THE details of two cover notes are as follows: 1. Cover note bearing No. 636749 for Rs. 3,00,000/- against risk of loss or damages by burglary. THE period of risk for which the cover note was valid was from 29.12.86 to 28.12.87. 2. Cover note No. 43650 for a sum of Rs. 3,00,000/- for the period 29.12.86 to 28.12.87 against the various risks of damage or loss caused by fire, lightning and R.S.D., M.D., earthquake, flood etc.

The complainant has filed both the cover notes marked as Anxs. 1 and 2. It has been alleged by the complainant that on 16.6.87 after 5.00 p.m. till late in the night heavy loss or damage to the hypothecated goods occurred at the insured''s site by the members of an outraged and furious crowd of thousand of persons assembled at the site by committing offences of riot and theft/burglary for a reason that mishap had occurred. In the complaint it was stated that the said crowd was not only bent upon taking lives of the complainants namely Ashok Kumar and Kishore Kumar but of all the employees and workers who were employed on that day at that place. The complainant immediately reported loss or damage to the Branch Manager of the insured in writing and apprised him by telephone on 17.6.87. The complainant is said to have submitted a list of goods damaged or taken in theft/burglary with value of each item and total loss or damage so caused to the complainant. The formalities required to be done in this connection were done by the partners of the insured. According to the complainant loss or damage so caused was of Rs. 2,59,710,78. On repeated requests the insurer deputed the surveyor who verified the loss or damage claimed by the complainant from the insured under the cover notes of the policies. Copies of the First Information Report and Final Report (FR) were also submitted, photostat copies have been marked as Anxs. 4 and 5. The complainant has stated that for a period of 26 months from the date of incident, the insured did not settle the claim of the insurer though repeated requests were made by the complainant and the Bank of Rajasthan. The complainant has filed a letter dt: 15.3.89 bearing No. 352103/31/32/86-88/2 stating that the case of the complainant has been registered by the police as theft/burglary in terms of S. 379 of I.P.C. which does not support the view that the loss has been occasioned of the "operation of the perils covered under R.S.D. extension. The complainant apprised the insurer that its claim is not only covered by burglary but also by R.S.D. clause which means damage or loss by rioting. Letters sent by the complainant to the insured were produced as Anxs. 7 to 10 and 11 to 24. According to the complainant it had apprised the insurer that on the claim amount interest shall also be charged. Copy of the interest and loan account was sent to the insurer vide letter of the Bank of Rajasthan informing the complainant that amount due to the Bank inclusive of interest upto 25.3.89 is Rs. 2,72,339/-. On account of the delay in the settlement of the claim and disputing the liability to pay the claim and interest, the complainant filed the complaint before the State Commission on 29.8.89. The complainant seeks the following reliefs: 1. that the claim amount of Rs. 2,59,710.78 detailed in para 2 of the complaint may be awarded. 2. that interest @ 24% p.a. on the claim amount from 16.6.87 to this date with further interest at the same rate till the claim is fully paid by the insurer to the complainant''s banker namely Bank of Rajasthan pro forma party may also be awarded. 3. that an amount of Rs. 1,00,000/- for the mental torture and agony suffered by the complainant due to the negligence of .the insurer was also claimed. Costs amounting to Rs. 2,000/- were also claimed.

The complainant thus filed the complaint for award of Rs. 4,96,710.78/-. The complain- ant has submitted various documents with the complaint. The relevant and material documents will be referred hereafter as and when necessary.

The insurer filed the version of the case on 5.12.89 traversing the allegations made in the complaint. It admitted that cover note No. 636749 was issued in favour of the Bank and the complainant which was valid from 29.12.86 to 28.12.87 and it covered burglary, risk of stock of construction material, equipments, furnishing material, wooden and iron fixtures, electric fittings, steel and material lying at the site. Cover note No. 43649 was also admitted and it was submitted that this cover note covered RSD, MD, flood, earthquake etc. The facts alleged by the complainant regarding giving of information in respect of the incident on 16.6.87 vide letter dated 19.6.87 and supplying of goods with cost and other details were also admitted. In para 6 of the version of the case it was pleaded that on the request of the complainant an independent surveyor M.P. Bakshi Surveyor Pvt. Ltd. was appointed to assess the loss without prejudice to the right of the insurer who gave the report. Besides the above pleas, the insurer stated: that the loss which has occurred to the insured is not covered on the ground of the burglary, RSD, MD, for, there was no forcible entry by violence, riots which are necessary. For the consequential loss such as interest or damages which were claimed by the complainant, it was submitted that they are not covered by the terms of the policy and the Insurance Act, 1938 ("the Insurance Act") under which the policies were issued.

IT was submitted that the enquiry in the matter is still pending and the police authorities have not included the enquiries which were launched by them in the matter. In other words a plea was taken that the complaint is not maintainable. Affidavits of Shri Ashok Kumar Singhal dated 19.12.89, Shri Munshi dated 19.12.89, Shri Devkinandan dt: 15.12.89 and Shri Tarachand dated 20.12.89 were filed on behalf of the complainant. The deponents of the affidavits were permitted to be cross examined by the learned Counsel for the insurer. In rebuttal the insurer examined Shri R.C. Siyal as OPW 1. Photostat copies of various documents were submitted by the parties. As original policy was not filed in the beginning, copies of the two policies were submitted on 1.9.90. Both the parties submitted written arguments. After the filing of the two policies both the learned Counsel stated that they want to make additional oral submissions for which an opportunity was afforded to them. Before we proceed further we consider proper to refer Anx. 1 which is a cover note dt: 23.12.86. That cover note relates to burglary and the subject matter of insurance is stocks of all kinds of construction materials, equipments, furnishing materials like wooden, iron and electric fittings materials stored and lying at the Police Academy Jhotwara road at site. Second cover note dated 29.12.86 is for the period from 29.12.86 to 28.12.87. The sum assured is Rs. 3,00,000/-. The subject matter of insurance mentioned therein is almost identical with that of the first cover note Anx. 1. Under the head additional perils covered it is mentioned RSD, MD, flood and earthquake risks. Policies were issued in pursuance of the aforesaid two cover notes. The first policy is a burglary policy (business premises). The second policy mentions RSD and MD, flood, E.Q. risks. The case as disclosed in the First Information Report lodged by the complainant states amongst others that at the site where the quarters were going to be constructed at 5.00 p.m. on 16.8.87 the block of 12 houses collapsed killing two persons and about 14 persons were trapped therein. On account of this thousand of persons gathered at the site. They became agitated and turned into violent mob. It is said that steel windows, frames, C.I. pipe fittings fixtures, toilet fittings, ply and shuttering ballies, tukka, wooden fanta, wooden doors etc. were taken away by the agitated crowd. The Police Authority Shastri Nagar, Jaipur registered a case against the contractor and the engineers. They are said to be not at the site. The complainant himself went to get the case registered but he failed in his attack. He approached the Superintendent of Police and on his intervention it was registered as a theft case. Ultimately the police submitted a F.R. As the claim was not settled arising out of the two insurance policies, the complainant filed the complaint for the reliefs mentioned hereinabove.

BESIDES the oral evidence of the parties, photostat copies of the various documents have been placed on record by them. Photostat copies of survey reports were also submitted on behalf of the parties. Out of various defenses taken by the insurer one defence which according to us is an important one is that the claim filed by the complainant insured is not covered by both the policies, for, according to the insurer the facts as disclosed in the complaint which were also stated in the First Information Report neither constitute burglary nor Commission of offence of riot. It may be recalled that the first cover note and the policy issued in pursuance thereof is in regard to burglary and the second cover note and the policy issued is in regard to riots etc. According to the learned Counsel for the complainant, the facts so narrated by the complainant covered both the contingencies. The complainant in support of the incident that has taken place has examined complainant''s partner Shri Ashok Singhal, Chowkidar Shri Munshi and Shri Devkinandan. All these facts have been stated in the letter Ex. C 170 dt: 27.7.87 (para 1) letter Ex. C 172 (para 2) letter Ex. C 174 (paras 4 to 6) and Ex.C 175 (para 2). BESIDES this complaint, para 3 and the First Information Report filed by the complainant reveal the same facts. Devkinandan has given full details of the incident in his affidavit in paras 2 to 5. The gist of the narration is that on 16.6.87 after falling down of the building, the mob which included the residents of police line and neighbours and passers by attempted to kill partners of the insured and its employees and they caused damage to the articles that were lying there and removed them without consent. Thus the articles owned by the complainant were stolen. In these circumstances, the principal point that arises is whether the claim made by the complainant insured is covered by the two policies of burglary and riot etc. The first information report was lodged by the complainant. According to it, on 16.6.87, at about 5.00 p.m. one of the quarters out of the various constructed quarters fell down on account of some technical defect and that resulted in the death of the two persons. As the two persons died on account of the falling down of the quarter, the residents in the vicinity including the persons residing in the police lines and other persons collected in thousands and attacked the proprietors (partners) of the firm and its employees and removed the building material lying at the site and destroyed it. The partner of the firm Shri Ashok Singhal reached at the site and the mob standing there came to attack him and therefore, in order to save his life, he ran away. On the basis of these premises, the first question is whether in the circumstances when the persons collected there took away the building material lying on shop, constituted burglary, which is the subject matter of policy dated 29.12.86. The material was lying at the site. "Criminal trespass" has been defined in Sec. 441 of the Indian Penal Code as under: 441. Criminal trespass - Whoever enters into or upon property in the possession of another with intent of commit an offence or to intimidate, insult or annoy any person in possession of such property, or having lawfully entered into or upon such property, unlawfully remains there with intent thereby to intimidate insult or annoy any such person, or with intent to commit an offence, is said to commit "criminal trespass."

"Theft" has been defined in Sec. 378, I.P.C. Sec. 379, I.P.C. provides for punishment for theft. Sec. 380 I.P.C. provides for the theft in dwelling house. "House trespass" has been defined in Sec. 442, I.P.C. "Unlawful assembly" has been defined in Sec. 141, I.P.C. as under: "141. Unlawful assembly- An assembly of five or more persons is designated an "unlawful assembly", if the common object of the persons composing that assembly is- " First.- To overawe by criminal force, or show of criminal force* (the Central or any State Government or Parliament or the Legislature of any State), ''or any public servant in the exercise of the lawful power of such public servant; or Second.- To resist the execution of any law, or of any legal process; or Third.- To commit any mischief of criminal trespass, or other offence; or Fourth.- By means of criminal force, or show of criminal force, to any person, to take or obtain possession of any property, or to deprive any person of the enjoyment of a right of way, or of the use of water or other incorporeal right of which he is in possession or enjoyment, or to enforce any right or supposed right; or Fifth.- By means of criminal force, or show of criminal force, to compel any person to do what he is no legally bound to do, or to omit to do what he is legally entitled to do. Explanation.- An assembly which was not unlawful when it assembled may subse- quently become an unlawful assembly."

Rioting has been defined in Sec. 146 I.P.C. Two words used in Sec. 146 I.P.C. are ''force'' and ''violence''. "Force" has been defined in Sec. 349 I.P.C. as under: 349. Force: A person is said to use force to another if he causes motion, change of motion, or cessation of motion to that other, or if he causes to any substance such motion or cessation of motion as brings that substance into contact with any part of that other''s body, or body, or with anything which that other is wearing or carrying, or with anything so situated that such contact affects that other''s sense of feeling: Provided that the person causing the motion, for change of motion, or cessation ofmotion, causes that motion, change of motion, or cessation of motion in one of the three ways hereinafter described: First.-By his own bodily powers. Secondly.- By disposing any substance in such a manner that the motion or change or cessation of motion takes place without any further act on his part, or on the part of any other person. Thirdly.- By inducing any animal to move, to change its motion, or to cease to move."

According to the term ''force'' as mentioned in the said section, it is in connection with the human body and it contemplates force or criminal force as supplied to human beings. The persons who assembled there after the death of the two persons on account of the fall of the quarter which was under construction had common object of removing the building material lying at the site.

THE insurers, in para 9 of the version of the case have stated that the incident that had taken place on 16.6.87 at 5.00 p.m. cannot be said to be burglary under the policy as neither there was ''rok tok'' forcible entry or violence or quarrel. Shri R.C. Siyal (OPW) in his deposition has stated that the claim is not covered by burglary as there was no forcible entry and that lock etc. were not broken. For riot, it has been stated that the riot was not declared. In these circumstances, an interesting question that crops up is whether the angry mob that has collected there had forcible entry or used violent means. ''Forcible entry, has been defined in Black''s Dictionary, IIIrd Edition, at page 581 as under: - "Forcible entry: At common law, violently taking possession of lands and tenements with menaces, force and arms, against the will of those entitled to the possession, and without the authority of law. 4 B1. Comm. 148. Entry accompanied with circum- stances tending to excite terror in the occupant, and to prevent him from maintaining his rights. Barbee v. Winnsboro Granite Corporation, 190 SC 245, 2 SE 2d 737. Angry words and threats of force may be sufficient. Calidino Hotel Co. of San Bernardino v. Bank of America Nat. Trust & Savings Ass''n, 31 Cal. App. 2d 295, 87 P. 2d 923, 931. Every person is guilty of forcible entry who either (1) by breaking open doors, windows, or other parts of a house, or by any kind of violence or circumstance of terror, enters upon or into any real property or (2) who, after entering peaceably upon real property turns out by force, threats, or menacing conduct the party in possession. Code Civil Proc. Cal. 1159. In many states, an entry effected without consent of rightful owner, or against his remonstrance, or under circumstances which amount to no more than a mere trespass, is now technically considered "forcible", while a detainer of the property consisting merely in the refusal to surrender possession after a lawful demand, is treated as a ''"forcible" detainer, the "force" required at common law being nor supplied by a mere fiction."

In Webster''s Dictionary, it has been defined at page 888 in the following terms: "Forcible entry and detainer No. 1: the entering upon and taking or the keeping possession of land or a tenement by actual force or by threats or display of force menacing life or limb without authority of law 2: the statutory proceeding to regain possession of property alienated by forcible entry and detainer."

IN the written arguments, it was stated by the learned Counsel for the complainant that the entry of the angry mob at the site without permission and to make an attempt to attack the employee and partner of the complainant firm clearly indicated that the entry was forcible and violent means were used. Aid was taken from the definition of ''violence'' as given in Black''s dictionary at page 1408 and that of Webster dictionary at page 2554 and also from the judgment rendered by the State Commission in the New INdia INsurance Co. v. Mis. Wipro Electronics Pvt. Ltd. (First Appeal No. 103/89, decided by the State Commission on 12.1.90) which has been affirmed by the National Commission in revision. The first information report and the letters written by the complainant-insured, the statements of Shri Ashok Singhal, Shri Munshi and Shri Devkinandan, clearly show that the persons entered at the site without permission, and attempted to kill the contractor and chowkidar. It is also on the record (in the statement of the witnesses of the complainant) that when the contractor went at the site, people ran after him to kill and used force against chowkidar. The persons, who had collected there removed the building material that was lying there. According to the complainant, it constituted theft and robbery, which is burglary. There is no dispute that the place where the building material was lying was used for the construction of the building and it was a private place. The reasoning given in A.I.R. 1979 Cal. 56 was availed of by the learned Counsel for the complainant to show that the incident that had taken place was burglary and so under the first policy, the complainant could make a claim for burglary. Even otherwise, the case of the complainant is covered by the second policy, which relates to riots and malicious damages. The provisions relating to the riots and malicious damages are contained in Schedule 5 of the policy. According to them, any act of physical damage by external violence done to the injured by the person or persons together with to commit offence at public place, it is covered under the head of ''riot and malicious damages''. In regard to the external violence means in Black''s dictionary, page 1408 and Webster''s dictionary at page 2554, their meanings have been explained. With regard to affray, in Black''s dictionary at page 428 its definition has been given. The facts that have come on record clearly show that the persons who had collected there in thousands, became angry and attacked the partners and employees with an intention to cause loss to the property. We may refer A.I.R. 1956 Bom. 533 in regard to the external violent means. The view taken in A.I.R. 1937 Mad. 286 is that if thousand persons collect at a spot and there is some disturbance, that tantamounts to the breach of peace; it is not necessary whether a plea has been taken by the insured that a riot should be declared. We are, therefore, of the opinion that the incident which had taken place on 16.6.87 is covered by the first policy as well as the second policy.

The next question is with regard to the amount that has been claimed by the complainant in the complaint. The complainant, in para 14 of the complaint has claimed Rs. 4,96,710.78. Out of this, the claim amount arising out of the two cover notes is Rs. 2,59,710.78. The complainant has submitted the statement marked as Ex. C.4, in which the details of the loss has been given. Shri Ashok Singhal (C.W. 1) has proved the loss. On the basis of the entries in the stock register marked as Ex. C/5 to 22, the bills regarding the purchase of the material which have also been proved and they are Ex-C/25 to 169. It is significant to note that while replying to paras 1 and 14, the insurers have merely stated that two cover notes were issued and the material which is used for construction was insured, and that para 14 relating to the reliefs is wrong and hence not admitted and in the circumstances, the accident and damage have been caused, they are not covered by the cover notes and, therefore, the complainant is not entitled to any relief. No specific reply was given in the reply to the various amounts of compensation claimed by the complainant. A perusal of the statement of Mr. R.C. Siyal shows that he has not controverted the statement of Shri Ashok Singhal with respect to the claim amount. It has been admitted that the loss was caused to the complainant. The insurer had appointed M.P. Bakshi to assess the loss without prejudice to the right of the insured. He submitted his report. After seeing the record of the case he did not raise any objection with respect to the stock register. An application was submitted by the insurer for examining the stock register by handwriting expert, on the ground that the stock register may have been prepared after the accident to show the loss exaggerated. The application was submitted on 21.2.90. On 10.8.90, learned Counsel for the complainant was directed to keep the stock registers ready, which have been referred to in the evidence for the perusal of the Commission on 29.8.90. Learned Counsel for the insurer submitted his written arguments on 10.8.90. The application that was filed for the examination of the handwriting expert was opposed on behalf of the complainant vide reply dated 18.4.90. It was stated in the reply that Mr. R.C. Siyal, Sr. Divisional Manager, has not deposed that the entries of the stock register or in the account books were not made in the ordinary course of business as he himself admitted in deposition that the loss had, in fact been caused to the complainant due to the alleged event. The surveyor had examined the stock register and entries made therein for the purpose of assessing the loss. The copies of the reports were submitted on 10.8.90 and not before that, though according to the complainant, notice was given for the production of the survey report. It is significant to note that the insurers sought adjournment on various dates. Nothing was done for getting the stock registers examined by the handwriting expert, and written arguments, as stated above, were filed. In these circumstances, no useful purpose will be served by examining the handwriting expert for the stock register. There is direct proof regarding the entries made in the stock registers. The Survey Reports were filed by the opposite parties and the Surveyors has stated nothing so to cast any suspicion about the stock registers. The stock of the material on that day was in the stock registers. After the loss, whatever stock was available, the list was prepared thereof and, therefore, it could easily be found out as to what material was forcibly taken away by the angry mob. Mr. M.P. Bakshi, Surveyor''s report dated 31.3.88 is as detailed document. Under the head, Occurrence of loss, it has been stated in it as under: "The occurrence of loss: The construction work at the site at Rajasthan Police Academy was in progress on 16th June, 1987. The structure of last batch of 12 houses in a three storeyed building had been constructed. The RCC roof of the top floor was still supported by scaffolding of shuttering i.e. ply, funta and tuka. At this stage at about 5 p.m. on 16.6.87 this block of 12 houses collapsed. There had been rain at the site prior to this occurrence. Due to collapse of this building about 14 labourers were trapped therein. Ultimately a woman and a child died in this incident. The occurrence of collapse of building attracted thousands of people to the site of mishap. The people became agitated and turned into violent mob and indulged in looting of various materials of the insureds lying around the site in a show of anger towards the contractor of the building. This mob damaged as well as looted steel windows, door frames, small sized C.I. pipes and fittings, G.I. pipes and fittings, toilet fittings, steel bars, ply, motor shuttering ball is, tuka, wooden funta (Rafters), wooden doors, labour''s equipment etc. In this disturbance, the workers and watchman of the insureds left the scene of occurrence in panic. The police was busy in helping to pull out the trapped persons from the debris. A case was registered by the Police Station Shastri Nagar, Jaipur against the contractors and engineers. As a result the partners of the contractors'' firm of the insureds did not visit the police station to avoid arrest. Ultimately when the police was contacted they did not agree to record a police report and avoided the same on one pretext or the other. The insureds finally approached S.P. Police, Jaipur and have been able to get their F.I.R. No. 39/88 registered on 12.2.88 at Shastri Nagar, Jaipur. True copy of this F.I.R. is attached alongwith photo copy of insureds letter to the policy which has been reproduced in the F.I.R."

UNDER the head Our Survey and Investigation; the Surveyor has stated that the complainant insured has suffered loss due to the riotous mob causing damage and loss to the material and equipment of the insured lying at the site after the mishap on 16.6.87. This loss was over and above loss of the building material which was used in the block of thc building which collapsed. Apart from delay in lodging the F.I.R. no other material fact had come to the notice of the Surveyor, which could suggest to the contrary. The Surveyor discussed the claim filed by the insured in detail. The conclusion arrived at by the Surveyor is that a sum of Rs. 2,03,678/- is fair and reasonable indemnity to the insured for the loss suffered by them on account of the riot-struck damage, in so far as it is covered and recoverable under the Insurance Policy held by them. The complainant has claimed Rs. 2,53,710.78, as the amount recoverable under the cover note. We have considered the statement of Shri Ashok Singhal (CW1) the documents produced by him and the report of Shri Bakshi, Surveyor. In our opinion, a sum of Rs. 2,03,678/- will be reasonable amount for which the complainant is to be indemnified. The sum assured under the two policies of the insurance is 3 lakhs and the gross amount of loss stated therein is Rs. 2, 10, 466.86 and, therefore, the net loss was Rs. 2,03,678/-.

THE complainant has claimed interest @ 24% p.a. on the amount of claim on the ground that interest which is being charged on the loan by the Bank of Rajasthan is 18% p.a. added to the loan, so due, every quarter of the year comes to 24% p.a. THE compensation can be awarded to a consumer under Sec. 14(1) of the Act for the loss or injury suffered by him due to the negligence of the opposite-parties. It is well settled that the claim must be substantiated by sufficient evidence and the compensation is to be assessed not arbitrarily but on the basis of well recognised legal principles. THE compensation to be awarded should be quantified on rational basis on a consideration of the materials produced before the Redressal Forums, showing the manner and extent of the monetary loss caused to the complainant. Under the terms of the policy, the interest which the complainant is required to pay to the Bank is not recoverable from the insured. THE insurer agreed for indemnifying the loss with respect to the loss or damage by burglary or riot or malicions damages. THE complainant has also claimed Rs. 1 lakh on account of the menial torture and agony under which the complainant remained due to the negligence of the insurers for not immediately arranging payment and the Bank which has been continuously threatening for the recovery of the loss and taking recourse to the legal action. THE claim with regard to this also has not been substantiated by the complainant and under the terms of the policy, the loss amount is not recoverable. THE question of payment of interest on the sum assured was examined by the State Commission in Umedilal v. K.K. Nagpal and Ors. (Complaint Case No. 4/88 decided on 21.2.89) which was affirmed by the National Commission. It was held therein as under: "THE term ''compensation'' signifies that which is given in recompense, as equivalent rendered damages on the other hand constitute the sum of money claimed or adjusted to be paid in compensation for loss or injury sustained, the value estimated in money of something, lost or withheld. THE term ''compensation'' is used to indicate that constitute or is regard as equivalent or recompense for loss of privation. Under S. 14(1)(d) read with Sec. 18 of the Act, the State Commission is empowered to direct the opposite-party to pay such amount as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party."

The incident took place on 16.6.87. The fresh claim form was submitted on 23.2.88, The survey report was given on 31.3.88. Despite all this, the claim of the insured was not settled. The complaint was filed on 29.8.89. Having examined the record, we are of considered opinion that the insurer failed to indemnify the insured for the loss caused within reasonable time from 16.6.87. The insurers were negligent in not settling the claim within a period of four months time. The insured was wrongly deprived of the sum assured for about 18 months upto the date of the filing of the claim and also from the date of filing of the complaint until its decision. The period is about 20 months. Reasonable compensation should be awarded to the complainant. In the circumstances of the case, we consider it proper to award a sum of Rs. 59,322/- as compensation to the insured for the loss suffered by it.

THE Insurance Company is directed to settle the claim of the complainant (insured) for indemnifying the loss by making payment of Rs. 2,03,678/- to the insured. THE insurer shall also pay Rs. 59,322/- to the insured as compensation for not settling the claim. Thus, insured will be paid Rs. 2,03,678/- plus Rs. 59,322/- = Rs. 2,63,000/- as compensation.

FOR complying with the direction relating to the payment of Rs. 2,63,000/- one month''s time to be reckoned from the date, the copy of this order is supplied to the insurer, is allowed. The rest of the claim made by the complainant-insured is dismissed. The complaint is, accordingly, decided as indicated above. Parties shall bear their respective costs of the complaint. Complaint partly allowed.