Ashu Textiles vs New India Assurance Company And Anr.

HEARD the learned Counsel for the petitioner.

THE petitioner/complainant had taken insurance for Rs. 17 lacs for the period 28.1.2002 to 27.1.2003. The insurance related to stocks of raw material, finished goods, packing material, etc. against fire, flood, natural calamities, etc. Fire took place on 17.1.2003 in which the complainant is said to have suffered extensive damage. According to the complainant the estimated damage was to the extent of Rs. 23,29,000 and the claim was put up for the insured amount to the tune of Rs. 17 lacs. The District Forum had ordered the Insurance Company to pay Rs. 17 lacs with 12% interest p.a. thereon from six months of institution of complaint till realisation. Besides this, compensation of Rs. 10,000 and cost of Rs. 5,000 were awarded. This order was challenged before the State Commission.

THE State Commission by majority judgment allowed the appeal filed by the Insurance Company and directed payment of Rs. 7 lacs with 12% p.a. interest thereon, to be calculated after three months of the fire incident. However, the compensation of Rs. 10,000 was set aside and the order for cost of Rs. 5,000 was maintained. The minority judgment had confirmed he District Forum''s order for payment of Rs. 17 lacs with 12% interest thereon. However, it was held that there was no justification to award additional compensation of Rs. 10,000 which was set aside. The majority judgment of the State Commission is challenged in revision before this Commission. Arguments were heard. Learned Counsel for the petitioner submitted before us that the District Forum as also the minority judgment of State Commission had rightly taken into consideration the damages assessed by the Fire Brigade as also on the basis of monthly stocks statements submitted by the complainant to the bankers. According to the learned Counsel for the petitioner, the majority judgment failed to attach due weight to the report of the Fire Brigade as also monthly stocks statements which were submitted, by the petitioner to bank who had verified the same.

THE Insurance Company had appointed Surveyor who had inspected the premises on 18.1.2003 itself and had also verified the affected stocks on 20th and 25th January, 2003. After seeking clarifications, he submitted report to which we shall refer a little later.

TO start with, we would like to state that Surveyor''s report which is based upon the visit to the site as also subsequent verification and also after obtaining clarifications has to be given more weight than the report of the Fire Brigade about loss and monthly stocks statements which were being sent by the petitioner to the Bank. On what basis the Fire Brigade had made the assessment has not been explained by learned Counsel for the petitioner. Not much importance can be given to the monthly stocks statement which were sent by the petitioner to the bank in the light of the survey report which is of prime importance which is based on the facts and circumstances of the case.

THE report states that initial visit to the site was on 18.1.2001 and subsequent visits were on 20th and 25th January, 2003 when physical segregation of affected stocks was done. After examination of the initial documents, the Surveyor sought clarifications and also had a meeting with the insured. Based upon the relevant details/documents, observations during physical verification of the affected factory site, clarifications received from the insured and deliberations held with the insured, the final survey report was given. The Surveyor took into account that the insured did not maintain any stock register. The monthly stocks statements which were sent by the petitioner to the bank were taken note of by the Surveyor. In the absence of maintenance of any stock register, the closing stock could not be verified by correlating from the stock register. On the basis of provisional proforma trading account, the Surveyor came to the conclusion that the closing stocks came to Rs. 6,44,263.11. After making deductions, etc., the Surveyor assessed the loss at Rs. 4,32,055. The majority judgment of the State Commission had considered the issue with reference to Fire Brigade report and monthly stock statements which were sent by the petitioner to the bank. In the light of the detailed survey report, obviously the said documents could not be accepted. The majority judgment has, therefore, very rightly taken the survey report as the basis for determination of compensation. Taking into consideration the survey report, the majority judgment of the State Commission has awarded Rs. 7 lacs as compensation for damages along with 12% p.a. interest to be calculated after three months to the fire incident. The said order, in our opinion, is more than reasonable as the claim which has been allowed is in excess of recommendation of the Surveyor. The State Commission has rightly set aside the compensation of Rs. 10,000 which was separately given.

IN view of the above, we do not find that any case has been made out for interference in the exercise of revisional jurisdiction under Section 21(b) of Consumer Protection Act, 1986 as we do not find any material irregularity, illegality or jurisdictional error in the majority judgment of the State Commission which is hereby affirmed. The revision petition is, accordingly, dismissed with no order as to costs. R.P. dismissed.