Branch Manager, New India Assurance Co. Ltd. vs KAMATCHI COIR INDUSTRIES

THIS appeal is directed against the order dated the 28th day of February, 1997, in O.P. No. 255/95 on the file of the District Consumer Disputes Redressal Forum, Trichirapalli.

THE appellant New India Assurance Co. Ltd., represented by its Manager, Trichy-620 001 is the opposite party while the respondents 1 and 2 are partners of M/s. Kamatchi Coir Industries, namely Kamatchi and Maruthaiveeran, are the complainants. M/s. Kamatchi Coir Industries, it appears, is a partnership concern. The partners are Kamatchi and Maruthaiveeran. The said partnership firm it appears had insured industrial building for Rs. 1,20,000/-, machineries for Rs. 1,60,000/- and stock in trade at Rs. 40,000/-. The policy, it is said, was kept alive between 29.12.1993 and 28.12.1994.

A fire, it is said, broke out in the industries on 23.8.1994 at 1.30 p.m. causing extensive damage to the building and other machineries. The complainant estimated the loss at Rs. 3,60,000/-. When a claim has been made to the opposite party Insurance Company, there was no response or reaction in the sense of ever acceding to the claim made or computations made thereof. Consequently, the partnership firm (complainant) launched a complaint before the Forum below for the reliefs as below : (i) To direct the opposite party to pay a sum of Rs. 3,20,000/- as insurance claim; (ii) To direct the opposite party to pay Rs. 1,25,000/- towards loss of income from the industry. (iii) To direct the opposite party to pay Rs. 20,000/- for mental agony, stress, strain and physical inconvenience; and (iv) To direct the opposite party to pay Rs. 500/- towards the costs of the complaint.

THE opposite party filed objections as reflected below : No doubt the complainant had insured their building, machinery, stock in trade, etc., to the total extent of Rs. 3,20,000/-. The cause of fire to the building was not established beyond doubt. The complainant did not co-operate with the opposite party in furnishing clear particulars about the extent of damage caused inspite of several letters sent to them. The claim of loss of Rs. 3,20,000/- cannot be sustained as there was no basis. The Surveyor appointed by them filed a report evaluating the extent of damage only to the tune of Rs. 20,730.70 and they have no objection for an award being passed for the said amount. The complainants are not entitled to any other amounts as they are neither proved nor the opposite party committed any deficiency in service.

THE Forum below on consideration of the materials placed on record and after hearing the projection of hues of views by the respective parties through their Counsel ultimately directed the opposite party to pay to the complainant the sum of Rs. 3,00,000/- with interest thereon @ 18% p.a. from 23.8.1994 the date of accident till the date of payment and Rs. 2,000/- as compensation for mental agony and sufferings and costs of Rs. 500/-. Arguments of learned Counsel Mr. S. Stanley John, representing learned Counsel M/s. D. Bright Joseph, appearing for the appellant/opposite party and learned Counsel M/s. R. Umamaheswari, representing learned Counsel Mr. R. Devaprasad, appearing for the respondents/complainants were heard. We have thoroughly sifted and scanned the materials on record in the shape of documents as exhibits by both the parties. Such scanning and sifting reveals that the complainant''s coir industry due to difference of opinion between the partners was not at all running a few months prior to the breaking out of fire causing the alleged damage to the building, machinery, stock in trade, etc. Some attempt had been made by the complainants to make it appear that the said coir industry was a running concern on the date when the fire broke out namely 23.8.1994. The complainants in fact produced electricity bill marked as Ex. A10 series obviously with a view to point out that the coir industry was in fact a running concern on the date when the fire broke out. None of the bills under Ex. A10 series is in the name of the partnership concern M/s. Kamatchi Coir Industries. Such bills under Ex. A10 series bear the name of Kamatchi. In such state of affairs, it cannot at all be stated that the relevant electricity bills under Ex. A10 series relates to the complainants coir industry.

THIS apart, we have to take into account, the statement made by one Mr. G. Jayapal, Chartered Engineer, in Ex. A11 Certificate to the effect that the 3 phase electrical connection to the said coir factory had been disconnected due to arrears in the bill payment. The said valuation report is dated 17.5.1994. If that be the case, we are puzzled to take note of the fact that electricity consumption charges under Ex. A10 series had been paid. In such state of affairs, one can positively come to the conclusion that the said electricity bills under Ex. A10 series might not at all relate to the coir industry of the complainant.

CERTAIN balance sheets under Ex. A12 series had been marked. These balance sheets, we rather feel, had been procured for the occasion to suit the exigencies of the case of the complainants. The balance sheets are dated 20.12.1990, 4.6.1991 and 14.2.1992. Normally, we can understand that a balance sheet of a going concern is prepared at the end of the accounting year so to say 31st March of the year or the end of the calendar year 31st December. The accounting year must be uniform and it cannot be changed at the whims and fancies of the trader or business man. This apart, Ex. A11 valuation certificate is dated 17.5.1994 issued by a Private Chartered Engineer by name Mr. G. Jayapal, as already indicated. We are not able to understand as to why the valuation certificate was procured on 17.5.1994 and the valuation certificate is not relatable to the accounting year at all. Pertinent it is to note at this juncture that the alleged fire accident took place a few months after the obtaining of the valuation certificate under Ex. A11 that is to say on 23.8.1994. This shows the material preparedness of the complainants to make a claim obviously with a view to enrich themselves.

Ex. B17 is the Surveyor''s Report dated 21.3.1995 filed by the Insurance Company. A cursory perusal of the said Surveyor''s Report reveals interesting details. Under the heading "Extent of Damage" as relatable to Stock it is observed as below : "As the factory was not functioning from August, 1994 the unused raw materials dumped around the building were un-guarded and set into fire. The raw materials dumped on both sides of the building were uniformly burnt. The distance between each atties in 6'' to 10'' gap. The upper layer almost 1'' to 2'' were burnt/charred. The remaining husk were safe due to fire fighting operations made by the Fire Brigade. In all the atties, upto 2'' depth (max) from the top layer had burnt and caused the loss."

The value of the stocks so lost is estimated at Rs. 14,455.70. Similarly, the loss suffered on machine had been estimated at Rs. 2,550/-. This apart the loss suffered on building was estimated at Rs. 4,025/- all totalling to Rs. 21,030.70 less salvage value for motor Rs. 300/- will come to Rs. 20,730.70.

THE other interesting detail revealed under the heading "Opinion and Cause of Loss" is as below : "THE insured has not paid the loan properly and also she was not in a position to run the factory due to her family problems. On the spot study and available circumstance evidence, the fire was wantonly set up on the stocks and the factory roof AC sheets were purposely broken. THEre was no trace of fire/carbon soot is found in the entire area of the building. Only few meters wires and an isolated electric motor (1 HP) were found in burnt condition. Initially the insured told that she don''t know the cause of fire and after rigorous interrogation she told that "some body might have put up the fire". THE insured is a very knowledgeable person and she is very clever in doing the business. During the discussion and enquiry she refused to give the statement in writing and also the questionnaires submitted by her is a typed one. Her relatives are working in LIC, Auditor Office and in political parties. Based on the enquiry and the documents submitted by her, the following points need to be noted seriously. (i) She made a pre-planned arrangement and obtained the valuation certificate on 17.5.1994. (ii) She made a pre-planned arrangement and obtained the stability certificate of the building on 16.5.1994. (iii) From July,1994 onwards the factory was in closed condition. (iv) She has not co-operated in submitting the required information inspite of repeated reminders. Since she is not in a position to run the factory and didn''t pay the loan amount to TIIC, and the Authorities has pressed, she find the way to set the fire on the unused remaining stocks and tried to get the loss from the insurer so that she can clear the loan. But however, no evidence is available to prove that she wantonly created the loss. (v) Under all the above circumstances leaving the benefit of doubt, i.e., considering the cause of loss is a sabotage caused by some body, this claim may be admitted."

In such circumstances, we are of the view that the claim has to be admitted for Rs. 20,730.70.

EXCEPT the fact that the insurance policy of the complainant''s coir industry was kept alive on the date when the fire broke out, there are no materials worth the name produced and placed as exhibits by the complainants to prove the loss sustained by them in a satisfactory way. Such being the case, we rather feel that the total extent of damages as valued by the Surveyor under Ex. B17 quantified in a sum of Rs. 20,730.70 can be ordered to be paid to the complainants and to this the opposite party Insurance Company cannot object when especially it is their own document. For the reasons as above, the order of the Forum below in directing the opposite parties to pay to the complainant Rs. 3,00,000/- with interest thereon @ 18% p.a. from 23.8.1994 till date of payment is modified as below : The opposite party is directed to pay to the complainant a sum of Rs. 20,730.70 with interest thereon @ 18% p.a. from 23.8.1994 till date of payment.

THE Forum below awarded compensation in a sum of Rs. 2,000/- for mental agony and sufferings and we feel the said amount is reasonable on the facts and in the circumstances of the case calling for no interference. THE costs of Rs. 500/- also we feel is the reasonable sum calling for no interference.

THE order of the Forum below is modified to the extent indicated above. THE appeal is thus disposed of. We however make no order as to costs on the facts and in the circumstances of the case. Appeal disposed of.