Govind Agrawal vs National Insurance Co. Ltd. and Ors.

THIS revision petition has been filed by Shri Govind Agrawal who is the original complainant challenging the order dated 28.9.2012 passed by Bihar State Consumer Disputes Redressal Commission, Patna in First Appeal No. 336/2011 whereby the State Commission partly accepted the appeal filed by respondent Nos. 1 and 2 and set aside the order passed by the District Forum on 6.6.2011 in Consumer Complaint No. 78/2010 and modified the relief earlier granted by the District Forum. The order of the District Forum can be reproduced thus: From whole discussion it appears that this is a fit case to be decreed. Accordingly, the case is decreed in favour of the complainant. The case is decreed for Rs. 14,83,712 for insurance money Rs. 45,000 for unnecessary harassment and Rs. 05,000 for litigation totalling Rs. 15,33,712, with an interest @ 12% (which the Bank has been taking) from 22.6.10 The filing of the present complaint. This award money shall go directly to the Allahabad Bank, Katihar in the A/c of Govind Agrawal, the Complainant and proprietor of M/s. Mobile World. The O.P. No. 1 and O.P. 2 are jointly and severally directly to deposit the decretal amount within a fortnight to avoid any further delay. The case is disposed of in this way. In case, the O.P. make any default, the Complainant has an option to take recourse in law.

The aforesaid order of the District Forum was set aside and modified by the State Commission vide its impugned order in terms of the following directions:

We direct the appellant to pay a sum of Rs. 5,67,010.89+ Rs. 45,000 as litigation cost + Rs. 10,000 as cost for harassment. Since only voucher was sent in respect of draft on behalf the Insurance Company for acceptance by the insured, so interest would be payable @ 10% per annum from that date, i.e. 24.1.2010, which would roughly come to more than Rs. 1,40,000 (Rs. one lac forty thousand only) till date. So this amount should be added along with the aforesaid amount within sixty days from the date of passing of this order, failing which interest @ 12% per annum shall payable by the Insurance Company till payment.

BRIEFLY stated, the facts relevant for disposal of this revision petition are that the petitioner insured his shop at Katihar with the respondent Insurance Company under "shop keepers insurance policy" for a sum of Rs. 3 lakh for the period from 19.2.2008 to 18.2.2009. During the period when the first policy was already in force, the petitioner/complainant took another policy for the same premises for the sum of Rs. 26,04,000 which was effective from 15.10.2008 to 14.10.2009 for covering risk of stocks in trade against fire and allied perils as also burglary and house breaking with hypothecation of the goods with respondent No. 3 Bank. In the night intervening between 16 -17.10.2008, theft took place in the insured shop of the petitioner and after breaking the premises the thieves took away mobiles and laptop etc. worth Rs. 19,90,000. An F.I.R. was lodged with the local police station giving details of the articles stolen. The petitioner also informed the respondent Insurance Company and the respondent Bank about the burglary committed in his shop. Reportedly the police recovered mobile sets worth Rs. 52,463 and accordingly the police filed charge sheet holding that the thieves had entered the shop by breaking ventilator and also through false ceiling. On receiving intimation about the theft from the insured/petitioner, a survey was got conducted by the respondent. Insurance Company by engaging M/s. S.N. & Associates, Patna, who assessed the loss at Rs. 14,83,712 and at the same time, the surveyor raised certain doubts in respect of some aspects discussed in its report dated 9.11.2009. Keeping in view the doubts raised by the first surveyor in respect of the claim submitted by the petitioner to the OP Insurance Company, the Insurance Company appointed another surveyor, namely, Ajay Kumar Ojha, who visited the place of occurrence of the event for final survey and also to clear the doubts raised by the first surveyor. The second surveyor asked for the exact EMEI number details relating to the stolen mobile sets and their purchase invoice in respect of specific mobile sets with corresponding EMEI numbers but the insured did not submit the same to the subsequent surveyor and as such the surveyor advised him to send the required documents to his Patna office. It is alleged that in spite of several reminders to the petitioner and also an e -mail to the supplier M/s. Gulab Chand Hansraj, Katihar, the petitioner did not care to take any interest in the matter so as to furnish required information. Be that as it may, the second surveyor considered the details made available and assessed the value and price of the mobile sets alleged to have been stolen during the theft. The total loss was estimated by him at Rs. 5,55,090.65 after considering the cost of only 181 pieces at Rs. 5,33,741.33 in addition to 4% VAT amount of Rs. 21349.65. Accordingly he submitted his report to the OP Insurance Company. Based on the report of the second surveyor, the OP Insurance Company sent an advance receipt voucher for Rs. 5,55,090 through the OP Bank for acceptance by the complainant/petitioner but the same was not returned duly discharged by the complainant to the Insurance Company: Since the OP Insurance Company did not settle the claim of the petitioner and instead appointed another surveyor for the same work and obtained another report, the petitioner approached the District Consumer Forum by filing the complaint in question alleging deficiency in service on the part of the OP Insurance Company while rendering service to the complainant. Based on the submissions made by the parties before it and considering the evidence placed by them, the District Forum accepted the complaint in terms of its order reproduced above.

AGGRIEVED of this order, the OP Insurance Company challenged the same before State Commission which partly accepted the appeal and set aside the order of the District Forum by modifying it in terms of the aforesaid impugned order which resulted in substantial reduction of the relief earlier granted by the District Forum to the petitioner. Under these circumstances, the petitioner/complainant has now approached this Commission challenging this impugned order by filing the present revision petition.

WE have heard learned Mr. S.M. Tripathi, Advocate for the petitioner, Mr. Ranjan Kumar Pandey, Advocate for the respondent Insurance Company and Mr. V.P.S. Ahluwalia and Mr. H.C. Kapoor, Advocates for respondent Bank. Learned Counsel for the petitioner has submitted that the impugned order is bad in law and facts and the findings as recorded in the impugned order by the State Commission are far from truth because they are based on the assessment contained in the report of the second surveyor which itself is not based on cogent material. Referring to the grounds of substantial reduction in the valuation of the stolen mobile sets, the main argument put forth by learned Counsel was that reliance on IMEI numbers cannot be the basis for assessment of loss and instead the stock statement which had been accepted by the District Forum would be the appropriate basis for such assessment. Learned Counsel also submitted that the State Commission erred in law by relying on the second surveyor''s report because mere was no justification or reasonable basis for appointment of second surveyor when first surveyor had already gone into the matter in great detail and submitted his assessment of the loss in his report. He also stated that the appointment of the surveyor was not in accordance with the guidelines issued by the Insurance Regulatory and Development Authority (IRDA) and as such the State Commission committed a mistake in relying on this report and basing the impugned order on such a report. He, therefore, submitted that the impugned order could not be sustained in the eye of law and is liable to be set aside. Learned Counsel has relied on the judgments of the National Commission in the cases of National Insurance Company Ltd. v. New Patiala Trading Company, : I (2003) CPJ 33 (NC) and New India Assurance Company Ltd. v. Balbir Singh,, II (2004) CPJ 12 (SC) :, III (2004) SLT 161 : First Appeal No. 628 of 2007 dated 2.4.2013. On the other hand, learned Counsel for the respondents have contended that even while evaluating the value of the stolen goods the first surveyor has raised certain doubts about the genuineness of the claim preferred by the petitioner which eventually led to the appointment of the second surveyor. They submitted that the appointment of the second surveyor was, therefore, for justified reasons and eventual failure on the part of the petitioner to furnish the specific IEMI numbers of the stolen mobile sets and other corresponding specific information to the second surveyor was a material lapse on the part of the petitioner and as such the modification in the assessment of loss reported by the second surveyor was justified. They also submitted that keeping in view the suspicion raised by the surveyors regarding the genuineness of the claim and also the failure on the part of the petitioner to provide necessary information in spite of reminders, the two cases relied upon by Counsel for the petitioner would not be applicable to the facts and circumstances of the present case and hence the impugned order be confirmed and the revision petition dismissed.

WE have carefully considered the rival contentions. Admittedly the petitioner has failed to furnish the IMEI list of all the mobile sets stolen and related duplicate purchase invoices with IMEI attachments. Perusal of the two survey reports would clearly indicate that even though the first surveyor assessed the loss at much higher amount, significantly he had also raised certain doubts about the genuineness of the claim put forth by the petitioner and the same is reflected in concluding paras 18.1 and 18.2 of the report which is reproduced thus: 18.1 It was already discussed by us in our earlier chapter that there was no parity, with regard to the insured''s purchases and sales. We could not understand why they had unnecessarily accumulated huge quantity of stock. As for example, Nokia 1200 the closing stock of August -08 was 96 pcs and sale in the month of September -08 was only 48 pcs whereas they had purchased 60 pcs of this set during the month of September -08. Hence the stock of this set further increased. Similar thing was happened in the month of October -08. Also we observed same thing in case of Nokia 1209, 1650, 2626 etc.

18.2 In the F.I.R. the insured had stated total 555 pcs. mobile were lost. Also they had mentioned in F.I.R. about the loss of 80 pcs of Nokia 2625, but subsequently insured informed to us that it was a clerical mistake and the actual Model No. was 2626.

IN view of the aforesaid observations in the concluding para of the first survey report, the OP Insurance Company was quite justified in appointing a second surveyor who would examine the matter in greater detail after calling upon the petitioner to furnish necessary details in respect of his claim. We do not agree with the plea taken by learned Counsel for the petitioner to the effect that IMEI cannot be the basis for assessment of loss. It is common knowledge that IMEI number is an important individual identification mark in respect of each mobile set and the same is widely used for different purposes by the concerned parties like dealers, police and other investigating agencies to identify the mobile set concerned for taking further necessary action as may be required in the circumstances. Learned State Commission has made the following observations in its impugned order while accepting the appeal of the respondent Insurance Company: 18. Here, in the fact and circumstances of the case, it is apparent that such mobile sets were purchased from the stockiest and was required to be duly accounted for in the books of accounts regularly to be kept in regular business transaction so as to make it distinguished and identifiable in case some untoward happens. If someone claims regarding existence of such mobile, even when there is no theft lying in the premises of insured, the insured can only take defence of retention of such large number of mobiles only on the basis of their proper identification marks so purchased from the stockiest or wholesaler/dealer as the case may. The mobile set should be distinguished for the purpose of identification anywhere at any time so as to locate its identity and so is it a must for any Shopkeeper/wholesaler or trader to keep IMEI number in their books of records.

Here, in the facts and circumstances, the insured/complainant could not furnish details of such IMEI number to the second surveyor despite being repeatedly demanded. He could furnish only IMEI number for which the Insurance Company on the basis of such receipt of report from second surveyor retained by the insured in respect of genuine evaluation of stolen mobile set. In the given situation, there was requirement for appointment of another surveyor, which was also confirmed by the first appointed surveyor.

So, we have to see that these two reports are not contradictory to each other rather supplementary and in such situation the value assessed by the second surveyor, which is in consonance with the Chartered Accountant reports cannot be said to be unjustified.

In view of the aforesaid discussion, we are convinced that the State Commission was right in modifying the amount of claim and allowing it only to the extent justified by the documents based on which the second surveyor had made his recommendation in his report. Therefore, we do not find any material irregularity, illegality or jurisdictional error which would call for any interference by us with the impugned order. We have gone through the two judgments of the National Commission relied upon by the Counsel for the petitioner but considering the facts of this case, decision in those cases cannot be made applicable to the present case. In this context, the observations of the National Commission in para -7 of the judgment in the case of New Patiala Trading Company (supra) which is reproduced below clearly indicates that the facts and circumstances in that case were different: Scheme of Section 64UM, particularly of Sub -sections (3) and (4), would show that insurer cannot appoint second Surveyor just as a matter of course. If the report of the Surveyor or Loss Assessor is not acceptable to the insurer it must specify reasons but it is not free to appoint second Surveyor. Appointment by the insurer of a second Surveyor itself would be a reflection on the conduct of the first Surveyor. Surveyor or Loss Assessor is duty bound to give a correct report. If the insurer Insurance Co. finds that Surveyor or Loss Assessor has not considered certain relevant points or has considered irrelevant points or for any other account it has reservation about the report, it can certainly require the Surveyor or Loss Assessor to give his views and then come to its own conclusion, but insurer cannot certainly appoint a second Surveyor -cum Loss Assessor to counter or even contradict or rebut the report of the first Surveyor.

SIMILARLY , in the second case of Balbir Singh (supra), we find that the defence of the appellant Insurance Company had been non -suited because it had appointed a second surveyor without recording any reasons for rejecting the report of the first surveyor. This is not the case with the present dispute. Here, the OP Insurance Company had appointed the second surveyor keeping in view the reasons recorded by it which have been found to be valid and appropriate for such appointment. In view of the above discussion, we do not find any merit in the revision petition and accordingly dismiss the same with the parties bearing their own costs.