LAKSHMI TRADING COMPANY vs DIVISIONAL MANAGER, THE NEW INDIA ASSURANCE CO. LTD.

THIS complaint CD 10/90 was filed by Lakshmi Trading Company against, (1) Divisional Manager, (2) Regional Manager, and (3) Head office of New India Assurance Company Ltd., claiming a sum of Rs. 1,99,712.71 Ps being the loss suffered by the complainant in the Arson and looting that took place on 26.12.88 at Vijayawada.

THE case of the complainant is that he is a dealer in Indian Liquors and beers carrying on retail business in the premises bearing D. No. 2737-47/4 situated at Attarattaiah street and Bandar road, Governorpet, Vijayawada-2 after obtaining necessary licences from the Excise Department and also the certificate of Registration from Sales Tax Department. THE complainant through its banker State Bank of Hyderabad paid the necessary premium of Rs. 1178/- and took a shopkeepers insurance policy from the opposite party No. 1 covering the period from 20.9.88 to 19.9.89 for a sum of Rs. 4 lakhs. During the subsistance of the policy on 26.12.88 consequent on the murder of Local M.L.A. Vangaveeti Mohan Rangao Rao, the shop of the complainant along with so many shops were subjected to arson and looting. THE complainant gave F.I.R. to the police and the premises was also inspected by the revenue officials who estimated the loss suffered by the complainant. After informing the opposite parties about the incident on l4.1.89, submitted his claim to the Divisional Office of the opposite parties at Vijayawada. By letter dated 21.4.89, the complainant was informed by the Divisional Manager that the shop-keepers comprehensive policy covers the premises situated at Attarattaiah street, Governor pet, Vijayawada and no policy was issued covering the retail wine shop of Bandar road, Governorpet, Vijayawada and hence they repudiated their liability and closed the file as no claim. The representations made by the complainant for reconsidering the matter did not bear any fruit. After some correspondence and issuance of lawyer notice to the opposite parties, this complaint was filed. According to the complainant, that what was insured is the shop premises bearing D. No. 27-37-47/4, Attarattaiah street and the other premises in the same street was merely a godown which was not insured. According to the complainant in the year 1984 the State ''Government has divided the complainant''s licence into two types i.e., wholesale and retail and after taking the shop premises bearing D.No. 27-37-47/4 which was a corner shop opening to Attrattaiah street as well as Bandar road with the permission of the Excise Department, he shifted his shop premises to D. No. 27-37-47/4 after obtaining the necessary lease in the year 1985. According to the complainant he informed the same to the Insurance Company on 7.5.85. The certificate of registration issued by the Commercial Tax Department also shows that the is having a retail shop at 27-3747/4 and in fact it is only the shop premises that was covered by the insurance policy and the opposite parties deputed their Surveyor with regard to this premises only. As the premises bearing D. No. 27-37-47/4 which faces and opens on to two roads i.e. Attarattaiah and Bandar road there is some amount of confirmation and the complainant after the incident closed the access from Attarattaiah street and transacting the business through Door that opens to Bandar road. It is also submitted that the State Bank of Hyderabad addressed letters dated 17.3.89 and 4.5.89 to the opposite parties requesting to settle the claim of the complainant. But the opposite parties did not settle the claim although a Surveyor was appointed and submitted his report assessing the net loss at Rs. 1,11,000/-

In the counter filed, the opposite parties generally denied all the allegations made in the complaint including the incident and the loss said to have been suffered by the complainant. It admitted the payment of premium and issuance of shop-keepers policy to the complainant. But pleaded that the insurance covers only the premises situated at Attarattaiah street, Governorpet, Vijayawada and no policy was issued for the premises at Bandar road, Vijayawada. It was further stated that the complainant had two licences one for the wholesale of all kinds of Indian liquor, Foreign liquor and beer in form FL 15 (Statewide) at the premises bearing D. No. 27-10-7/2 and retail licence for the sale of all kinds of Indian liquor, Foreign liquor and beer in form No. FL 24 in the shop premises 27-37-47/ 4 Bandar road, Vijayawada, and that the policy covers Laxmi Trading Company at Attarattaiah street, Vijayawada and not his retail wine shop at Bandar road.

A rejoinder was filed on behalf of the complainant reiterating that there is deficiency of service on the part of the opposite parties and that therefore the complaint is maintainable under the Consumer Protection Act and that the opposite parties are not correct in stating that the complainant paid only Rs. 10,500/- for the licence as the said amount represents only initial amount and the complainant paid the remaining amount of Rs. 52,500/- in all a sum of Rs. 63,000/-. It was stated that prior to 1985 the godown and the wholesale and retail business of the complainant was located at one and the same premises i.e.,27-10-7/2 Attarattaiah street. When the business was bifurcated the retail business of the complainant was shifted to premises bearing D.No. 27-37-47/4 Attarattaiah street and as the main business in carried on and as there is lot of furniture and other equipments, the complainant took the insurance policy in respect of that premises alone and there was no policy taken in respect of the godown and as the said shop premises faced both Bandar road and Attarattaiah street, hence the insurance was in respect-of the shop premises bearing D. No. 2737-43/4, Attarattaiah street only. No oral evidence was adduced by both the parties. But on the affidavit filed by the Branch Manager of Bank he was cross-examined RW1. The complainant filed copies of 18 documents along with the complaint and also filed 12 documents as additional papers and two documents as additional documents.

THE only question that arises for consideration is whether the shop-keepers insurance policy taken by the State Bank of Hyderabad on behalf of the complainant from the opposite party covers the retail shop premises and whether the complainant is carrying on retail shop business in premises bearing D. No. 27-37-43/4 Attarattaiah street. It is not in controversy that the State Bank of Hyderabad i.e., Financing Bank of the complainant took shop keepers Insurance policy for the benefit of the complainant for the period from 20.9.88 to 19.9.89 for a sum of Rs. 4 lakhs as evidenced by document No. 3 i.e., shop-keepers insurance policy. It is also not in much controversy that the retail wine shop of the complainant situated at D. No. 27-37-47/4 was the subject matter of arson and looting on 26.12.88. This is evidenced by the FIR document No. 4 given to the police by the complainant on 29.12.88 and also the net damage certificate document No. 5 issued by the Sub-Collector dated 15.2.89 and document No. 8 dated 3.5.89 wherein V. Sobhanadreeswara Rao, Member of Parliament wrote to the Divisional Manager of Insurance Company stating that "in the recent disturbances the retail shop of the complainant located in the corner of Atrarattaiah street was completely looter, burnt and destroyed. In the letter written by the Branch Manager, Governorpert Branch Vijayawada (document No. 9) to the Divisional Manager of Insurance Company under heading point No. 2 it was mentioned that it is universal fact, that M/s. Laxmi Trading Company was damaged during recent riots, and requesting the Divisional Manager to settle the claim. It is the case of the complainant that prior to 1984, before the Government decided issuing of separate wholesale and retail shops, licences the complainant had his wholesale and retail business located at D.No. 27-10-7/2 Attarattaiah street and that when the State Government separated wholesale and retail licences, the complainant has shifted his retail business to D. No. 27-37-47/4, a corner shop which faced both Attarattaiah street as well as Bandar road on lease from 24.3.85 as evidenced by the lease agreement commencing from 1.4.85 to 31.3.88. The complainant also filed the proceedings of the Excise-Superintendent, Krishna dated 3.6.85 as additional document which shows that M/s. Lakshmi Trading Company represented by S. Satyanarayana, proprietor was permitted to shift his licenced premises from D. No. 27-10-7/1A , Attarattaiah street, Governor pet, to D.No. 2737-47/4 Bandar road, Vijayawada and necessary corrections were made in the original licence. It is therefore, clear that the complainant shifted his retail business to the premises bearing D. No. 27-37-47/4 situated in Bandar road in the year 1985. But in the schedule to the lease agreement, it shows that the eastern boundary is Attarattaiah road and southern side at (sic.) Bandar road.

IT is the case of the complainant that since the shop opens to both the Bandar road as well as Attarattaiah street, in the lease agreement and as well as in the permission granted by the Excise Department, it was mentioned that D. No. 27-37-47/4 was in Bandar road. In the certificate for registration issued by the Assistant Commercial Tax Officer, document No. 1, it is clearly mentioned that apart from the principal place of business situated at D..No. 27-10-7/2 Attarattaiah street, Governorpet, Vijayawada, the complainant has a retail shop at D. No. 27-37-47/4, Attarattaiah street. Since the complainant was taking the insurance policy even earlier from the opposite parties, after shifting of the premises he wrote a letter dated 7.5.85 (document No. 2) informing the Divisional Manager of the Insurance Company that he shifted his retail section of his liquors and wines to premises bearing D. No. 27-37-47/4 situated at Attarattaiah street with a face to Bandar road also. IT was also stated that the previous premises where the wholesale business was carried is used as godown. The complainant, therefore, requested the opposite parties that he is interested in insuring the retail shop premises only. But in the shop-keepers insurance policy taken by the State Bank of Hyderabad on behalf of the complainant M/s. Lakshmi Trading Company, Attarattaiah street, Governorpet the Door number was not mentioned. But the policy number was mentioned as 4861080200245 issued at Vijayawada and the premium amount was Rs. 1178/- and the schedule shows that the insurance was for a sum of Rs. 4,09,000/- consisting of all varieties of liquors while stored in class I construction building situated at Attarattaiah street.

IN the letter dated 17.3.89 i.e., document No. 6 addressed by the State Bank of Hyderabad to the Branch Manager of the INsurance Company a reference was made to policy number mentioned above and to its earlier letter dated 9.1.89, informing the Branch Manager that the damage occurred more than two months back with regard to the premises covered by the policy. IN the certificate issued by the State Bank of Hyderabad dated 9.2.91 (document No. 2 of the additional material papers), it was stated that they have paid a sum of Rs. 1178/- towards insurance premium on 20.9.88 for insurance of M/s. Lakshmi Trading Company which is carry ing on business in the premises bearing D. No. 27-37-47/4, Attarattaiah street and the Policy Number is 4861080200245. Since the State Bank of Hyderabad took the policy on behalf of the complainant, it is clear that the policy taken by the bank is in regard to the premises bearing D. No. 27-37-47/4 Attarattaiah street, Governorpet, Vijayawada and this is the very Door number which was the subject-matter of riots resulting in damage.

The insurance policy issued (document No. 7 of the additional material papers) mentions that the stocks of all types of brandy, liquors whilst stored and or kept in class ''A'' construction building situated at Attarattaiah street Governorpet, Vijayawada-2 occupied as shop only was covered by the policy. By mere circumstance that Bandar road was mentioned, it cannot be said that the complainant was having another wine shop at Bandar road apart from the shop situated at Attarattaiah street. There is no evidence adduced by the opposite parties to show that the complainant has another shop at Bandar road and that the claim related to that shop and not relating to the premises situated at Attarattaiah street which was covered by the policy.

IT is also pertinent to note that the Surveyor assessed the loss in the premises with regard to which the claim is made by the complainant. Hence the version of the opposite parties that the loss occurred in the retail wine shop of the complainant which was situated in Bandar road and not in Attarattaiah street cannot be accepted in the absence of any proof to that effect. The document No. 11 of additional documents filed by the complainant, with regard to Raj Lakshmi Beer & Wines Stores, Ali Baig street, Vijayawada and document Nos. 14 and 15with regard to M/s. Poorna Wines, Raja-gopalachari street Governorpet, Vijayawada show that normally fire policy ''C'' will be issued to cover the risk of the godown. The complainant also invited our attention to the document Nos. 8 & 9 to show that the shop-keepers policy issued to M/s. Asian Wines is in respect of retail business. Hence the contention of the opposite parties cannot be accepted that the policy issued by them covers the risk in respect of godown situated in Attarattaiah street and not the retail shop of the complainant. Since the opposite parties repudiated their liability under the policy as evidenced by the document No. 7 dated 21.4.89, solely on the ground that they have not issued any policy covering the retail shop of the complainant at Bandar road is arbitrary, not bonafide and is not based on any material on record and it therefore amounts to deficiency of service on the part of the Insurance Company.

WITH regard to quantum of compensation, the Surveyor assessed the loss at Rs. 1,11,000/-. The complainant has not adduced any material to show that the assessment of the loss made by the Surveyor is not proper. The opposite parties also did not dispute the loss assessed by the Surveyor. We, therefore, direct the opposite parties to pay to the complainant a sum of Rs. 1,11,000/- with interest @ 18% p.a. from 15.4.89 (taking 3 months period from the date of claim i.e., 14.1.89) as a reasonable period of settlement by the opposite parties) till the date of payment. The complainant is also entitled for payment of Rs. 1,000/- by way of costs. 18. The complaint is allowed in part. Complaint partly allowed with costs.