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Judgment
This Appeal, by the Complainant, under Section 19 of the Consumer Protection Act, 1986, calls in question the correctness and legality of order dated 5.12.2012, passed by the State Consumer Disputes Redressal Commission, Delhi (for short "the State Commission") in Complaint No.05/37. By the impugned order, the State Commission has dismissed the Complaint preferred by the Appellant against Respondent Insurance Company challenging their decision in repudiating its claim, amounting to Rs.44,13,200/- and offering a paltry sum of Rs.1,90,000/- as full and final settlement of the claim under the Standard Fire and Special Peril Policy.
Briefly stated, the material facts are : that the Appellant, a Proprietorship Concern, had obtained a Standard Fire and Special Peril Policy covering its office, factory and godown, for an assured sum of Rs.59 Lac. The Policy was valid from 17.12.2002 to 16.12.2003. Unfortunately, on 20.7.2003, a fire broke out in the factory premises. The fire was severe and it took 4-5 hours for the fire brigade to extinguish it. It is the case of the Appellant that the office, factory and godown buildings, as also the raw materials, finished and semi-finished goods, etc. lying therein were completely destroyed in the fire. Informaiton regarding the fire was sent to the Insurance Company on 22.7.2003.
Thereafter, a claim for indemnification of the loss suffered by the Appellant on account of the said fire, amounting to Rs.44,13,200/- was preferred.
On receipt of the claim, the Insurance Company appointed a Surveyor to assess the loss suffered by the Appellant. The Surveyor asked the Appellant to furnish certain documents, including purchase and sale invoices; shipping bills; goods receipt and issue register, etc. in support of the claim that stock worth Rs.37,13,000/- had been lost in the fire. It is noted in Surveyor''s letter dated 1.10.2003 that the Appellant had agreed to furnish all the requisite documents pertaining to the period from 1.4.2003 till the date of fire on 6.10.2003 but no such documents were ultimately furnished. Vide letter dated 28.9.2003, with the consent of the Insurance Company, the Surveyor appointed one Mr.K.K. Bhagirath & Co., Chartered Accountants to carry out inspection/verification of the books of account and related records maintained by the Appellant. In their report, the Chartered Accountants observed thus : "A number of purchase bills submitted by the insured are not genuine and supplier has denied its genuineness. Number of discrepancies was observed in the bill book of one of the major supplier of fabrics namely Kittu Collections, who was also found to be an interested party other than being a creditor. Most of the purchases of Neha are not genuine and are merely book entries. Payments reflected in books of accounts differ from those verified from Bank records. The audited accounts do not carry any accuracy or authenticity. The books of accounts prepared by the insured are incorrect and not reliable. It appears that these books of accounts have been manipulated to mislead the quantum of loss sustained by the insured."
In view of the said report, the Surveyor observed that the Appellant had submitted inflated estimates; bogus bills and had made false declaration with the sole aim to file an exaggerated claim and derive undue monetary benefit under the Policy, in contravention of General Condition No.8 of the Policy. Accordingly, the surveyor held that in view of breach of a policy condition, all the benefits under the Policy stood forfeited.
Aggrieved by the said Report and the decision of the Insurance Company, offering a compensation of Rs.1,90,000/-, the Appellant filed Complaint before the State Commission, the subject-matter of the present Appeal.
When the Appeal came up for consideration on 4.2.2015, on a specific query by the Bench relating to the basis for evaluating the closing stock at Rs.37,13,000/-, learned counsel appearing for the Appellant had sought time to seek instructions on this aspect of the matter, which was granted.
Learned counsel, appearing for the Appellant, now submits that as per her instructions, the entire record, including the books of accounts and related documents, were destroyed in the fire and no relevant record is available with the Chartered Accountants as well. Nevertheless, she has made a valiant attempt to justify the claim in respect of the stocks, valued at Rs.37,13,000/-, on the strength of the manufacturing, trading and profit and loss
account for the period ending 31.3.2003, wherein the value of the closing stock had been declared as Rs.35,86,380/-. We are not at all convinced with submissions made by the learned counsel. There may not be any dispute with regard to the value of the closing stock as on 31.3.2003, but what the Appellant was required to prove was the extent of the stocks available on the fateful day, i.e., 20.7.2003, for which purpose, he had to file some material to show the purchases, if any, of the raw material and the sales between the period 1.4.2003 to 20.7.2003. Admittedly, no cogent material was produced and the bills, etc. furnished were found to be unreliable by the Chartered Accountants. The stand of the Appellant that even his Auditors did not possess any relevant document, does not inspire confidence. How the Auditors had finalized accounts for the previous year ending 31.3.2004, is anybody''s guess.
In that view of the matter, we do not find any illegality in the impugned order, upholding the decision of the Insurance Company in not accepting the total claim of the Appellant, i.e. Rs.44,13,200/-, out of which the claim in respect of the closing stock was Rs.37,13,000/-. Consequently, the Appeal must fail. It is dismissed accordingly, with no order as to costs. It will, however, be open to the Appellant to approach the Insurance Company for release of the admitted claim, amounting to Rs.1,90,000/-.