National Insurance Co. Ltd. vs HIREN NATVARLAL DHOLAKIA

THIS appeal arises from order dated 30th October, 2002 rendered by the learned Kutch District Consumer Disputes Redressal Forum in Complaint Application No. 95/2001 directing the opponent Insurance Company to pay to the complainant Rs. 1,80,000/- being the insurance amount under the policy of insurance in question covering risk of earthquake which disturbed the whole of Gujarat State resulting into loss of complainant''s flat, and interest @ 12% p.a. from June, 2001 till payment with compensation in the sum of Rs. 3,000/- on the head of mental agony and cost in the sum of Rs. 2,000/-.

WE have heard the learned Advocates for the parties. It has been submitted on behalf of the opponent Insurance Company that learned Forum has clearly not considered the report of the Surveyor M/s. Rajiv Bhatt Associates. In our considered opinion learned Forum has dealt with the evidence adduced by both the parties and appreciated the same. Briefly stated, when the insurance was taken complainant had submitted Government approved valuer''s certificate for putting up the amount of insurance. The insurance was taken just 7 to 8 months before the date on which earthquake gripped the State and destroyed the flat in question. The value so stated by the Government approved valuer was in the sum of Rs. 1,80,000/- and, therefore, the complainant was prima facie justified in claiming that amount, although on close scrutiny of that report it would appear that it includes cost of land. WE will presently consider this aspect of the matter. Opponent''s Surveyor has also put up valuation of the building which matches with the valuation thereof put up by the Government approved valuer whose report was submitted at the time of insurance. It would, therefore, appear that the value of the construction was approximately the same figure as has been assessed by even the opponent''s Surveyor. Thus the valuation so put up would come to around Rs. 1,23,750/-. With regard to cost of land, it has been submitted that the complainant continues to have interest in land since he would be one of the joint owners thereof. If that is so, the complainant would not be entitled to value of the land assessed by even the complainant''s valuer when the insurance amount was proposed.

Taking then to the report of the Surveyor we find that the surveyor has deducted salvage in the sum of Rs. 12,000/- for which there was no data. Nothing appears to have been left with and retained by the complaint. No evidence has been produced by the opponent Insurance Company with regard to debris or any left out material remaining with the complainant as the result of the total loss of the flat sustained by the complainant. Therefore, deduction of Rs. 12,000/- appears to be neither just nor proper. Besides, the Surveyor has not given any particulars with regard to salvage. Hence there is no justification for deducting the amount of Rs. 12,000/- from the amount assessed by the Surveyor. That precisely appears to be deficiency in service on the part of the opponent Insurance Company.

OPPONENT Insurance Company has also proposed deduction by way of depreciation which was not warranted when the amount of insurance was put up in the policy of insurance in question after obtaining Government approved valuer''s report who assessed value of the property after deducting depreciation in the construction of the flat. Hence there is no justification for deduction of depreciation of Rs. 2,475/-. This is another instance of deficiency in service on the part of the opponent Insurance Company. The Surveyor also deducted excess 5% amounting to Rs. 5,464/-. Neither the Surveyor nor the opponent Insurance Company has been able to illustrate and satisfy such deduction. Even as on today the opponent Insurance Company has not been able to explain this item of deduction from the amount assessed by the Surveyor.

IN the result, complainant would be entitled to the sum upto Rs. 1,23,750/- and since there is clear deficiency in service on the part of the opponent INsurance Company in such a matter where calamity of earthquake had hit the whole of the State of Gujarat we do not propose to disallow the claim of compensation on the head of mental agony and hardship and also of the cost. We also find that the award of interest, which is 12%, appears to be quite reasonable in view of the facts and circumstances of the present case. We, therefore, pass following order : Impugned order dated 30th October, 2002 rendered by the learned Kutch District Consumer Disputes Redressal Forum at Bhuj in Complaint Application No. 95/2001 is hereby modified by reducing the amount of Rs. 1,80,000/- to Rs. 1,23,750/- while maintaining the rest of the order. Accordingly, the opponent Insurance Company shall pay to the complainant Rs. 1,23,750/- with interest @ 12% from 1.6.2001 till payment, compensation in the sum of Rs. 3,000/- and cost of complaint in the sum of Rs. 2,000/-. The amount of Rs. 1,30,000/- deposited by the opponent Insurance Company in this Commission shall be verified and paid over to the complainant by A/c payee cheque. Balance amount shall be paid over by the opponent Insurance Company to the complainant within six weeks from today. This appeal is accordingly partly allowed with no further order as to cost. Appeal partly allowed.