NEW INDIA ASSURANCE CO LTD vs Kamboj Ultra Sound And Diagnostic Pvt Ltd

THIS appeal has been filed by the appellant against the order dated 10.09.2007 passed by the learned State Consumer Disputes Redressal Commission, Delhi (in short, ''the State Commission'') in Consumer Complaint No. C -90/99 M/s. Kamboj Ultra Sound and Diagnostic Pvt. Ltd. Vs. The New India Assurance Co. Ltd. and Ors. by which, while allowing complaint, OP was directed to refund Rs. 9,15,200/ - with 12% p.a. interest and further allowed Rs.50,000/ - as compensation for mental agony and cost of litigation.

BRIEF facts of the case are that complainant/respondent had purchased "CT MX 640 whole Body CT Scanner with 8 x 10 multi format camera, voltage stabilizer, lead glass and frame for lead class" from M/s. Wipro G.E. Medical System Ltd., Bangalore, for a sum of Rs.65,75,000/ - and installed the aforesaid machine on 25.11.1995 at Jaipur Golden Hospital Plot No. 2, Institutional Area Sector 3, Rohini, Delhi. M/s. Wipro GE gave warranty for the aforesaid machine w.e.f. 25.11.1995 to 24.11.1996. This machine was insured by OP/appellant for a period of one year from 9.1.1997 to 8.1.1998 on replacement basis. On 25.10.1997, scanning procedure came to standstill at about 5.00 p.m. Engineer from M/s. Wipro GE was informed about stoppage of functioning of machine. M/s. Wipro G.E. quoted cost of Rs.9,15,200/ - for replacement of defective tube. Complainant lodged claim with OP. OP appointed surveyor, but OP failed to settle the claim. It was further submitted that OP again approached complainant for renewal of policy on its expiry and complainant paid Rs. 99,823/ - towards renewal charges of the aforesaid policy, but even then OP did not issue policy and complainant is entitled to refund of the aforesaid premium. It was further submitted that OP vide letter dated 16.1.1998, informed complainant that OP was not liable to any claim in respect of X -Ray tube, as it had undergone 100% depreciation which was illegal. Alleging deficiency on the part of OP, complainant filed complaint before the learned State Commission and claimed cost of tube, refund of premium and compensation of Rs.50,000/ - and cost of litigation. OP resisted complaint and submitted that complaint has not been filed by duly authorised person. It was further submitted that complainant took EEI policy which carries endorsement applicable to all electro medical equipment and as X -Ray tube had already done more than 40,000 exposures, complainant was not entitled to any claim and prayed for dismissal of complaint. Learned State Commission after hearing both the parties allowed complaint, as aforesaid. Heard learned Counsel for the parties and perused record.

LEARNED Counsel for the appellant submitted that appellant rightly repudiated claim in the light of endorsement attached to the policy; even then, learned State Commission has committed error in allowing complaint and further allowing interest along with compensation; hence, appeal be allowed and impugned order be set aside. On the other hand, learned Counsel for the respondent submitted that order passed by learned State Commission is in accordance with law, as there was no endorsement attached with the police; hence, appeal be dismissed.

LEARNED State Commission has observed in the order that there was no such endorsement attached with the policy in respect of the X -Ray tube. Learned Counsel for the appellant submitted that as per order dated 6.2.2008 of this Commission, appellant has filed endorsement for calculation of depreciation and as this order has not been challenged, endorsement is to be treated as part of the policy. On the other hand, learned Counsel for the respondent submitted that policy does not contain aforesaid endorsement and it cannot be considered. This Commission vide order dated 6.2.2008 directed appellant to file documents regarding how depreciation has been considered within a period of 4 week from that date. Admittedly, this endorsement has been filed on 16.4.2008 and in such circumstances; it becomes clear that aforesaid endorsement has not been filed within the time granted by this Commission. Not only this, this endorsement apparently does not form part of the policy issued in favour of the respondent. Merely because same policy number has been mentioned in this endorsement, it cannot be presumed that it was forming part of the policy particularly when at the time of insurance, X -Ray tube had already completed 42470 slices meaning thereby, even on the date of insurance, respondent was not entitled to compensation of more than 40% as per aforesaid endorsement which cannot be believed.

LEARNED Counsel for the respondent has also drawn my attention towards report of surveyor G.P.S. Bagga dated 13.1.1997 which is pre inspection cum valuation report given by surveyor to Insurance Company and according to this report X -Ray tube had completed 42470 slices on the date of inspection and highest tube life in India was 3,00,000/ - slices. Surveyor further mentioned in his pre inspection report that it was a good risk which may be accepted by Insurance Company under standard terms and conditions.

IN the light of aforesaid pre inspection report it becomes clear that appellant was well aware about the fact that X -Ray tube had already completed 42470 slices; even then, appellant granted insurance policy in favour of respondent for the aforesaid machine and in such circumstances, no reliance can be placed on the endorsement filed by the appellant before this Commission. Had it been a part of policy, this should have been given by the appellant to the respondent along with policy and further it should have been filed by the appellant before State Commission along with reply. Perusal of policy further reveals that this policy was issued on replacement basis. Clause 1 on page 2 of the policy runs as under: "1. SUM INSURED: It is a requirement of this insurance that the Sum Insured shall be equal to the cost of replacement of the insured property by new property of the same kind and same capacity, which shall mean its replacement cost including freight, dues and customs duties if any and erection costs".

WHEN policy was issued on replacement basis, there was no question of endorsement regarding compensation on depreciation basis based on number of exposures.

LEARNED Counsel for the respondent further apprised that policy was renewed by appellant for the next year after charging 30% extra premium on account of this claim. Learned Counsel for the appellant has not disputed this fact. In such circumstances, it becomes clear that respondent was entitled to get benefit of insurance under the policy so he paid 30% extra premium on renewal of policy. Learned Counsel for the appellant further submitted that interest and compensation both could not have been allowed by learned State Commission. Perusal of impugned order reveals that Rs.50,000/ - has been allowed as compensation for mental agony, harassment and cost of litigation and I do not find any illegality in the impugned order allowing interest on the refund amount along with aforesaid compensation for harassment including litigation charges.

IN the light of aforesaid discussion, appeal filed by the appellant is liable to be dismissed.

CONSEQUENTLY , appeal filed by the appellant is dismissed with no order as to costs.