NEW INDIA ASSURANCE CO. LTD. vs Lilabai Devichand Jain

HEARD learned Counsel for petitioner and respondent on admission. Brief facts are that respondents had taken a fire policy, insuring stocks in trade, furniture and building which was valid for the period from 18.7.2005 to 17.7.2006. Due to unawaited rain on 25.7.2005 there was flood in the area and shop premises were submerged in water for a considerable period. The garments and other materials in the stock suffered damages on getting these stocks washed away. Intimation of loss was sent to petitioner Insurance Company to depute a Surveyor to assess losses. The Surveyor visited shop premises on 7.12.2005 and submitted his report on 5.12.2005 assessing loss to the extent of Rs. 1,78,996 , taking into account all documents and evidences produced by respondent. The claim of respondent was however repudiated by Insurance Company holding that since respondent had failed to submit relevant documents despite long waiting to settle the claim, this being a flood claim failed with lapses of 30 days. Aggrieved with repudiation of claim respondent filed a consumer complaint before the District Forum which regard being had to the findings of the Surveyor and assessment of loss made by him, passed an award directing Insurance Company to pay sum of Rs. 1,78,996 along with 10% interest. Compensation of Rs. 10,000 and also litigation costs of Rs. 2,000 were awarded by District Forum. In appeal that was preferred by aggrieved respondent, the State Commission passed an award for Rs. 6,86,247 and partly allowed the appeal. It is against this finding of the State Commission that Insurance Company is in revision before us.

WE have heard the learned Counsel appearing for petitioner and respondent on admission. Learned Counsel appearing for respondent strenuously urges that even though all relevant documents evidencing list of stock in trade, purchase bills, statement prepared by Chartered Accountant, repairing costs of furniture, purchase bills of the steel materials and also repairing costs of building were available, the surveyor had not chosen to give credence to them and confined assessment of loss only to the extent of Rs. 1,78,996 which was contrary to the weight of mass of evidence. Learned Counsel upholding the finding of the State Commission submits that State Commission rightly taking notice of this document which was of vital significance for assessment of loss suffered by respondent during catastrophe, of flood upholding claim of respondent passed award for Rs. 6,86,257. The Surveyor had visited the shop premises on 27.7.2005 and simply for belated filing of report on 5.12.2005, the credibility of the Surveyor''s report could not be lost. Since shop premises are supposed to be closed and not opened, it is most unlikely that entire stock kept in premises would be swept in flood. For their failure to make available damaged stock to Surveyor for verification, it will be seen from Surveyor''s report that respondents endeavoured to justify their absence stating inter alia that damaged items were distributed free in public. We are however not impressed with this logic and this has to be rejected.

THE State Commission however preferred to put credence on Panchnama made by revenue officer and report of local authority for non -availability of damaged articles to be shown to Surveyor. The State Commission also put credence on purchase bills which were rejected by District Forum, there being some corrections/over writing in them. The purchase invoices were however not discarded by Surveyor. Notwithstanding State Commission, while making award for Rs. 6,86,297 took into consideration repairing bills of the furniture, costs of steel materials and repairing costs for building also. The finding of the Surveyor was that policy covered stock for Rs. 6,20,000. As per trading account as on 4.7.2005, total stock was worth Rs. 6,11,408. Purchase bills for the period from 1.4.2005 to 24.7.2005 were worth Rs. 7,91,317. Total of this purchase bills for said period however was of Rs. 8,25,035. In view of these discrepancy which could not be properly explained by respondent that Surveyor had not preferred to put credence on them. Documents made available to Surveyor evidencing status of stock 4 or 5 months preceding the day when shop premises got submerged in water would not help to assume status of stock available on that day. The District Forum had assigned good reasons for rejecting inflated claim of respondent and rightly preferred to put credence on Surveyor''s report. We however do not mean to say that Surveyor report was last word in the matter of assessment of loss, as assessment made by Surveyor was still to open question to the Insurance Company and also the Court to approve or disapprove them. Yet the Surveyor report carries vital significance and cannot be brushed aside on untenable grounds. We accordingly, while reversing finding in the matter of quantum of award passed by State Commission restore that of the District Forum. The revision petition accordingly partly succeeds with no order as to costs.