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Judgment
J.P. Singh, Judge
M/s Vashuki Films insured its Sony 3 Chip CCD Colour Video Camera and other items used for Indoor and Outdoor Shooting purposes, with
the Oriental Insurance Company Limited, for Rs.6,92,064/- vide Insurance Policy No. 234300/48/97/000059/304/00023 which was to remain in
operation from 23.08.96 to 22.08.97. The Policy was extended from time to time and the last extension was for the period commencing from
23.08.2001 to the Mid Night of 22.08.2002. The insured items with the sum assured are indicated in the Policy Schedule as follows:-
S.No Qty. Description of Yr.of Sum Excess %Mirt
Items Manfr insured CA Excess
5 EQUIPMENT 1996 Rs.4245005 Rs.2500
SONY
CHIP CCD
COLOUR
VIDEO.
6 2. CAMERA 1996 Rs.2640005 Rs.2500
WITH THE
FLLG ACCS
1.5"" B/W
VIEW
FINDER.
3.FUJINON
ZOOM LENS
(12X0
CARRYING
CASE
TRIPOD
ADAPTOR
EQUIPMENT
VRT 8800
MODEL
Rs.150000/-
JVC.
RS.22000/-
GUN MICE
SONY
RS.20000/-
RIPOD
RS.30000/-
CHARGER
SONY
RS.40000/-
LOPEL
MICE RS.
2000/-
Mr. Surinder Singh, the Proprietor of M/s Vashuki Films, was carrying the insured Camera on his scooter on 07.07.2002 when it met with an
accident in which the Camera was severally damaged. After informing the Insurance Company of the accident and the damage caused to the
Camera, he lodged a claim with the Company to indemnify the damage. Repudiating the claim, the Company informed the petitioner vide its
Communication of March 13, 2003.
The complainant approached the Divisional Forum constituted under the Jammu and Kashmir Consumer Protection Act, 1987 seeking a
direction against the Company for payment of Rs.4,24,500/- along with interest @ 12% per annum, besides Rs.50,000/- by way of compensation
and Rs.10,000/- as costs.
Responding to the Complaint, the Insurance Company pleaded that after the receipt of the information of damage to the insured Camera, it
appointed Mr. Mukesh Purdhani-Surveyor, for assessment of the loss, who vide his Report dated 07.09.2002, assessed Rs.84,800/- as net loss
to the Camera. The claim was, however, repudiated as it was not covered by the terms and conditions of the Insurance Policy.
Justifying its stand of repudiating the Claim, the Insurance Company denied the complainant's entitlement to compensation for the damage
caused to the Camera.
Holding the repudiation of complainant's Claim erroneous, the Divisional Forum allowed the complainant's claim, but only for Rs.84,800/-, as
assessed by the Surveyor, on total loss basis.
Questioning the quantum of compensation awarded by the Divisional Forum and seeking allowance of his claim, as projected in the Claim
Petition, the complainant approached the Jammu and Kashmir State Consumer Disputes Redressal Commission, ""State Commission"" for short, by
his Appeal.
While allowing the complainant's Appeal, the State Commission has directed the Insurance Company to pay, the respondent, Rs.4,24,500/-
along with interest @ 9% per annum with Rs.6000/-as costs.
Aggrieved by the order of the State Commission, the Insurance Company has filed this Writ Petition seeking quashing of the State Commission's
Order of November 30, 2007.
The finding of the Divisional Forum that the complainant-respondent's claim was covered by the terms and conditions of the Insurance Policy
and the Insurance Company had wrongly repudiated the claim, has not been disputed by the Insurance Company's learned counsel, who
questioned the State Commission's order, only on the ground that the Commission had erred in awarding Rs.4,24,500/-, whereas the claimant was
entitled only to the amount as assessed by the Surveyor appointed by the Company.
Learned counsel for the claimant, on the other hand, justified the State Commission's Award urging that the Surveyor had erroneously
deducted Rs.3,18,000/- by way of 75% depreciation and 5% of the claim amount, from the value of the Camera taken at Rs.4,24,000/- and the
order passed by the State Commission thus did not suffer from any error of law, warranting interference by the Court in exercise of its extra
ordinary Civil Writ Jurisdiction.
I have heard learned counsel for the parties and perused the records.
Perusal of the pleadings of the parties indicates that the specific claim of the complainant for Rs.4,24,500/- as the cost of the Camera,
Rs.50,000/- as compensation and Rs.10,000/- as litigation expenses was not specifically denied by the Insurance Company, for all that has been
pleaded by it, in response to the respondent's Complaint, is the avoidance of its liability stating that the Claim was not covered by the terms and
conditions of the Insurance Policy, of course with the bald denial of paragraph No. 9 of the claimant's Complaint where he had spelt out the break
up of its claim.
The Company had not pleaded and projected any specific case to dispute its liability to pay compensation more than the one assessed by the
Surveyor. It is not indicated in the Company's Response to the Complaint as to how was the Company entitled to deduct 75% depreciation from
the accepted value of the Camera.
In terms of the provisions of Section 11 of the Jammu and Kashmir Consumer Protection Act 1987, only those facts which were disputed,
could be set down for proof by evidence.
As only deficiency in service pleaded by the complainant had been disputed by the Insurance Company, so the Divisional Forum had to
examine the disputed issue only, on the evidence which the parties had adduced in the case.
The Divisional Forum was thus not right in holding the complainant entitled only to Rs.84,800/- on the ground that the complainant had not
produced any evidence to rebut the estimate of the Surveyor. This is so because the claim of the complainant having not been questioned by the
Insurance Company in its Response to the Complaint, the complainant was not required to lead any evidence to support its claim that stood
admitted by the Insurance Company which had disputed the claim only on the ground that it was not covered by the terms and conditions of the
Insurance Policy.
Be that as it may, even otherwise, the Divisional Forum appears to have accepted the deduction of 75% depreciation from the accepted value
of the Camera at Rs.4,24,500/-, without giving any reason(s) in support thereof. Before accepting the report of the Surveyor in so far as it
pertained to depreciation at the rate of 75% from the accepted value of the Camera, the Divisional Forum was required to give reasons for such
high rate of depreciation for a period of about 11 months.
The Insurance Company having accepted, the value of the Camera at Rs.4,24,500/- in its latest Policy, during which the accident had taken
place in which the Camera got damaged, and taken premium therefor on it, on the aforesaid amount, was not entitled to claim depreciation taking
the value of the Camera on the date it was initially insured in the year 1996 After having demanded and accepted the premium for insurance of the
Camera, taking its market value at Rs.4,24,500/- as on August 23, 2001, the Company could, at the most claim depreciation from August, 2001
to 07.07.2002 when it was damaged in file accident. Thus, the amount which could be deducted by way of depreciation from the value of the
Camera could be for 10 months and in this view of the matter only 10% of the value of the Camera could be deducted by way of depreciation to
assess the market value of the Camera. In this view of the matter, the complainant, even if one were to allow the Insurance Company to deduct
depreciation value from the accepted cost of the Camera, despite its having not so pleaded in defence to the Complaint, the market value of the
Camera at the time of the accident would come to Rs.3,82,050/-. Taking note of the Excess Clause appearing in the Policy and allowing 5%
deduction from the Claim on that account, the Complainant's Claim for loss of the Camera would come to Rs.3,62,948/-.
Both the Divisional Forum and the State Commission have not considered the petitioner's claim of Rs.50,000/- by way of compensation
although his evidence led in this behalf, had remained uncontroverted by the Company. In view of the findings of the two Forums holding the
Insurance Company wrong in rejecting the complainant's claim as not covered by the terms and conditions of the Insurance Policy, the claimant
becomes entitled to compensation u/s 12(d) of the Jammu and Kashmir Consumer Protection Act, 1987 for deficiency in service in settling the
complainant's claim.
Allowing Rs.20,000/-, which, in the circumstances of the case, is considered just and proper compensation to the Complainant for deficiency
in service by the Insurance Company, and Rs.6000/- as costs as allowed by the Commission, the Complainant becomes entitled to Rs.3,88,948/-.
The order passed by the Commission directing Insurance Company to pay Rs.4,24,500/- thus needs to be modified to Rs.3,88,948/-.
For all what has been said above, I, therefore, do not find any merit in the petitioner's learned counsel's submission that the State Commission
had erred in directing enhancement of the amount of compensation awarded by the Divisional Forum except to the extent indicated hereinabove.
The claim of respondent no.1 thus succeeds for an amount of Rs.3,88,948/-along with interest as allowed by the State Commission.
This Writ Petition is, accordingly, disposed of on the above terms. The Registrar Judicial of the Court to release the amount deposited by the
appellant, in terms of this judgment minus, however, the amount already received by the complainant during the pendency of the litigation before
the Consumer Forums. The excess amount, if any, shall be refunded to the petitioner-Insurance Company.