RAHUL RUBBER INDUSTRIES vs NEW INDIA ASSURANCE CO. LTD.

-M/s. Rahul Rubber Industries (P) Ltd. has filed this complaint against the New India Assurance Co. Ltd. seeking a direction to the Insurance Company to pay a sum of Rs. 35,07,817/- on account of alleged deficiency in service on the part of the Insurance Company, in settling its claim. The facts as disclosed in the complaint are that the complainant is manufacturer of Hawai Chappals and has been in production for the last several years. The complainant, in order to cover stocks, had taken a policy from the opposite party for the period from 6.12.1993 to 5.12.1994. Similarly for covering office building, furniture, fixtures and office equipment, the complainant had also taken another policy for the period from 21.12.1993 to 20.12.1994 from the opposite parties. The stocks in process and godown were insured for Rs. 50 lakhs, while the office building, etc., were insured as for Rs. 14.50 lakhs. On 12.1.1994, during the policy period suddenly a severe fire had erupted in the factory of the complainant. The complainant informed the opposite parties on 12.1.1994 itself regarding the loss. The claimant lodged a claim for stocks Rs. 47,08,786/-, for office building Rs. 53,451.52, for furniture Rs. 12,400/-, for office equipment Rs. 2,100/-. The Insurance Company deputed M/s. C.P. Mehta & Co., to assess the quantum of loss in accordance with the terms and conditions of the policy. Mr. Milan D. Mehta visited the premises on 17.1.1994 and assured that he would be submitting a report within 25 days. The complainant supplied all the information and the documents required by the Surveyor. The complainant followed up the matter with the Surveyors and insurers for immediate settlement of their claims, as they were finding it very difficult to pull up. While the firm of Surveyors were already deputed to the case, another Investigator, M/s. L.P. Associates, were brought into picture at the instance of the opposite neighbours and panwalas months after the event, and this report was not acceptable to the complainant.

ACCORDING to the complainant, in September, 1994, the Surveyor conveyed in personal discussion at Bombay that they had assessed the loss of stock at Rs. 35.26 lakhs and under terms and conditions of the policy, it had been adjusted at Rs. 31.9 lakhs, but they did not give the basis of the assessment of the loss. The complainant feeling intense pressure of financial constraints were left with no option but to agree for a commercial indemnity and hence sent their consent letter on 28.10.1994 to the Surveyors. The complainant took up the matter with the opposite party to make on account payment in case settlement was to take further time. It is stated, finally on 20.4.1995 the complainant was given partial payment of Rs. 23,37,459.00. The complainant had requested the opposite party Nos. 1 and 2 by their letter of 21.4.1995 to give them complete details of assessed liability, as they were reportedly told that the final liability for stock claim had already been worked out by the opposite party. The opposite parties were requested to settle the claim fully without further delay as there was enough delay in settling the claim. While giving the basis of loss assessment, the opposite party gave reasons which accounted for a reduction of Rs. 9,77,274/- from the claim amount. However, no reason for further deduction of Rs. 2,05,255/- in the assessed loss could be given. The grievances of the complainant are that against the loss of Rs. 39,22,587/- payable under the policy, the opposite parties have paid only Rs. 23,37,459/-. Loss of Rs. 67,951.52 was suffered on account of the damage caused to the office building, furniture etc. The opposite parties had not given the full basis of assessment of financial loss. In these premises, they claimed for an amount of Rs. 35,07,817/-. The opposite party contested the claim. In the written version filed on behalf of the opposite party it is stated that the complainant is debarred in filing the present complaint after having accepted the amount of Rs. 23,37,459/- in full and final settlement vide Cheque No. 364689 dated 20.4.1995. The said acceptance of the complainant, debars him from filing the present complaint. As the complainant is disputing the quantum to be paid, the arbitration clause under the policy gets attracted and the complainant cannot straightaway come to this Commission without having recourse to the Arbitration Clause. On merits, it was stated that no assurance as alleged was ever given to the complainant. It was denied that 90% of the stocks were completely gutted in the fire. The claim of the insured was highly exaggerated. The Surveyors made it abundantly clear to the insured that they could restart repairs of machinery and manufacturing activities in the main plant as soon as they wished, only leaving aside the salvage of the damaged stock which were in other sections. It was on account of their own reasons that the complainant could not start the production. The payment of Rs. 23,37,459/- was not partial, but was full and final payment. The complainant was told as to how the amount was worked out. As a matter of fact, the final settlement took time as there were breaches to various terms and conditions of the policy. The complainant filed a rejoinder to the written version filed by the opposite party wherein the contentions raised on behalf of the opposite party were denied and the allegations made in the complaint were reaffirmed.

We have heard both the parties. The Counsel for the complainant contended that the complainant signed a blank printed receipt dated 20.4.1995. On the other hand, Counsel for the Insurance Company asserted that the complainant accepted the amount in full and final settlement and they signed the receipt after receiving the cheque.

WE have considered the relevant contentions of the parties. WE have perused the complete records. In the complaint it is nowhere stated that the complainant signed the blank receipt. There is no affidavit in support of his contentions that when he signed, the receipt was blank. The receipt reads as under : "Received from the New India Assurance Company Limited the sum of Rupees Twenty three lacs thirty seven thousand four hundred in full and final settlement of all claims upon the said Company under Policy No. 1133010302176 for loss or damage by a fire which occurred on 12.1.1994 in consequence of which the sum insured stands reduced by the above amount, in the proportion paid under each item of the policy, until the date of next renewal. Rs. 23,37,459/- For Rahul Rubber Industries Sd/- Sd/- State Bank of India"

It is signed on behalf of the complainant as well as on behalf of the Bank. It is unbelievable that the officers of the Bank would sign a blank receipt. Moroever, it is not the case set up in the complaint. Even otherwise the law stands settled by the Supreme Court in the case of United India Insurance Co. Ltd. v. Ajmer Singh Cotton Factory, reported as II (1999) CPJ 10 (SC)=VI (1999) SLT 590=1986-99 Consumer 5077 (NS), wherein it is held as under : "''If in a case the consumer satisfies the authority under the Act that the discharge voucher was obtained by fraud, misrepresentation, undue influence or the like, the authority before whom the complaint is made would be justified in granting appropriate relief. In the instant cases the discharge vouchers were admittedly executed voluntarily and the complainants had not alleged their execution under fraud, undue influence, misrepresentation or the like. In the absence of pleadings and evidence the State Commission was justified in dismissing their complaints."

In view of the above discussion, we find no merit in this complaint. It is dismissed. No costs. Complaint dismissed.