SADEEV SINGH SANDHU AND SONS vs UNITED INDIA INSURANCE COMPANY Limited

DISTRICT Forum, Moga on March 24, 1998 allowed complaint filed by Sadeev Singh Sandhu against United India Insurance Company with the direction to the Insurance Company to pay Rs. 40,095/- within one month, otherwise to pay 18% p.a. interest thereon from the date of order till payment. Costs of Rs. 5,000/- were also ordered to be paid. The complainant is in appeal claiming enhancement towards compensation amount and claiming interest on the amount from the Surveyor''s report.

THE complainant Sadeev Singh Sandhu and Sons owned truck No. DIG 6337 which was insured with the opposite party-United India Insurance Company for an year commencing from May 23, 1991. THE aforesaid truck was involved in an accident on November 23, 1991 and the claim was lodged with the Insurance Company. Three Surveyors were appointed by the Insurance Company one after the other. THE first Surveyor submitted report dated October 25,1992 assessing the loss at Rs. 87,895/-. Second Surveyor subsequently appointed assessed the loss at Rs. 36,922/-. Yet a third Surveyor was appointed who assessed the loss at Rs. 78,130/- Since the claim was not settled, District Forum was approached. THE Insurance Company took up the plea that the complainant had not produced relevant receipts for effecting repairs to the truck before the Surveyor and hence there was delay in settlement of the claim. Rejoinder was filed by the complainant. Both parties led their evidence on affidavits and documents on the basis of which the aforesaid impugned order was passed basically relying upon the report of the first Surveyor (Annexure A-4) dated October 25,1992. THE District Forum observed with respect to thereof the receipts/bills which were not accepted as genuine by the Surveyor those were Annexure A-13 for Rs. 500, Annexure A-15 for Rs. 36,500/ and Annexure A-16 for Rs. 9,800/-. We have gone through the grounds of appeal and have heard learned Counsel for the parties. The short question for consideration is as to whether under the terms and conditions of the insurance policy, the Insurance Company was to indemnify the insured for the loss suffered to the tune of Rs. 87,895/- as assessed by Sh. Rajinder Kumar, Associated Surveyor, New Delhi as per report (Annexure A-4). It is immaterial whether the owner of the truck got the truck repaired or not. Even if no repairs had been done, there was no scope for the Insurance Company to reduce the aforesaid amount. The Insurance Company is legally bound to pay the amount as assessed by the Surveyor and non-payment of the same amount to deficiency in rendering service.

The practice of appointing Surveyor one after the other by the Insurance Company has already been deprecated. When the first Surveyor had assessed the loss, there was no need to appoint other Surveyor with the hope of reduction in the amount of loss as assessed as would be clear from the report of second Surveyor who assessed the loss at Rs. 36,922/-. Even that did not satisfy the Insurance Company that a third Surveyor was appointed followed by an Investigator. There was no justification in discarding the bills as produced by the complainant as already observed above even if the truck had not got repaired, the complainant was entitled to the amount as assessed by the first Surveyor.

THE grant of interest as awarded by the District Forum from the date of order, if the amount is not paid within one month, is not otherwise justified. When finding has been recorded of deficiency in rendering service on the part of the Insurance Company, due compensation by way of interest on the amount awarded should have been granted, allowing three months time from the date of first Surveyor''s report to enable the Insurance Company to settle the claim. THE Supreme Court in United India Insurance Company Limited v. M.K.J. Corporation, III (1996) CPJ 8 (SC), has held that compensation by way of interest against the Insurance Companies cannot be granted more than 12% p.a. Following the same, the complainant in the present case would get interest on the amount payable at the aforesaid rate. For the reasons recorded above, this appeal is allowed. The order of the District Forum is modified with the direction to the Insurance Company to pay Rs. 87,895/- to the complainant with 12% p.a. interest thereon w.e.f. January 25, 1993 till payment. The amount, if any, already paid, would be adjusted. The appellant will get costs of litigation which are assessed at consolidated Rs. 7,000/-. Appeal allowed. ______________