United India Insurance Co. Ltd. vs VIJAY KUMAR

UNITED India Insurance Company challenges order of District Forum, Moga dated November 4, 1997 whereby a direction was given to the appellant to pay a sum of Rs. 50,000/- as compensation and Rs. 500/- as costs to the complainant Vijay Kumar.

VIJAY Kumar had taken an Insurance Policy from United India Insurance Company covering risk of household articles which included one Television priced at Rs. 50,000/-. During the currency of the policy, on January 1, 1996, when both VIJAY Kumar and his wife were carrying the aforesaid T.V. upstairs, it fell down and was damaged. The Surveyor appointed by the Insurance Company determined it to be case of total loss and after considering depreciation, the loss of the T.V. was assessed at Rs. 12,500/-. However, the Surveyor considering the nature of the damage caused to the T.V. observed that it appeared to be a created damage and thus recommended for repudiation of the claim. Accordingly, the Insurance Company has repudiated the claim which led the complainant to approach the District Forum. As briefly stated above, Insurance Company contested the complaint relying upon the repudiation. Both the parties led their evidence on affidavits and documents on the basis of which the impugned order was passed. Learned Counsel for the appellant Insurance Company has argued that repudiation of the claim made in the present case was on the basis of mateiral collected through the Surveyor and it was bona fide action of the Insurance Company, hence there was no deficiency in rendering service on the part of the Insurance Company. Secondly, it has been argued that the District Forum was not justified in granting Rs. 50,000/- as compensation ignoring the depreciation clause in the Insurance Policy. We have given due consideration to the aforesaid arguments. As far as first point is concerned, contention of Counsel for the Insurance Company is that in view of decision of National Commission in Shiv Trading Company v. New India Assurance Company Limited & Ors., II (1996) CPJ 197 (NC)=1996 (2) CPC 89, no relief can be granted to the complainant. We have perused the aforesaid judgment, however, on facts the ratio of the decision aforesaid cannot be applied to the case in hand. The question as to whether the whole story was concocted to cover up loss falsely by the complainant is dependent upon the facts and circumstances of each case. That was a case of stocks allegedly destroyed by fire and on the material collected it was found that the story of fire was manured. In the present case, it cannot be held so. The only reliance placed on the mateiral collected is on the report of the Surveyor (Ex. R-4). Paras 3 and 4 of this report reads as under : "3. Further to our detailed physical observations to the Television; the back side of the Television was shown badly broken and its front side showing No Impact of feeling; clearly indicates that the Television was broken with some external tool like hammer from its back and shown the damages as a result of felling of the Television which is totally fabrication of the circumstances of the loss.

We wonder; how suddenly the insured got the idea of shifting of the old Television from ground floor to 1st floor after many years keeping at its ground floor that too on the last day of the expiry of the policy. Further to this the Television if carried by two persons straightaway fell rolling on the ground as it will struck between the legs of the person carrying or downward side of stairs. In our views, this is all a drama to get compensation for their already work out Television which was purchased old about seven years back." 4. We are afraid that from the nature of the damage caused to the Television, no finding could be arrived at that the damage caused was intentional or was caused with a hammer and was not the result of fall. When a Television was being carried by two persons in the stairs and it had a fall, it cannot be visualised which portion of the T.V. would hit the stairs and get damaged. Stairs as such is also a hard substance and if particular portion of the T.V. is struck against such hard substance, only such portion would be damaged. The mere fact that screen of the T.V. was not damaged with the fall is no ground to come to the conclusion that back portion of the T.V. was damaged with a hammer. The opinion expressed by the Surveyor is arbitrary and the repudiation cannot be held to be bona fide. Since claim was not settled, there was deficiency in rendering service on the part of the Insurance Company.

THERE is merit in the second contention raised by the Counsel for the Insurance Company. Copy of the Insurance Policy is Annexure A-3 as produced by the complainant himself. Under the heading General Exception Clause II would read as under : "The Company shall not be liable in respect of loss or damage casused by depreciation or wear and tear." The report of the Surveyor indicates that the T.V. was an old one and had been purchased by the complainant from a private person few years ago. He was justified in considering depreciation towards the price of the T.V. which was originally assessed at Rs. 50,000/-. He rightly came to the conclusion that considering the aspect of depreciation for which the Company was not to be liable, the loss on account of damage to the T.V. was Rs. 12,500/-. If the complainant was not satisfied with the amount as assessed by the Surveyor, it will be open to him to approach the Civil Court but as far as Fora under the Consumer Protection Act is concerned, the right course would be to accept the loss determined by the Surveyor and give directions for its payment and to leave the complainant to approach the Civil Court for any further relief in this respect. It may be observed that compensation is to be fixed under Section 14(1)(d) of the Consumer Protection Act after recording a finding of negligent act on the part of the opposite party and regarding the loss suffered by the complainant. While determining such loss suffered by the complainant, in the set of present circumstances is not the price of the T.V. as declared for the purposes of insurance but is the actual value of the T.V. at the time of causing of the loss. If that is so, the age of the T.V. is a relevant consideration. The original price will not continue to prevail after 5-6 years for such an electrical appliance. The Surveyor rightly assessed the loss as stated above. For the reasons recorded above, this appeal is partly allowed. The order of the District Forum modified with the direction to Insurance Company to pay a sum of Rs. 12,500/- with 12% interest thereon w.e.f. 3.7.1999 (three months from the Surveyor''s Report) alongwith costs of Rs. 500/-. For further relief, if any, the complainant may approach the Civil Court, if so advised. Appeal partly allowed with costs.