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Judgment
HEARD the learned Counsel for the parties.
IT is an admitted fact that the complainant-respondent had taken an insurance policy for the finished goods stock kept in his premises. On 18.10.1996, the watchman reported that the window bars on the backside of the unit were cut by some burglars and found that finished leather and some semi-finished leather were missing. He lodged a claim with the Insurance Company contending that the total loss was for a sum of Rs. 4,78,300. The Insurance Company appointed Surveyor. The Surveyor, by his report dated 25.2.1998, after proper verification, arrived at the conclusion that loss suffered by the complainant was for a sum of Rs. 4,53,000. Considering the Under Insurance Clause, the Surveyor assessed loss payable to the complainant at Rs.2,48,900. As the amount was not paid, complainant approached the State Commission, Chennai, by filing O.P. No. 161/1999. The State Commission, by its judgement and order dated 20.2.2004, allowed the complaint and directed the Insurance Company to pay a sum of Rs. 4,88,300 which included costs of Rs. 2,000. Against that judgment and order, the Insurance Company has preferred this appeal and pointed out that the order passed by the State Commission is without considering Clause No. 6 of the Insurance Policy.
In our view, the submission made by the learned Counsel for the Insurance Company is totally justified. It is apparent that State Commission has not taken into consideration the following Average Clause No. 6 of the terms and conditions of the Insurance Policy: "Average : If the property hereby insured shall at the time of any loss or damage be collectively of greater, value than the sum insured thereon, then the insured shall be considered as being his own insurer for the difference, and shall bear a rateable proportion of the loss or damage accordingly. Every item, if more than one, in the Policy, shall be separately subject to this condition."
UNDISPUTEDLY, in the present case, the stock at the relevant time was for a sum of Rs. 9,10,491. Applying this clause, the Surveyor rightly arrived at the conclusion that, complainant was a co-insurer as per the said terms and, therefore, on the basis of rateable proportion, loss is to be adjusted and on that basis the loss is determined by the Surveyor. With regard to the formula applied by the Surveyor, it is just arithmetic and it does not require any discussion.
HENCE, the order passed by the State Commission directing the Insurance Company to pay a sum of Rs. 4,88,000 cannot be justified. Insured is entitled to have reimbursement of the loss on the basis of rateable proportion of loss as he is the co-insurer. HENCE, on the basis of Survey Report, the Insurance Company is required to pay the sum of Rs. 2,48,900 . In the result, the appeal is partly allowed and impugned order passed by the State Commission is modified. For delay in reimbursing the complainant, he is required to be properly compensated. For measuring the compensation, interest is a proper yardstick in the present case, Hence, we direct that Insurance Company shall pay the said amount with interest at the rate of 12% per annum. Insurance Company is directed to pay a sum of Rs. 2,48,900 with interest at the rate of 12% per annum from 18.4.1997 (i.e. after six months from the date of incident). There shall be no order as to costs. Learned Counsel for the Insurance Company submits that within six weeks from today, Insurance Company would pay the said amount to the complainant by A/c payee cheque. First Appeal No. 138/2004
THIS appeal is filed against the judgment and order in O.P. No. 162/1999 passed by the State Commission on 20.2.2004. In the present case, during the night between 14th May and 15th May, 1997 theft took place and it was contended that loss suffered by the complainant was for a sum of Rs. 4,78,300 . As per the survey report dated 15.2.1999 given by Mr. R. Balaraman, the loss assessed is as under: Adjusted Loss is herein given: 1. Net Loss due to theft of 1435 pieces Rs. 2,30,000 2. (a) Value of Leathers Stock as on 14.5.1997 Rs. 7,65,050 (b) Value of chemical stock as on 14.5.1997 Rs. 1,53,638 Rs. 9,18,688 3. Insured Value Rs. 5,00,000 Since the stock value is more than the insured value the conditions of average has to be applied i.e. (Insured Value Stock Value) Loss = (Rs. 5,00,000 Rs. 9,18,688) Rs. 2,30,000 = Rs. 1,25,166.
FOR the reasons stated above and particularly Clause No. 6 of the Policy, the loss assessed by the Surveyor is in accordance with the terms and conditions of the Insurance Policy. In this view of the matter, impugned order passed by the State Commission is modified and it is directed that Insurance Company shall pay the amount of Rs. 1,25,166 as assessed by the Surveyor with interest at the rate of 12% per annum from 14.11.1997 (i.e. after six months after the date of incident).
Learned Counsel for the Insurance Company submits that within six weeks from today, Insurance Company would pay the said amount to the complainant by A/c payee cheque. Appeals partly allowed