A consent letter signed by the insured, agreeing to accept a certain amount in full and final settlement of an insurance claim, is valid and binding, and the insurer cannot insist on the production of additional documents after the consent letter is signed.

Mr. S.K.M. Lodha, President — The complainant Pinkcity Textiles, Jaipur^ has filed this complaint under Section 12 read with Section 17 (a)(i) of the Consumer Protection Act, 1986 (“The Act” hereinafter) against the United India Insurance Company Ltd., Jaipur (“the Insurer”) before the State Commission in August 20, 1990.

The complainant (the insured) got the raw material and other goods of the factory insured with the insurer. Cover note No. 035811 was issued to the complainant. In pursuance of that policy No. 140301/57/1/1073 was issued. The period of insurance was 15.2.1988 to 14.2.1989. The premium paid was Rs. 1,447/-. According to the complainant, all risks were covered. Between the night of 6th and 7th June 1988 at 2.00 A.M. fire was caused in the godown of the factory situate at Baise Godam Jaipur. As a result of that raw material was burnt and with considerable difficulty fire was brought under control. The complainant informed the insurer on the next day 8.6.1988 by a letter asking it to depute surveyor for assessment of loss. A letter dated 14.6.1988 was sent by the surveyor (Shri P.K. Bhatia) seeking certain information from the insured. The complainant submitted the details of the loss suffered by him and also the statement of stock. The complainant approached the insurer for the settlement of the claim several times. It is said by the complainant that in order to avoid the settlement, a letter dated 9.3.1989 was written to the complainant. In that, the complainant was asked to submit a copy of the fire brigade report and also to furnish the present market value of the properties (building of factory, Plant and Machinery, electrical installation and stock in godown and stock in process). It was stated by the complainant that it was not proper for the insurer to have asked the information. According to the complainant loss suffered by him on account of fire was Rs. 90,507.70 for which the insurer is liable. As the claim of the insured was not settled in time he suffered loss in production and trade and that loss was assessed by it at Rs. 50,000/-. It, therefore, filed the complaint praying that a sum of Rs. 90,507.70 on account of loss caused in fire together with interest @ 18% p.a. and also Rs. 50,000/- as compensation may be awarded. Costs were also claimed. The insurer (opposite party) contested the complaint. It was submitted that the documents referred to in the complaint were made available to the surveyor but after considerable delay. It is said that the claim was discussed by the surveyor Shri P.K. Bhatia with the representative of the complainant for the purpose of the assessment of the loss caused due to fire. This discussion took place on 25.11.1988. On the basis of the discussion, the documents submitted by the complainant, real position of the real loss, circumstances resulting to the cause of fire and the terms of the contract relating to insurance, Shri P.K. Bhatia surveyor assessed the loss and recommended payment of Rs. 18,802/- on the condition that salvage shall be made available to the insurer. A consent letter was prepared and it was signed by the partner of the complainant’s firm. It may be stated that it is not in dispute that this consent letter was signed by Shri Jagdish Prasad Sharma, Partner of Pinkcity Textiles (complainant). That letter has been produced by the insurer marked as Annex. A- 1. It is as under:

“CONSENT LETTER

Claim No.

Policy No.

Vehicle No.

I/we agree to accept sum of Rs. 18,802/- (Rupees Eighteen Thousands Eight hundred two) only subject to terms, conditions and exceptions as per policy towards repair and new parts in full and final settlement 7-8/6/88 at–––.

I/we shall not submit any supplementary claim for the said accident

The following charges are included in the above settlement figure.

The settlement is subject to acceptance of the liability by the Insurance Co.”

2. On the basis of this letter it was submitted in the version of the case that the complainant (insured) i