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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Prem Narain, Presiding Member
New India Assurance Co. Ltd.—Appellant
versus
M/s. Shivalik Tube Pvt. Ltd.—Respondent
First Appeal No.577 of 2014 (Against the Order dated 08/07/2014 in Complaint No. 5/2002 of the State Commission Uttar Pradesh)
Decided on 18.9.2019
For the Appellant:Mr. P.K. Seth, Advocate
For the Respondent:Mr. Sanjay Kr. Tyagi, Advocate with Mr. Vivek Gupta and Mr. Somraj Gangopadhyay, Advocates
IMPORTANT POINT
Interest is awarded from date of filing of complaint and not from date of incident.
Headnote:
Consumer Protection Act, 1986—Sections 17, 19 and 21—Insurance—Theft in factory—Complaint allowed by State Commission—Although Investigator and Surveyor both have expressed their doubts on actual theft, but because same is not affirmed by police investigation, total claim may not be repudiated—However, State Commission has not accepted report of Surveyor without any proper reason, order of State Commission requires modification on the basis of report of Surveyor—State Commission has allowed 12% interest on the amount of Rs.13,76,377/- from date of appointment of first Surveyor till filing of complaint—Interest is awarded from date of filing of complaint and not from date of incident—Interest @12% p.a. and 9% p.a. seem to be on a higher side—There is no contract to pay interest on amount of claim in policy contract between parties—Looking at interest scenario prevailing from 2003 till now interest @8% p.a. shall be reasonable and just—Order modified to the extent that appellant Insurance Company shall be liable to pay amount of Rs.4,63,497/- as assessed by Surveyor to complainant instead of Rs.13,76,377/- as awarded by State Commission along with 8% interest.
Held: Although the investigator and the surveyor both have expressed their doubts on the actual theft, but because the same is not affirmed by the police investigation, the total claim may not be repudiated. However, as seen above, the State Commission has not accepted the report of the surveyor without any proper reason, therefore, the order of the State Commission requires modification on the basis of the report of the surveyor.
It is seen from the impugned order of the State Commission that the State Commission has allowed interest @12% p.a. on the amount of Rs.13,76,377/- from the date of appointment of the first surveyor till filing of the complaint. Honorable Supreme Court in the matter of Chengalrayan Cooperative Sugar Mills Vs. Oriental Insurance Co. Ltd. & Anr., (2000) 10 SCC 213 has held the following:-
“6. We however, feel that the interest ought to have been awarded from the date on which the claim was filed before the National Commission. Consequently, while maintaining the order of the National Commission for payment of Rs.11,69,994 to the appellant as the value of the gunny bags, we direct that this amount shall be paid within two months from today and that too, with interest at the rate of 18 per cent per annum from the date of filing of the claim before the National Commission till the date of actual payment.”
From the above, it is clear that interest is awarded from the date of filing of the complaint and not from the date of incident. Moreover interest @12% p.a. and 9% p.a. seem to be on a higher side. It is seen that there is no contract to pay interest on the amount of claim in the policy contract between the parties. Looking at the interest scenario prevailing from 2003 till now interest @8% p.a. shall be reasonable and just.
On the basis of the above discussion, the first appeal No.577 of 2014 is partly accepted and the order dated 8.7.2014 is modified to the extent that the appellant Insurance Company shall be liable to pay an amount of Rs.4,63,497/- as assessed by the surveyor to the complainant instead of Rs.13,76,377/- as awarded by the State Commission. This amount will be paid along with interest @8% p.a. from 01.1.2003 till the date of actual payment to the complainant. The order in respect of the litigation charges of Rs.15,000/- as awarded by the State Commission is maintained. This order be complied by the appellant Insurance Company within a period of 45 days from the date of receipt/service of this order. (Paras 14 to 17)
Result: Appeal Partly allowed.
ORDER
The appeal has been filed by the appellant New India Assurance Co. Ltd. against the order dated 08.07.2014 of the State Consumer Disputes Redressal Commission, Uttar Pradesh, (in short ‘the State Commission’) passed in CC No.05 of 2002.
2. Brief facts of the case are that the complainant/respondent is a company in the name of M/s. Shivalik Tube Pvt. Limited and is duly registered under the Companies Act having its registered office at Velhana Chowk, Village Shandhawali, Meerut Road, Muzzafarnagar. Company’s main business was to manufacture M S Pipes. On 27.3.1998, complainant company insured its factory with complete plant and machinery, electric meters, panels, etc. with the opposite party situated at Town Hall Road, Muzzafarnagar. Period of insurance was effective from 27.3.1998 till 26.3.1999. Total sum insured was Rs.33,00,000/-. On the fateful day, 30.7.1998, three guards/watchmen in the factory were beaten in the night, tied and locked in room. At the same time, certain items in the factory were stolen. Thereafter, on the same day, an oral intimation was given to the opposite party following the written information on the next day. Despite repeated reminders and legal notice by the complainant, claim was not settled by the opposite party. Aggrieved with the acts and omissions of the Insurance Company, the complainant filed a consumer complaint before the State Commission. The complaint was resisted by the Insurance Company which pleaded that documents were not submitted by the complainant company in time. As the factory was closed, so the incident of theft was doubtful and therefore, there was no deficiency in service on the part of the Insurance Company.
3. The State Commission vide its order dated 08.07.2014 passed the following order:-
“The complaint is hereby allowed. The opposite parties are directed to pay a sum of Rs.13,76,377/- to the complainant. Interest @12% shall be payable by the opposite parties to the complainant from the date of the claim lodged on which the first surveyor was appointed by the opposite party, till the date of filing of this complaint. A further interest @09% p.a. shall be payable to the complainant on the aforesaid sum from the date of complaint till the date of realization of the amount. A sum of Rs.15,000/- is further allowed to be paid by the opposite party to the complainant as litigation charges.”
4. Hence the present appeal.
5. Heard the learned counsel for the parties and perused record. The learned counsel for the appellant stated that the surveyor on 5th July, 2000 has given the following opinion on the admissibility of the claim:-
“9. Admissibility of the Claim: We have some reservations on the bonafides of the above claim. The reasons for this reservation are detailed here below:
a. The insured unit was in poor financial health and has been forced to close down due to heavy operating losses.The insured was on the verge of closing the unit when he purchased this insurance under burglary policy.Whereas the policy wording says that the risk is used for the purpose of manufacturing of M.S.Pipes, the unit went silent immediately after taking this policy of insurance.This material fact has not been disclosed.
b. The miscreants had been at site for about four and a half hours.The nature and extent of dismantling in the machinery parts particularly of the tube welder do not justify this as the involved dismantling would take 8-10 hours and that too by a skilled work man.
c. The statement of the watchmen Mr. Vinay says that the miscreants left the premises after burglary with some material/machine parts in a Riksha Reri.The items involved in this incident ae not feasible to be carried away in a Riksha Reri.”
6. The learned counsel for the complainant emphasized that on this report of surveyor, investigator was appointed by the Insurance Company to find out the correct facts. The investigator also gives the following conclusion:-
“Thus, from the totality of the circumstances
