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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Ram Surat Ram Maurya, Presiding Member
Oriental Insurance Co. Ltd. and Ors. —Appellants
versus
Deepika Cements Pvt. Ltd. and Anr. —Respondents
First Appeal No.295 of 2009
(Against the Order dated 24/02/2009 in Complaint No. 37/2005 of the State Commission Andhra Pradesh)
Decided on 27.9.2022
Consumer Protection Act, 1986 —S.19 [Consumer Protection Act, 2019 —S.51] – Appeal against order of State Commission - Services – Insurance – Repudiation of Claim - Flood / Rain - continuous rain fall - Loss due to inundation - proof of - According to the Insured, heavy rain hit the Andhra Pradesh state, including Hyderabad and Secunderabad due to depression which ultimately turned as cyclone from on 22.08.2000 to 30.08.2000. Due to unprecedented and continuous rain, flood water entered at the factory premises of the Insured on 24.08.2000. Flood water and continuous rain water washed away, the clinker stocked in open place at factory premises - The Insured through letter dated 21.11.2000, strongly protested the said letter and asked the surveyor to provide the photographs taken by him during his inspection on 01.09.2000, on the basis of which, he had reported that raw materials in open were found wet. The said photographs were neither supplied nor produced before State Commission. As such, the Insurer has failed to prove that raw materials of clinker was only wet and not washed away. Second surveyor visited the factory premises on 14.08.2001, in evening i.e. after one year. At that time heavy rain fall was going on, as such, he could not inspect the place, where the loss had occurred and the drains through which the clinker was washed away. The Insured has filed Report of Meteorological Department, which states that between 22nd and 24th August, 2000, the twin cities of Hyderabad and Secunderabad experienced the wettest spell in 92 years due to heavy downpour of rain. The rainfall measured 24 cm on a single day on 24th August, 2000. Many areas of these cities were inundated. As such, it is proved that cause of loss was inundation due continuous rain fall and not only the rain - The surveyor has assessed the loss to Rs.911680/-, in Survey Report dated 20.11.2002, on the basis of papers produced by the Insured. Although in Claim Form, the Insured has claimed loss of Rs.25/- but it was not found as proved. The Insurer could not point out that the Insured had submitted any fabricated paper in order to invoke Clauses-6(1) and 8 of General Conditions of the policy, the appeal is dismissed. [Paras 7 to 8]
Result: Appeal dismissed.
ORDER
Heard Mr. Mohan Babu Agarwal, Advocate, for the appellant and Ms. A. Subhashini, Advocate, for respondent-1.
2. Above appeal has been filed from the order of State Consumer Disputes Redressal Commission, Andhra Pradesh, dated 24.02.2009, passed in CD/37/2005, partly allowing the complaint and directing the Insurer to pay Rs.911680/- with interest @12% per annum, from 01.12.2000 till the date of payment, as insurance claim and Rs.5000/- as cost of the litigation.
3. The office has reported 79 days delay, in filing the appeal. The appellant has filed an application for condonation of delay. Cause shown is sufficient. Delay in filing the appeal is condoned.
4. Deepika Cements Private Limited (the Insured) filed CD/37/2005 for directing Oriental Insurance Company Limited (the Insurer) to pay Rs.25/- lacs, with interest @18% per annum, from 25.08.2000 till its realization, as the insurance claim and any other relief which may deemed fit and proper. The complainant stated that the Insured was private company, registered under the Companies Act, 1956 and engaged in the business of manufacture and sale of cements, from its factory, situated at Plot No. K-5, IDA, Rd. No.-5, Nacharam, Hyderabad. The cement was manufactured from grinding clinker, gypsum etc. as raw materials. The Insured obtained Standard Fire and Special Perils Policy No. 431301/2001/258, for the period of 16.06.2000 to 15.06.2001, for a sum of Rs.40/- lacs (i.e. Rs.25/- lacs, for stock of clinker in open, Rs.5/- lacs, for clinker, gypsum & grinding media in process, Rs.50000/-, for cement in process, Rs.8.5/- lacs, for finished products and Rs.one lac, for gunny bags & pkg. materials, stored at the factory premises) from the Insurer. Heavy rain hit the Andhra Pradesh state, including Hyderabad and Secunderabad due to depression which ultimately turned as cyclone from on 22.08.2000 to 30.08.2000. Due to unprecedented and continuous rain, flood water entered at the factory premises of the Insured on 24.08.2000. Flood water and continuous rain water washed away, the clinker stocked in open place at factory premises. The Insured intimated the loss to Oriental Bank of Commerce on 25.08.2000, from where, he took term loan of Rs.18/- lacs and working capital facility of Rs.29/- lacs, with request to inform the Insurer. The Insured informed the Insurer about the aforesaid loss through letter dated 31.08.2000. The Insurer appointed D.V. Bhaskara Reddy, Hyderabad, as the surveyor, who inspected the factory premises on 02.09.2000. Thereafter, the surveyor neither turned up again nor made any correspondence with the Insured. D.V. Bhaskara Reddy, vide letter dated 15.11.2000 informed that (i) Raw materials in open were found wet during inspection. (ii) There was no evidence of flood or inundation in the premises. (iii) The damage to the stocks was due to unprecedented rain fall of 24 cms on 23.08.2000 only and not due to flood, storm and cyclone; and (iv) The policy did not cover loss due to rain water, as such, the Insurer had no liability. The Insured through letter dated 21.11.2000, strongly protested the said letter and asked the surveyor to provide the photographs taken by him during his inspection on 01.09.2000, on the basis of which, he had reported that raw materials in open were found wet. The surveyor however did not respond. The Insured, vide letter dated 13.12.2000, complained to the Insurer that the surveyor was not making any correspondence with him. D.V. Bhaskara Reddy, vide letter dated 29.12.2000, recused from conducting survey due to his health issue. The Insurer then appointed Sisir & Ravi Associates, Visakhapatnam, a new surveyor on 19.01.2001, who allegedly visited the factory premises of the Insured on 29.01.2001 and found it as locked. New surveyor, vide letter dated 01.02.2001, asked the Insured to submit claim form on the proforma and also sent an inventory requiring various information. Managing Director of the Insured met in an accident and hospital
Inundated - The rainfall measured 24 cm on a single day on 24th August, 2000. Many areas of these cities were inundated. As such, it is proved that cause of loss was inundation due continuous rain fa....
Insurance claims must prove the cause of loss without reliance on unsupported allegations.
The court affirmed that damages due to inundation are covered under the insurance policy, and failure to provide policy terms invalidated the insurance company's repudiation.
1. Investigated and determined - Merely because recording of evidence is required, or some questions of fact and law arise which would need to be investigated and determined, cannot be a ground for s....
Surveyor – It is mandatory for the Insurer to appoint a surveyor for assessment of loss, exceeding Rs.25000/- under Section 68 UM of Insurance Act, 1938. Bonafide/malafide – The surveyor is an expert....
Underinsurance assessed by Surveyor is arbitrary.
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