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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
A.P. Sahi, President
Vaibhav Dyestuff Industries
and Anr. – Appellants
versus
New India Insurance Co. Ltd.
And Ors. – Respondents
First Appeal Nos.613 and 633 of 2015
Decided on 30.1.2024
Consumer Protection Act, 1986 – Section 19 [Consumer Protection Act, 2019 – Section 51] – Appeal – services – Insurance – Loss – Due to rainfall – Proper assessment of Loss – The inundation in the present case has resulted from excessive rainfall and according to the aforesaid orders and judgments, inundation would stand covered under the risk policy, which is also available in the present case. The accumulation of water to the extent of 9" to 1 feet as observed by the surveyor and its retention for about 16 hours in the premises, that to a certain extent is also supported by photographs, renders the claim to be preponderantly probable and therefore acceptable. Consequently, in view of the conclusions drawn hereinabove and the law as discussed, no error is discernable in the conclusions drawn by the State Commission, while allowing the complaint. The loss had occurred due to heavy rainfall and it appears that the surveyor seems to have inappropriately recommended non-payment of damages and his report, which contradicts his own observation is not creditworthy – Coming to the appeal of the complainant, being First Appeal No. 613 of 2013, it appears that the loss had not been correctly addressed to in the final survey report and therefore an addendum was tendered by the surveyor on 10.12.2010. Even though the assessed loss was denied in the addendum on the ground of the premises not being inundated, yet there is a consistency in the number of bags said to have been recovered both, which were empty, resulting in loss or damage and also the unaffected bags. The addendum report has been extracted hereinabove, which demonstrates the same. Consequently, the proportionate calculation of the loss of 405 bags appears to be correct, as this was the figure of the empty bags mentioned in the spot survey report and also in the final survey report. This indicates that the surveyor did not deviate on the figures of the empty bags that had been collected from the site on the date of first survey conducted immediately after the incident – Thus, the State Commission in the
opinion had rightly assessed the loss
accordingly and therefore no error is
found in the same so as to interfere in this appeal. [Paras 10 to 36].
Result: Appeal dismissed.
ORDER
These two appeals arise out of a common order dated 26.06.2015 passed by the State Consumer Disputes Redressal Commission, Gujarat in Complaint No. 69 of 2010. The impugned order is in native Gujarati and a translated copy thereof has been placed on record.
2. Appeal No. 613 of 2015 has been filed by the complainant praying for enhancement of the amount of claim awarded by the State Commission, contending that the claim has been only partly allowed and the loss has been inadequately compensated. Appeal No. 653 of 2023 has been filed by the Insurance Company for setting aside the entire impugned order of the State Commission.
3. Having heard learned counsel for the parties, the facts which remain undisputed are that the complainant, which is a Dye manufacturing unit, took insurance coverage in respect of buildings, plant, machinery and accessories of the said unit for production of chemical colour fabrication and stocks relating thereto, where a total sum of Rs.1,76,00,000/- was insured. The policy is a Standard Fire and Special Perils Policy and is also governed by the additional conditions of the Standard Fire and Special Perils Policy (Material Damage). The relevant clause of the Material Damage Terms that has to be taken note of for the purpose of this dispute is extracted herein:—
“VI. Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and Inundation. Loss, destruction or damage directly caused by Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood or Inundation excluding those resulting from earthquake volcanic eruption or other convulsions of nature shall stand deleted.”
4. The contention of the complainant is that on 7th and 8th August, 2010, there were heavy rains in Ahmedabad, where the unit is situate and on account of such heavy rains, the entire premises was inundated with water with regard to which a claim was made before the Insurance Company seeking indemnification for the loss and damage suffered on account of the stocks that were lost in the said incident. Immediate information was tendered to the Insurance Company on 09.08.2010. The intimation sent is extracted herein under:—
“Monday, August 09, 2010
To
The New India Assurance Co. Ltd.
104-105, Dev Arc Building, Iscon Circle,
Opp. Big Bazar, SG Highway Ahmedabad-380054
Policy No. 212400/11/10/11/0000576
Subject: Due to heavy rain Request for survey in our factory
Dear Sir,
Due to heavy rain at early morning 8th August, 2010 the rain water destroyed material and machinery approximately of Rs.60,00,000.00 to Rs.70,00,000.00 we hereby request an urgent insurance survey.
Thanking Your,
For Vaibhav Dyestuff Industries,
Sd/-
Partner/Jasmine Shah
Mo.9824023759"
5. The Insurance Company appointed M/s. Trans Ocean Marine & General Survey Agency, which was to conduct the survey. The complainant also wrote a letter to the said surveyor on the very same day informing them of the heavy rains from the midnight of 7th August, 2010 that continued till the morning of 8th August, 2010 and stated that the water has flooded the whole factory causing destruction to the stocks and material inside the premises. They also informed about taking precautions in the matter. The said letter is extracted herein under:—
“Date: 09th, August, 2010
To
Trans Ocean Marin & General Survey Agency
Gawarikar Sadan, Vasant Chowk,
Bhadra, Ahmedabad – 380 001
Kind Attn: Mr. B. M. Gawarikar
Policy No. 212400/11/10/11/0000576
Subject: Note of Occurrence
Dear Sir,
It rained very heavily on midnight of 07th August, 2010, we got a call from our factory night supervisor that water is flooding in the whole factory and ruining our material. At the same time we instructed the supervisor to move the affected material on higher level they instantly came in action and started moving the material. They did whatever they can but they couldn’t save all of it. We saved whatever they moved in time rest of all got wasted in water.
Hereby we are att
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