1. The present Complaint is filed under Section 21 (a) (1) of the Consumer Protection Act, 1986.

2. The Complainant is a Limited Company incorporated under the Companies Act and operates in leather processing business, having one of its establishments at Runkata, Agra. The building, plant & machinery and stocks of the Complainant were comprehensively insured against Fire and Special Perils by Opposite Parties, vide Policy No.080404/11/05/00147, from 30.6.2005 to 29.6.2006. The Complainant paid a premium of Rs.72,126/- under the Policy for risk cover as follows:

• Buildings including boundary wall, cables. Meter Board & other similar goods for sum assured Rs.1 Crore.
• Plant, machinery & accessories including Generator sets for sum assured Rs.1 Crore.
• Other stocks:
  • Finished Leather Sum Assured : Rs.50 Lakhs
  • Chemicals for Sum assured : Rs.35 Lakhs
  • Wet Blue like unfinished leather

Sum insured:Rs.1 Crore

Total Sum insured:Rs.3,85,00,000/-

3. The case of the Complainant is that in the night of 01.08.2005, due to heavy rain the factory shed fell down causing huge damage to the building, plant & machinery and stocks. On 02.08.2005, the Complainant sent intimation regarding the loss caused by inundation in the premises to Opposite Party No.2 requesting them to appoint a Surveyor to assess the loss. The Complainant submitted the claim of Rs.91 Lakhs. The Complainant wrote letter dated 04.08.2005 to Opposite Party No. 2 stating that the Complainant had not received any Policy document after paying the premium on 29.06.2005. On the request of the Complainant, the Opposite Party No.2 supplied a duplicate copy of the Policy without terms & conditions of the Policy.

4. Opposite Party No.2 deputed Mr. Dhanesh Kumar Sharma as Surveyor & Loss Assessor. The Complainant received letter dated 03.08.2005 from the Surveyor, seeking information and documents from the Complainant. The Complainant, vide letter dated 09.08.2005, submitted reply fulfilling the requirement and requested the Surveyor to supply Preliminary Survey Report to them. The Complainant received letter dated 23.08.2005 from the Surveyor, requiring further information and documents which was supplied by the Complainant, vide its letters dated 01.09.2005 and 19.10.2005. The Complainant, vide letter dated 28.11.2005, informed Opposite Party No.2 that the reconstruction at the premises was being done. Inspection be done so that the Complainant could remove the waste material from the site. Despite letter dated 28.11.2005, no final visit was made by the Surveyor. The Surveyor, however, assessed the loss at Rs.8,89,176/-. After one and a half years from the date of the incident, the Complainant received a letter dated 19.12.2006 from Opposite Party No.2, repudiating the claim of the Complainant stating as follows:

The loss was not due to insured peril of inundation as claimed, hence the same is outside the purview of the policy.

After receiving the repudiation letter, the Complainant sent letters dated 20.04.2007 and 13.06.2007 to Opposite Party No.2 that repudiation of the claim was arbitrary and illegal and requested to review the decision but no response was received from Opposite Party No.2 till the date of filing the Complaint. Aggrieved by the repudiation of the claim, the Complainant filed the instant Consumer Complaint with this Commission with the following prayer:

A-Require respondents (Insurance Co.) to pay Rs.91,50,00/- towards losses suffered by the complainant due to inundation.

B- Require respondents (Insurance Co.) to pay interest on the aforesaid value of claim of such other value @18% p.a. from the date of incident i.e. 1.8.2005.

C- Require respondents (Insurance Co.) to pay Rs.15 Lac by way of compensation for harassment, loss suffered by the complaint due to inaction/delay on the part of respondents.

D- Pass such other & further order as this Hon'ble Commission may deem just, fit & proper under the circumstances.

5. Opposite Parties resisted the Complaint by filing the written statement that the Complainant was not a Consumer as Insurance cover was obtained for commercial purpose. It was also stated that the facts and circumstances of the case requires examination of witnesses and records to decide the disputed questions of fact which may not be possible in the summary proceedings. The Consumer Complaint was, therefore, not maintainable.

6. On merits, it was stated that the Complainant had withheld material facts and is guilty of misstatement of facts. The Complainant did not cooperate with the Surveyor and deliberately avoided furnishing relevant information to the Surveyor in time. The delay in deciding the claim was solely due to non-cooperation of the Complainant. It was submitted that on receiving information from the Complainant, Insurance Company took necessary action and appointed a Surveyor, who submitted his report dated 24.7.2006 and assessed the loss at Rs.8,89,176/-. The Surveyor examined various persons and observed that damage to the building was not on account of inundation. The Complainant did not give any definite cause for loss in the claim form. Moreover, the records suggested that the loss might have occurred due to gradual weakening of walls and seepage which was not covered under the Policy. Opposite Parties denied that the Policy was not supplied to the Complainant, stating that it was not open to the Complainant to take up this issue at this stage. The claim was thoroughly examined by the competent authority before coming to the conclusion that the claim was not covered under the Insurance Policy. On the basis of the Surveyors report, the claim was repudiated. There was no deficiency in service on the part of Opposite Parties.

7. The Complainant filed a Rejoinder to the reply of Opposite Parties stating that during the last two weeks of July 2005, there was heavy rainfall in Agra due to which a lot of water accumulated around the insured factory shed/building on account of which submergence of water took place in the foundation of shed column. For this reason, the columns sank down causing the rocking of entire shed resulting in huge damage to the factory shed/ building. This fact was disclosed to the Surveyor by the Insured as well as its employees who were present at the time of the incident, but in order to give undue advantage to the Opposite Parties, the Surveyor failed to give weightage to the statements of the eye-witnesses. The Complainant also engaged an independent Surveyor and Loss Assessor Shri U. K. Sharma, who also made a visit on 03.08.2005 at the site. After thoroughly investigating the matter, he assessed the loss at Rs.46,97,085/- and found that the damages to the insured premises was on account of inundation. The insured premises was renovated in 2003 hence insured shed/factory building was in sound condition and there was no possibility of it collapsing.

8. The stand of the Opposite Parties that the damage was not caused on account of inundation is absolutely false. There was no disputed question of facts which required voluminous evidence or examination of witnesses. The matter is simple and can be tried before this Commission in summary proceedings.

9. Heard the Learned Counsel for the Parties and carefully perused the record. Learned Counsel for the Complainant submitted that the Complainant raised a tentative claim Rs.91,50,000/-. The Complainant duly supplied the documents sought by the Surveyor. It was further submitted that the Surveyor clearly observed that the Building of the Factory was renovated in 2003 and the structure was good enough for the factory. Learned Counsel further submitted that the Surveyor recorded the statement of the Complainant, after expiry 11 months of incident i.e. on 08.07.2006. The Final Documents were submitted by Complainant on 28.11.2006 with the request to inspect the site so that debris could be removed, but no inspection was done. Opposite Parties never supplied the Policy document to the Complainant and it was obtained by the Complainant under Right to Information Act. Learned Counsel further submitted that the Surveyor engaged by the Complainant was an Independent Surveyor, observed that the cause of incident was water inundation and calculated the quantum of damages as Rs.46,97,085/-. The plea of the Opposite Parties that the building was in dilapidated condition is frivolous because the building was renovated in 2003 itself and was in sound condition. Due to heavy rain a lot of water accumulated around the insured factory shed/building on account of which submergence took place in the foundation of shed column. For this reason, the columns sank down causing the rocking of entire shed resulting in huge damage to the factory shed/ building. Repudiation of claim by the Insurance Company was unjustified.

10. Learned Counsel for the Opposite Parties submitted that the Complainant was not a Consumer as the Insurance cover was obtained for commercial purpose. Learned Counsel also submitted that the case required examination of witnesses and records to decide the disputed questions of fact which may not be possible in summary proceedings. The Consumer Complaint was , therefore, not maintainable.

11. On merits, Learned Counsel for the Opposite Parties submitted that in the claim form, the Complainant did not give any specific cause of loss. The Surveyor observed that the cause of loss could not be established, and probably the loss was due to water inundation. In the Policy, the water logging/ water accumulation was a must, whereas in the present case, there was neither accumulation, nor water logging at the site. The Surveyor observed that even on the basis of cause of loss given by the Insured, the claim fell under gradual deterioration and did not fall under sudden and unforeseen incident. The Surveyor concluded after extensive inspection that the iron rods used in the pillars, deteriorated due to chemical reaction and gradually weakened to the extent that it would not withstand the supporting truss and pillars resulting in the whole structure of left side tin shed falling down. He further submitted that the Complainant did not file any evidence contrary to the observation of the Surveyor. The law is well settled that the Surveyors are the appropriate person to assess the loss and their report cannot be brushed aside, unless there are very strong reasons otherwise. Learned Counsel submitted that there was no deficiency in service on the part of the Opposite Parties and the Complaint deserved to be dismissed.

12. Brief facts of the case are that the premises of the Complainant was insured by the Opposite Parties, vide Standard Fire and Special Perils Policy (Material Damage) No. 080404/11/05/00147, with effect from 30.06.2005 to 29.06.2006 for loss to the plant & machinery, building etc. In the night of 01.08.2005, due to heavy rain, the factory shed fell down causing damage to the factory of the Complainant. The Insurance Company deputed the Surveyor for assessment of loss. The Complainant provided the documents and information required by the Surveyor, vide letters dated 09.08.2005, 01.09.2005 and 19.10.2005. Opposite Party No.2, vide letter dated 19.12.2006, repudiated the claim of the Complainant stating that the loss was not covered under the Policy.

13. The contention of Opposite Parties that that Complaint contains complicated facts which cannot be adjudicated in a summary proceeding under Consumer Protection Act, 1986 cannot be accepted. In this regard Honble Supreme Court in CCI Chambers Coop. HSG. Society Ltd. v. Development Credit Bank Ltd., Appeal (Civil) 7228 of 2001 wherein Honble Supreme Court held as follows:

It cannot be denied that Fora at the national level, the State level and at the district level have been constituted under the Act with the avowed object of providing summary and speedy remedy in conformity with the principles of natural justice, taking care of such grievances as are amenable to the jurisdiction of the Fora established under the Act. These Fora have been established and conferred with the jurisdiction in addition to the conventional Courts. The principal object sought to be achieved by establishing such Fora is to relieve the conventional Courts of their burden which is ever-increasing with the mounting arrears and whereat the disposal is delayed because of the technicalities. 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 shutting the doors of any Forum under the Act to the person aggrieved.

From the above, it is clear that this Commission is competent to adjudicate this Consumer Complaint.

14. The Opposite Party also contested the Complaint on the ground that the Complainant took the Policy in question for Commercial purpose. In this regard, observation of this Commission in M/S. Harsolia Motors v. M/S. National Insurance Co. Ltd.. I, (2005) CPJ 27 (NC) decided on 03.12.2004 is relevant, wherein it was held that since an Insurance Policy is taken for reimbursement or for indemnity of the loss which may be suffered on account of insured perils, the services of the insurer cannot be said to have been hired or availed for a commercial purpose. This Commission does possess the requisite jurisdiction to entertain a Consumer Complaint wherever a defect or deficiency in the services rendered by an insurer is made out. In view of the above, the Complaint is held maintainable.

15. On merits, the Surveyor in his report dated 24.07.2006, observed that the loss was not caused due to inundation. In this regard, the statements recorded by the said Surveyor are relevant. Statement of Mr. Bawar Singh, Quality Controller reads as follows:

Mr. Bawar Singh, Quality Controller states that On 1^st August, 2005 at about 10.00 p.m. workers were working in lime yard/training yard. Suddenly, a loud voice came from wall side and immediately I sent all the workers outside and at the same time suddenly due to collapse of wall the shed came down.

Similarly, the statement of Mr. A.R. Yevale, Chief Technician reads as follows:

Mr. A.R. Yevale, Chief Technician states that- During the late evening around 10 O clock on 1.8.05, when I was in the finishing department, suddenly heard sound of cracking. When tried to find out what is happening, I saw that factory shed on one side was coming down. The wall alongside paddles was adown/collapsed. It stretched the factory shed heavily. Thereafter, it came down on drums/paddles/machinery. This possibly started from the wall area. Due to heavy rain during the last 2-3 weeks, there was accumulation of water alongside the wall, which could have gone down into the foundation. The wall area was coming out of the land from foundation area.

The Surveyor also recorded the statements of Mr. Swami Saran, Finishing Incharge and Mr. Santosh Kumar Jha, another employee of the Complainant. They also corroborated the aforesaid two statements.

16. The aforesaid statements recorded by the Surveyor of the Insurance Company support the version of the Complainant that due to heavy rain the factory shed fell down and causing loss to the building, Plant & Machinery and stocks. Mr. A.R. Yevade stated that due to heavy rain during the last 2-3 weeks, there was accumulation of water alongside the wall. The Surveyor of the Insurance Company ignored the statement of the eye-witnesses. Moreover, Mr. U.K. Sharma, Surveyor observed as follows: -

During the interrogation I met with the section incharges as well as the labourers. It was revealed that on 01.08.2005 at about 10 pm all of them heard a cracking sound of the factory wall & thereafter the whole shed came down over the machinery such as drums etc. The chief technician also added that due to heavy rains during the last 2-3 weeks there was accumulation of water outside the factory wall which could have gone down into the foundation, which resulted such damage.

Mohd. Furkhan, the Director of the insured stated more or less the same story which his personnel stated. He also added that there was continuous rains for several days before the incident took place i.e. 01.08.2005. Due to continuous rains the water got accumulated all around the walls which ultimately sweeped into the foundation of the walls as well as the columns supporting the shed. He also said that all the precautionary measures were taken to minimize the accumulation of water but due to continuous rains the same remained in vain. He has also shown the signs of water accumulation on the walls & the columns of the factory shed which clearly indicates that there was a flood type situation occurred for a long time which resulted to said inundation.

Note: - The above statements clearly confirms that the present loss took place on account of inundation of water, which is fully covered under the said policy of insurance.

17. The Surveyor deputed by the Insurance Company observed that at the site of loss there was neither water logging nor water accumulation signs. This observation is ruled out from the statement of Mohd. Furkhan, Director of the Complainant Company that all the precautionary measures were taken to minimize the accumulation of water but due to continuous rains the same remained in vain. Moreover, the Surveyor deputed by the Complainant observed that Mohd. Furkhan, Director of the Complainant had shown the signs of water accumulation on the walls and the columns of the factory shed which clearly indicated that there was flood type situation occurred for a long time which resulted in inundation.

18. The Complainant deputed the Surveyor Mr. U.K. Sharma as per IRDA Circular No.IRDA/NL/Cir/Misc/129/07/2015 dated 14^th July, 2015 which reads as follows: -

It is clear from the above that no person other than the insurers and the insured can appoint a surveyor or loss assessor within 72 hours of intimation of claim from the insured to assess the loss above rupees twenty thousand under policy of Insurance in respect of general insurance business. It is reiterated that the appointment of Surveyors and loss assessors shall be made by the insurers or the insured only and not by any other person.

19. From the above, it is clear that the Insured can also appoint a Surveyor or loss assessor. The Complainant had independently hired a Surveyor, who submitted his report dated 21.01.2006, whereby the cause of loss was clearly stated as Water Inundation and the loss was assessed as Rs.46,97,085/-with remarks as follows:

1. Since the loss took place in the mid of rainy season as such the possibility of flood like situation & submerging of building foundation etc. cannot be ruled out.

2. The statement of the chief technician as well as the director confirms that there were heavy rain for the last so many days, with the result the position of flood arose & due to which the submerging of foundations took place, which resulted into the said damage.

3. The loss to building / shed was assessed purely on the basis of architect report which is enclosed h/w.

4. The photographs of the damaged site were taken by me from twenty different angles, which are enclosed along with their negatives.

20. Complainant also alleged that the terms & conditions of the Insurance Policy were not supplied to them. Though the Insurance Company denied this allegation, they could not adduce any evidence to show that the terms & conditions of the Policy were supplied to the Complainant. Honble Supreme Court in New India Assurance Co.Ltd. & Ors. vs. Paresh Mohanlal Parmar, Civil Appeal No.10398 /2011, decided on 04.02.2020 held that if the terms of exclusion is not made known to the Complainant/Insured then it will not affect the Insured. Honble Supreme Court in Bharat Watch Company through its partner Vs. National Insurance Company Ltd., 2019(6)SCC 212 also held as follows:

7. The basic issue which has been canvassed on behalf of the appellant before this Court is that the conditions of exclusion under the policy document were not handed over to the appellant by the insurer and in the absence of the appellant being made aware of the terms of the exclusion, it is not open to the insurer to rely upon the exclusionary clauses.

The Opposite Parties failed to supply the terms & conditions of the Insurance Policy, the same would not affect the case of the Complainant.