The New India Assurance Co. Ltd vs M/S. Protection Manufacturers Pvt.Ltd

2. Although, the scope of the appeal is to some extent limited, a few facts may be stated for proper appreciation of the case made out by the Respondent/complainant.

4. On the very same day when the fire broke out, the Insurance Company appointed Mr. A.S. Asthana, Surveyor, to conduct a preliminary spot survey. On 30th March, 2000, Mr. Asthana and the representatives of the Insurance Company took joint stock of burnt motors and air coolers which were being manufactured by the Respondent/complainant. Mr. Asthana submitted his preliminary report on 3rd April, 2000, but did not specify the cause of fire. Thereafter, on 9th April, 2000, one Mr. Bhaskar Joshi was appointed as Joint Surveyor to conduct a final survey along with Mr. Asthana. On 13th April, 2000, a status report was submitted by Mr. Bhaskar Joshi. The Joint Surveyors prepared a draft 5 assessment report and estimated the loss suffered by the Respondent/complainant to be Rs.2,37,09,372.12 paise. The joint assessment report which was submitted on 28th August, 2000, clearly stated that the exact cause of fire was not known, though it could be due to a short circuit.

5. Thereafter, on 30th October, 2000, the Regional Manager of the Insurance Company appointed M/s. J. Basheer & Associates as investigator to conduct an investigation into the cause of fire and to assess the loss. As many as six independent investigation reports were filed by M/s. J. Basheer & Associates on 28th May, 2001, 3rd July, 2001, 27th August, 2002, 4th October, 2002, 7th November, 2002 and 10th December, 2002. According to M/s. J. Basheer & Associates, the net amount of loss suffered by the Respondent Company on account of the fire would be Rs.1,10,57,034/-, which tallies almost exactly with 6 the assessment made by the Insurance Company amounting to Rs.1,10,67,230/-. Interestingly, although in the report submitted by M/s. J. Basheer & Associates it has been mentioned in clause 6 that their appointment was for investigation into (i) cause of fire and (ii) assessment of loss, there is nothing definite in the 67 page report as to the cause of fire, except for a reference to the reply sent by the Fire Officer, Cuttack, to the Khurda Branch Manager of the Insurance Company on 5th May, 2001, stating that the estimate of fire amount was about Rs.15 lakhs and the cause of fire was "short circuit" in the raw material section.

6. On 25th June, 2001, the Appellant Insurance Company requested Mr. Bhaskar Joshi to make his observations on the report submitted by M/s. J. Basheer & Associates on 28th May, 2001. In his comments submitted on 10th August, 2001, Mr. Bhaskar 7 Joshi severely criticized the report filed by M/s. J. Basheer & Associates and even went to the extent of observing that they had failed to measure upto the faith and responsibility reposed on them by the insurers. The report seemed to suggest that the same had been tailor-made in order to fit the loss assessed by the Insurance Company at Rs.1,10,67,230/-, which uncannily tallied with the estimate of M/s. J. Basheer & Associates, namely, Rs.1,10,57,034/-.

10. The claim of the Respondent-Company was repudiated by the Appellant Insurance Company on 20th February, 2003, when the National Commission admitted the complaint filed by the Respondent- Company and directed notice to issue to the Insurance Company limited to the question of deficiency of service. After considering the reply filed by the Insurance Company and after examining one Mr. Amit Biswas, the representative of the 10 Insurance Company, and Mr. J. Basheer of M/s. J. Basheer & Associates, who admitted that he had not visited the Excise Office, the Vendors and had also not provided any supporting evidence to bolster his findings, the National Commission, by its order dated 24th October, 2005, directed the Appellant Insurance Company to pay to the Respondent Company a sum of Rs.2,26,36,179 with interest @12% p.a. with effect from 1st July, 2000 and to also pay a sum of Rs.1 lakh by way of compensation. The Insurance Company was given liberty to recover the said amount from its defaulting officers. Incidentally, it may be indicated that in the final assessment report of the Joint Surveyors the loss suffered by the Respondent Company was assessed at Rs.2,26,36,180.23 paise.

14. Mr. Gupta also referred to paragraph 6 of the Final Assessment Report on the basis of the joint survey conducted by M/s. A. Asthana & Co. and Bhaskar Joshi, which deals with the cause of the 13 fire. It was pointed out that the very first sentence of paragraph 6 indicates that the exact cause of the fire was not known, but the police had attributed it to short circuit. Sub-paragraph 2 records the fact that nothing specific as to the cause of the fire could be found even on further probe and hence it had to be presumed that short circuit could be one of the probable causes out of other probables. It was also indicated that in the light of the reports issued by the local authorities, such as the police and the fire brigade, the cause of the fire could only be attributed to a short-circuit, since no evidence could be found that would point towards a deliberate act of arson. The final opinion expressed in Sub-paragraph (a) of paragraph 6 was that the fire appeared to be accidental and the loss would be indemnifiable under the Fire Policy issued to and held by the insured.

29. Mr. Gupta submitted that no interference was called for with the impugned Award of the National Commission and the appeal was liable to be dismissed.

36. The Appeal filed by the Insurance Company, therefore, fails on all counts and is dismissed. There will be no order as to costs.

37. Having regard to the judgment delivered today, no further orders are required to be passed on the application for directions filed on 30.4.2010 on behalf of the Respondent Company and supported by 36 an affidavit dated 27.4.2010 affirmed by Mr. Piyush Gupta and the same is disposed of accordingly.

________________J.

(ALTAMAS KABIR) ________________J.

(CYRIAC JOSEPH) New Delhi Dated: 8th July, 2010.

comprising His Lordship, and Hon'ble Mr. Justice Cyriac Joseph.

The appeal is dismissed in terms of the signed judgment placed on the file. There will be no order as to costs.

(Signed Reportable judgment is placed on the file.) 38