MANASA READY MADE AND CLOTH CENTRE Vs. NEW INDIA ASSURANCE COMPANY LIMITED
LAWS(APCDRC)-2004-8-2
ANDHRA PRADESH STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Decided on August 31,2004

MANASA READY MADE AND CLOTH CENTRE Appellant
VERSUS
NEW INDIA ASSURANCE COMPANY LIMITED Respondents

JUDGEMENT

- (1.) THIS is a complaint filed under Sec.17 (a) (i) of the Consumer Protection Act, 1986 .
(2.) THE factual matrix leading to the filing of this complaint is set out as hereunder. Complainant No.1 is a registered partnership firm dealing in ready made cloth business under the name and style of 'manasa Ready Made and Cloth Centre and business premises is situated at 6/360 -C and D, R. S. Road, Rajampet Town and Mandal, Cuddapah District. Complainants 2 to 4 are the partners of the said firm and complainant No.2 is the Managing Partner of the said firm. Complainants obtained two insurance policies from opposite party No.3 on 28.12.1998 vide Policy No.4861120104058 and 4861120104059 covering the period from 5.1.1999 to 4.1.2000. The first policy was obtained to cover the entire stocks i. e. , ready made cloth and other cloth and fixtures and fittings lying in Godown pertaining to the complainant business situated at D. No.6/360 C and D, R. S. Road, Rajampet Town and Mandal, Cuddapah District and the sum assured was Rs.10,00,000/ - towards fire accident besides other sums for other coverage. The second policy, 4861120104059 was obtained to cover the entire stocks i. e. ready made cloths and other cloth and furniture and fixtures lying in the shop pertaining to the complainant at D. No.6/360 -C and D, R. S. Road, Rajampet Town and Mandal, Cuddapah District and the sum assured was Rs.7,00,000/ - towards fire accident besides other sums for other coverage. Opposite Party No.3 after collecting the premium amount issued the above mentioned policies. On the intervening night of 24/25.3.1999 at about 00.30 hours, a fire accident has taken place in the shop and godown premises of the complainants which has resulted the entire stocks i. e. , ready made garments, cloths, furniture and fixtures including generator gutted in fire. The worth of the goods gutted in the said fire accident is about Rs.20,00,000/ -. It is contended by the complainants that one D. Rami Reddy died in the said fire accident. The police of Rajampet Village had registered a case in Crime No.25/1999 under Sec.174 of Cr. P. C. and later on the same was altered to Sec.304 -A of IPC and charge sheet is filed against complainant No.3 and one of the employees of the said firm. The complainants further submit that immediately after the accident they lodged a claim before opposite party No.3 to reimburse the sum assured under the policies to a tune of Rs.17,00,000/ - by submitting all the relevant documents in the month of April, 1999. Opposite Party No.3 appointed a Surveyor to assess the loss who visited the business premises and assessed the loss and submitted a report. The Surveyor did not furnish a copy of the report to the complainants inspite of their request. The police authorities of Rajampet and Fire Services also confirmed the incident as fire accident. It is contended by the complainants that though the Surveyor has submitted the report long time back, the opposite parties did not settle the claim and it is kept pending for a long time inspite of several visits to the office of the opposite parties and even after furnishing the necessary documents to opposite party No.3. Vexed with the attitude of the opposite parties, the complainants issued a legal notice, despite receiving notice, the opposite parties neither settled the claim nor repudiated the same. It is the case of the complainants that he had successful business which was reduced to ashes over night due to the freak accident. The complainants had insured their business with the opposite parties and the insurance was in force on the date of fire accident. Though the amount of claim actually worked out of Rs.20,00,000/ - the complainants have limited their claim to Rs.17,00,000/ - only. It is contended that the delay in settling the claim is deficiency of service and the complainants have claimed a sum of Rs.17,00,000/ - together with interest at 18% p. a. and pay an amount of Rs.2,00,000/ - towards compensation for mental agony.
(3.) OPPOSITE parties have filed written version and admitted that the complainants had obtained aforementioned two policies for the entire stocks, fixtures and fittings for the period from 5.1.1999 to 4.1.2000 for a sum of Rs.10,00,000/ - and Rs.7,00,000/ - respectively. They also admitted that the complainants have put forth a claim for Rs.17,00,000/ - due to fire accident which had occurred on the intervening night of 24/25.3.1999. A Surveyor was appointed to assess the loss and the Surveyor visited the premises on 25.3.1999. The Surveyor relied on the statements given by the complainants to the Police. According to the F. I. R. statement of Mr. Mohan Babu, who was working in the shop he was putting labels and his friend, Mr. Rami Reddy, was looking after the purchase bulks all of a sudden flames came he and Rami Reddy caught fire. It is also stated that Rami Reddy managed to come out with flames but was engulfed in flames and one more person escaped from fire with minor injuries. The fire spread and damaged the entire stocks, furniture and fittings. According to the F. I. R. the cause of accident is electric short circuit followed by explosion. Later Mr. Mohan Babu seems to have changed his version and stated that while he and Mr. Raja Mouli Reddy were verifying stocks, electric fuse was blown out then they lit a candle and connected the fuse. According to them a tin of petrol kept for generator accidentally fell down. The leaking of petrol was not noticed by them. Mr. Rami Reddy came there and all of them went out for having water when they came and lifted shutter suddenly fire broke and all the three persons were injured. According to the opposite parties the inquiry of the Surveyor revealed that the shop was running under heavy loss and the Bank loans are not repaid. Some loan was obtained from deceased Rami Reddy and it was not repaid. It is also stated that the Surveyor assessed the loss at Rs.4,80,000/ - and it is further contended that there is possibility of the insured trying to cover up his loss in the business by setting fire to the building and filing a claim. Therefore, an investigator was appointed, who conducted a thorough inquiry and submitted a report stating that the shop was set fire to claim insurance. Panchanama was conducted at the scene which revealed that a petrol tin with two holes was found at the place and was not sent to Forensic Expert. The Bank Manager has not revealed the true state of financial status of the insured. They contended that the debris was removed by the insured even before the Surveyor inspected them. The insured could not produce the stock registers and stated that they received stock but the investigation report revealed that the said stock was ceased at Orissa/karnataka border. In short they suspected the facts of the accident and hence they justified their repudiation and contended that there is no deficiency of service. The second complainant filed affidavit evidence and reiterated the averments in the complaint and submitted that, one D. Rami Reddy, died in the said fire accident and the police have registered a case in Crime No.25/1999 under Sec.174 of Cr. P. C. and later on the same was altered to Sec.304 -A, I. P. C. and a charge sheet was filed against third complainant and one of the employees of the firm. It is further stated that immediately after the accident, the complainants lodged a claim before opposite party No.3 to reimburse the sum assured i. e. , Rs.17,00,000/ - under the policies by submitting all the relevant documents in the month of April, 1999. Opposite party No.3 appointed a Surveyor, who visited the business premises of the complainants and conducted a detailed inquiry, assessed the loss and submitted a report to opposite party No.3. It is his contention that although the Surveyor has submitted his report long time back, opposite party No.3 did not settle the claim. Complainant No.2 further stated that on the intervening night of 24/25.3.1999, his partners M. Rajamoulal Reddy and B. Narasimha Reddy (complainants 3 and 4) along with shop workers were fixing price tags and while doing so, there was a failure of power supply and they lit a candle and at the same time closed the shutter and went to have a cup of tea and after some time when they returned to the shop along with one of their friends, namely, Rami Reddy, and opened the shutter, there was sudden explosion and one of the shop employee was seriously injured and the said Rami Reddy died in the said accident. The experts who visited the accident have unanimously opined that the fire was due to accident. The possibility of explosion due to bombs was ruled out. It is also stated that no right minded person will ever involve a friend's life in faking an accident. He reiterated that they had a successful business and on account of the accident, they incurred heavy loss and they limit their claim to Rs.17,00,000/ - only. He also stated that there are valuable merchandise in the shape of ready made clothes, furniture, fittings together with books of accounts and receipts and other records and all of them were reduced to ashes which fact was immediately brought to the notice of opposite parties and the opposite parties did not settle the claim inspite of several requests.;


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