R.K.AGRAWAL,J. - (1.) The present Consumer Complaint has been filed under Section 21 of the Consumer Protection Act, 1986 (hereinafter referred to as the Act) by M/s. Mangalam Organics Limited, Mumbai (hereinafter referred to as the Complainant Company) against The New India Assurance Company Limited (hereinafter referred to as the Opposite Party Insurance Company).
(2.) Brief facts as narrated in the Consumer Complaint are that the Complainant Company M/s. Mangalam Organics Limited (earlier known as Dujodwala Products Limited in the year 1981 and subsequently known as Allied Colloids Pvt. Ltd. in the year 1992) is engaged in the manufacture of Terpene Products such as Camphor Technical, Camphor A Grade, Camphene, Isobornyl Acetate, Isoborneol, Dipentene, Sodium Acetate Trihydrate, Camphor Oil, Pine Oil, Pine Tar, Resin Products such as Terpene Phenolic Resin, Penta Ester Gum, Glycerol Ester Gum, Alkyl Phenolic Resin, Phenol Formaldehyde Resin, Gum Rosin etc.The Complainant Company is an ISO certified Company and is a Government recognized Export House with customers in Europe, USA, Africa and Middle East.The Factory of the Complainant Company comprised of various departments for the storage, production and Office.One Block of the Factory was used for Resin Plant for manufacture of various Resin Products and other Block comprises of a Camphor Plant used for the manufacture of Camphor Products.The Complainant Company obtained two Insurance Policies, i.e., Standard Fire Policy No. 11080011150100000168 and the Declaration Policy 11080011150200000001 valid from 01st May 2015 to 30th April 2016 from the Opposite Party Insurance Company for covering the risk of Building (Super Structure / Plinth and Foundations), Plant and Machinery (P&M), Furniture, Fittings, Fixtures ("FFF"), Stock and Stock (Work-in-progress) at the Factory.During the currency of the Insurance Policies on 22 June 2015, due to short-circuit there was a major fire accident at about 12:30 hours in the Resin Plant located in the Factory.Upon noticing the fire, the power supply of the entire Factory was isolated and the Plant Operations, including the Boiler Line, Chilling Plant and other Common Utilities were completely shut down.The fire which broke out in the Resin Plant reached the Common Utilities connected to the Camphor Plant.Having no alternative arrangement to cool off the Camphor Plant, maintain the temperature and to prevent the possibility of an explosion, resulting from the exothermic heating of the material charged in process at the various Reactors at the Camphor Plant, the Complainant Company was compelled to drain out Work-in-Progress (WIP) items in the Reactors, Columns and Pipelines to avoid fire/explosion in the Camphor Plant.It is the case of the Complainant Company that if drain out of Work-in-Progress was not done, the Camphor Plant would have also caught fire and it would have lead to an enormous loss to the tune of Rs.80 - Rs.100 crores. The Opposite Party Insurance Company was informed about the fire incident on 22nd June, 2015, who appointed M/s. Allied Insurance Surveyors and Loss Assessors Pvt. Ltd. (hereinafter referred to as the Surveyor) to assess the loss. The Surveyor visited the Factory to assess the loss. Requisite information / documents were provided to the Surveyor. The Complainant Company lodged a total claim of Rs.29,26,64,553/- (Rs.18,93,35,219/- towards Standard Policy and Rs.10,33,29,334/- towards Declaration Policy) with the Opposite Party Insurance Company. The Complainant Company informed the Opposite Party Insurance Company that the Resin Plant would take approximately 9 months to get into Operation as it would require redesigning of Equipment, Fabrication, Installation, Commissioning of the Plant and the Structure on which the Equipment is to be installed would also be replaced and it would require huge amount and therefore, the Complainant Company requested Opposite Party to release Rs.7.5 crore on an adhoc basis to restart the restoration of the Plant. The Complainant Company retained the salvage for Rs.83 lakhs. The Surveyor issued an Interim Survey Report dated 29.01.2016 vide which he assessed the Minimum Liability to Rs.8,15,57,419 and also recommended an on-account payment of Rs.2 Crores towards ad-hoc payment of the claim. The Opposite Party Insurance Company made a payment of Rs.24 lakh on 11.03.2016 and after repeated requests, another sum of Rs.1.76 Crore was also released on 31.05.2016 making total ad-hoc payment of Rs.2 Crores. The Surveyor issued Final Survey Report dated 29.03.2017 vide which he assessed the Loss to Rs.18,02,43,552/- (Rs.12,30,87,548/- towards loss under Standard Fire Policy including structure, machines, stock (WIP) in Resin and Camphor Plant and Rs.5,71,56,004/- towards loss under Declaration Policy - Stock including Raw Material and Finished Goods (Camphor Solutions). The said Final Survey Report was challenged by the Complainant Company alleging certain discrepancies in the said Report, but in vain. Due to financial crises, the Complainant Company requested the Opposite Party Insurance Company to release an interim payment of Rs.10 crores till the final disposal of the processed claim amount. It is alleged that the Opposite Party Insurance Company arbitrarily and unilaterally credited a sum of Rs.8,09,34,774/- in the account of the Complainant Company towards full and final settlement of the Claims. The Complainant Company requested the Opposite Party Insurance Company to review the loss assessment as according to the Complainant Company there were discrepancies, such as, assessment of loss was incomplete because the loss to the Plinth was not covered in the assessment, the depreciation charges were erroneously included despite of reinstatement exercise; the loss caused to the entire Electrical equipments were completely overlooked; single inflationary factor was wrongly applied. But getting no response from the Opposite Party Insurance Company, alleging deficiency in Service and Unfair Trade Practice on the part of the Opposite Party Insurance Company, present Complaint has been filed seeking the following reliefs:- "a. Declare that the Complainant Company suffered deficiency-in-service and Unfair Trade Practices from the Opposite Party hereinabove. b. Declare that the Complainant Company is entitled to the full claim amount of Rs.26,26,56,330/- (Rupees Twenty Six Crores Twenty Six Lacs Fifty Six Thousand and Three Hundred thirty only) for the actual loss suffered and covered under the insurance policies; c. Declare that the Opposite Party unilaterally and arbitrarily credited a partial sum of Rs.8,09,34,774/- (Rupees Eight Crores Nine Lacs Thirty four thousand and Seven Hundred Seventy Four only) towards alleged full and final settlement of insurance claim of the Complainant Company; d. Declare that the consent letter dated 29 March 2017 issued by the Complainant Company to the Opposite Party for a claim amount to the tune of Rs.18,02,43,552/- (Rupees Eighteen Crores Two Lacs Forty Three Thousand Five Hundred Fifty Two only) is not binding on the Complainant Company; e. Direct the Opposite Party to pay to the Complainant Company the balance amount of Rs.16,17,21,556/- (Rupees Sixteen Crores Seventeen Lacs Twenty One Thousand Five Hundred Five Sixty only); f. Direct the Opposite Party to pay to the Complainant Company interest at the rate of 18% per annum from the date of intimation of loss till the date of actual payment. g. Direct the Opposite Party to also pay to the Complainant Company compensation to the tune of Rs.10 Lacs for causing harassment and mental agony in pursuing its legitimate claim; h. Direct the Opposite Party to pay costs of the present proceedings to the Complainant Company;"
(3.) Upon Notice, Opposite Party Insurance Company contested the Complaint and filed its Written Statement.In the Written Statement, the Opposite Party Insurance Company took a preliminary objection that the Claim of the Complainant has been assessed by a reputed, experienced, Govt. Licensed firm of Surveyor and the admissible amount has been credited in the account of the Complainant in full and final settlement of the Claim.Therefore, there is no deficiency in service on the part of the Opposite Party Insurance Company.It was also submitted that the claim of the Complainant falls within the exclusion clause of the Policy, which reads as under:- ".......The Company agrees (subject to the conditions and Exclusions contained herein or endorsed or otherwise expressed hereon) that if after payment of premium the Property insured described in the Schedule or any part of such property be destroyed or damaged by any of the perils specified hereunder during the period of insurance named in the said schedule .... the Company shall pay to the insured the value of the Property at the time of the happening of its destruction or the amount of such damage or at its option reinstate or replace such property or any part thereof." This policy does not cover : "Loss destruction or damage to any electrical machine, apparatus, fixture or fittings arising from or occasioned by overrunning excessive pressure, short circuiting, arcing, self heating or leakage of electricity from whatever cause (lighting included) provided that this exclusion shall apply only to the particular electrical machine, apparatus, fixture or fitting so affected and not to other machines, apparatus, fixtures or fittings which may be destroyed or damaged by fire so set up." "1.1.3 : Policies having sum insured above INR 10 Cr. and upto INR 1500 Cr. Per location 5% of claim amount subject to a minimum of INR 5 lakhs." "9. Loss of earnings, loss by delay, loss of market or other consequential or indirect loss or damage of any kind or description whatsoever." "10. Loss or damage by spoilage resulting from the retardation or interruption or cessation of any process of operation caused by operation of any of the perils covered." "The work of replacement or reinstatement (which may be carried out upon another site and in any manner suitable to the requirement of the insured subject to the liability of the Company not being thereby increased) must be commenced and carried out with reasonable dispatch and in any case must be completed within 12 months after the destruction or damage or within such further time as the Company may in writing allow, otherwise no payment beyond the amount which would have been payable under the policy if this memorandum had not been incorporated therein shall be made." (relevant to property other than stock.)" ;