SINDHU FLOWERS PRIVATE LIMITED Vs. NEW INDIA ASSURANCE COMPANY LIMITED

JUDGEMENT

(1.) M/s. Sindhu Flowers Private Limited have invoked the original jurisdiction of this Commission by filing the present complaint against the New India Assurance Company, alleging deficiency in service in releasing the amount claimed by way of compensation for the loss suffered by the complainant on the basis of the insurance policy issued by the opposite party for covering various risks including hail-storm etc.

(2.) According to the complainant a Private Limited Company, engaged in the cultivation of various types of flowers in consonance with the natural climatic conditions, nature of land and other related conditions in different farms situated at different places and one such farm being in Village Mallan, Distt. Kangra, the Company had taken the financial assistance of Punjab National Bank from their Branch Office at Chandi Mandir for the smooth running of their business. The Bank sanctioned a Cash Credit (H) Limit of Rs.15 lacs which the complainant has been availing from time to time. The complainant got their flori-culture crop insured with the opposite party against the risk of fire, hail-storm, cyclone, floods and natural calamities etc. The policy was taken on 15th November, 1995 and the same was valid upto 14th November, 1996 and it was renewed from time to time making the total coverage limit to the tune of Rs.21 lacs. On 28th May, 1997 while the flowering crop of the complainant was under cultivation there was severe hail-storm in the area around Village Mallan, which completely destroyed the flowering crop of the complainant about which immediate information was sent to the Assurance Company-opposite party telegraphically on 2nd June, 1997 as under : "to the New India Assurance Company, Kalka (Haryana) crop damage of gladiolus flowers to the extent of Rs.4.00 lacs due to hail and cyclone at our farm near Allan, Kangra. Arrange spot survey to settle our claim. Sindhu Flowers Private Limited. " despite this telegram, when there was no response from the Company-opposite party upto 5th June, 1997, the complainant requested Dr. A. P. S. Gill, Advisor on Flori-culture of APEDA - Government of India organisation for promotion of export of agricultural produce based at Ludhiana, to visit the affected farm area and also to advise the complainant to further course of action to minimise the damage to the flori-crop as also to assess the loss due to damage done due to hail-storm. Dr. A. P. S. Gill assessed the loss to the tune of Rs.4 lacs and apprehended further damage to the crop also, keeping in mind the severe injury on the plants and foliage to the crop.

(3.) On the other hand, the Assurance Company instead of releasing the payment keeping in view the assessment of loss made by Dr. A. P. S. Gill, cancelled the insurance policy by their letter dated 20th May, 1997 even though the policy had been in force for the past 18 months. Aggrieved by this deficiency in service on the part of Assurance Company by canceling the insurance policy retrospectively and unilaterally and repudiating the claim of the complainant, the present complaint has been filed for claiming refund of the amount of Rs.5.5 lacs as loss on account of damages to the crop along with interest @ 18%.