Ummadi Simhachalam vs Oriental Insurance Co. Ltd. on 30/5/2006
ORDER
P.D. Shenoy, Member
1. Aggrieved and dissatisfied by the judgment and order of the Andhra Pradesh State Consumer Disputes Redressal Commission, Hyderabad in Complaint No. 157 of 1993 Smt. Ummadi Simhachalam has filed this appeal before us.
Case of the complainant:
2. The complainant purchased a second hand fishing boat in 1983 for Rs. 1,40,000 got a registration Number VPT 519 for the said boat and operated the same from Visakhapatnam from 1983 to 1987. During 1989 the complainant effected major repairs like rebuilding the hull, fitting of new engine of Ashok Leyland make with finance from Andhra Bank. The Bank wrote to the Deputy Conservator, Visakhapatnam Port Trust requesting him to renew its licence and to make an endorsement on it mentioning the hypothecation to the Bank. M/s. Brahma Associates assessed the total value of the fishing vessel at Rs. 2,60,000 and M/s. Oriental Insurance Company insured the same for Rs. 2,50,000 on 19.12.1989 to 18.3.1990 which was further renewed on 16.3.1990. On 27.3.1990 when the said vessel was engaged in fishing operations near Bhyravapalem the boat overturned and sank into the sea. Another fishing vessel No. KKD 572 noticed the accident and rescued the crew of this vessel. On 28.3.1990 the owner came to know about the accident from the driver through a telegram. On 30.5.1990 after getting the records, connected with the case, the complainant filed a claim with the Insurance Company along with the weather certificate issued by the department on 30,5,1990 and letter dated 15.11,1990 issued by the Mercantile Marine Department of the Ministry of Surface Transport. The Surveyor submitted the report on 27.9.1991 assessing the same as total loss. Finally on 3.7.1992 the complainant was informed that the Insurance Company has repudiated her claim on the grounds that the investigator appointed by the Insurance Company has reported that it is a false case Thereafter, the complainant filed a complaint before the State Commission claiming (a) Rs 2.5 lakhs with interest @ 18% from the date of accident; (b) Rs. 10,000 towards search and salvage operation; (c) Rs. 1.00 lakh towards loss of business; and (d) Rs. 2.00 lakhs towards mental agony with costs.
3. Case of the Insurance Company.
* Complainant failed to furnish the details of the 'Bank loan' taken at the time of taking insurance.
* The Branch officer of the respondent at Kakinada received an anonymous letter warning them that attempt is likely to be made by the complainant for sinking the boat for taking false insurance claim.
* The Surveyor appointed by the Insurance Company conducted the survey operations thoroughly and could not retrieve any part of the fishing boat.
* He submitted the final report of total loss without any prejudice to their rights under the policy conditions.
* As the anonymous letter dated 6.2.1990 stated that the owner of the boat has registered the same vessel under different registration number NZM 240 at Niazamapatnam Port and as such the sinking of this boat is a fraud, they appointed Mr. I.V. Ratna Rao a retired Supdt, of Police, CBI conduct an investigation, After thorough investigation he submitted a report stating that the complainant's claim is false.
* The Insurance Company further contended that the complainant failed to pay berth and water charges to the port authorities and she further failed to show the major repairs effected to the vessel;
* Further the complainant suppressed the fact that the vessel' was earlier insured with M/s. United India Insurance Company, Visakhapatnam for Rs. 1,10,000;
* The complainant also managed to get a valuation certification from M/s. Brahama Associates for an exaggerated amount of Rs. 2.5 lakhs.
4. The State Commission relied upon the decision of the National Commission in N.C. Report in Parees Offset Pvt. Ltd. v. United India Insurance Co. Ltd. VPT 519, II (1995) CPJ 9 (NC), where it was held that on the facts and circumstances of the complaint, repudiation of the liability by the opposite party-Insurance Company cannot be said to have been made arbitrarily or unreasonably and there is absolutely no reason to hold that the decision was taken by the opposite party otherwise than in good faith and that, therefore, there is no deficiency in service on the part of the opposite party. Accordingly the complainant is not entitled for any relief.
Findings:
5. Learned Counsel for the appellant quoted the judgment of the NCR on Consumer in Oriental Insurance Co. Ltd. v. M/s. Khemani Electronics, wherein the Commission has held that:
The contention of the appellant that there was no theft/burglary in the 'shop of the complainant and that it is a concocted story is to be brushed aside. Immediately when the complainant noticed the lock and shutters of his shop tampered with, he reported the matter to the police. The order of the State Commission also shows a news item also appeared in the newspaper about the incident. At the behest of the Insurance Company two Surveyors had earlier surveyed and investigated the claim of the complainant. After having received the reports of the two Surveyors, the Insurance Company, appointed "Strategic Security Consociates" for investigations who alleged that there was no burglary. In view of the spot observations it is futile for the Insurance Company to urge that the shop of the complainant was not broken open by the culprits. No reliance can be placed upon the report of 'Strategic Security Consociates' who submitted its report in November 1990 i.e., after about one year of the incident.
6. The ratio of this case quoted by the learned Counsel for the appellant has no relevance to the appeal which is before us. In this case the allegation of sinking of vessel has neither been reported nor investigated by police or any news paper report has appeared in this regard. Hence the relevant facts in these two cases are not comparable.
7. The learned Counsel for the appellant also quoted the decision of our Commission reported in the NCR on Consumer in Oriental Insurance Co. Ltd. v. Suresh Arjun Karande. In this case:
It has held that though a Surveyor was appointed by the Insurance Company and a report had been made to the company by him which is part of the record, we find that the entire approach made by the f Surveyor was totally wrong. The Surveyor should have ascertained what was the value in the market of a second hand (used) vehicle of the particular make and model as on the date when the accident took place. This will be quite different from the value of different parts put together. The Surveyor's report is thus of absolutely no assistance to us.
8. The ratio of this case is not applicable to the case on hand as the facts and circumstances of the case are entirely different.
9. On the following issue this Commission by its order dated 26.8.2005 sought the opinion of the Insurance Regulatory and Development Authority "whether under the Insurance Act apart from Surveyor and Assessor, any investigator could be appointed; and if so, what shall be the value of the report of the investigator".
10. The IRDA while giving a detailed opinion has quoted an extract of the following judgment of the Supreme Court:
That the Hon'ble Supreme Court, recently, in National Insurance Co. Ltd., v. Harjeet Rice Mills, III (2005) CPJ 6 (SC), has emphatically held that Section 64 UM of the Insurance Act, 1938 cannot stand in the way of the insurer in establishing (by engaging a private investigator) that the claim was a fraud on the insurer or that it was a case deliberately causing loss so as to lay the foundation for an insurance claim.
Some of the important issues raised by the investigator are as follows:
The said boat was insured with the answering respondent for the first time on 19.12.1989 for a period of three months and thereafter it was further renewed for three months on 19.3.1990 and the sinking took place within ten days of the second quarter of the policy. The complainant defaulted to the Bank and to the Port Trust on a regular basis. The said boat conducted fishing operations all through at Vishakhapatnam until 31.1.1990. The fishing operations were shifted to Byravapalem thereafter. This was quite unnatural as it is an admitted case of the insured that the business is looked after by her husband who is an employee of SAIL at Vishakhapatnam working as Crane Helper in the Equipment Section. It would not have been possible for the husband of the insured to have managed the business outside Vishakhapatnam being employed there. The reasons for shifting the fishing operations can only be to manipulate the sinking and to fabricate evidence which otherwise would have been difficult at Vishakhapatnam. The driver of the insured boat and that of the rescue boat were not produced before the investigator. The statement of the driver of the insured boat and the driver of the rescue boat had many contradictions. The anonymous letter dated 6.2.1990 received by the Branch Office, Kakinada was specific and the facts appeared realistic as the boat in fact allegedly sank on 27.3.1990. The informer had specific knowledge about the plans hatched by the insured for sinking of the boat as the particular given in the letter totally matched with the facts of the case. Thus, it can very well be said that it was not an accident but was a premeditated and predetermined plan.
11. In view of the above analysis we have all the reasons to doubt the veracity of the complaint of the complainant that the vessel had sunk at Byravapalem. Accordingly, the appeal is dismissed. There shall be no order as to costs.
