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M/s. Jagdish Glass Works Pvt. Ltd., Firozabad v/s New India Assurance Co. Ltd., Through Its Chairman & Managing Director, Fort Mumbai

    Consumer Case No. 66 of 2005

    Decided On, 16 February 2022

    At, National Consumer Disputes Redressal Commission NCDRC

    By, THE HONOURABLE MR. C. VISWANATH
    By, PRESIDING MEMBER & THE HONOURABLE MR. JUSTICE RAM SURAT RAM MAURYA
    By, MEMBER

    For the Complainant: Ravindra Bana, Advocate. For the Opposite Parties: Ashish Varma, Advocate.



Judgment Text

1. Heard Mr. Ravindra Bana, Advocate, for the complainant and Mr. Ashish Varma, Advocate, for the opposite party.

2. M/s. Jagdish Glass Works Private Limited (the complainant) has filed above complaint for setting aside the order of opposite party dated 13.08.2004, repudiating the claim of the complainant and directing the opposite party to pay Rs.10289840/- (i.e. insurance claim of Rs.7170620/- + interest of Rs.3119220/- from 05.02.2003 to 30.06.2005) and any other relief which is deemed fit and proper, in the facts and circumstances of the case.

3. The facts, as stated in the complaint and emerged from the documents attached with the complaint, are as follows:-

(a) The complainant was a partnership firm, formed on 03.05.1987 and engaged in manufacture and trade glass items. The complainant had a factory in an area of 98000 sq.ft. situated at Dhaulpura, at a distance of 3 KM from Firozabad towards Agra on the Highway. From April, 1999, the complainant was incorporated as a private company under the Companies Act, 1956. Initially the furnace of the complainant was of traditional design and coal was used as the fuel. Later on the furnace of natural gas was installed, for which, the complainant obtained gas connection from Firozabad Gas Authority of India. The complainant invested Rs.85/- lacs in the year 2000-2001 and installed a new furnace built up by high quality electro-cast refractories and a gas generator was installed for that purpose. By utilizing natural gas, the complainant raised daily drawing capacity to 40 M.T. and turnover for the year 2000-2001 was Rs.4.3/- crores and at the end of 2002-2003 was about Rs.3.6/- crores. The complainant was manufacturing Quality Tumblers from Press machines, Branded and other Headlight Glasses, Laboratory wares, Chimneys, Bulb Shells, Lamp Shades and Bangles of latest designs, Paper Weight, Kitchen ware etc.

(b) The complainant obtained Policy No.323002/11/01/00929, i.e. Standard Fire and Special Perils Policy (Material Damage), for a sum of Rs.105/- lacs, for the period of 20.02.2002 to 19.02.2003, from New India Assurance Company Ltd. The policy covered risk of Rs.50/- lacs on Plant and Machinery, Rs.52/- lacs on Stock of finished and unfinished goods and Rs.3/- lacs on Building and Boundary wall.

(c) On 05.02.2003 at 16:30 hours, a loud explosion occurred in the factory unit, due to which, main shed of the factory and the walls collapsed, which caused extensive damage to the furnace, Plant & Machinery and the stocks of finished goods, stored there. The Unit was closed for past two weeks for repair and maintenance of refractory layer of the furnace at the time of incident. The burners of furnace were removed along with associated piping up to inlet valve, located near furnace.

(d) The complainant informed the incident to Assistant Director of Factories, U.P. at Firozabad, Gas Authority of India Limited and the Branch Manager of the opposite party on 06.02.2003 and to the local Police Station on 09.02.2003. The Insurer appointed Anil Jain, Surveyor & Loss Assessor, Agra, for preliminary survey, who inspected the factory premises on 07.02.2003 and submitted his Preliminary Report dated 15.02.2003, mentioning therein that as per verification of the site, no fire had occurred at the site and the loss had not occurred by or through any consequence directly or indirectly of the occurrence on account of Typhoon, Hurricane, Tornado, Cyclone or other atmospheric disturbance. As per the reports published in the local newspaper “Jageran” dated 06.02.2003, the likely cause of loss was that the workers have tied the chain pulley on the iron angle of the trusses. The trusses could not bear the heavy load of pulley and the weight of the object lifted. Hence entire trusses were lean down causing extensive damage to the entire structure consist of iron angles and asbestos sheets on it.

(e) The Insurer appointed Core Engineering Group, New Delhi, for survey and assessment of loss. The Surveyor inspected the factory premises on 19.02.2003. At the time of inspection, the Surveyor found that much of the site had already been cleared and debris removed with the permission of the Insurer. The Surveyor, therefore, examined the photographs produced by the Insured, Report of Amardeep Developers & Project dated 06.02.2003 and Report of Spark Association and Consultant, New Delhi dated 10.02.2003. The Insured submitted insurance claim on 12.03.2003. Core Engineering Group, New Delhi submitted its Interim Report dated 02.05.2003 and Final Report dated 31.07.2003, mentioning therein that loss had occurred due to explosion, caused due to accumulation of gas leaking from piping/inlet valve and assessed the loss of Rs.5266069/.

(f) The Insurer sent all the papers to Puri Anuj & Associates Private Ltd., Surveyor and Loss Assessor, New Delhi and sought his opinion. Puri Anuj & Associates Private Ltd. Surveyor and Loss Assessor, New Delhi, after examining the entire materials on record, submitted his report dated 11.03.2004, mentioning that it was not established conclusively that the loss was caused due to explosion. Thereafter, the Insurer repudiated the claim, vide letter dated 13.08.2004 on the ground that collapse of the factory shed had not occurred on account of any of the perils insured. This complaint has been filed on 19.07.2005, alleging that the claim has been illegally repudiated, ignoring various independent reports.

4. The insurer filed its written reply, on 17.10.2005, in which, the material facts relating to the trade of the Insured and the insurance policy have not been denied. It has been stated that the Insurer found contradiction in Preliminary Report dated 15.02.2003 of Anil Jain, Surveyor & Loss Assessor, Agra, and Final Survey Report dated 31.07.2003 of Core Engineering Group, New Delhi, in respect of cause of loss. Therefore, the Insurer deputed Puri Anuj & Associates Private Ltd. Surveyor and Loss Assessor, New Delhi, for their opinion. Puri Anuj & Associates Private Ltd. Surveyor and Loss Assessor, New Delhi, after examining entire materials on records submitted his report dated 11.03.2004, mentioning that it was not established conclusively that the loss was caused due to explosion. The Insurer, thereafter, examined entire materials on records and for following reasons came to the conclusion that collapse of the factory shed had not occurred on account of any of the insured perils. Evidence on record show (i) The building had collapsed inward and the columns had bent inwards. (ii) The trusses have bent downwards. (iii) No ball of flame was seen by anybody. (iv) None of the worker sustained any burn injury on their body. (v) There was no outward scattering of the materials. (vi) There was no fire subsequent to alleged explosion. (vii) CNG supply system provided two quick shut valves in gas supply pipe to the furnace. Both the valves were closed as the maintenance /repair work was going on from two weeks prior to the incident. (viii) Source of sparking is not proved. (ix) No welding set was found on the site. (x) As per GAIL Gas Consumption Report, no gas was consumed after January, 2003. (xi) CNG has a distinctive smell. It is not possible that its presence could not have noticed by the workers. The preliminary objection that the complainant is not a ‘consumer’ has also been raised.

5. The Insured filed his rejoinder reply on 09.03.2006, in which, the facts stated in the complaint were reiterated. He stated that it has been fully proved from the reports of Amardeep Developers and Project dated 06.02.2003 and Spark Association and Consultant, New Delhi dated 10.02.2003 that the loss was caused due to explosion. Core Engineering Group, New Delhi did not find any reason to differ from the aforesaid reports and submitted its Interim Report dated 02.05.2003 and Final Report dated 31.07.2003, mentioning the cause of loss as explosion. The report of Puri Anuj & Associates Private Ltd. is not reliable. Repudiation of the claim was illegal. The Insured filed various documentary evidence and Affidavit of Evidence of Sunil Agrawal. The Insurer filed Affidavit of Evidence of Narinder Kapoor, Senior Divisional Manager, Affidavit of Evidence of Anil Jain, Preliminary Surveyor and Affidavit of Evidence of Sharda Rai, Manager, annexing the reply of Core Engineering Group dated 24.03.2004.

6. We have considered the arguments of the counsel for the parties and examined the record. Core Engineering Group, in Appendix-A of Final Report dated 31.07.2003, has mentioned the length of main shed as 62.3 meter and width as 20.3 meter. This is the place, where the incident took place. The drawing (Appendix-B) shows that after about middle half of the main shed, furnace was erected and Regenerator was installed. It is asbestos-sheets construction on iron angles and trusses. On both the side, there were cemented pillar and RCC columns. The Insured, in his letter dated 06.02.2003, given to the Branch Manager of the Insurer, Assistant Director of Factory and Gas Authority of India Ltd. has stated that main shed of his factory had collapsed. Amardeep Developers & Projects, in his report dated 06.02.2003, has mentioned that roof above the furnace and around it was seen to have been clearly blown out due to some sort of blast. Sparks Associates & Consultants in his report dated 10.02.2003 has also mentioned that the roof above the furnace and the surrounding area has apparently blown out-ward and the tin and asbestos roof pieces found scatters all around the premises due to blast outward effect of the explosion. Sparks Associates & Consultants in his report dated 10.02.2003 has attached four photographs, which show that roofs were fallen towards downward and not outward. Preliminary Report dated 15.02.2003 is attached as Exhibit-B and 30 photographs were attached as Exhibit-K to the Final Survey Report dated 31.07.2003 of Core Engineering Group. These photographs also prove that the roof was collapsed downward. Picture-15 to Picture-23 related to the damage to the furnace, which shows that entire roof together with sheets, iron angle and trusses were collapsed on the furnace.

7. Sparks Associates & Consultants in his report dated 10.02.2003, has mentioned that the explosion was of medium intensity. If a medium intensity blast hit the roof in some area, which was blown, then the collapsing of entire roof of the shed which was 62.3 meter x 20.3 meter, having separate angles and trusses for its support, was not probable, as the intensity was towards upward. Cause of the blast is being alleged as the accumulation of CNG gas. From meter reading of the gas, it was proved that la

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st fifteen days of the incident, there was no consumption of the gas. Admittedly supply of the gas was stopped from the valve points as the furnace was under repairing. The shed was opened on all the sides. If leakage of the gas was in very small quantity, there could be no accumulation of such huge quantity of gas, which can cause medium intensity blast. 8. Although seven workers were injured on the spot but none of them received burn injury. If the incident had occurred due to explosion, then in all probability some of the worker might have received burn injury. Anil Jain, the Preliminary Surveyor had seen the spot. He did not find any trace of explosion or fire. Anil Jain had filed Affidavit of Evidence to prove Preliminary Report dated 15.02.2003. The complainant did not cross-examine him. By the time, the Surveyors of Core Engineering Group inspected the spot, the complainant had already removed debris. In such circumstance, we do not find any illegality in the repudiation letter dated 13.08.2004, in which, Preliminary Report dated 15.02.2003 has been relied upon. ORDER In view of the aforesaid discussions, the complaint has no merit and is dismissed.
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