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New India Assurance Co. Ltd. v/s M/s. Avadh Wood Prodcuts (Cold Storage) Azam Road, Mihinpurna Bahraich Uttar Pradesh Through its Partner


Company & Directors' Information:- R J COLD STORAGE PRIVATE LIMITED [Active] CIN = U74899DL1992PTC049659

Company & Directors' Information:- S. D. COLD STORAGE PRIVATE LIMITED [Active] CIN = U15132UP1995PTC018791

Company & Directors' Information:- D G COLD STORAGE PRIVATE LIMITED [Active] CIN = U45209WB2001PTC092809

Company & Directors' Information:- N P S COLD STORAGE PRIVATE LIMITED [Active] CIN = U15549WB1997PTC085229

Company & Directors' Information:- G M COLD STORAGE PVT LTD [Active] CIN = U63022WB1986PTC041010

Company & Directors' Information:- P C INDIA LIMITED [Strike Off] CIN = U33111TN1986PLC013401

Company & Directors' Information:- A. S. INDIA LIMITED [Active] CIN = U70100MP2009PLC022300

Company & Directors' Information:- G C G COLD STORAGE PRIVATE LIMITED [Active] CIN = U01400MH2012PTC235712

Company & Directors' Information:- L P COLD STORAGE PRIVATE LIMITED [Active] CIN = U15133UP1997PTC021864

Company & Directors' Information:- P D COLD STORAGE PRIVATE LIMITED [Active] CIN = U74900UP2010PTC039698

Company & Directors' Information:- N R S COLD STORAGE PVT LTD [Active] CIN = U63022WB1978PTC031524

Company & Directors' Information:- AZAM COLD STORAGE PRIVATE LIMITED [Active] CIN = U63020BR2008PTC013775

Company & Directors' Information:- S M COLD STORAGE PVT LTD [Active] CIN = U63022WB1986PTC040843

Company & Directors' Information:- A TO Z COLD STORAGE PRIVATE LIMITED [Active] CIN = U15122UP2010PTC040956

Company & Directors' Information:- A-1 COLD STORAGE PRIVATE LIMITED [Active] CIN = U74900TG2015PTC100777

Company & Directors' Information:- D N COLD STORAGE PRIVATE LIMITED [Active] CIN = U15133UP1989PTC010708

Company & Directors' Information:- P S COLD STORAGE PRIVATE LIMITED [Active] CIN = U15139UP2001PTC026373

Company & Directors' Information:- N L COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U63022ML2001PTC006536

Company & Directors' Information:- K H I COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022DL1999PTC100373

Company & Directors' Information:- K J COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022PB1996PTC018274

Company & Directors' Information:- V K COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022RJ1998PTC014964

Company & Directors' Information:- R M COLD STORAGE PRIVATE LIMITED [Active] CIN = U15133UP1999PTC024532

Company & Directors' Information:- S L P COLD STORAGE PRIVATE LIMITED [Converted to LLP] CIN = U00063KA1997PTC022544

Company & Directors' Information:- M D COLD STORAGE PRIVATE LIMITED [Active] CIN = U15133UP2001PTC025987

Company & Directors' Information:- S N COLD STORAGE PVT LTD [Active] CIN = U15132WB1977PTC031040

Company & Directors' Information:- A K COLD STORAGE PRIVATE LIMITED [Active] CIN = U15133UP1999PTC024374

Company & Directors' Information:- G. T. COLD STORAGE PRIVATE LIMITED [Active] CIN = U70101UP1999PTC024239

Company & Directors' Information:- WOOD INDIA PVT LTD [Active] CIN = U20211AS1980PTC001819

Company & Directors' Information:- THE INDIA COMPANY PRIVATE LIMITED [Active] CIN = U74999TN1919PTC000911

Company & Directors' Information:- R J WOOD AND CO PVT LTD [Active] CIN = U20219DL1931PTC000245

Company & Directors' Information:- G D COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U63022WB1997PTC084601

Company & Directors' Information:- J S COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022PB1997PTC020250

Company & Directors' Information:- B C COLD STORAGE PRIVATE LIMITED [Active] CIN = U45302PB1997PTC019355

Company & Directors' Information:- G S P COLD STORAGE PRIVATE LIMITED [Active] CIN = U74899DL1995PTC069618

Company & Directors' Information:- R R COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022TZ1995PTC006478

Company & Directors' Information:- H J COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U63022WB1999PTC089452

Company & Directors' Information:- B K COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022PB1997PTC020070

Company & Directors' Information:- J T S COLD STORAGE PRIVATE LIMITED [Active] CIN = U74900UP2011PTC044733

Company & Directors' Information:- COLD STORAGE CORPORATION OF INDIA LIMITED [Active] CIN = U25193UP1946PLC001472

Company & Directors' Information:- M K R S S COLD STORAGE PRIVATE LIMITED [Active] CIN = U63090WB2020PTC241530

Company & Directors' Information:- R G P COLD STORAGE PRIVATE LIMITED [Active] CIN = U74999KA2006PTC039844

Company & Directors' Information:- J P G A COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022PB2005PTC028831

Company & Directors' Information:- INDIA CORPORATION PRIVATE LIMITED [Active] CIN = U65990MH1941PTC003461

Company & Directors' Information:- R B COLD STORAGE PRIVATE LIMITED [Active] CIN = U63022BR1979PTC001418

Company & Directors' Information:- N J COLD STORAGE PRIVATE LIMITED [Active] CIN = U63020DL2010PTC207001

Company & Directors' Information:- G M COLD STORAGE PVT LTD [Strike Off] CIN = U63022OR1985PTC001574

Company & Directors' Information:- S V S COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U74999AP1999PTC033134

Company & Directors' Information:- R V COLD STORAGE PVT LTD [Strike Off] CIN = U15133UP1988PTC010122

Company & Directors' Information:- WOOD (INDIA) PVT LTD [Under Process of Striking Off] CIN = U20221OR1983PTC001171

Company & Directors' Information:- V L S COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U63010TG2011PTC072072

Company & Directors' Information:- C K ROAD COLD STORAGE PVT LTD [Strike Off] CIN = U63022WB1978PTC031567

Company & Directors' Information:- M Y COLD STORAGE PRIVATE LIMITED [Active] CIN = U15122UP2012PTC053516

Company & Directors' Information:- K T COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U63022NL2001PTC006616

Company & Directors' Information:- M M COLD STORAGE PRIVATE LIMITED [Strike Off] CIN = U63090TG2013PTC090068

Company & Directors' Information:- H. R. COLD STORAGE PRIVATE LIMITED [Active] CIN = U63030GJ2016PTC092718

Company & Directors' Information:- A K STORAGE PRIVATE LIMITED [Strike Off] CIN = U99999MH1978PTC020884

Company & Directors' Information:- COLD STORAGE (INDIA) LTD. [Dissolved] CIN = U99999MH1922PTC000998

Company & Directors' Information:- INDIA COLD STORAGE CO. LTD. [Not available for efiling] CIN = U99999MH1948PLC006673

    First Appeal No. 220 of 2007

    Decided On, 07 March 2013

    At, National Consumer Disputes Redressal Commission NCDRC

    By, THE HONOURABLE MR. JUSTICE ASHOK BHAN
    By, PRESIDENT & THE HONOURABLE MRS. VINEETA RAI
    By, MEMBER

    For the Appellant: Abhishek Kumar, Advocate. For the Respondent: Anuj Kumar, Advocate.



Judgment Text

Vineeta Rai, Member

1. This first appeal has been filed by New India Assurance Co. Ltd., Appellant herein and Opposite Party before the U.P. State Consumer Disputes Redressal Commission, Lucknow (hereinafter referred to as the State Commission) being aggrieved by the order of that Commission which allowed the complaint of M/s Avadh Wood Products (Cold Storage), Original Complainant before the State Commission and Respondent herein.

2. In his complaint before the State Commission, Respondent had stated that since 1987 they were running a cold storage as a partnership firm at Azam Road, Mihinpurna, Bahraich, U.P. for storing potatoes on behalf of customers, businessmen and farmers. Respondent had taken two insurance policies from the Appellant-Insurance Company in respect of (i) potato stocks in the cold storage and (ii) building, plant & machinery for Rs.45 Lakh and Rs.30 Lakh respectively. The said policies covered the risks of fire, terrorist attacks and damage to potatoes packed in gunny bags as also damage to the building, plant and machinery. During the validity of the policies, due to erratic supply of electricity caused by a fire in the substation, due to which the transformer got burnt, the potatoes stored in the cold storage got damaged and despite several requests to the Executive Engineer and other Electricity Authorities, this problem was not addressed. Alternative arrangements for generator could not materialize since the competent authority i.e. the District Supply Officer had directed all diesel and petrol pumps not to issue diesel and petrol to individuals as these were required for vehicles involved in the conduct of elections.

3. Out of 22447 bags of potatoes that were stored, 7727 bags were damaged due to non-supply of electricity consequent to the burning of the transformer. Out of the 154 customers who had stored their potato stocks in the cold storage, 50 customers filed their claim before the Licensing Authority, which passed orders against the Respondent and directed it to pay Rs.6,50,764/-. Remaining 104 claims were settled mutually and Respondent had to pay Rs.5,35,612/- to these claimants. In addition, Respondent had to pay money to the labour for clearing the cold storage and also Rs.1,50,000/- on maintenance of the building damaged by the potato stocks. Respondent, therefore, filed a claim alongwith necessary documents to the Appellant-Insurance Company, which neither responded to the same nor appointed any surveyor to assess the loss. Being aggrieved, Respondent filed a complaint before the State Commission on grounds of deficiency in service and requested that the Appellant-Insurance Company be directed to settle the insurance claim and the loss suffered by the Respondent amounting to Rs.18,45,368/- under the following heads :

'a) On maintenance building Rs.1,50,000 (Rupees One lakh fifty thousand);

b) Compensation duly awarded by the licensing authority Rs.6,50,764/- (Rupees six lacs fifty thousand seven hundred and sixty four only);

c) Amount incurred on amicable settlement Rs.5,35,612/- (Rupees five lacs thirty five thousand six hundred twelve only);

d) Amount for clearing the cold storages on labourers on Rs.60,000/- (Rupees sixty thousand only);

e) Compensation for rent charge Rs.2,88,992/- (Rupees two lacs eighty eight thousand nine hundred ninety two only);

f) Compensation Rs.1,00,000/- (Rupees one lac only);

g) Pocket expenses incurred in prosecuting this claim Rs.10,000/- (Rupees ten thousand only);

h) Legal expenses on litigation pending before Licensing Authority and Tribunal Rs.50,000/- (Rupees fifty thousand only)'.

4. Appellant-Insurance Company on being served entered appearance and filed a written rejoinder denying that there was any deficiency in service. It was stated that both insurance policies covered risks only against fire and terrorist attacks and nothing else was included in the policy. Since the damage was caused on account of erratic supply of electricity and not by any fire in the cold storage or any terrorist attack, as admitted by the Respondent himself, the damage/loss was not covered as per the insurance policy and the claim was rightly not entertained.

5. The State Commission after hearing the parties and considering the evidence filed before it inter alia concluded that the insurance policy document specifying the risks covered in the policy had never been issued to the Respondent and only a cover note had been given to Respondent, which, however, did not state that only a fire which occurs in the premises will be treated as 'fire' under the policy. The State Commission, therefore, allowed the complaint by observing as under :

It is the argument of counsel for insurance company that the insurance company is not responsible and liable for the damage consequent to fire incident in the transformer because as per insurance terms, the insurance company has no concern with the transformer got burnt in the fire. Contention of not covered by the insurance terms is not admissible. It has also been stipulated in Section 2(d) of Consumer Protection Act, 1986 that '… and includes any of such goods …' i.e. presumption of means and includes also support the fact of damage of potatoes due to fire in transformer, because stored potatoes got damaged only due to fire incident in the transformer. ‘Fire’ is the only cause and reason of damage of stored potatoes. As such the insurance company is liable to pay the assured sum towards the damaged potatoes. It is also necessary to point out that it has not been mentioned in the cover note of Fire Policy that only ‘Fire’ will be treated and considered as ‘Fire’ under the insurance which fire incident occurs in the premises. It is also relevant to state that only cover note is available with the complainant and neither the insurance policy has been issued by the insurance company to him till date from which the complainant could know as to what are the conditions binding on him. As with regard to not issuing the insurance policy, the Hon’ble Commission in its judgment has held the deficiency in service on the part of insurance company. Therefore, in the light of aforesaid judgment passed by the Hon’ble National Commission in the case of Hundi Lal Jain Cold Storage, this complaint for damage of potatoes is liable to be allowed.

The State Commission, therefore, directed the Appellant-Insurance Company to pay (i) value of 2431 potato bags at the rate of Rs.280/- per quintal; (ii) value of 5296 potato bags at the rate of Rs.125/- per quintal; (iii) take into consideration the weight of each bag as 80 kgs.; and (iv) pay interest at the rate of 7.5% from the date of filing of the complaint i.e. 28.08.1998 till payment.

6. Being aggrieved by the order of State Commission, the present first appeal has been filed.

7. Learned counsel for both parties made oral submissions essentially reiterating the facts as stated in their respective complaints/rejoinder. Counsel for the Appellant-Insurance Company while admitting that only the cover note of the insurance policy was made available to the Respondent, which did not include the various terms and conditions of the policy, stated that the cover note clearly specified that it was a fire policy and since the damage to the potato stocks was not caused as a result of a fire in the cold storage but due to erratic supply of electricity, the claim was rightly not entertained.

8. Counsel for the Respondent on the other hand stated that the State Commission had rightly concluded that in the absence of the policy document, Appellant-Insurance Company could not bind down the Respondent to the terms and conditions of the policy. The insurance policy for which the Respondent had sought insurance cover pertained to fire, terrorist attacks and damages caused to stocks as well as building. Admittedly, because of a fire in the substation resulting in erratic supply of electricity, there was damage to the potato stocks for which Respondent had to pay the customers on whose behalf these had been stocked and also incurred expenditure pertaining to the maintenance of the building, labour charges etc. The State Commission after carefully considering these facts had, therefore, rightly concluded that there was deficiency in service on the part of Appellant-Insurance Company in not entertaining the claim.

9. We have heard learned Counsel for both parties and also gone through the evidence on record. The fact that Respondent had taken two insurance policies to cover (i) potato stocks and (ii) building & machinery respectively are not in dispute. It is also an admitted fact that Appellant-Insurance Company issued only the cover note to the Respondent and the insurance policy specifying the detailed terms and conditions was not made available to the Respondent. This itself is a deficiency in service on the part of Appellant-Insurance Company. Furth

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er, since the cover note does not specify the actual terms and conditions governing the policy, we agree with the State Commission that the Appellant-Insurance Company could not have bound down the Respondent to provisions of the policy of which he was not made aware. The National Commission has taken a similar view in the case of Oriental Insurance Co. Ltd. v. Brahmdeo Panjiyara decided on 14th of March, 2012, which is also relevant to this case. We, therefore, agree with the finding of the State Commission in this connection that the Appellant-Insurance Company was guilty of deficiency in service in not settling the Respondent’s insurance claim 10. In view of these facts and following our judgment in BrahmdeoPanjiyara (supra), we uphold the order of the State Commission and dismiss the present first appeal. Appellant-Insurance Company is directed to settle the insurance claim of the Respondent as ordered by the State Commission within a period of three months from the date of this order.
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