Prabir Kumar Samanta, President:
1. This complaint case has been sent back on remand by the National Commission for deciding the same afresh after giving due opportunities to the parties by setting aside the judgment and order of dismissal of the complaint case by this State Commission.
2. The complainant is a Co-operative Cold Storage Society Ltd. It carries on business of cold storing of potatoes of farmers and businessmen on rental basis. The complainant has two chambers of cold storage and the requisite plant and machineries for running of the same. It has also generator for maintaining a particular temperature for the purpose of preservation of potatoes stored in the aforesaid two chambers, in case of low voltage supply of electricity. It has been stated that in each of the said two chambers of the complainant’s cold storage 33,333 bags of potatoes were stored. It is not in dispute that the complainant took three insurance policies from the OP/New India Assurance Co. Ltd. covering the plant and machineries of the cold storage under one policy and other two policies for the bags of potatoes as aforesaid stored in two chambers in the said cold storage.
3. During the validity period of insurance coverage there was failure of supply of electricity for which the stored potatoes got severely damaged. The matter was intimated to the Insurer in due time for making proper survey to find out the damage done to the potatoes, but the OP wilfully neglected to determine the loss suffered thereby by the complainant. The damage suffered by the complainant was thereafter assessed by the complainant and informed to the OP/Insurer which deputed its Surveyor to assess the damage on its behalf. The Surveyor inspected the necessary papers and the cold storage and ultimately submitted a report. The loss had been originally assessed by the Surveyor at Rs. 41,58,495. After policy deduction it became Rs. 37,42,645. After salvage of 10% deduction the figures stood at Rs. 33,68,380. There was further deduction to the extent of Rs. 10,98,647. The Surveyor further deducting 20% as being the excess claim ultimately determined the net loss suffered by the appellant at Rs. 8,78,917 for payment by the OP/Insurer to the complainant. The Insurance Company instead of accepting the said report of the Surveyor repudiated the claim of the complainant which was raised for a sum of Rs. 38,13,093 on the ground that subject of loss was not coming under the purview of policy condition. Hence the complaint case before this Commission.
4. In the complaint case, however, the claim has been confined to Rs. 19,94,000, as stated herein, only for the purpose of invoking the pecuniary jurisdiction of the State Commission. The OP contested the aforesaid claim case by specifically contending that the potatoes were damaged due to rise in temperature above 43.5F. as a result of continuous failure of power supply of electricity by the West Bengal State Electricity Board (WBSEB) from 4.9.1995 to 9.9.1995.
5. Initially at the hearing of the complaint case OP/Insurer raised a plea that in view of Clause 7 of the policy the complaint was barred by limitation as the claim case had not been preferred within a period of three months from the date of repudiation of the claim by the Insurance Co. by its letter dated 9.9.1996. The complaint case was therefore decided by this Commission on the preliminary question as to limitation in filing the complaint case. It was held that the complaint case having been filed after the passage of more than three months from the date of repudiation of the claim there was violation of the mandatory provision of Clause 7 of the policy for which the complainant’s right to make the claim stood forfeited and the complaint became barred under the law. Furthermore, it was held that the Insurer considered the claim of the complainant and thereafter repudiated the same and such repudiation was intimated in writing to the complainant by a letter dated 9.9.1996. Therefore, there was no deficiency in service on the part of the OP/Insurer. The complaint case was thus dismissed.
6. Against the said order of dismissal of the complaint case the complainant preferred an appeal before the National Commission which upon contest has set aside the order of dismissal of the complaint for the reasons that provisions of Clause 7 of the Insurance policy are violative case of Section 28 of the Contract Act and therefore void and sent the case back on remand for a decision on the merits of the complaint case.
7. Evidently there were three insurance policies, one covering the plant and machinery of this cold storage and the other two covering the stocks of potatoes stored in the two chambers of the complainant’s cold storage. Evidently the final survey report as submitted by one Mr. S.R. Das revealed that from 4.9.1995 till 9.9.1995 i.e. for about 144 hrs there was no supply of electricity. Otherwise there was continuous supply of electricity by the WBSEB, although on occasions there was low voltage supply of electricity during few hours of a day.
8. At the hearing of this case only question that fell for consideration is whether the complainant under the aforesaid insurance policy against deterioration of stocks (potatoes) is. entitled to the benefit of risk cover in case of failure of electricity supply for whatever reasons.
9.The short question therefore arises whether there is insurance cover for all accidental failure of supply of power by the Electric Power Supply Authority. The insurance policy issued covering the risk against deterioration of stocks (potatoes) in cold storage on its face provides an exception clause to the effect that the Insurer would not be liable for any damage to the stocks due to rise or fall in temperature caused by failure of electric supply for whatever reasons Most interestingly, the two insurance policies covering the risk against deterioration of stocks (potatoes) in cold storage in its schedules have clearly mentioned that for cold storages who have opted for failure of electric supply extension. It has further noted in schedules of the aforesaid policies that the insured would necessarily obtain a clear letter from Electricity Supply Authority in all cases of accidental power supply failure specifying the cause, date and time of 'switch off’ and 'switch on' of power and duration of interruption of power. It is furthermore evident from the certificate issued by the State Electricity Board that power supply was disrupted w.e.f. 4.9.1995 till 9.9.1995 due to fault in 11 KVOC. The aforesaid final survey report also corroborates the fact that there was no supply of electricity during the period from 4.9.1995 till 9.9.1995. The said Surveyor although ultimately assessed the net loss at Rs. 8,78,917 by making clear finding that the potatoes were damaged due to rise in temperature above 40 F. as a result of continuous failure of power supply by WBSEB on and from 4.9.1995 to 9.9.1995 while there was no machinery break down in the cold storage of the insured during the said period but on the question of liability the said Surveyor concluded by saying that the insured failed to maintain normal temperature of the cold storage purely due to their own negligence as there was no break down to the plant and machineries of the cold storage which was also certified by the insured themselves. Accordingly he opined that the underwriter was not liable for the compensation for the above losses as per the terms and conditions of the policy of insurance.
10. In the case in hand it is thus established beyond any reasonable doubt that there was no supply of electricity by the WBSEB into the cold storage for the period from 4.9.1995 till 9.9.1995. The potatoes were damaged due to rise in temperature above 40 F. as a result of continuous failure of power supply by the WBSEB during the said period. Because of such damage of the potatoes the net loss suffered by the complainant was to the tune of Rs. 8,78,917. Most importantly, this State Commission in its earlier judgment clearly recorded that it is also an admitted position that a special clause namely 'Failure of Electric Supply' characterized the two DOS policies. It recorded that 'admittedly further, the cold storage in dispute had two chambers capacity cach containing 33,333 bags of potatoes, each bag weighing 60 kgs, and in all 3999960 kgs. of potatoes were stored in both the chambers. The report of the Surveyor shows that the chambers were not overloaded. As per provision of the DOS policies (Schedule 2 of the Annexures B and C) in view of this special coverage due to Failure of Electricity Supply Extension Clause it was warranted that the insured should obtain a clear letter from the Power Supply Authority in all cases of accidental power supply failure specifying the cause, date and time of switch-off and switch-on of power supply'. Such finding made earlier by the State Commission was not controverted by the OP/lnsurer before the Hon’ble National Commission. That apart the OP/lnsurer has not been able to establish on the strength of any cogent evidence that the complainant insured did not take the special coverage for failure of electric supply while taking the insurnnce policy for covering the risk against deterioration of stocks (potatoes) in cold storage. The insurance policy clearly under its exception clauses indicated that the company would not be liable for any damage to the stocks due to rise or fall in temperature caused by failure of electric supply for whatever reasons. If the complainant had taken the insurance policy with such exclusion clauses then there was no occasion for the Insurer to indicate in type writing in the schedule to the said insurance policy that for cold storages who have opted for failure of electric supply extension it is warranted that the insured shall obtain a clear letter from Electric Supply Authority in all cases of accidental power supply failure specifying the cause, date and time of 'switch off' and 'switch on' of power and duration of interruption of power. The OP/lnsurer has also not shown by production of any cogent material that in case of insurance policy with such exclusion clause, the premium therefor would be different from the insurance policy which has the risk covered by extending the case of failure of electric supply. In the case in hand schedules to both the insurance policies covering the risk against deterioration of stocks (potatoes) in cold storage clearly noted that for cold storages who have opted for failure of electric supply extension would have to obtain a clear letter from Electric Power Supply Authority showing failure of supply for the particular period with date and time so as to enable the insured to make a claim on such ground. Had the complainant not taken such coverage question of noting of such stipulations in the schedules to the insurance policies would not have had arisen at the time of issuing the insurance policies.
11. We are therefore of the view that the complainant had taken the insurance coverage against risk of deterioration of stocks even in case of failure of electric supply. The opinion of the Surveyor as aforesaid that the underwriter was not liable for the compensation of the net loss as assessed by him as above because of the failure of the Insurer in maintaining the normal temperature of the cold storage purely due to their own negligence as there was no break down to the plant and machineries of the cold storage cannot therefore be sustained. The complainant cold storage was obliged to maintain normal temperature in the cold storage in case of occasional low voltage supply of electricity by the Electric Power Supply Authority through the generator installed in the cold storage. It is not at all possible for the complainant itself to maintain the required temperature in the cold storage all throughout without causing any damage to the stocks through the generator installed in the cold storage for a continuous period of five days. That was what also has been found by the Surveyor himself in his remark portion under the heading liability. It has been clearly recorded that the potatoes were damaged due to rise in temperature above 40 F. as a result of continuous failure of power supply by WBSEB on and from 4.9.1995 to 9.9.1995 while there was no machinery break down in the cold storage of the insured during the said period. We are therefore of the view that because of such continuous failure of supply of electricity in the cold storage of the complainant during the period as aforesaid which contingency is covered under the policy, the Insurer is liable to compensate the complainant for the
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loss suffered by it due to the deterioration of stocks (potatoes stored in the two chambers of the cold storage). So far as the quantum of loss suffered by the complainant apart from the aforesaid final survey report which is an admissible place of evidence as per the insurance law and has also been relied upon by the Insurer, we are inclined to place reliance on the same. Furthermore in the absence of any other cogent materials produced on behalf of the complainant to show that it had suffered loss much more than what had been assessed by the said assessor, we hold that the complainant would be entitled to the aforesaid amount of Rs. 8,78,917 as the net loss suffered by the complainant as assessed by the Surveyor for damage of the potatoes stored in the cold storage during the said period from 4 9.1995 till 9.9.1995. 12. The complaint case is thus allowed by directing the OP/Insurer to pay to the complainant the aforesaid sum of Rs. 8,78,917 with interest @ 9% per annum from the date of filing of the complaint case till realization and a sum of Rs. 50,000 by way of compensation for the harassment suffered by him as also the cost of litigation for a sum of Rs. 25,000. All the aforesaid sums shall carry an interest @ 9% per annum as above from the date of this order till realization if the awarded amounts as above are not paid within a period of 45 days from this date. Complaint allowed.