JUDGMENT - G.G. LONEY, President:---This complaint contains allegations of deficiency in service against the Insurance Company for not settling the complainant's claim of Insurance. The facts are that the complainant is a Partnership firm, dealing in "Import-Export" of cut and polished diamonds. The complainant's firm deals in cutting and polishing rough diamonds through various individual firms on job work. The complainant has insured his business through the opposite party, covering their stock and stock-in-trade, consisting of Jewellery, Gold or Silver ornaments, plate, pearls and precious stones etc. The Policy also specifically covers the aforesaid property whilst in the custody of the persons not in regular employment of the complainant, such as Brokers or Cutters of diamonds or Goldsmiths all over India. The Insurance Policy indemnifies the loss of complainant upto Rs. 7,50,000/-. 2. It is the case of complainant that, on 10th June, 1989, at about 7.30 p.m., a pouch of diamonds, belonging to the complainant, entrusted to the Cutter at Bombay, was lost in transit from the Cutter's Workshop to the Cutter's residence, where the property is usually kept over-night. The incident was reported to the Police immediately. The opposite party appointed a Surveyor, who called various information from the complainant, visited the spot of occurance and submitted his report to the opposite party. It is the allegation of the complainant that the Survey Report was completed in November, 1989, but the complainant's claim was rejected on 28-12-1990. The complainant claims settlement of his claim for Rs. 6,63,037.56, which is the value of the diamonds + interest @ 18% per annum. The opposite party filed written version, dated 8th September, 1992. Inter-alia, it is contended by the opposite party that the complainant is not a "Consumer" and that there was no deficiency in service of the opposite party and submitted that the dispute between the parties is maintainable in the Civil Court. It is also contended that the complainant's claim is false. The opposite party sought the dismissal of the complaint on the ground that the claim of the complainant is not in conformity with the statements made to the Police by the diamond cutter. 3. We have heard Shri Prabhavalkar, Advocate for the complainant and Shri A.M. Vernekar, Advocate for the opposite party. We have given our anxious consideration to the contentions raised by both the parties and have also gone through the relevant documents. 3. We have heard Shri Prabhavalkar, Advocate for the complainant and Shri A.M. Vernekar, Advocate for the opposite party. We have given our anxious consideration to the contentions raised by both the parties and have also gone through the relevant documents. The following points arise for our consideration :- 1. Whether the complaint is maintainable? 2. Whether the facts alleged constitutes deficiency in the service of the opposite party due to negligence in rendering the service? 3. Whether the complainant is entitled to settlement of his claim, as alleged in the complaint? 4. As regards Point No. 1, it is now settled that the complaint as regards delay in settlement of Insurance claim has been held as deficiency in the service of the Insurance Company in the case of Shri Umedilal Aggarwal v. K.K. Nagpal others. 5. In view of the observations of the National Commission in Umedilal's case - referred to above, the complainant is a "Consumer" and his complaint before this Commission is maintainable under the Provisions of the Consumer Protection Act. 6. In view of the aforesaid legal situation, it is not necessary for the complainant to approach the Civil Court for the settlement of his claim. 7. As regards Point No. 2, it is an admitted fact that the complainant's stock-in-trade and stock-in-transit has been insured by the opposite party by providing a cover on the terms and conditions mentioned in the Insurance Policy. Under the terms and conditions of the Policy, the opposite party has indemnified the loss of goods during transit and in possession of the diamond cutters. The complainant's case is that, whlist in transit from the cutter's workshop to the cutter's residence, a pouch containing diamonds valued at Rs. 6,63,037.56 were lost. The Policy indemnifies such loss to the extent of Rs. 7,50,000/-. The complainant has precisely alleged the loss of a pouch containing diamonds from the cutter's possession during transit. In order to support his case, the complainant has filed on record a copy of the First Information Report, lodged at Borivali Police Station, on the date of incident at 8.10 p.m. We have perused the contents of the First Information Report. The substance of the First Information Report is as under :- 8. "To-day, on 10-06-1989, at 7.30 p.m. at Ganjawala Apartment, the complainant sat in a Riksha with his mother and father with some luggage. The substance of the First Information Report is as under :- 8. "To-day, on 10-06-1989, at 7.30 p.m. at Ganjawala Apartment, the complainant sat in a Riksha with his mother and father with some luggage. Riksha was hired to reach his residence near Vazira Naka. When Riksha reached their residence, it was raining and, therefore, the complainant and his parent hurridly got down from the Riksha and collected their luggage. The Riksha went away after the charges were paid. When the luggage was checked at the residence, it was noticed that the white cloth bag, in which the pouch containing diamonds, was kept, was missing. The description of the lost article is one white cloth bag in which black colour pouch was kept containing deamonds - worth Rs. 4,00,000/-" 9. The aforesaid F.I.R. is lodged by Mahavir Rajendra Kumar Sheth, the diamonds cutter and recorded by the Police immediately within 40 minutes of the incident, on the same day. The statement of the complainant, Mahavir, was also recorded by the Police. There is also an affidavit of Mahavir filed on record. The opposite party doubted the incident of lost diamonds solely on the ground that Mahavir stated the value of the goods at Rs. 4,00,000/- in his First Information Report and now the claim is made for Rs. 6,00,000/-. Subsequently, the supplimentary statement of Shri Mahavir was recorded on 18-6-1989, in which Mahavir tried to explain that the value of the goods mentioned in F.I.R. at Rs. 4,00,000/- was by approximation, but after verification, the value of goods (diamonds) was found to be Rs. 6,00,000/- and Rs. 3,50,000/- for 2 sets of diamonds. In our view, there is nothing to doubt the statement made by Mahavir as regards the fact of diamonds being lost during transit. There is contemporeneous record in the form of F.I.R., statement and Panchnama to corroborate the version of Mahavir about the incident of missing of diamonds. The opposite party was bound to indemnify the loss of diamonds lost during transit in terms of conditions of the Insurance Policy. The claim has been rejected only on the ground that Mahavir stated in F.I.R. the loss worth Rs. 4,00,000/- and in his subsequent statement stated Rs. 6,00,000/- and Rs. 3,50,000/-. This cannot be the ground for rejection of the complainant's claim. The question is whether the fact of loss of diamonds during transit inspires confidence or not? The claim has been rejected only on the ground that Mahavir stated in F.I.R. the loss worth Rs. 4,00,000/- and in his subsequent statement stated Rs. 6,00,000/- and Rs. 3,50,000/-. This cannot be the ground for rejection of the complainant's claim. The question is whether the fact of loss of diamonds during transit inspires confidence or not? There is evidence in the form of F.I.R. and the Police statement of Mahavir, which support the claim of the complainant. The F.I.R. was lodged immediately within 40 minutes, in which the facts of loss of diamonds during transit is clearly mentioned. The F.I.R. and the Police - Statements are the documents recorded on the date of incident. They cannot be said to be the got-up documents just to support a false claim. From the F.I.R. and Police Statement, it is clear that Mahavir lost diamonds during transit, which were entrusted to him by the complainant for cutting and polishing on job work. In fact, it has been stated before us that, in diamond business, prevailing practice is that diamonds are entrusted to cutters on job work for cutting and polishing. There are serveral such artisans involved in the business and they do the job work at their own premises and, after finishing the job work, return the diamonds to the owners. It is also stated before us at the Bar that all the business of diamond cutting and polishing is based on mutual trust and confidence between the diamond merchants and the diamond cutters to whom the diamonds are entrusted for cutting and polishing. It is argued that, because of this practice, the opposite party has come forward to extend to issue Insurance cover in case of loss during transit. Therefore, from the nature of the Policy and its conditions, it will be clear that the Insurance Company has extended the cover to indemnify the loss of the diamond merchants, in the event of its loss. According to Shri Prabhavalkar, Advocate, it is not fair on the part of the Insurance Company to have doubted the entire incident of loss just to deny the legitimate claim of the complainant. The complainant has persued the claim with the opposite party by making long correspondence. The opposite party, after a gap of about 6 months, rejected the genuine claim on unreasonable and untenable grounds. 10. The complainant has persued the claim with the opposite party by making long correspondence. The opposite party, after a gap of about 6 months, rejected the genuine claim on unreasonable and untenable grounds. 10. It has been argued on behalf of the opposite party that there was a clause in the Policy under which the insured has to make efforts to avoid loss as per condition No. 10 of the Insurance Policy. Hence, the complainant is not entitled to any claim. We have found from the facts and the circumstances of this case that the diamonds were lost in riksha and it was not traceable later on. One has to imagine the situation that it was raining and night-time, Mahavir gotdown hurriedly. In such a hurry, he must have forgotten cloth bag in riksha. Peculiar circumstances in which the article was lost cannot be said that it is as a result of not taking due care within the meaning of condition No. 10. The loss during transit can happen due to variety of reasons. Many articles are forgotten in Aircrafts, Railway, Buses. There is a Department of "lost articles". Therefore, a person may forget an article, despite his due care. Thus, losing an article is not un-common. When the policy covers the loss during transit, it is incumbent on the insurer to indemnify loss. Heavy premium is charged for these policies. It cannot be imagined that any persons will forget the article deliberately. No further reason has been given by the opposite party to reject the complainant's claim. We, therefore, find that rejecting of legitimate claim of the complainant for no reasons after the delay of 6 months is a negligent act on the part of the opposite party in its service. The complainant has been put to loss of his diamonds due to negligence in the service of the opposite party. In our view, negligence on the part of the opposite party to settle the complainant's claim has resulted in deficiency in the service of the opposite party. 11. The complainant has claimed the value of diamonds of Rs. 6,63,037.56. The complainant, on the basis of his affidavit and affidavit of Mahavir, proved his allegations. The complaint is, therefore, allowed. 12. The opposite party has repudiated the liability unfairly and unjustly and for untenable reasons-as discussed above in previous paragraphs. 11. The complainant has claimed the value of diamonds of Rs. 6,63,037.56. The complainant, on the basis of his affidavit and affidavit of Mahavir, proved his allegations. The complaint is, therefore, allowed. 12. The opposite party has repudiated the liability unfairly and unjustly and for untenable reasons-as discussed above in previous paragraphs. The National Commission, in the case of the (United India Assurance Co. Ltd. v. M/s. Vipro Electronics Pvt. Ltd.)1, (1991)I C.P.J. 335, has held that, merely because of the insurer totally repudiated his liability in respect of the claim does not mean that no proceedings can be validly initiated under the Consumer Protection Act. We have already quoted the decision of the National Commission in the case of (Shri Umedilal Aggarwal v. United India Assurance Co. Ltd.)2, (1991)I C.P.J. 3. In view of this legal position, we find that the complainant in this case deserves the settlement of his claim with interest @ 18% p.a., as compensation from the date 28th December, 1990, when the claim was rejected. We, therefore, pass the following order :- ORDER The opposite party, i.e. United India Assurance Co. Ltd., through the Divisional Manager, Bombay, is directed to settle the complainant's claim of Insurance for Rs. 6,63,037.56, together with interest @ 18% p.a. from 28-12-1990, till the payment. The complainant also be paid Rs. 500/- as costs. The aforesaid amount be paid within 30 days from the date of receipt of this order, failing which the complainant is at liberty to approach this Commission under sections 25 and 27 of the Consumer Protection Act. Order accordingly.