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Himachal Pradesh High Court · body

2008 DIGILAW 7 (HP)

Kamal Raj Malhotra v. Oriental Insurance Company

2008-01-04

ARUN KUMAR GOEL, NARINDER SINGH THAKUR, SAROJ SHARMA

body2008
ORDER (Arun Kumar Goel, J. (Retd.) President) (Oral) - Since these appeals have arisen out of the order dated 31.5.2007 passed by the District Forum, Mandi in Complaint Case No. 55/2007, as such they were heard together and are being disposed of by this common order. 2.Appeal No. 248/2007 has been filed by the appellants, hereinafter referred to as the complainants, for enhancement of the compensation, whereas Appeal No. 261/2007 has been field by the Insurance Company, hereinafter referred to as the opposite party, for reduction of compensation. 3.House of the complainant at Jawahar Nagar, Mandi, being insured in respect of the building of Class-A construction, fire and allied perils, burglary house-breaking, breakdown of domestic appliance, T.V. Set/Video and personal accident, with the opposite party from 19.10.2005 to 18.10.2006, is not in dispute. 4.From the other material on record including Surveyor’s report field and relied upon by the opposite party as well as of retired Junior Engineer filed by the complainant, it is established that there was incessant rains between 6.8.2006 to 10.8.2006. Retaining wall and PCC wall of the house of the complainants was badly damaged having subsided as a result of such rains. As such, they informed the opposite party and submitted a claim in the sum of Rs. 2,84,644, against the retaining walls, etc. having been insured for Rs. 2,00,000. ?Finally, as per Surveyor’s report appointed by the opposite party, he assessed the damage caused, to the extent of Rs. 1,26,047 after deducting Rs. 22,518 on account of work below H.P. Public Works Department specifications, the Surveyor’s report, having been accepted by the District Forum below, it has been ordered that the complainants were entitled to recover Rs. 1,04,101 from the opposite party with interest @ 9% per annum from the date of institution i.e., 12.3.2007 till payment alongwith cost of Rs. 2,000. 5.Both sides have field the appeals as noted hereinabove. Before proceeding further in the matter, it may be noted that it is also admitted case of the parties that part of the retaining wall was damaged in the year 2005 and for that a sum of Rs. 20,734 was paid at that time. From the evidence on record, it is also made out that retaining wall, etc. after damage of 2005 were repaired by the complainants and was again damaged because of incessant rains, as noted hereinabove during the period 6.8.2006 to 10.8.2006. 20,734 was paid at that time. From the evidence on record, it is also made out that retaining wall, etc. after damage of 2005 were repaired by the complainants and was again damaged because of incessant rains, as noted hereinabove during the period 6.8.2006 to 10.8.2006. The liability to indemnify the complainants is not in dispute in these appeals. What is in dispute is the quantum of compensation. REason for deducting the amount out of the damage caused given by the Surveyor was that the work was not upto the H.P. Public Works Department specifications and was below standard. Properly dressed stones were not used, filling was undertaken by the complainant with small stones. In addition to this, stones were not properly chiselled so as to properly get intact. 6.Mr. Bagga on behalf of the Insurance Company submitted that the compensation awarded is on higher side. It needs to be reduced in he peculiar background of this case as the compensation awarded is excessive, beyond the entitlement of the complainants. Wile controverting this plea on behalf of the complainants, Mr. Peeyush Verma, submitted that the opposite party was deficient in rendering service by employing unfair trade practice in the instant case. According to him, damage to the retaining wall, PCC wall is not in dispute. What is being disputed was that it was of sub-standard material and old stones which were not properly chiselled and for filling-in the gaps, small stones had been used, after damage to the retaining wall in 2005. Again the retaining wall, etc. having been reconstructed by the complainants in the same year, is not in dispute. In case the plea urged on behalf of the opposite party that on account of the poor workmanship and the quality of the material used being sub-standard and/or that the retaining wall was not properly constructed, was factually correct, then in the ordinary course of things, the opposite party would not have insured the retaining walls at Rs. 2,00,000 with effect from 19.10.20905 to 18.10.2006. This is not the plea of the opposite party that retaining wall was either not inspected and/or was insured without verifying the factual position on the spot so far quality etc. after repair is concerned. 2,00,000 with effect from 19.10.20905 to 18.10.2006. This is not the plea of the opposite party that retaining wall was either not inspected and/or was insured without verifying the factual position on the spot so far quality etc. after repair is concerned. 7.On the other hand, it is presumed that whenever insurance is undertake by an insurer like opposite party in the present case, its development officer/agent or any other person undertaking the job satisfies himself about what he is going to insure. This is otherwise necessary to be done for the simple reason that the interest of the insurer like opposite party does not suffer later on. The person who undertook insurance in the year 2005 and 2006 has not stated anything nor his affidavit is there regarding state of retaining wall after the incident of 2005. So the plea of sub-standard work and it not conforming to H.P. Public Works Department specifications is incorrect. That being the position, we are of the view tha the claim of the opposite party that the retaining wall was either of sub-standard construction or was not upto the H.P. Public Works Department specifications, is hereby rejected. 8.In addition to this, it was the duty of the insurer like opposite part in the instant case, under Insurance Regulatory and Development Authority (Protection of Police Holders’ Interest) Regulations, 2002, to have appraised expressly to the insured as to what is the nature of insurance and what are the particular clauses like average/excess etc. so that the insured is in a position to see as to what is the best in his interest. And at the risk of repetition, it may be observed that best person to say anything in this behalf was the person who undertook the insurance after incident of 2005 for the period 19.10.2005 to 18.10.20906. For taking this view reliance is being placed on a decision of the National Commission in the case of National Insurance Co. Ld. v. D.P. Jain, 2007(III) CPJ 34 (NC). 9.From the impugned order, it is evident that retaining wall is admittedly insured to the extent of Rs. 2,00,000. In these circumstances, it is the duty of the opposite party to indemnify the complainants to the extent of loss suffered within this sum. Since insurance was only in the sum of Rs. 2,00,000, whereas amount claimed is Rs. 9.From the impugned order, it is evident that retaining wall is admittedly insured to the extent of Rs. 2,00,000. In these circumstances, it is the duty of the opposite party to indemnify the complainants to the extent of loss suffered within this sum. Since insurance was only in the sum of Rs. 2,00,000, whereas amount claimed is Rs. 2,84,644, we feel that interest of justice will be well served, if the opposite party-Insurance Company is directed to pay Rs. 1,50,000 in all plus interest on this amount @9% per annum from the date of filing of the complaint along with cost assessed by the District Forum below. 10.We may mention in this behalf that the incident is of August, 2006, when the matter was no settled till May, 2007 by the opposite party, this forced the complainants to institute the complaint before the District Forum, Mandi. Ordinarily as well as in the ordinary course of things, opposite party is expected as an extended arm of the welfare state to have settled the claim within a reasonable time expeditiously admittedly that was not done until he impugned order was passed. Opposite party had to incur litigation expenses firstly before the District Forum below, and then in this Commission by filing the appeal for enhancement. If benefit of two months is allowed to the opposite party for having settled and paid the amount, then the complainants will become entitled to interest from atleast 10th of October, 2006 till the date of payment. 11.To be fair to Mr. Baggan, we may notice his submission on which great emphasis was laid by him that, in addition to the damage to the retaining wall as well as PCC wall having been caused due to poor construction as noted hereinabove, damage to the retaining wall was also caused, because immediate neighbour of the complainants had dug out a plot which was below their house and brought it upto National Highway level. This resulted in pillars and foundation of the building of the complainants hanging in the air without any support. Further submission of Mr. bagga is that a complaint was lodged by the complainant under Section 133, Cr.P.C. against their neighbouers before the S.DM.M, Mandi. This resulted in pillars and foundation of the building of the complainants hanging in the air without any support. Further submission of Mr. bagga is that a complaint was lodged by the complainant under Section 133, Cr.P.C. against their neighbouers before the S.DM.M, Mandi. 12.With a view to succeed on this plea, it was further incumbent upon the opposite party to have shown that when the insurance was undertaken which was effective from 19.10.2005 till 18.10.2006, the digging of the plot below the house of the complainants had already taken place. That is admittedly not the case of the opposite party. Subsequently whenever the complainants found that some harm is likely to be caused to their property, they approached the authorities as envisaged under law. Here the question that arises is, as to whether it exonerates the opposite party of its liability to indemnify the complainants, our answer is in the negative. 13.We may further point out here in this context that the District Forum below has already held as a question of fact that in between the house of the complainants and the plot of Mr. Dhawan who is alleged to have done the digging work and sold the plots to one filing station as well as to a lawyer of Karsog, there was a temple in between. This factual finding could not be controverted by Mr. Bagga. In these circumstances, to say hat damage to the retaining wall was caused because of any action on the part of the complainants, falsifies the stand of the opposite party to the contrary. 14.No other point was urged. In view of the aforesaid discussion, Appeal No. 261/2007 is dismissed and at the same time Appeal No. 248/2007 is partly allowed thereby enhancing the compensation to Rs. 1,50,000 with interest at the rate and from the date as awarded by the District forum below together with cost assessed in the complaint. Appeals are disposed of subject to this modification, leaving the parties to bear their own costs. All interim orders passed from time to time in Appeal No. 261/2007 stand vacated forthwith. Office is directed to place an authenticated copy of this order on the file of Appeal No. 261/2007 and at the same time to supply copy of this order free of cost to the parties as per rules. M.R.B. ———————