THE NEW INDIA ASSURANCE CO. LTD.versusM/S. PROTECTION MANUFACTURERS PVT. LTD.

                     (2010] 8 S.C.R. 61


         THE NEW INDIA ASSURANCE CO. LTD.                      A
                             v.
    M/S. PROTECTION MANUFACTURERS PVT. LTD.
            (Civil Appeal No. 312 of 2006)
                       JULY 8, 2010
                                                               B
     [ALTAMAS KABIR AND ·CYRIAC JOSEPH, JJ.]

     Insurance - Fire insurance - Surveyors appointed by
Insurance Company finding the cause of fire to be accidental
- Insurance Company appointing Investigator to find out C
cause of fire - Investigator finding that fire could be an act of
arson by vested interest - Insurance company obtaining
opinion of former Chief Justice of India regarding cause of fire
- Chief Justice discarding the report of Investigator, opining
that fire was accidental - Complaint - National Commission D
allowing the claim - On appeal, held: Report of the Joint
Surveyors were .correct - Report of the Investigator is liable
to be discarded as it was tailor-made intended to benefit the
Insurance Company - Appointment of Investigators was also
not correct as the Insurance Company should have applied E
to the Regulatory Authority under Insurance Act, for second
opinion - Insurance Act, 1938 - s. 64 UM - Evidence Act,
1872 - s. 45 - Consumer Protection Act, 1986.

      Evidence Act, 1872 - s. 45 :... Opinion of retired Chief
 Justice of India after analysis of survey and investigation F
 reports - Admissibility of the opinion - Held: The opinion of
 the Chief Justice is admissible in evidence as it is not an
 opfnion as contemplated uls. 45, but an independent and
 unbiased analysis of the reports and the materials provided
·to him.                                                       G

    The factory of the respondent, which was covered by
Fire Insurance Policy, caught fire. The appellant-
insurance company appointed a surveyor to conduct a
                            61                                 H
    62      SUPREME COURT REPORTS               (2010] 8 S.C.R.


A   preliminary spot survey. In the preliminary report, cause
    of fire was not specified. Thereafter insurance company
    appointed joint surveyor to conduct final survey. Joint
    surveyor estimated the loss suffered by the respondent
    to be Rs. 2,37,09,372/-. The final report stated that exact
B   cause of fire was not known. Insurance company, then
    appointed an investigator tv conduct an investigation
    into the cause of fire and to assess the loss. The
    investigator assessed the loss suffered to be Rs.
    1,10,67 ,230/-. As to the cause of fire, he stated that fire
c   could be attributed to an act of 'arson' by vested interest
    for some pecuniary benefits. Joint surveyors criticized
    the report of the investigator stating that it was tailor-
    made in order to fit the loss assessed by the Insurance
    Company. Insurance company, therefore, decided to
    obtain views of the former Chief Justice of India as to the
0
    cause of fire. The Chief Justice concluded that the fire
    was accidental and was not an act of arson.

        As the claim of the respondent was not settled by the
    Insurance Company, respondent filed a complaint.
E   National Commission for Consumer Disputes Redressal
    directed the Insurance Company to pay to the
    respondent a sum of Rs. 2,26,36, 170/- with 12% interest
    p.a., w.e.f. 1.7.2000 and to pay Rs. 1 lakh towards
    compensation. Hence the present appeal.
F
         Dismissing the appeal, the Court

         HELD: 1.1. The report of the Joint Surveyors
    indicates that the exact cause of the fire was not known,
    though it could be due to a short circuit. The observation
G   of the Investigators that the fire could reasonably be
    attributed to an act of "arson" by vested interests, for
    some pecuniary benefit, is without any factual basis.
    Apart from the aforesaid observation made at the end of
    the report, no foundation has been laid down in the
H
 NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                 63
          MANUFACTURERS PVT. LTD.
 report for such an observation which literally appears out A
 of the blues. [Para 31) [77-F-H; 78-A]

      National Insurance Co. Ltd. vs. Harjeet Rice Mills (2005)
  6 sec 45; United India Insurance Co. Ltd. and Ors. VS.
  Roshan Lal Oil Mills Ltd. and Ors. (2000) 10 SCC 19;            B
. Ramesh Chandra Agrawal vs. Regency Hospital Ltd. arid Ors.
  (2009) 9 sec 709, distinguished.

     1.2. Even if the views expressed by the Joint
 Surveyors, on the reports submitted by the Investigators
 are discounted, although they were appointed by the C
 Insurance Company itself, the views obtained by the
 Insurance Company from former Chief Justice cannot be
 Ignored. [Parc;i 32) [78-8-C]

      1.3. It is not correct to say that the opinion of the D
 retired Chief Justice was not admissible in evidence in
 view of s. 45 of Evidence Act, 1872, since the opiniol"I
 given by the retired Chief Justice was based on an
 analysis of the materials placed before him by the
 Insurance Company, including the reports submitted by E
 the Joint Surveyors, and the Investigators. Section 45 of
 the Evidence Act empowers the court, in order to form
 an opinion upon a point of foreign law or of science or
 of art, or as to identity of handwriting or finger
 impressions, to rely upon the·opinions of persons
 specially skilled in such matters. The case in hand is quite F
 diff§rent; as the views expressed by the retired Chief
 Justice were not meant to be an opinion within the
 meaning of Section 45 of the Evidence Act, but an
 analysis of the reports and the materials provided by the
 Insurance Company. In fact, the attempt made on behalf G
 of the Insurance Company to exclude the views
 expressed by the retired Chief Justice with regard to the
 cause of fire from the area of consideration does not
.commend itself as the same is a cqmpletely independent
                                                              H
    64      SUPREME COURT REPORTS              [2010) 8 S.C.R.


A   and unbiased assessment of the events relating to the
    cause of fire on the basis of the materials made available.
    [Para 32] [78-C-G]

         1.4. It would be entirely unjust and inequitable to
    accept the theory of arson, projected by the
8
    Investigators, without any material to support it and
    sufficient material to hold otherwise. Accordingly, the
    views expressed by the Natio_nal Commission that the
    cause of fire was accidental and that the attempt made
    by the Investigators to show that the fire had been
C   caused by an act of arson, was motivated and intended
    to benefit the appellant-Insurance Company, is endorsed.
    [Para 33] [79-A-C]

         1.5. The almost identical amounts, barring a few
D rupees, arrived at by the Insurance Company and the
  Investigators speak volumes of the exercise carried out
  by the latter on a wholly cursory investigation which has
  quite aptly been described as "tailor-made". The amount
  of loss suffered by the respondent-company on account
E of the fire has been calculated by the Joint Surveyors on
  the basis of the amounts mentioned by the respondent-
  company and the computer data available in support
  thereof and also upon cross-checking with the accounts
  of suppliers and vendors of raw materials to the
F respondent-company. There is no reason to differ with the
  views expressed by the National Commission in this
  regard. [Para 34] [79-D-G]
      1.6. The discretion exercised by the National
  Commission regarding the rate of interest awarded from
G three months after the date of the award is also accepted.
  The rate of interest cannot be enhanced because such
  exercise of discretion was just and equitable in the
  absence of any agreement between the parties regarding
  payment of interest or the quantum thereof. [Para 34] [79-
H G-H; 80-A]
NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                 65
         MANUFACTURERS PVT. LTD.
    Sovintorg (India) Ltd. vs. State Bank of India, New Delhi    A
1999 (6) SCC 406; Ghaziabad Development Authority vs.
Balbir Singh 2004 (5) SCC 65, referred to.

     2. In view of Section 64UM of the Insurance Act, 1938,
the Appellant Insurance Company should have applied              8
to the Regulatory Authority under the Act, for a second
opinion instead of appointing the Investigators for the
said purpose unilaterally. The reports submitted by the
Investigators are liable to be discarded on such ground
as well. [Para 35] [80-8]
                                                                 c
                     Case Law Reference:
    (2005) 6 sec 45           Distinguished         Para 19
    (2000) 10 sec 19          Distinguished         Para 19
                                                                 D
    (2009) 9 sec 709          Distinguished         Para 20
    1999 (6) sec 406          Referred to.          Para 28
    2004 (5) sec ·55          Referred to.          Para 28
     CIVIL APPELLATE JURISDICTION: Civil Appeal No. 312          E
of 2006.

     From the Judgment & Order dated 24.10.2005 of the
National Consumer Disputes Redressal Commission at New
Delhi in Original Petition No. 60 of 2003.                       F

      Jaideep Gupta, Dines! 1 Mathur, Rameshwar Prasad Goyal
for the Appellant.

    Respondent-In-Person.
                                                                 G
    The Judgment of the Court was delivered by

    ALTAMAS KABIR, J. 1. This is a statutory. appeal filed
under Section 23 of the Consumer Protection Act, 1986,
hereinafter referred to as 'the 1986 Act', from an order dated   H
    66      SUPREME COURT REPORTS                 (2010] 8 S.C.R.


A 24th October, 2005, passed by the National Consumer Disputes
  Redressal Commission, New Delhi, hereinafter referred to as
  the "National Commission", in O.P. No.60 of 2003. By the said
  order, the National Commission accepted the claim of the
  Respondent herein, Mis. Protection Manufacturers Pvt. Ltd., in
B respect of insurance claim on account of a fire which had
  broken out in its factory at about 8.45 a.m. on 29th March, 2000,
  and directed the Appellant Insurance Company to pay
  Rs.2,26,36, 179/- to the Respondent with interest at the rate of
  12 per cent per annum from three months after the date of the
c fire. In other words, the interest was to be reckoned from 1st
  July, 2000, till date.

          2. Although, the scope of the appeal is to some extent
    limited, a few facts may be stated for proper appreciation of
    the case made out by the RespondenUcomplainant.
D
        3. On 29th March, 2000, at about 8.45 a.m., there was a
  devastating fire in the factory of the RespondenUcomplainant.
  The same was noticed by the factory workers who had
  assembled in front of the factory premises and were waiting for
E the factor/ to open. On being informed, the fire brigade reached
  the site at about 9.10 a.m. and began their operations
  immediately. However, the fire was so severe that it continued
  to flicker for the next three to four days and was completely
  extinguished only on 4th April, 2000. As the factory premises
F of ttie Respondent was covered by Fire Insurance Policy for the
  period from 19th February, 2000, to 18th February, 2001,
  against the risk of fire, the Respondent made its clai;n to the
  Insurance Company amounting to Rs.2,85,50,000/- on account
  of damage and loss suffered to the building, plant and
G machinery, stocks and stock-in-process and the transformer for
  which the Respondent Company had paid Rs.1, 16,636/- as
  premium. It appears that while the Policy was in force, the
  insurance coverage was enhanced.

       4. On the very same day when the fire broke out, the
H Insurance Company appointed Mr. A.S. Asthana, Surveyor, to
 NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                    67
 MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.]
conduct a preliminary spot survey. On 30th March, 2000, Mr.           A
Asthana and the representatives of the Insurance Company
took joint stock of burnt motors and air coolers which were
being manufactured by the Respondent/complainant. Mr.
Asthana submitted his preliminary report on 3rd April, 2000, but
did not specify the cause of fire. Thereafter, on 9th April, 2000,    B
one Mr. Bhaskar Joshi was appointed as Joint Surveyor to
conduct a final survey along with Mr. Asthana. On 13th April,
2000, a status report was submitted by Mr. Bhaskar Joshi. The
Joint Surveyors prepared a draft assessment report and
estimated the loss suffered by the Respondent/complainant to          c
be Rs.2,37,09,372.12 paise. The joint assessment report which
was submitted on 28th August, 2000, clearly stated that the
 exact cause of fire was not known, though it.could be due to a
 short circuit.

        5. Thereafter, on 30th October, 2000, the Regional            D
. Manager of the Insurance Company appointed Mis. J. Basheer
  & Associates as investigator to conduct an investigation into
  the cause of fire and to assess the loss. As many as six
  independent investigation reports were filed by Mis. J. Basheer
  & Associates on 28th May, 2001, 3rd July, 2001, 27th August,        E
  2002, 4th October, 2002, 7th November, 2002 and 10th
  December, 2002. According to Mis. J. Basheer & Associates,
  the net amount of loss suffered by the Respondent Company
  on account of the fire would be Rs.1, 10,57,0341-, which tallies
  almost exactly with the assessment made by the Insurance            F
  Company amounting to Rs.1, 10,67,2301-. Interestingly, although
  in the report submitted by Mis. J. Basheer & Associates it has
  been mentioned in clause 6 that their appointment was for
  investigation into (i) cause of fire and (ii) assessment of loss,
  there is nothing definite in the 67 page report as to the cause     G
  of fire, except for a reference to the reply sent by the Fire
  Officer, Cuttack, to the Khurda Branch Manager of the Insurance
  Company on 5th May, 2001, stating that the estimate of fire
  amount was about Rs.15 lakhs and the cause of fire was "short
  circuit" in the raw material section.                               H
    68      SUPREME COURT REPORTS                   [2010) 8 S.C.R.


A       6. On 25th June, 2001, the Appellant Insurance Company
  requested Mr. Bhaskar Joshi to make his observations on the
  report submitted by M/s. J. Basheer & Associates on 28th May,
  2001. In his comments submitted on 10th August, 2001, Mr.
  Bhaskar Joshi severely criticized the report filed by M/s. J.
B Basheer & Associates and even went to the extent of observing
  that they had failed to measure upto the faith and responsibility
  reposed on them by the insurers. The report seemed to suggest
  that the same had been tailor-made in order to fit the loss
  assessed by the Insurance Company at Rs.1, 10,67,230/-, which
c uncannily tallied with the estimate of Mis. J. Basheer &
  Associates, namely, Rs.1, 10,57,0341-.

       7. After receipt of the views expressed by the Joint
  Surveyors, the Appellant Insurance Company decided to obtain
  the views of Justice Y.V. Chandrachud, former Chief Justice of
D India, on the question as to the cause of fire. In his report, Chief
  Justice Chandrachud arrived at the conclusion that the report
  of Mis. J. Basheer & Associates was unfounded and
  speculative while that of the Joint Surveyors contained a careful
  analysis of the events. Chief Justice Chandrachud was of the
E view that he had no doubt that the fire was accidental and could
  not by any reasonable norm or standard be characterized as
  an act of arson.

       8. Mr. Bhaskar Joshi also commented on the report
F submitted by Mis. J. Basheer & Associates on 3rd July, 2001,
  and 29th November, 2001, and castigated the same in no
  uncertain terms. Mr. Joshi observed that Mis. J. Basheer &
  Associates had not gone into the roots of documentation and
  had not even bothered to verify the original documents. On the
  other hand, ttiey had gone around creating confusion and
G controversies and to create an air of suspicion, which was a
  classic example of table-top investigation.
      9. Thereafter, as the claim of the Respondent Company
  was not being settled by the Appellant Insurance Company, a
H complaint was filed by the Respondent Company with the
NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                      69
MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.)
National Commission on 13th February, 2003, for a direction            A
to the Insurance Company to pay compensation of
Rs.2,48,94,000/- for the loss suffered by it, together with interest
@18% p.a. and to also grant compensation of Rs.10 lakhs for
the delay in settlement of the claim, which had caused mental
agony and harassment to the Respondent/Complainant.                    B

      10. The claim of the Respondent-Company was repudiated
by the Appellant Insurance Company on 20th February, 2003,
when the National Commission admitted the complaint filed by
the Respondent-Company and directed notice to issue to the
Insurance Company limited to the question of deficiency of             C·
service. After considering the reply filed by the Insurance
Company and after examining one Mr. Amit Biswas, the
representative of the Insurance Company, and Mr. J. Basheer
of Mis. J. Basheer & Associates, who admitted that he had not
visited the Excise Office, the Vendors and had also not provided       D
any supporting evidence to bolster his findings, the National
Commission, by its order dated 24th October, 2005, directed
the Appellant Insurance Company to pay to the Respondent
Company a sum of Rs.2,26,36, 179 with interest @12% p.a. with
effect from 1st July, 2000 and to also pay a sum of Rs.1 lakh          E
by way of compensation. The Insurance Company was given
liberty to recover the said amount from its defaulting officers.
Incidentally, it may be indicated that in the final assessment
report of the Joint Surveyors the loss suffered by the Respondent
Company was assessed at Rs.2,26,36, 180.23 paise.                      F
                                           '
    11. Aggrieved by the said Award of the National
Commission, the Appellant Insurance Company has filed this
appeal and questioned the said Award on several grounds.

     12. Appearing for the Insurance Company, Mr. Jaideep G
Gupta, learned Senior Advocate, submitted that the National
Commission had erroneously approached the problem by
concentrating only on the reports submitted by the Joint
Assessors and the opinion given by former Chief Justice of
India, Y.V. Chandrachud, while rejecting the several reports H
     70      SUPREME COURT REPORTS                  [2010] 8 S.C.R.


A · submitted by Mis. J. Basheer & Associates. It was submitted
    that the specific issues and the allegations made in respect
    thereof were not seriously considered by the National
    Commission.

       13. Mr. Gupta submitted that the National Commission had
8
  not considered the evidence in its totality. Out of the six reports
  submitted by M/s. J. Basheer & Associates only two were taken
  into consideration, while the other four, including the Final
  Report submitted on 10th December, 2002, were ignored and
C were wrongly rejected. The National Commission relied only on
  the Joint Report submitted by the Mis. Asthana and Joshi and
  the views expressed by Chief Justice Chandrachud, which was
  only an opinion and hence not admissible in evidence. Mr.
  Gupta urged that the only certificate available as to the cause
  of the fire was the Fire Certificate issued by the Fire Officer,
D Orissa, Cuttack, on 17th May, 2000, indicating that the fire was
  the result of an electrical short circuit, but except for a bald
  statement, no evidence was produced to corroborate such
  opinion.

E       14. Mr. Gupta also referred to paragraph 6 of the Final
   Assessment Report on the basis of the joint survey conducted
   by M/s. A. Asthana & Co. and Bhaskar Joshi, which deals with
   the cause of the fire. It was pointed out that the very first
   sentence of paragraph 6 indicates that the exact cause of the
 F fire was not known, but the police had attributed it to short
   circuit. Sub-paragraph 2 records the fact that nothing specific
   as to the cause of the fire could be found even on further probe
   and hence it had to be presumed that short circuit could be one
   of the probable causes out of other probables. It was also
 G indicated that in the light of the reports issued by the local
   authorities, such as the police and the fire brigade, the cause
   of the fire could only be attributed to a short-circuit, since no
   evidence could be found that would point towards a deliberate
   act of arson. The final opinion expressed in Sub-paragraph (a)
   of paragraph 6 was that the fire appeared to be accidental and
,H
  NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                    71
  MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.]
 the loss would be indemnifiable under the Fire Policy issued         A
 to and held by the insured.

      15. Mr. Gupta also referred to the opinion of Chief Justice,
 Y.V. Chandrachud, wherein His Lordship indicated that on a
 perusal of the Survey Report and the Investigation Report it was
                                                                      8
 quite clear that the Report of J. Basheer & Associates was
 unfounded and speculative, whereas the Report of the Joint
 Surveyors contained a careful analysis and assessment of the
 cause of fire and the facts incidental to and attendant upon the
 event of fire.
                                                                      c
       16. Mr. Gupta reiterated his earlier submission that except
  the Fire Certificate issued by the Fire Officer, Orissa, Cuttack,
  there were no other reports as to the cause of the fire and the
. views expressed by the Joint Surveyors and also Chief Justice
  Chandrachud were without foundation and were themselves             D
  speculative and conjectural and could not, there, be relied on.
  If, however, all the reports submitted by J. Basheer &
  Associates were taken together, it would point towards an act
  of arson as to the cause of the fire.
                                                                      E
      17. Mr. Gupta then referred to the decisit n of the National
 Commission on the question of cause of the fire. It was pointed
 out that the National Commission in considering the report of
 J. Basheer & Associates and the opinion of Chief Justice Y.V.
 Chandrachud and the views expressed by Bhaskar Joshi which
 had been accepted by the Insurance Company, observed as              F
 follows:

            "Undisputedly, this report is accepted by the
      Insurance Company and the learned counsel for the
      Insurance Company had stated that the Insurance                 G
      Company acceptedJhat t~e fire was accidental and could
      not be characterized as an act of arson."

     18. Mr. Gupta submitted that the said observation was
. made on the basis of a concession which had been ma~ by\ H
    72      SUPREME COURT REPORTS                   (2010) 8 S.C.R.

A Counsel for the Insurance Company and not on the pleadings,
  wherein it had been consistently stated that the cause of the
  fire had not been finally determined by any of the Assessors
  or Investigators and that the opinion of M/s. J. Basheer &
  Associates, that an act of arson was the cause of fire, could
B not be ruled out. Mr. Gupta reiterated that even in the Joint
  Survey Report of M/s. Asthana and Joshi it had been mentioned
  that the exact cause of fire is not known but that the police had
  attributed it to a short circuit. But it had also been indicated that
  the same was only a probable hypothesis. Mr. Gupta submitted
c that it is on such improved probability that an opinion was given
  that the fire appeared to be accidental and the loss would be
  indemnifiable under the fire policy issued to and held by the
  insured. Mr. Gupta submitted that in the circumstances when
  the cause of fire had not been established with any certainty,
  the direction given by the Commission to make payment of
0
  insurance on the Fire Policy, was not justifiable.

         19. Mr. Gupta urged that this was a fit case for remand to
  enable the National Commission to ascertain the cause of the
  fire before making any Award for payment of insurance under
E the aforesaid policy. In support of his submissions, Mr. Gupta
  firstly referred to the decision of this Court in National Insurance
  Co. Ltd. vs. Harjeet Rice Mills [(2005) 6 SCC 45), wherein it
  was held that since the High Court had failed to consider the
  allegations of the Insurance Company, that the claim of the
F complainant was fraudulent, though there was adequate prima
  facie material available to warrant a proper inquiry, the matter
  was required to be remanded for a decision afresh for
  adjudication on such submissions made on the behalf of the
  Insurance Company. Learned Counsel also referred to the
G decision of this Court in United India Insurance Co. Ltd. & Ors.
  vs. Roshan Lal Oil Mills Ltd. & Ors. [(2000) 10 SCC 19), where
  in a somewhat similar situation as existing in the instant case,
  the matter was remanded to the Commission for a fresh
  hearing.
H
 NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                  73
 MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.]
     20. Mr. Gupta submitted that the National Commission had A
wrongly relied on the opinion of Justice Y.V. Chandrachud,
former Chief Justice of India, in contravention of the provisions
of Section 45 of the Indian Evidence Act, 1872. Learned
counsel urged that if the Commission wanted to rely on the
opinion given by Justice Y.V. Chandrachud, as if it were an B
expert opinion, it could only have done so after examining His
Lordship in order to satisfy the provisions of Section 45 of the
aforesaid Act. In support of his said submissions Mr. Gupta
relied on the decision of this Court in Raiji'~sh Chandra
Agrawal vs. Regency Hospital Ltd. & Ors. [2009) 9 SCC 709,         c
wherein, while considering the evidence of experts in the ligbt
of Section 45 of the Evidence Act, it was held that such "
evidence is only advisory in character since such expert is not
a witness of fact.
                                                                   D .
     21. Mr. Gupta urged that in view of the inconclusive nature
of the reports as submitted, the matter was required to be sent
back on remand to the National Commission for a fresh
determination in accordance with law.

      22. Mr. Piyush Gupta, who appeared in-person on behalf       E
of the Respondent-Company, submitted that the allegations
made about inclusion of the damage in respect of the products
manufactured at the manufacturing unit at SCR-14, Suryanagar,
Bhubanesw<!r, was misleading, since after the establishment
of the new factory premises at Bhatkuri, the Suryanagar Factory    F
ceased to exist. A request was made to the Central Excise
Authorities to cancel the licence for production of air coolers
at Suryanagar with effect from 1st July, 1999 and all
manufacturing operations were being carried on by the insured
at its new location at Bhatkuri which was affected by the fire.    G

     23. Mr. Piyush Gupta submitted that the Company
maintained computerized financial accounts which combined
financial accounting as well as inventory management in one
software. Learned counsel submitted that in making their report
the Joint Surveyors, M/s. Asthana and Joshi, had relied on the     H
    74      SUPREME COURT REPORTS                [2010] 8 S.C.R.


A same after carrying out a detailed check of the system to
  ascertain its integrity. A substantial quantity of raw materials
  which had been damaged during the super cyclone in October,
  1999, had been found to be subtracted from the other material
  which had been damaged on account of the fire. Learned
B counsel pointed out that in their report, Mis. Asthana and Joshi
  had in paragraph 8.03.1.14 indicated that they had verified the
  integrity of the system by making dummy entries and the results
  were found to be reliable. In order to further cross-check the
  account, ledger entries of the Company's accounts in the
c vendor's books were also called for and the same when
  reconciled with the Company's system produced corroborative
  results. Mr. Piyush Gupta submitted that based on their
  examination of the stock and the entries in the computer which
  were reconciled with the accounts of the suppliers (vendors),
0 they submitted a draft assessment report assessing the loss
  incurred by the Company on account of the fire amounting to
  Rs.2,37,09,372.12/-. However, upon visiting the Regional Office
  of the Appellant-Insurance Company for discussions, they were
  given the version of the assessment made by the Insurance
E Company amounting to Rs.1, 10,67,230/-. As against this, the
  loss assessed by Mis. J. Basheer & Associates was almost
  identical, namely, Rs.1,10,67,034/-. Mr. Gupta urged that it was
  obvious that the assessment made by the investigators was
  based on the Insurance Company's assessment of the loss
  suffered by the Company on account of the fire.
F
        24. Mr. Piyush Gupta then submitted that Section 64UM
  of the Insurance Act, 1938, which provides for licensing of
  Surveyors and Loss Assessors, would be attracted to the facts
  of this case and instead of appointing another surveyor, as was
G done in the instant case by the appointment of M/s. J. Basheer
  & Associates, the Insurance Company ought to have gone to
  the Regulatory Authority under the Insurance Regulatory and
  Development Authority Act, 1999, and under Sub-Section (3)
  it was for the said Authority to call for an independent report
H from any other Approved Surveyor or Loss Assessor specified
NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                    75
MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.]
by it. Mr. Gupta urged that by appointing another surveyor/         A
assessor/investigator after M/s. Asthana and Joshi had
submitted their report, the Insurance Company had presented
two different reports as to the ·toss·~caused and had also
introduced a third opinion as to the cause of the fire from a
former Chief Justice of India, Justice Y.V. Chandrachud,            B
although, an attempt was made to play down the same since it
went completely against the case of the Insurance Company. It
was pointed out that Chief Justice Chandrachud had observed
that the report submitted by M/s. J. Basheer & Associates was
unfounded and was in any way of speaking, speculative, while        c
the Joint Surveyors' report contained a careful analysis of the
event. It was further pointed out that Chief Justice Chandrachud
came to the conclusion that he had no doubt that the fire was
accidental and could not by any reasonable norm or standard
be characterized as an act of arson.                                D
     25. On the merits of the report submitted by M/s. J.
Basheer & Associates, Mr. Piyush Gupta submitted that one
Mr. J. Basheer had been deputed by M/s. J. Basheer &
Associates to visit the factory premises of the Respondent-
Company, which had been damaged by the fire, only on 14th           E
November, 2000, i.e., 8 months after the fire had occurred and
by that time rehabilitation work had already been commenced
after obtaining due permission from the Appellant-Insurance
Company. Even then, Mr. Basheer was in the factory for barely
half an hour and did not visit the factory ever again.              F

     26. On the point of non-consi.deration of the last 3 reports
filed by M/s. J. BRsheer & Associates, learned counsel
submitted that the same was nothing but a repetition of what
had been mentioned in the earlier reports and did not reflect       G
anything new which deserved separate consideration .
            •
     27. On the quantu'm of damages, Mr. Piyush Gupta referred
to the assessment made !:>Y the Commission on a comparison
of the reports submitted by M/s. Asthana and Joshi and M/s.
J. Basheer & Associates. It was submitted that the conclusion       H
    76      SUPREME COURT REPORTS                  [2010] 8 S.C.R.

A arrived at by the Commission holding that the report submitted
  by M/s. J. Basheer & Associates was totally unreliable and
  tailor-made with regard to the loss suffered by the Respondent-
  Company on the basis of the suggestions made by its Regional
  Office at Orissa and its agreement with the observations made
B by the Joint Surveyors to the effect that the whole exercise of
  Mis. J. Basheer & Associates was beyond their competence,
  cannot be called into question and the ultimate Award directing
  the Appellant-Assurance Company to pay Rs.2,26,36, 179/- with
  interest @12% per annum from 3 months after the date of
c occurrence of the fire, i.e., from 1st July, 2000 till payment, was
  fully justified and the further direction to the Insurance Company
  to pay a further sum of Rs.1 lakh to the Respondent-Company
  by way of compensation for unjustly repudiating the claim of the
  Respondent-company did not also call for any interference.
D         28. A further submission was made by Mr. Gupta claiming
    payment of interest from the date of the fire and not from the
    date of the final decision of the Commission as the delay was
    on account of the Insurance Company, whose repudiation of
    the claim of the Respondent-Company was found to be unjust.
E   In this regard reference was made to the decision of this Court
    in Sovintorg (India) Ltd. vs. State Bank of India, New Delhi
    [(1999) 6 SCC 406], wherein Section 14 of the Consumer
    Protection Act, 1986, fell for consideration and it was observed
    that where no contract existed between the parties regarding
F   payment of interest on delayed deposit or service, interest
    could not be claimed under Section 34 C.P.C. as the
    provisions of the C.P.C. have not been made applicable to
    proceedings under the 1986 Act. However, the general
    provisions of Section 34 of the Code being based on justice,
G   equity and good conscience, would authorize the consumer
    courts to grant interest according to the circumstances of each
    case. It was submitted that in the said case the direction to pay
    interest@12% given by the State Commission was enhanced
    by the National Commission to 15% per annum. Reference was
H   also made to the decision of this Court in Ghaziabad
NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                 77
MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.]
Development Authority vs. Balbir Singh [(2004) 5 SCC 65], A
where somewhat similar views were expressed in the context
of Section 73 of the Contract Act, 1872, and it was observed
that the award of compensation had to be made under different
and separate set of circumstances and must vary from case
to case depending on the facts of each case and no hard and B
fast rule, could, therefore, be laid down.

     29. Mr. Gupta submitted that no interference was called
for with the impugned Award of the National Commission and
the appeal was liable to be dismissed.
                                                                 c
     30. The nature of the controversy between the parties has
made us dwell on the facts of the case at some length. Despite
the extensive submissions made on behalf of the parties, the
issues to be resolved in this Appeal are confined to two
questions, namely,                                               D

            (i)    What was the cause of fire which broke out
                   in the factory premises of the assured at
                   Bhatkuri at about 8.45 a.m. on 29th March,
                   2000?
                                                                 E
            (ii)   What was the extent of loss and damage
                   suffered by the assured on account of such
                   fire?

     31. As far as the answer to the first question is concerned, F
the report of the Joint Surveyors, Mis. Asthana & Joshi, dated
28th August, 2000, indicates that the exact cause of the fire
was not known, though it could be due to a short circuit.
Interestingly, while referring in its report dated 28th May, 2001,
to the reply given by the Fire Officer, ,Cuttack, to the Khurda G
Branch Manager of the Insurance Company on 5th May, 2001,
stating that the cause of fire was a "short circuit" in the raw
material section of the factory premises, M/s. J. Basheer &
Associates ultimately observed that the fire could reasonably
be attributed to an act of "Arson" by vested interests, for some H
    78        SUPREME COURT REPORTS               [2010) 8 S.C.R.

A pecuniary benefit, without any factual basis for the same. Apart
  from the aforesaid observation made at the end of the report,
  no foundation has been laid down in the report for such an
  observation which literally appears out of the blues.

          32. Even if the views expressed by the Joint Surveyors,
8
    M/s. Asthana and Joshi, on the reports submitted by M/s. J.
    Basheer & Associates are discounted, although they were
    appointed by the Insurance Company itself, one cannot ignore
    the views obtained by the Insurance Company from former Chief
C   Justice, Y.V. Chandrachud, although, an attempt has been
    made on behalf of the Insurance Company to exclude the said
    views from consideration or at least to water down the same
    by taking refuge in Section 45 of the Evidence Act. Such a
    stand has no legs to stand upon, since the opinion given by
    Justice Chandrachud was based on an analysis of the
D   materials placed before him by the Insurance· Company,
    including the reports submitted by the Joint Surveyors, Mis.
    Asthana and Joshi and Mis. J. Basheer & Associates. Section
    45 of the Evidence Act empowers the Court, in order to form
    an opinion upon a point of foreign law or of science or of art,
E   or as to identity of handwriting or finger impressions, to rely
    upon the opinions of persons specially skilled in such matters.
    The case in hand is quite different, as the views expressed by
    Justice Chandrachud were not meant to be an opinion within
    the meaning of Section 45 of the Evidence Act, but an analysis
F   of the reports and the materials provided to His Lordship by
    the Insurance Company. In fact, the attempt made on behalf of
    the Appellant Insurance Company to exclude the views
    expressed by Justice Chandrachud with regard to the cause
    of fire from the area of consideration does not commend itself
G   to usas    the same is a completely independent and unbiased
    assessment of the events relating to the cause of fire on the
    basis of the materials made available to His Lordship.

         33. Without any material to support the theory of arson
    projected by Mis. J. Basheer & Associates and sufficient
H
NEW INDIA ASSURANCE CO. LTD. v. PROTECTION                  79
MANUFACTURERS PVT. LTD. [ALTAMAS KABIR, J.]
material to hold otherwise, it would be entirely unjust and A
inequitable to accept such a theory without any evidence
whatsoever in support thereof. Reference can be made in this
context to the submission made by the counsel for the Insurance
Company before the National Commission and quoted in para
17 above. Accordingly, we endorse the views expressed by the B
National Commission that the cause of fire was accidental and
that the attempt made by M/s. J. Basheer & Associates to show
that the fire had been caused by an act of arson, was motivated
and intended to benefit the Appellant Insurance Company. The
decisions cited by the parties were rendered in their own        c
particular fact situations in accordance with law which is not
disputed. The fact situations are, however, distinguishable.

      34. This brings us to the second question regarding the
quantum of loss suffered by the Respondent Company on
account of the fire. As has been commented upon by the Joint D
Surveyors and Chief Justice Chandrachud and subsequently by
the National Commission, the almost identical amounts, barring
a few rupees, arrived at by the Insurance Company and M/s.
J. Basheer & Associates speak volumes of the exercise
carried out by the latter on a wholly cursory investigation which E
has quite aptly been described as "tailor-made". The amount
of loss suffered by the Respondent Company on account of the
fire has been calculated by the Joint Surveyors on the basis of
the amounts mentioned by the Respondent Company and the
computer data available in support thereof and also upon cross- F
checking with the accounts of suppliers and vendors of raw
materials to the Respondent Company. We see no reason to
differ with the views expressed by the National Commission in
this regard. We also accept the discretion exercised by the
National Commission regarding the rate of interest awarded G
from three months after the date of the Award. The submissions
made on behalf of the Respondent Company for enhancement
of the same is rejected as we are of the view that such exercise
of discretion was just and equitable in the absence of any
                                                                 H
    80       SUPREME COURT REPORTS                [2010] 8 S.C.R.


A   agreement between the parties regarding payment of interest
    or the quantum thereof.

       35. The submissions of Mr. Piyush Gupta in regard to
  Section 64 UM of the Insurance Act, 1938, are also of
  substance, as the Appellant Insurance Company should have
8
  applied to the Regulatory Authority under the Act for a second
  opinion instead of appointing M/s. J. Basheer & Associates for
  the said purpose unilaterally. The reports submitted by M/s. J.
  Basheer & Associates are liable to be discarded on such
C ground as well.
          36. The Appeal filed by the Insurance Company, therefore,
    fails on all counts and is dismissed. There will be no order as
    to costs.

0      37. Having regard to the judgment delivered today, no
  further orders are required to be passed on the application for
  directions filed on 30.4.2010 on behalf of the Respondent
  Company and supported by an affidavit dated 27 .4.2010
  affirmed by Mr. Piyush Gupta and the same is disposed of
E accordingly.
    K.K.T.                                     Appeal dismissed.