Chandigarh

StateCommission

A/103/2016

M/s Hitech Light Ltd - Complainant(s)

Versus

HDFC ERGO General Insurance Co. Ltd. - Opp.Party(s)

Pradeep Sharma

25 Jul 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

                                                                 

 

Appeal No.	:	103 of 2016
Date of Institution	:	04.04.2016
Date of Decision	:	25.07.2016

 

M/s Hitech Light Limited, Plot No. 315-316, Phase-IX, Industrial Area, Mohali, Punjab, through its Director Sh. R.S. Sachdeva.

.…Appellant/Complainant.

Versus

[1]  HDFC ERGO General Insurance Company Limited, SCO 124-125, 1st Floor, Sector 8, Madhya Marg, Chandigarh, through its Branch Manager.

[2]  HDFC ERGO General Insurance Company Limited, 1st Floor, 165-166, Back Bay Reclamation, H.T. Park Marg, Churchgate, Mumbai – 400020 through its M.D.

[3]  HDFC Bank Limited, SCO 78-79, Sector 8, Chandigarh, through its Branch Manager.

…..Respondents/Complainants.

 

Appeal under Section 15 of the Consumer Protection Act, 1986.

 

BEFORE:   JUSTICE JASBIR SINGH (RETD.), PRESIDENT.

                SH. DEV RAJ, MEMBER.

                SMT. PADMA PANDEY, MEMBER.

               

Argued by:

 

Sh. Pradeep Sharma, Advocate for the appellant.

Sh. Vishal Aggarwal, Advocate for respondents No.1 and 2.

Sh. Vineet Yadav, Advocate Proxy for Sh. Sunil Narang, Advocate for respondent No.3.

 

PER DEV RAJ, MEMBER

              This appeal has been filed against the order dated 25.02.2016, rendered by the District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (in short ‘the Forum’), vide which, consumer complaint bearing No.291 of 2015 was dismissed.

2.             The facts in brief are that the complainant company, which deals in Compact Fluorescent Lamps (CFL), got a Marine Open Policy (Annexure C-2) from Opposite Party No.1 for coverage “on consignments said to contain CFL glass Tube, Plastic Parts of CFL, PCB Components and CFL machinery from anywhere in the World to anywhere in India”. It was further stated that the complainant Company imported Burner Glass (Glass Tube of CFL) from China Shipment port (Shanghai to Nava Sheva, India) and the consignment contained 700 cartons of CFL Lamp Burner 45W (Spiral) and each carton contained 50 Pcs, 340 cartons of CFL Lamp Burner 65W (Spiral) and each carton contained 50 Pcs and 138 cartons of Plastic Body Sets containing 52000 sets. It was further stated that the value of the consignment was USD 39,920 vide invoice dated 25.11.2014 (Annexure C-4). It was further stated that thereafter from Mumbai to Nalagarh, the consignment was received in two trucks of Cargo Carriers India (Regd). It was further stated that when the consignment was being unloaded from the trucks on 15.01.2015, it was found that the material was broken and damaged, upon which employees of the complainant company immediately stopped unloading. It was further stated that as the material/consignment was insured under the aforesaid Marine Policy, the Opposite Parties were requested to immediately depute a Surveyor to assess the loss vide e-mail dated 15.01.2015. It was further stated that the complainant company submitted the claim form alongwith all the requisite documents to the Opposite Parties seeking indemnification of the loss sustained by it. It was further stated that the complainant company vide email dated 02.02.2015 clarified that the consignment was imported from China and the said consignment was covered under ICC(A) and not ICC(B). It was further stated that as per marine insurance clauses, all Exports/Imports are covered either of clauses namely ICC(A), ICC(B) or ICC(C). It was further stated that as per the special conditions of the Policy, ITC(B) was applicable only for the consignments either on tail end or all glass & fragile items. It was further stated that the clauses of ITC(B) were applicable to domestic consignments and not to imported consignments. It was further stated that the Opposite Parties closed the claim of the complainant as ‘No claim’ vide email dated 9.2.2015 stating that the loss did not fall within the scope of the Policy (Annexure C-10). It was further stated that the aforesaid acts of the Opposite Parties amounted to deficiency, in rendering service, and indulgence into unfair trade practice.

3.             When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only) was filed seeking various reliefs.

4.             Opposite Parties No.1 & 2, in their written version, admitted that upon receipt of information, they appointed Cunningham Lindsey International Insurance as Surveyor for assessing the loss, who after duly inspecting the premises, gave its report regarding the loss incurred by the complainant. It was stated that the insurance was for the purpose of insuring the goods to be imported by the complainant to India and not for the purpose of insuring the goods to be transported from one place to another only in India. It was further stated that the loss involved in this case was of CFL Glasses, which falls under the purview of ‘glass and fragile’ items and, hence, was strictly governed by ITC(B) clause, which was standard in nature. It was further stated that since no peril of ITC (B) had occurred during inland transit, the damage to the consignment does not trigger any insurance claim. It was further stated that the claim of the complainant company was rightly repudiated by Opposite Parties No.1 & 2. It was further stated that neither there was any deficiency, in rendering service, on the part of Opposite Parties No.1 & 2, nor they indulged into any unfair trade practice. The remaining averments, were denied, being wrong.

5.             Opposite Party No.3, in its written version, stated that the complainant failed to show any deficiency in service on its part. It was further stated that the complaint was false, malicious and incorrect and an abuse of process of law. It was further stated that the complex issues were involved in the complaint, which could only be dealt with before the civil court. It was further stated that neither there was any deficiency, in rendering service, on the part of Opposite Party No.3, nor it indulged into unfair trade practice. The remaining averments, were denied, being wrong.

6.             The complainant filed short rejoinder-cum-written arguments wherein it reiterated all the averments contained in the complaint and repudiated those as contained in the written statements of the Opposite Parties.

7.          The parties led evidence, in support of their case.

8.           After hearing the Counsel for the parties and, on going through the evidence, and record of the case, the Forum, dismissed the complaint, vide the impugned order, as stated above.

9.           Feeling aggrieved, the complainant has filed the instant appeal.

10.           We have heard the Counsel for the parties, and have gone through the evidence and record of the case, carefully.

11.           It is evident from record that the complainant secured Marine Open Policy effective for the period from November 25, 2014 to November 24,2015 (Annexure C-2), on payment of total premium of Rs.42,245/-. As per the Policy Schedule, the salient features of the Policy were as under:-

Interest Insured	:	CFL glass tube, plastic parts of CFL, PCB components and CFL machinery.
Conveyance	:	By Rail/By Road/By Sea/By Air
Voyages	:	From: Anywhere in the world To     :Anywhere in India
		Excluding Imports from Iran, Iraq, Syria, U.N. Sanctioned/EU Prohibited Countries. In respect of shipments to African Countries cover would cease at disport/airport.
Sum Insured Value	:	Rs.10,00,00,000/-
Term of Cover	:	All Risk as per ICC ‘A’ Clauses and War & SRCC as applicable. CIF Imports: ITC ‘B’ + SRCC
Deductible	:	0.5% of consignment value subject to a minimum of INR 10,000 for each and every claim.

 

12.           In the instant case, the insured imported goods valuing 39,220 USD (Annexure C-4). The goods on receipt at Mumbai were transported to Nalagarh (H.P.) by road through trucks (Annexure C-5 colly.). When the consignment(s) was being unloaded from the trucks on 15.01.2015, it was found that material was broken and damaged and consequently, the Opposite Parties No.1 & 2 were requested to depute a Surveyor to assess the loss vide email dated 15.01.2015 (Annexure C-6). Opposite Parties No.1 & 2, despite furnishing all clarifications by the complainant, closed claim as ‘No Claim’ vide email dated 09.02.2015, on the ground that the risk did not fall under       the scope of the Policy. Email dated 31.01.2015 and email dated 09.02.2015 read thus:-

“Email dated 31.01.2015:

Please find the survey report brief.

“All glass & Fragile Items will be covered as per ITC B perils”.

In view of above mentioned special condition, your subject consignment in both the lorries fall under this condition as it was of CFL Glass tubes. Since, there occurred no peril of ITC (B), thus subject claim is not payable under the policy. If you have some different opinion, then please share with us within two days duly supported with evidence, otherwise we will have to close the file as No Claim.

Under ITC (B) coverage, only following perils are covered:

• Fire
• Lightning
• Breakage of the bridges.
• Collision with or by the carrying vehicle
• Overturning of the carrying vehicle
• Derailment or accidents of like nature to the carrying railway wagon/vehicle.”

 

“Email dated 09.02.2015:

 

Please see u/w mail and inform the insured accordingly that this loss doesn’t fall within the scope of the Policy. Hence we are closing this claim as “No Claim”.”

 

13.           The question, which falls for consideration, is, as to whether Opposite Parties No.1 & 2 rightly repudiated the claim of the complainant or not. The answer to this question is in the negative. The Policy covered voyages from anywhere in the world to anywhere in India and the conveyance could be by road, by rail, by road, by sea and by air. The ground taken that transportation from Mumbai Airport to Nalagarh was not covered, is, therefore, contrary to the terms and conditions of the Policy. The “Terms of Cover” under the Policy clearly said “All Risk as per ICC ‘A’ Clauses and War & SRCC as applicable. CIF Imports: ITC ‘B’ + SRCC”.

14.           During arguments, the Counsel for the appellant/complainant submitted that despite clarification, the explanation given by the respondents/Opposite Parties that the risk did not fall under ITC ‘B’ and the claim was not payable, was not applicable to the consignment in question. He further submitted that the loss caused to the consignment, in question, due to jerks and jolts during the course of transit, was covered under the Policy. There is special condition in the Policy that all glass and fragile items will be covered as per ITC (B) Perils. On perusal of the Policy, it reveals that ITC(B) Perils are not mentioned in the Policy. During arguments, reliance placed by the Counsel for respondents No.1 & 2/Opposite Parties No.1 & 2 on Inland Transit (Rail/Road) Clause – B (Named Perils), cannot be made applicable in the instant case. The consignment imported, and damage to which was caused, was of glass/plastic and the same was fully covered under the Policy. Counsel for the appellant/complainant placed reliance on Rajendra Singh Vs. Life Insurance Corporation of India and others, 2014 (2) CPJ 194 (NC), wherein it was held that when two reasonable interpretations of terms of policy are possible, interpretation which favour insured is to be accepted and not the interpretation which favours insurer. He further placed reliance on Life Insurance Corporation of India Vs. Ram Singh Tanwar, 2007 (1) CPJ 48 (NC), wherein it was held that if terms of policy are vague, it should be interpreted for benefit of policy holder. In our opinion, the claim is covered under the Policy.

15.           The next question, which falls for consideration, is, as to what amount, the appellant/complainant is entitled to.  On receipt of consignment in broken condition, the complainant informed Opposite Parties No.1 & 2 vide email dated 15.01.2015 to depute a surveyor to assess the loss and Opposite Parties No.1 & 2 appointed Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., who gave its Final Survey Report dated 12.02.2015 (Annexure R-1/1). The complainant also appointed a Surveyor, namely, Er. Harish C. Gupta, who gave his report dated 05.03.2015 (Annexure C-11). The assessment made by both the Surveyors, in their respective reports, is extracted hereunder:-

I.      Assessment made by Cunningham Lindsey International Insurance Surveyors and Loss Assessors Pvt. Ltd., deputed by Opposite Parties No.1 & 2.

 

Description	Total Qty.	Rate (USD)	Amount (USD)
45 W Burner	931	0.5	465.5
65 W Burner	571	0.6	342.6
	1502		808.1
Add: Freight Overseas prop.			40.08
Add: Insurance			4.45
CIF Value			852.63
Exchange Rate		INR	63.85
CIF Value in INR			54441
Total Duty on 45W weighing 9450 Kg.		INR	461282
Prop. Duty on damaged 931 pcs weighing @0.27 Kg/pc		INR	12270
Duty on 65W weighing 4920 Kg.		INR	240157
Duty on damaged 931 pcs weighing @0.27/pc		INR	8055
CIF Value			54441
Duty			20325
Total			74766
Less: Salvage			0
Net Loss Assessed – Not payable			74766

 

SALVAGE VALUE     -       Nil, as glass tubes were broken.

 

POLICY EXCESS      -       0.5% of consignment value subject to

                                        a maximum  of  INR 10,000 for each

                                        and every claim.

 

ADJUSTMENT AS PER POLICY.

 

Net Loss Assessed – Not payable			74,766
Less: Excess – 2 events			21,866
Net adjusted Loss – Not payable			52,900

Note:- We are not adding 10% as per policy in absence of declaration.

 

POLICY CONDITION         The subject claim is falling under one

CHECKED?                      Special condition, thus not payable.

 

II.    Assessment made by Er. Harish C. Gupta, Surveyor and Loss Assessor, appointed by the complainant.

 

25. Assessment

The assessment has been done as per actual quantity of the material found broken due to accident and loss have been allowed in accordance with the Marine Policy.

 

45W & 65W Material Costing

Expenses:	45 W Burner	65 W Burner	Plastic
Custom	351500	421800	165205
CHA Expenses	194272	233126	91308
Local Freight	53558	64270	25172
Total Expenses	599329	719195	281685
Quantity Purchased	35000	17000	52000
Total Expenses Per Pc	17.12	42.31	5.42
Basic Cost:	45 W Burner	65 W Burner	Plastic
Basic Price	0.500	0.600	0.235
INR Rate	63.85	63.85	63.85
Basic Cost INR	31.93	38.31	15.00
Basic Cost:	45 W Burner	65 W Burner	Plastic
Landed Cost per pc	49.05	80.62	20.42

 

Value of the broken material:

Sr. No.	Item	No. of carton	Qty in each carton	Total qty.	Qty intact	Qty broken	Rate Rs/Ea	Amount assessed (Rs.)
1.	CFL Lamp Burner 45W	700	50	35000	34150	850	49.05	41691
2.	CFL Lamp Burner 45W	340	50	17000	16037	963	80.62	77633
3.	Plastic body sets	138	-	52000	165	1813	20.42	37025
	Total							156349

 

Loss Assessed – Rs.1,56,349.00

 

26. Salvage:

Since the material broken was the glass scrap & no useful material could be retrieved hence no salvage is envisaged.

 

Net claim amount                   =        Rs.1,53,349.00.”

 

16.             As per email dated 27.01.2015 (Page 102 of complaint file), the appellant/complainant had informed Opposite Parties No.1 & 2 that after segregation and 100% inspection, the breakage was of  931 pcs of 45W Burner and 571 pcs of 65W Burner, totaling 1502 pcs. Besides assessing loss for the broken quantity (glass parts) viz. CFL Lamp 45W Burner (850 pcs) and CFL Lamp 65W Burner (963 pcs), additionally the Surveyor appointed by the appellant/ complainant assessed the loss for equal number of Plastic Body Sets numbering 1813. The quantity, so mentioned, is not in consonance with the loss reported vide email dated 27.01.2015 (Page 102). Thus, according to the Surveyor appointed by the complainant, Plastic Body Sets of all the Burners (glass parts) were found to be broken. The glass parts are more prone to breakage/damage vis-à-vis plastic parts. Therefore, damage to plastic parts, in all probability, would be lesser than damage to glass parts. While giving his assessment regarding salvage, the Surveyor opined only with regard to glass scrap and nothing has been mentioned as regards plastic scrap.

17.           In view of position stated above, in our            opinion, report of the Surveyor appointed by  Opposite             Parties No.1 & 2 in  so far as loss is concerned, is                         in consonance with loss/damage indicated in                          email dated 27.01.2015. Therefore, the loss qua 931                       pcs (45W Burner) and 571 pcs (65 W Burner) is required                   to be  taken into account. The same, according to the  Surveyor

appointed by Opposite Parties No.1 & 2, comes to Rs.74,766/-. As per Policy excess clause, 0.5% of consignment value, subject to maximum of INR 10,000 for each and every claim, is deductible. The goods were imported as per Invoice dated 25.11.2014 (Annexure C-4) from Shanghai, China to Nava Sheva, India, in one consignment and it was only from Mumbai to Nalagarh that the same were transported in two trucks. The excess clause is for each and every claim. The complainant never lodged two claims and only one claim was lodged and, therefore, the excess deductible comes to Rs.10,933.00 i.e. (Rs.21,866.00 ÷ 2). The complainant is, therefore, entitled to the claim amount of Rs.63,833.00 i.e. (Rs.74,766.00 (-) minus Rs.10,933.00), alongwith interest @9% per annum from the date of filing the complaint till actual realization. Thus, by wrongly closing the claim of the complainant as ‘No claim’ and further by not paying the claim amount of Rs.63,833/- to the complainant, Opposite Parties No.1 & 2 were deficient in rendering service and also indulged into unfair trade practice.

18.           Due to aforesaid deficiency in service, the complainant also suffered financial loss and agony, due to deficiency in rendering service and unfair trade practice, for which, it needs to be compensated. Compensation and litigation costs, in the sum of Rs.25,000/- and Rs.10,000/-, if awarded, shall meet the ends of justice.

19.           No other point was raised by the Counsel for the parties.

20.            For the reasons, recorded above, the appeal is accepted. The impugned order passed by the Forum is set aside. Consequently, Consumer Complaint No.291 of 2015 is partly accepted, with costs against Opposite Parties No.1 & 2 only. Opposite Parties No.1 & 2 are, jointly and severally, held liable and directed in the following manner:-

(i)     To pay an amount of Rs.63,833/-, to   the   complainant,   alongwith interest @9% per annum, from the date of filing the complaint i.e. 15.05.2015, within a period of 45 days, from the date of receipt of a certified copy of this order, failing which, the aforesaid amount shall be payable alongwith interest @12% per annum from the date of filing the complaint till actual payment.

(ii)    To pay an amount of Rs.25,000/-  (Rupees              Twenty Five Thousand only), to the complainant, as compensation for financial loss and agony, on account of deficiency in rendering service and unfair trade practices, within a period of 45 days from the date of receipt of a certified copy of the order, failing which, the aforesaid amount shall be payable alongwith interest @12% per annum from the date of filing the complaint till actual payment.

(iii)   To pay cost of litigation, to the tune of Rs.10,000/-, to the complainant within a period of 45 days from the date of receipt of a certified copy of the order, failing which, the aforesaid amount shall be payable alongwith interest @12% per annum from the date of filing the complaint till actual payment.

21.           However, Consumer Complaint No.291 of 2015 stands dismissed against respondent No.3 (Opposite Party No.3) - HDFC Bank Limited, with no order as to costs.

21.           Certified copies of the order be sent to the parties free of charge.

22.           File be consigned to the Record Room after completion.

Pronounced

July  25, 2016.

[JUSTICE JASBIR SINGH (RETD.)]

PRESIDENT

 

 

 

(DEV RAJ)

MEMBER 

 

 

 

(PADMA PANDEY)

      MEMBER