BEFORE THE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD.
F.A. 355/2008 against C.C. 743/2007, Dist. Forum-III, Hyderabad.
Between:
A.S. Moosani & Company
Rep. by Mohd. Farooq Moosani
S/o. Abdul Sattar Moosani
41 years, 5-8-112,
21st Century Complex
Nampally, 1st Floor
Hyderabad-500 001. *** Appellant/
Complainant
And
The Branch Manager
National Insurance Company Ltd.
R.P. Road, Secunderabad. *** Respondent/
Opposite Party.
Counsel for the Appellant: M/s. K. L. N. Rao.
Counsel for the Respondent: M/s. M. Hari Babu.
CORAM:
HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT.
&
SMT.M.SHREESHA, LADY MEMBER.
FRIDAY, THIS THE THIRTIETH DAY OF JULY TWO THOUSAND TEN
ORAL ORDER: (Per Hon’ble Sri Justice D.Appa Rao, President.)
***
1) The appellant is unsuccessful complainant.
2) The case of the complainant in brief is that it is a partnership concern established for the purpose of eking out their livelihood dealing in various types of chemicals. It purchases chemicals from various sources in India and abroad and sells them to their clients. It had obtained a policy valid from 31.12.2004 to 30.12.2005 covering the transit risk of the consignment either by road or rail for assured sum of Rs. 1 crore. A premium of Rs. 21,766/- was paid as advance under the policy. The premium was collected in advance and kept in deposit. Based on the statement of consignments purchased/booked given to the insurance company, periodically the insurance coverage would be given by deducting pro-rata premium deposit and balance would be kept as premium deposit for future consignments. Insurance coverage is given only for the consignments mentioned in the periodical declarations. While so, it has imported 100 MT of Hydrated phenol from Republic of Korea and the shipment was received at Kandla port in Gujarat state. The consignment was loaded in a tanker on 3.9.2005 for transportation from Kandla to Hyderabad. The value of the consignment was Rs. 9,50,987/- While so on its way to Hyderabad it met with accident on 6.9.2005 at 11.00 p.m. at Vembka village on Tarapur high way in Gujarat State. The tanker fell from a bridge into the river bed and turned turtle. The entire consignment of hydrated phenol was lost. Immediately the carrier informed to the respondent insurance company as well as to it. The insurance company deputed a surveyor by name Sunil Kumar Bhatt. In fact they have submitted the monthly declaration for September, 2005 indicating totally five consignments including the consignment that met with accident. However, it repudiated the claim on the ground that sum assured of Rs. 1 crore was exhausted within 18 days of the policy and that the tanker was uninsured, and that proper post accident precautions were not taken in order to avoid possibility of involvement of driver-cum-owner of the tanker leaving all the matters to the transporters. The repudiation was unjust. Therefore the complainant claimed Rs. 9,51,986.41 together with interest @ 12% p.a., from 6.9.2005 till the date of payment together with compensation of Rs. 10,000/- and costs.
3) The insurance company resisted the case. While admitting issuance of policy to cover transit risk on 8.9.2005 it alleged that the complainant intimated about the accident and even before appointment of a surveyor the carrier of the complainant had appointed one S. P. Bhatt, Surveyor against the existing practice adopted by the insurance companies. Immediately it has appointed a spot surveyor who after inspection observed that the driver did not mention that there was leakage of the chemical, and that the distance between the accident place and Kandla port is only 350 kms however, the vehicle has taken nearly three days to reach the spot. The very submission of report on 27.1.2006 by the surveyor raises suspicion. The complainant had purchased the chemicals for a total sum of Rs. 5,82,51,521/- as on 30.3.2005 against sum assured of Rs. 1 crore under the policy. The sum assured was exhausted within 18 days. By the date of accident there was no coverage to the consignment. It is to be treated as un-insured transit. The surveyor appointed by it raised many doubts about the leakage of oil. In view of the fact that there was suspicion about the genuineness of the claim, the claim was repudiated. The complainant had suppressed the transportation of consignment and the value thereof. Had there been any leakage of chemicals in the alleged accident the complainant and his representative would have reached the spot immediately to prevent further damage to the tanker. They should intimate the same to the local police station and the revenue authorities. There was no deficiency in service on its part and they have rightly repudiated the claim. It prayed that the complaint be dismissed with costs.
4) The complainant in proof of its case filed the affidavit evidence of Mohd. Farook Moosani and got Exs. A1 to A9 marked, while the opposite party filed the affidavit evidence of its Deputy Manager, T.S.Samba and got Exs. B1 to B16 marked.
5) The Dist. Forum after considering the evidence placed on record opined that by the date of accident the sum assured had already been exhausted. The consignment was not insured and therefore the complainant was not entitled to any compensation and therefore dismissed the complaint however without costs.
6) Aggrieved by the said decision, the complainant preferred the appeal contending that the Dist. Forum did not appreciate either fact or law in correct perspective. It ought to have seen that the policy does not contain any clause or endorsement that the shipment must be insured under open declaration policy. Ex. B7 shows that there was un-utilized balance of Rs. 50,73,511/- . The repudiation was against all norms of law, and therefore prayed that the complaint be allowed.
7) The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?
8) It is an undisputed fact that the complainant has taken Marine Cargo Inland Transit Policy Ex. B1 for Rs. 1 crore covering the period from 31.12.2004 to 30.12.2005. It covers transit risk. The complainant having received 100 MT weighing 16,620 Kgs Hydrated phenol worth Rs. 9,50,987/- from Republic of Korea vide Ex. A2 at Kandla port in Gujarat State loaded into a tanker on 4.9.2005 at Kandla port and on its way to Hyderabad on 6.9.2005 at 11.00 p.m. it met with accident by falling from a bridge in to the river bed. It fell topsy-turvy and the entire consignment was lost carried away by the river water. In fact a declaration was given to the insurance company in declaration No. 7058 Dt. 5.9.2005 mentioning the details of date, tanker number, invoice etc. It mentioned the dispatches that were made in the month of September, 2005 by giving details of name of the supplier, port where the consignment was received and the place it had to be dispatched by giving tanker number, product name, bill number etc. It is not in dispute that the carrier as well as the complainant had intimated about the accident to the insurance company which in turn appointed a surveyor. He made a spot survey on 8.9.2005. He confirmed that the complainant had imported the material, paid customs duty, taken delivery of the consignment and loaded into a tanker which had met with accident. He also categorically noticed that “At the time of survey, it was found that the tanker was in topsy-turvy condition and top of tanker on rear side was submerged in water.” On his second visit he found the entire tank was completely empty. He went to the police station and checked the records and found that it was registered as Entry No. 40/05, 3/05. He confirmed that the carrier had made weighment of tanker after the accident at Shree Nakodaji Computerized Weighbridge and noted that there was complete leakage of entire 16,620 kgs of H. phenol. However, he surmised the total distance travelled by the tanker from Kandla to the place of accident being 350 Kms and it had taken 60 hours, and therefore it was not justified. It is not known as to how he could estimate the time for transportation of such a heavy chemical tanker. Whatever be the impression the fact remains that there was an accident wherein the entire material was lost but that was not a ground for repudiation.
9) The insurance company repudiated the claim vide Ex. A6 on two grounds i) “As per the investigator report the sum insured of Rs. 1 crore on the policy exhausted within 18 days of the policy. So the tanker was un-insured. ii) Proper post-accident precautions are not taken immediately after the accident without supervising the loss personally avoiding the possibilities involvement of the driver-cum-owner of the tanker except leaving all the matters to the transporters.”
10) It is an undisputed fact that whenever the complainant was sending the consignments he was furnishing the declarations mentioning the details evident from Ex. B7. They pertain to declaration Nos. 1751 to 1759. Declaration No. 1758 pertains to the consignment in question. There is a specific mention against declaration No. 1758 dt. 5.9.2005 that total amount declared from 31.12.2004 to 30.09.2005 was Rs. 49,26,489/- and the un-utilized balance was Rs. 50,73,511/- and the commodity description was “On acetic AIO, methanol, formic acid, formal dehyde, phenol, acetone, aniline oil and chemicals”. A statement was also appended by the complainant for the dispatches made for the month of September, 2005, wherein the consignment in question was noted mentioning the value at Rs. 9,28,537/-.
It is clearly stated in the said letter as under :
Balance amount b/d forward from Sept, 2005 Rs. 50,67,211/-
Declared as above Rs. 39,90,140/-
Balance premium c/d to October, 2005 Rs. 10,77,071/-
Since it is filed by the very insurance company it cannot be said that the complainant has created these documents. Equally the opposite party filed the details of purchases made during the period from 1.1.2005 to 30.9.2005 vide Ex. B8. Ex. B9 pertains to Profit & Loss account of complainant from 1.4.2005 to 31.3.2006. Ex. B10 is transit sale register for each of the commodity from 6.4.2005. It is not known whether it is deliberate or just to mis-direct the Dist. Forum it pleaded that the complainant had already exhausted the value of consignment amounting to Rs. 5,82,51,521/- as on 30.3.2005 as against the sum assured amount of Rs. 1 crore under the policy, and therefore not entitled to any amount.
11) In fact the complainant informed the purchases made during the period 1.1.2005 to 30.9.2005 under Ex. B8. It did not mention that they were transported. The complainant was informing the insurance company not only the purchases made but also profit & loss account. It was also furnishing transit sale register etc. It never stated that it had transported the consignment worth Rs. 14,95,17,144.72. This is contrary to very declarations given by them which we have already adverted to marked as Ex. B7. Obviously the insurance company from the statements given by the complainant pertaining to purchases made by it assumed that they pertain to consignments transported. It is not as though it did not understand the statements filed by the complainant in regard to its sales. The insurance company has been certifying the amounts covered under the declarations and also the amounts still lying with them towards premium deposit. Therefore it cannot be said that the complainant had transported the consignments worth more than the assured amount.
12) The contention that the complainant has exhausted the amount even by the date of transportation is false evident from declarations given under Ex. B7. It intends to equate the amounts spent for purchase of various commodities with that of value of goods transported by it. The complainant will be entitled to the amount towards loss caused while transporting the consignment on hand and not for the entire commodities purchased by it.
13) The second ground was that proper post-accident precautions were not taken immediately after the accident without supervising the loss personally avoiding possibility of involvement of the driver-cum-owner of the tanker, except leaving all the matters to the transporters. A report to the police immediately, which made a mention by the surveyor. No foul play was detected by the investigator. Therefore, we are of the opinion that the repudiation was unjust. The complainant is entitled to the value of the consignment. Since the repudiation was unjust, the insurance company is directed to pay interest @ 9% p.a., from the date of repudiation till the date of payment. We award a compensation of Rs. 10,000/- for unjust repudiation.
14) In the result the appeal is allowed setting aside the order of the Dist. Forum, consequently the complaint is allowed in part. The insurance company is directed to pay Rs. 9,28,537/- together with interest @ 9% p.a., from the date of repudiation viz., 20.09.2006 till the date of realization together with compensation of Rs. 10,000/-. The complainant is also entitled to costs of Rs. 10,000/-. Time for compliance four weeks.
1) _______________________________
PRESIDENT
2) ________________________________
MEMBER
Dt. 30. 07. 2010.
*pnr
“UP LOAD – O.K.”
