JUSTICE A. P. SAHI, PRESIDENT

1.       All these five complaints relate to a claim against the New India Assurance Company Limited for deficiency in service and unfair trade practice by not assessing the loss or damage suffered by the respective complainants of their rubber goods that were offloaded at the port of Mombasa, Kenya  in the year 1998. It is alleged that all the consignments that were transhipped as an export to buyers abroad to be delivered in Kampala, Uganda were allegedly lost for various reasons as alleged in the complaints due to the negligence of the carrier with whom the goods had been booked for their shipment to the destination referred to above. The goods were rubber sheets, rubber tyres, slippers and mattresses, which are said to have been transported in containers on the ships that sailed up to Mombasa and after unloading of the said containers, the same went untraceable.

2.       It is common ground in all the complaints that after having come to know of the goods not having reached the buyers, the complainants intimated the Insurance Company about the alleged non-delivery of the goods to the buyers and a private investigator M/s. Mclarens Toplis was also engaged to verify the location of the said goods, who also reported that their investigation revealed that since the goods were lying for almost two years at the port, they were stripped and the goods were auctioned by the customs authority as unclaimed goods. The report indicates that this happened because of the prolonged storage at the port of Mombasa, but the customs authority did not disclose the proceeds realised from the auction of the said goods.

3.       The Insurance Company was persuaded through several communications as would be discussed hereinafter for allowing the claim but the Insurance Company instead of having made its enquiries, through letters failed to respond to the same without any letter of acceptance or repudiation.

4.       It is gathered from the pleadings particularly the rejoinder affidavit filed by the complainants on 11.09.2005 that both the exporters namely M/s Kohinoor International and M/s. M.G. exports filed in all 16 complaints alleging deficiency in service against the Insurance Company, before the State Consumer Disputes Redressal Commission, Punjab. Out of these 10 of the complaints were allowed holding the Insurance Company liable for indemnity of the loss of the goods at Mombasa Port. The remaining complaints were found to be wanting in pecuniary jurisdiction and were accordingly returned for being presented before the National Commission vide order dated 02.05.2001. These orders are on record. The complainants instead of filing their complaints before the National Commission again filed fresh complaints before the State Commission for the same cause by reducing the pecuniary value. The State Commission again dismissed the complaints vide order dated 12.08.2002 maintaining the earlier order dated 02.05.2001.

5.       The complainants filed first appeals before this commission assailing the orders dated 02.05.2001 and 12.08.2002, which were ultimately dismissed on 31.03.2003. However, prior to the dismissal of the appeals, the present complaints were instituted in terms of the aforesaid orders, in which notices were issued and the parties have exchanged their pleadings.

6.       Applications were moved on behalf of the complainants that the opposite party nos. 1 and 3 have undergone liquidation, which applications were sought to be filed and were noticed in the order dated 22.07.2005, extracted herein under :

 “Learned counsel for the petitioner submits that on account of mistake in his office, rejoinder, affidavit evidence could not be filed and he undertakes to file the same within two weeks. In view of the undertaking given by learned counsel, we grant two weeks' time to file rejoinder, affidavit evidence by way of last opportunity. A copy thereof shall be supplied to the learned counsel for the opposite parties to enable them to file their own affidavit evidence within a period of three weeks thereafter. Within four weeks' thereafter, both the parties shall file their written submission.

Undisputedly, opposite party No. 1-Intraship AG, International Transport & Shipping has gone into liquidation and official liquidator has been appointed. The petitioner complainant is not aware whether official liquidator has been appointed or not. This Commission is not supposed to do the job of the complainant. If the complainant wants to proceed against a person, who is being proceeded against for winding up then it is the duty of the complainant to take appropriate  steps in this regard to enable us to decide how this Commission should proceed against the company which is said to be in liquidation. At this stage, learned counsel submits that he would be filing an amended memo of parties deleting opposite parties No. 1 and 3. Learned counsel shall also examine the matter in the light of the latest judgments of the Supreme Court on the point of prosecuting a case against a foreign company etc. including the case decided by the Bench presided over by Hon'ble Mr. Justice S.P. Barucha as to whether the complainant can proceed against their agents in India.

Both the parties may file their separate written submission of not more than two pages on this point to enable us to decide appropriate course  for further proceedings in this matter.

List on 23.09.2005 for arguments.

The complainant may also file all the concerned orders of the State Commission.”

7.       The said applications for deletion remain pending, which have been allowed upon hearing the learned counsel for the complainants and the learned counsel for the Insurance Company on 27.03.2024.

8.       As noted above 10 of the complaints filed before the State Commission had been allowed on 02.05.2001. The Insurance Company filed appeals against the said order, which appeals were numbered as 239, 240, 261 to 268 of 2001 before this Commission. Some appeals were also filed by the complainants. All the appeals were simultaneously taken up and on 08.03.2002 wherein an interim direction was issued that there shall be stay of the execution proceedings.

9.       The aforesaid appeals were finally allowed on 22.08.2006. It appears that aggrieved by the order of this Commission, the complainants approached the Apex Court by filing civil appeal nos. 7336-7345 of 2008. A mention was made before this Commission regarding filing of the said 10 appeals, which was noted in the order dated 25.01.2008, extracted herein under:

 “Ld. Counsel for the Complainant submits that a batch of similar complaints numbering 10 filed by him before the State Commission, Punjab have already been adjudicated in favour of the Complainant but the Opposite Party filed appeals against the Order of the State Commission and the said appeals were allowed by this Commission. The complainants have assailed the order passed by   this Commission in the said appeal before the Hon'ble Supreme Court of India where the matter is listed for 22.02.2008 as an after- notice matter. He hopes that the SLPs filed by him would be disposed of by the Supreme Court shortly. He wants to await the decision of the Supreme Court so as to decide whether the present complaints need to be pursued further or not, depending upon the outcome of the said SLPs. Ld. Counsel for the Opposite Party has no objection to the matter being postponed for the above reasons without prejudice to their rights and pleas taken by them in their written version.

Adjourned to 16.04.2008.”

10.     The present complaints therefore came to be adjourned from time to time and on 13.03.2010, orders were passed by this commission that these complaints be taken up after the disposal of the appeals filed before the Supreme Court of India. The proceedings therefore remained in abeyance and were again allowed to remain pending in view of the proceedings recorded by the registrar on 07.10.2015.

11.     It is thereafter, that Mr. Saini has put in appearance on 05.09.2023 on behalf of the complainants and Mr. Tripathi was called upon to assist the bench on behalf of the Insurance Company. The case was taken up 02.11.2023 to enable the learned counsel for the parties to arrange their pleadings and on 17.01.2024 the matter proceeded with the hearing. The arguments continued on 28.02.2024 and were finally heard and concluded on 27.03.2024, whereupon orders were reserved.

12.     As noted above, the case was taken up amongst the list of old cases on 05.09.2023, before this Bench, when Mr. Saini filed his appearance on account of the passing away of earlier counsel of the complainants, Mr. Walia and since there was no appearance on behalf of the Insurance Company a request was made to Mr. Tripathi, who is a regular counsel for New India Assurance Company Limited to seek instructions. He accordingly put in his appearance and the matter was again adjourned on the request of the learned counsel for the parties on 02.11.2023 for reconstructing their briefs. The matter was taken up on 17.01.2024, when Mr. Tripathi volunteered not to raise the issue of pecuniary jurisdiction and even otherwise it was found that in view of the observations made by the Apex Court in the case of Neena Aneja Vs. Jai Prakash Associates Limited (2022) 2 SCC 161, Paragraphs 72 to 91, the present complaints can continue to be entertained by this Commission. It may also be observed that even otherwise these complaints are of the year 2002 and have seen two decades of pendency without any formal adjudication. Fortunately, the issue of limitation under Section 24 (A)(2) of the Consumer Protection Act, 1986 was resolved by this Commission vide order dated 10.04.2007, whereby the delay was condoned and the complaints were treated to be within time.

13.     Mr. Saini, learned counsel for the complainants urged two issues. Firstly that the Insurance Company has failed to take any action on the claim either by acceptance or repudiation but has taken a totally erroneous stand before this Commission by contending that the claim cannot be accepted as the exclusion clause 4.6 disentitles the complainants from seeking any coverage for the alleged loss. The same is extracted herein under:

“4.6 loss damage or expense arising from insolvency or financial default of the owners managers charterers or operators of the vessel.”

14.     He submits that the argument of the Insurance Company that the carrier/ shipping agent was in financial default/ bankruptcy is only a perception without there being any proof and consequently, the said exclusion will not apply to the complainants, keeping in view the law laid down by the Apex Court in the case of Metal Powder Company Limited Vs. Oriental Insurance Company Limited, (2014) 5 SCC 771. He has invited the attention of the Bench to the paragraph 11 to substantiate his submission.

15.     He then contends that there is a complete failure on the part of the Insurance Company to establish their allegations by any document as held by the Apex Court in the above mentioned judgment.

16.     It is further urged that the complainants promptly intimated the Insurance Company, but it failed to comply with the terms and conditions of appointing a surveyor or proceeding to examine the claim in spite of the fact that the communications sent by it indicated that they were in the process of scrutinising the claims.

17.     He further submitted that the complainants were completely kept in the dark by the shipping agent and all efforts were made by corresponding with the High Commissions of Kenya and India to find out the status of the goods and to locate the consignments. The complainants also hired the services of an investigator and the entire documents as desired by the Insurance Company were placed before it but they failed to respond and have taken a very peculiar stand of denying the claim of the complainants.

18.     He has invited the attention of the Bench to the invoice and the bill of lading as well as other documents on record to establish that there cannot be any dispute about the fact of the export of the goods that were insured by the Insurance Company and that was supported by valid documents. In spite of the disclosure of the amount of loss and the supporting papers in respect thereof, the Insurance Company has failed in its obligation of processing and indemnifying the claim and therefore the complaints deserve to be allowed with damages as well as punitive costs.

19.     The claim therefore is only against the Insurance Company, the opposite party nos. 1 and 3 already having been deleted by the complainants themselves.

20.     Mr. Tripathi, learned counsel for the Insurance Company advanced ten submissions. His first submission is that the exclusion clause no. 4.6 clearly applies, in as much as a reading of paragraph 4 and 7 of the complaint and the investigators report dated 07.07.2000 relied on by the complainants themselves establishes that the goods were offloaded at Mombasa and remained unattended for almost two years which was on account of the shipping company being unable to discharge its financial liability at the port of Mombasa. It is this financial default by the shipping Company, which led to the auction of the consignment by the customs authorities as indicated in the investigators report.

21.     Mr. Tirpathi has also doubted the claim and questioned it on the ground that if the goods were auctioned after being stripped by the custom authorities, then the same is neither a loss nor a damage and is not covered by any of the perils mentioned in the terms of the policy by any proximate peril as defined therein. The claim is therefore also not with regard to any loss or damage as defined under clause 4.1 of the terms of the policy.

22.     His third submission is that no intimation was given to the Insurance Company by the insured as required under the terms of the policy, for which he has invited the attention of the column of Survey and Claims Settlement on the first page of the policy, which requires that in the event of loss or damage, that may result in any liability of the Insurance Company, immediate notice has to be given, which in the instant case was not done. It was after ten months of the alleged loss that a letter was sent on 26.05.1999 that the first letter arrived giving information about the non-delivery of the said shipments. It may be mentioned that the shipments were destined to reach Kampala from Mumbai that were discharged in July, 1998. He has invited the attention of the Bench to an information regarding the discharge of the goods that were obtained from M/s. Continental Surveys indicating that the containers in so far as complaint no. 444 pf 2002 is concerned is stated to have arrived on 20.07.1998 at Mombasa. This chart has been filed as annexure R-3 to the reply of the Insurance Company. The submission therefore is that from July, 1998, the complainant did not make any effort whatsoever to intimate the Insurance Company about this problem having arisen or lodging its claim, and the same was intimated for the first time in May, 1999 and then through subsequent letters to which replies were given by the Insurance Company calling for documents including original bill of lading and invoice vide letters dated 02.06.1999 and then 14.07.1999 as well as other letters that followed thereafter. It is urged by Mr. Tripathi that no effective reply or any document was supplied and in between even before the Insurance Company could take up the matter further the complainants filed their complaints before the State Commission on 28.09.1999. Even the said complaints did not disclose as to why they failed to promptly and immediately intimate the Insurance Company about the said loss as claimed by them.

23.     As a corollary to the said arguments, Mr. Tripathi invited the attention of the Bench to clause 18 of the terms of the Insurance Policy to contend that the assured had to act with reasonable care in all circumstances within their control. This was in order to avoid delay but the aforesaid clause has been clearly breached by the complainants.

24.     His next contention is that the failure to supply requisite information is also a breach of the terms of the policy and hence in the absence of any effective reply there was no occasion for the Insurance Company to investigate the matter.

25.     He has then pointed out that there is a difference in the number of containers as mentioned in the bill of lading as compared to the invoice and the investigators report dated 07.07.2000 on which reliance has been placed by the complainants. He submits that the number of containers as contained in the bill of lading does not find place in the investigators report.

26.     Another submission of Mr. Tripathi is that clause 8.1 regarding the duration and transit has also been breached in as much as the goods that were offloaded at Mombasa were not lying in the ordinary course of transit. He submits that they were left uncared for by the complainants, who were the sellers and possibly even by the buyers, who did not want to purchase the said consignment. Thus, the goods were not  lying at Mombasa port in the due course of transit, rather they were lying abandoned and uncared due to the negligence of the complainants, the shipping company and possibly the buyers, who did not collect the same. In such circumstances it is highly probable that the goods were auctioned by the custom authorities due to non-payment of port charges or other dues by the shipping company and therefore any loss or damage cannot be presumed to be during ordinary course of transit.

27.     He has then invited the attention of the Bench to clause 16 of the terms of the policy to urge that no steps were taken by the complainants to minimise the effect of the alleged loss by finding its location which they leisurely neglected for almost two years.

28.     No notice was given to the shipping company nor any suit was filed against it so as to minimise the impact of loss vis-à-vis the liability of the Insurance Company. To the contrary in the complaints, the deletion application for deleting the name of the opposite party nos. 1 and 3 have been moved in June 2006, which have been allowed on 27.03.2024. This clearly demonstrates that the complainants themselves have absolved the said opposite parties of any liability, thereby deliberately trying increase the burden on the Insurance Company, hence the claim cannot be allowed on this ground as well.

29.     He has then urged that there were almost 24 consignments with regard to all the complainants and the complainants have themselves failed to provide any information with regard to other destination as to what happened to them. Thus, there cannot be an assumption of loss and it is a clear case of negligence on the part of the complainants.

30.     He finally submits that even assuming for the sake of argument that there might be some liability on the Insurance Company, the claim cannot be allowed beyond the insured value of the goods which has been clearly indicated in the policy itself. Thus, the amount claimed cannot exceed the amount insured.      

31.     Having heard learned counsel for the parties, there is one addition which has been made in the complaints and they are the letters alleged to have been dispatched in 1998 by the complainants to the Insurance Company for information about the consignments not having reached the buyers. These letters were not filed along with the complaints and have been made part of the rejoinder affidavit dated 11.09.2005. There is no explanation as to why these letters were not brought forth in the main complaints. However, a perusal of these letters dated 30.06.1998, 31.07.1998, 30.09.1998 and 15.12.1998 are stated to have been addressed to the Insurance Company with the first reminder on 25.04.1999, but there is no evidence of the said letters having been served on the Insurance Company. Even otherwise these informations do not set up a claim against the Insurance Company for any loss. The intimations are simply about the goods not having reached their final destination and seeking advice from the Insurance Company. These letters therefore, do not inspire confidence, firstly that they have been filed with the rejoinder affidavit and secondly there is no proof of service of said letters on the Insurance Company. Thirdly, these are not intimations of claim of loss as envisaged under the policy and therefore, the Insurance Company was not obliged otherwise also to act thereon. The Insurance Company has taken a clear stand that it is for the first time that on 26.05.1999 that the complainants raised their voice with regard to the losses and the claim in respect thereof. It is therefore clear that these improvements in the rejoinder in these complaints seem to have been made in view of the findings recorded by this commission in the appeals allowed on 22.08.2006 in respect of the 10 complaints allowed by the State Commission.

32.     It is therefore, necessary now to narrate the facts and the orders passed in the other 10 complaints that were decided by the State Commission in favour of the complainants and later on reversed in appeal by this Commission. From the record it is evident that the 10 complaints with regard to the same transactions filed by the present complainants were allowed by the State Commission, holding that the Insurance Company was liable as the damage and the loss was proved to be covered under the policy. Separate orders were passed in all the complaints and as an illustration the order passed in original complaints 89 of 1999 in the case of MG exports finally records as follows:

 “Since the goods were insured, it was for the Insurance Company to watch the interest of the complainant. There is no controversy that the goods were not insured. Thus, the Insurance Company is liable to pay as per the terms of policy. The complainant is being allowed the cost of total loss of goods. Since there is deficiency of service, the complainant is entitled to compensation in the given circumstances of the case, interest @ 9% р.а. We are not inclined to discuss relief claimed under other various heads as this needs scrutiny with detailed evidence before the Civil Court.

After hearing the arguments and considering the pleadings and documents on record, we are of the opinion that the opposite party No.5 - Insurance Company to  indemnify the loss.

For the reasons recorded above, we accept the complaint and direct the opposite party no.5. The New India Assurance Co. Ltd., to pay to the complainant as under:-

1. Value of the consignment lost - Rs.2,55,710/-.

2.  Interest by way of compensation @ 9% from three months after filing the claim till realisation.

3. Costs of litigation - Rs.5,000/-.

For the remaining claim, the complainant may approach the Civil Court, if so advised.

Let this order be complied within 60 days from the receipt of a copy of this order.”

The relief granted was common, except for the amount in all the 10 complaints that were allowed on 02.05.2001.

33.     The Insurance Company filed 10 appeals before this Commission challenging the orders of the State Commission, wherein the execution of the order of the State Commission was  stayed initially on 08.03.2002 and the appeals were finally allowed on 22.08.2006. Since the order has a direct bearing on the present complaints as well. The same is extracted herein under:

“The above mentioned appeals have been filed against a composite and common order dated 2.5.2001 passed by the Punjab State Consumer Disputes Redressal Commission and they relate to a common questions of facts and law in connection with maritime insurance claims and, therefore, they are being taken up together.

The New India Assurance Co. has filed Appeal Nos. 239/2001 and 240/2001 against order passed in favour of M/s. Kohinoor International while Appeal Nos. 261/2001 to 268 of 2002 against the order passed in favour of M/s. M.G. Exports.

The New India Assurance Co. has also filed Appeal No. 297 of 2001 against M/s Allcargo Movers India Pvt. Ltd. M/s. M.G. Exports have also filed Appeal Nos. 298, 299, 300, 301, 302, 303, 304 of 2001.

The case of the Complainants, M/s. Kohinoor International and M.G Exports in their complaints as well as in all the above said appeals is that in the course of their business.

On orders from foreign buyer namely M/s. Starlite Industries Ltd. Kampala (Uganda). The Complainant accordingly despatched consignment giving an occasion to the Complainants and above appeals

These consignments were delivered to the Opposite party No. 1 - M / s Intraship, represented by Marine Mercantile (India) A-3 Focal Point Opp. State Bank of India, Ludhiana, a Shipping Company carrying on the business of transport/carriage of goods by ships. In all these matters the consignments were despatched from Ludhiana and were to be delivered at Kampala. The Bill of Lading and other documents were issued, signed and stamped by the OP No. 1, namely M/s Intraship, represented by Marine Mercantile (India). The same were forwarded by the Complainant to the foreign buyer through their bankers. But, the consignments never reached their destination i.e. Kampala. On detailed enquiries made from the OP No. 1 to 4, the consignments were informed to be in transit, for quite a long time at Mombasa Port and due to financial and other problems with the shipping company, the same could not be sent to Kampala. The consignments were insured with the New India Assurance Co. Ltd., the Appellant in cases mentioned above who had issued a Marine Transit Risk Policies. Since the consignments never reached their destination and were lost in transit, the claims were duly lodged with the Insurance Company .The Insurance Co. did not settle the claims in spite of repeated requests. The OP No 1-4 did not deliver the consignments to the consignee though they were bound to deliver the same to the consignee. This allegedly amounted to deficiency in service on the part of Shippers/transporters and due to their deficiency in service, the Complainants were entitled to get compensation from OP No. 1-4. In addition to it, the Complainant/Respondent was also entitled to compensation on account of mental harassment and direct loss of business due to breaking of the business cycle on account of denial of the Insurance Co. not to settle the Marine Transit Insurance Claim also amounted to deficiency in service. The two Complainants claimed following amounts in different cases.

Case No.                                                 Amount

F.A No 239/2001                                      Rs 5,57,743/

FA No 240/2001                                     Rs 9,37,616/

FA No. 261/2001                                     Rs. 11,97,599/

FA No 262/2001                                     Rs 10,54,497/

FA No 263/2001                                     Rs 7,58,663/-

FA. No. 264/2001                                    Rs. 11,97,599/-

FA No. 266/2001                                     Rs 5,97,732/-

F.A No 267/2001                                      Rs 13,56,537/

F.A. No 268/2001                                     Rs. 5,43,537/-

FA No 297/2001                                       Rs 11,97,599/-

FA No.298/2001                                       Rs 10,54,497/-

F.A No 299/2001                                      Rs 7,58,663/-

FA No. 300/2001                                     Rs 11,97,599/-

FA No.301/2001                                      Rs 11,29,864/

FA No.302/2001                                      Rs 5,97,732/-

F.A No. 303/2001                                     Rs. 13,56,537/-

FA No 304/2001                                      Rs 5,43,537/-

FA No 305/2001                                      Rs 5,57,743/-

FA No 306/2001                                     Rs 9.37,616/-“

The complainant also claimed interest @ 24% p.a with cost of litigation to the tune of Rs. 10,000/-in each case.

In so far as Respondent Divya International/Prakaswati International were concerned, they did admit the entrustment of consignments as alleged in the complaint. The goods duly booked were delivered for transhipment by sea to OP No. 1, M/s. Intraship. It is also admitted that the complainant had informed the OP No. 6 that the original Bill of Lading was never delivered to them 1 to 4 in spite of repeated requests.

It may be mentioned that the names of OP Nos. 1,2 & 3 were deleted before the State Commission.

The State Commission awarded compensation in each case as under

OP NO. 4 being agent of M/s Intraship could not be held liable in terms of the judgement of the Hon'ble Supreme Court in the Case of Marine Container Services South Pvt. Ltd. Vs Go Go Garments (1998) 3 SCC 247.

Thus, in these appeals we are supposed to consider the case and pleas for and against the liability of the insurer - The New India Assurance Co. Ltd.

The New India Assurance Co. Ltd through Shin Sanjeev Sharma Advocate raised their submissions. Firstly the alleged claims were lodged after a lapse of more than one year period from the date of alleged occurrence and after the expiry of policy of Insurance and closing of account with the concerned Regional office. The Insurance Co. has pointed out vide their Regd. Letters dated 2.6.1999 that since the policy had expired and the financial accounts for the year 1997-98 and 1998-99 had already been closed duly audited by the Statutory Auditors, and there was no point at the moment to consider claim of the complainants for the previous period. For the insurers had received information too late as the alleged consignments were sent between 31.12.1997 to 18.5.1998. It needed prior sanction from the competent authority for registration and settlement of above mentioned claims for non-delivery of transhipped consignments. However, they demanded certain information as mentioned in the letter but that information was not supplied by the complainant/claimant. Consequently, the claim could not be processed. In absence of necessary information, there was no deficiency of service on the part of the insurer. The complainant failed to comply with the terms and conditions of the insurance policy and the Insurance Company could not get the matter investigated/processed

As is evident from para 4 of the complaint non-delivery of goods by Shipping Co. and its agent to the consignee would amount to deficiency in service on the parts of carriers and shippers. As such, they were liable to pay.

In terms of para 7 of the complaint there could not be any dispute that the Marine Time Insurance Policy with the Cover Note of Marine Time Insurance Policy was valid upto 10^th August, 1998. According to the Appellant, the said consignment was insured vide Marine Cover Note Export Policy No. 0064541, which was issued on 11.8.1997 and was valid upto 10.8.1998. The Complainants claimed that they had also informed about the loss earlier to the appellant/Insurance Co. The information demanded by the Appellant/Insurance Co. was not furnished by the Complainant despite letter dated 2^nd  June and 14^th July 1999 as is mentioned in letter of the complainant dated August 24, 1990 paras 19, 27, 29, 30, 32, 34 at Page 90- 91 of the Paper Book. As such, the claim could not be processed.

The Complaint was filed before the State Commission on 29 September, 1999.

First Point

Shri Sanjiv Sharma, Ld. Counsel appearing on behalf of the Insurance Company submitted that the consigned goods kept lying at Mombassa Port and could not be sent further to Kampala (the place of delivery) due to financial problem with the shipping Company. It is submitted by Sh. Sanjiv Sharma, Ld. Counsel for the Appellant/Insurance Co. that the Appellant/Insurance Co. was not liable under Clause 4 of the terms and conditions of policy filed as Annexure 'A-1' to the appeal Pages 23-24 of the Appeal.

The relevant Clause 4 of the Policy reads as under:

"Exclusion

4 In no. case shall this insurance cover

4.6         Loss damage or expense arising from insolvency, or financial default of owners managers charterers or operators of vessel.

The loss or damage or expense arising from insolvency, or financial default of the owners, managers, charterers or operations of the vessel as the Clause 4.6 and Clause 4 of the Policy was not attracted since who were entrusted the goods for transport, were neither the owners, nor the managers, charterers, operators of the vessels which carried the goods, at any point of time, and they were only the freight forwarders in the present case. Ld. Counsel for the complainants wanted to rely upon Annexure "A-1" submitted along with written submissions. This certificate has not been properly brought on record for filing neither any permission nor leave of this Commission was taken by moving any appropriate application. Further, this is not supported by any affidavit. Consequently, we find it difficult to rely upon the same. Besides, the complainant itself, in para 4 had stated that the goods were lying at Mombassa Port and due to financial and other problems with the Shipping Co., the same could not be sent further to Kampala. The Respondent/Complainant could not explain the fact mentioned in para 4 of the complaint that shipping Company was not operator of the vessel. As such, the claim of the complainant must fail on this ground alone, and the Insurance Company could not be held liable.

Second Point

The next submission of Shri Sanjiv Sharma, Ld. Counsel for the Appellant/Insurance Co. was that as per Survey Report dated 7.7.2000 was filed by the Complainant excepting one consignment after its prolonged  storage at Port of Mumbasa were auctioned by Custom authorities as unclaimed goods because the Shipping Co .was declared bankrupt and was under receivership and the Shipping Co. had no money to get the goods cleared and pay for the further freight charges to send the containers to Kampala. These facts are not in dispute.

The State Commission probably took the view that the Insurance Policy was for the benefit of the carrier or other bailees also for no finding was given by the Ld. State Commission against their liability. It was submitted that in terms of Section 15 of the Policy, this insurance policy would not ensure to the benefit of the carrier or other bailee.

The next limb of the argument raised by the Complainants/Respondents is that by not taking prompt action within the statutory period under the Carriers Act against the Shipping Co. and its agents by Respondent No. 1, valuable right of the Appellant to recover the loss against them had been lost.

Clause 16 of the Institute Cargo Clause (A), of the Policy indicated that it was duty of the assured-

“16.1 to take such measures as may be reasonable for the purpose of averting or minimising such loss, and “16.2 to ensure that all rights against carrier, bailees or other third parties are properly preserved or exercised."

It may be mentioned that neither any measure was taken as might have been reasonable for the purpose of averting or minimising such loss nor the Complainant made any attempt to ensure that all the nights against the carrier, bellies or other purposes are properly preserved or exercised.

If shippers have been absolved by inaction not to implead them, the insured respondents/claimants have done so at their own peril. The insurer could not be placed in a situation where the insurer is left with no remedy against the carriers and shippers. On this score also the claim must fail.

Third Point

As regards the third point that the information of the loss was given on for the first time 26^th May, 1999, it is claimed by the complainant that information about the loss was given by the Complainant to the Insurance Co. on 30th July, 1998 followed by subsequent reminders from time to time. But this appears to be totally inconsistent with the documents on record. In terms of reply dated 2.6.1999 sent by the Insurance Co., particularly, mentioning that they had received letters 26^th  May, 1999 and dated 28^th May, 1999 informing about various shipments under said cover note and it was too late, as the consignments were shipped between 31.12.1997 to 18.5.1998 and also demanding certain information. The letter of the claimant dated 5^th June, 1999 in response to the said letter would not disclose that common information was sent prior to 26^th May, 1999 also. Similarly, in respect of letter by the Insurance Co. dated 2.6.1999, it was not mentioned in reply dated 10^th June 1999 that it was incorrect that no information was sent earlier and several letters were sent prior to 26^th May, 1999. Even in letter  dated 22^nd June, 1999, it was not claimed that any information was sent before 26^th May, 1999. It has been stated in the said letter that “your writing that we have intimated to you too late, is not correct because we had to inform when we ourselves were convinced that the goods are not traceable with the Shipping Company". These circumstances prove that no intimation was sent about their consignments before 26.5.1999.

It is apparent that M/s Kohinoor International and M/s M.G. Exports are sister concerns for common letters were sent and exchanged between  the parties and on 24^th  July, 1999, the partner of M/s M.G. Exports wrote that insurer were also requested to make separate letters for Kohinoor International and M.G. Exports to avoid any ambiguity in future.

It is further apparent, therefore, that first the Complainant slept over the matter by not informing the Insurance Co. in time and secondly, after 26^th May, 1999, they started pressurising the Insurance Co. as is evident from the subsequent letters dated 7^th July, 9^th July and 14^th  July, 1999 on one hand and by not supplying certain information which was demanded.

In all these matters the Insurance Policies have been issued containing similar terms and conditions.

In view of the foregoing discussion we hold that (i) no information was given by the Complainants to the insurers before 26^th May, 1999 about the loss and claim was preferred after 26^th May, 1999 (ii) the interest of insurers was not projected by adopting reasonable measure to avert the loss or to minimise it and thirdly by inaction absolving the shippers and carriers. On these grounds the claim of the respondent must fail for it amounted to breach of the condition of the terms of the policy.

For the aforesaid reasons, we feel that the appeal has to be allowed and it is allowed accordingly and the complaint is dismissed. Parties are left to bear their own costs.”

34.     These appeals were allowed and the present complaints were to be decided keeping in view the said order, reversing the order of the State Commission. It appears that these matters were adjourned and then it was intimated to the Bench that appeals have been filed before the Apex Court, which are pending. These facts were noted, whereupon the present complaints were adjourned and kept in abeyance.

35.     The Bench has been able to lay its hands on the orders passed in the civil appeals filed before the Supreme Court by the present complainants. All these civil appeals 7336 to 7345 of 2008 have been dismissed by the Apex Court on 31.08.2017 which is extracted herein under:

We have heard learned counsel for the parties and also perused the record.

We do not find any merit in these appeals which are hereby dismissed.”

36.     From the aforesaid facts and the orders passed, it is clear that the main issues raised in these complaints are no longer res integra as the same have been finally decided between the same parties vide order dated 22.08.2006 of this Commission and confirmed with the dismissal of the civil appeals by the Apex Court on 31.08.2017. The aforesaid order therefore, is binding on this Bench and the principal of constructive res judicata will apply. On a reading of the order of this commission dated 22.08.2006, it is evident that the first issue with regard to applicability of the exclusion clause 4.6 has been answered in favour of the Insurance Company, with which I am in full agreement with. There is no reason to differ from the view taken therein nor any different argument has been advanced. The second issue with regard to prolonged storage was taken notice of and clause 16.1 and 16.2 of the Institute Cargo Clause (ICC) (A), a clear finding has been recorded that no attempt was made by the complainants for averting or minimising the loss.

37.     The third issue with regard to the prompt information was dealt with and it was clearly found that the information was not given timely and therefore the policy conditions were violated.

38.     These three issues having been affirmed with the dismissal of the appeals by the Apex Court, the two arguments advanced by the learned counsel for the complainants do not hold water. Even otherwise their own investigator, namely, M/s. Mclerin Toplis had reported about the goods having been auctioned by the custom authorities at Mombasa on account of certain financial problems, which the complainants themselves have indicated in paragraph 4 and 7 of the complaint. Mr. Tripathi is therefore correct in his submission that the report dated 07.07.2000 and the aforesaid admissions in the complaint itself are sufficient to conclude that there were financial problems faced resulting in the default by the shippers and consequently the complainants cannot raise any grievances, more so when they failed to supply the documents that were desired by the Insurance Company. The contention raised by Mr. Saini that financial default has not been proved and therefore in view of the judgment of the Apex Court in the case of Metal Power Company Limited (Supra) there cannot be a presumption regarding the bankruptcy or financial default. The contention is that there has to be some adjudication or order to establish the same. In this respect it is evident from the report dated 07.07.2000 of the investigator appointed by the complainants themselves that there was an auction of the consignment, which the investigator reported on account of certain port dues. This probability on the own evidence of the complainants has remained unexplained by them. The aforesaid circumstances clearly indicate that the auction of the consignment must have in all probability taken place as the consignment was not lifted, as a result whereof the custom authorities in order to realise their dues had to auction the consignment. It was therefore in all probability a financial default that resulted in the auction of the consignment. Such a financial default therefore is excluded under the policy.

39.     To substantiate this, it would be pertinent to mention that the Insurance Company vide its letter dated 14.07.1999 and then subsequently on 04.10.1999 had called upon the complainants to furnish the documents that were wanting. Even though the complainants have alleged that they sent letters on 02.09.1999 intimating about the documents having been given to Mr. Taranjeet Singh on 21.08.1999 and 24.08.1999, yet the Insurance Company demanded details as the said information with regard to the location of the goods or how they were disposed of or even went on missing, were never supplied by the complainants. The details with regard to the alleged auction of the goods were admittedly not supplied by the concerned authorities and consequently there was no material at all before the Insurance Company to carry out any assessment. Thus, Mr. Tripathi is correct in his submission that this lack of information also disentitled the complainants from raising a claim.

40.     He has also pointed out certain discrepancies in the number of containers/ invoices but they are hardly of any significance in the background above.

41.     The contention raised by Mr. Tripathi on the strength of clause 8.1 of the policy regarding duration and transit, he is right in his submission that the goods cannot be presumed to be under transit as they were lying unattended for several months. His contention is correct that merely writing letters to the High Commission of India and the High Commission of Kenya would not suffice.

42.     The details with regard to the lapses which led to the goods getting untraced were not established by the complainants. Consequently the goods cannot be presumed to be under transit for such a long period. The lapses on the part of the shipper or the goods not being collected by the buyer cannot be at the luxury or convenience of the complainants to treat the goods to be in transit.

43.     Mr. Tripathi’s contention about no notice having been given to the shipping company or the transporters/ carriers also appears to be correct in the background that applications have been moved by the complainants to delete them which has been allowed.

44.     In the background above, none of the contentions raised on behalf of the complainants deserve to be entertained. The complainants have failed to establish any deficiency in service or unfair trade practice on the part of the Insurance Company, coupled with the order of this Commission dated 22.08.2006 on identical issues having been answered against the complainants and confirmed by the Apex Court. The complaints are unsustainable and are hereby dismissed.