Haryana

Ambala

CC/216/2011

M/S RICHI RICH AGRO FOODS PVT LTD - Complainant(s)

Versus

NEW INDIA ASSURANCE CO. LTD. - Opp.Party(s)

Sandeep Sharma

08 Feb 2017

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AMBALA.

 

          Complaint Case No.    : 216 of 2011

Date of Institution       : 11.07.2011

         Date of Decision         : 08.02.2017

M/s Richi Rich Agro Foods Pvt.Ltd. Village Tolawali Post Office Kambasi, Barara-Shahbad Road, Barara District Ambala through its Director-Neeraj Goel.                                                                                              

……Complainant.

                                                                                                        Versus

New India Assurance Company Ltd. SCO No.19, Municipal Shopping Complex,

Ambala City through its Branch Manager.

                                                                                    ……Opposite Party.

Complaint Under Section 12 of the Consumer Protection Act

BEFORE:       SH. D.N. ARORA,  PRESIDENT.

                        SH. PUSHPENDER KUMAR, MEMBER.                       

Present:          Sh. Sandeep Mishra, Adv. for complainant.

                        Sh. Mohinder Bindal, Adv. for Ops.

ORDER.

                        In nutshell, brief facts of the complaint are that complainant is Director of the company and got Marine Insurance Policy from the Op at Ambala City vide  insurance policy no.21/08/10/70000070 for a total sum of Rs.9085863/- against invoice no.AAI/2008-09/011 dated 13.06.2008. It has been submitted that Op issued Marine Insurance Certificate in favour of complainant for the transport of Indian  Sella Basmati Rice  of 2875 bags of 40 Kg. each, total 575 master bag of 10 Kg. from Tolanwali (Ambala) to Jabali Ali, UAE with the risk cover upto the warehouse.  It has also been submitted that before loading the goods in the port, all the goods were checked thoroughly and after finding the same in OK condition, the goods were allowed to be loaded at the port in the containers and all the containers were found in sound condition, except for all dents and/or repair.  It has been alleged that out of the five containers, one container having 150 bags of Sella Basmati rice was found damaged and remaining and the remaining 415 bags were found unaffected condition and the same were received by the consignee. So, the complainant immediately reported the said damage to the Op and the OP deputed Universal Surveyors and Loss Adjusters LIC P.O. Box:120227 Dubai UAE and surveyor with the knowledge and consent of the Op attended the consignment and gave his survey report vide report  no.NAR/S/0735/2008 dated 15.11.2008 invoice 0212/08 reported about the damage caused to the complainant. Further it has been submitted that as per assessment report quantity destroyed due to badly damage were 160 bags or 6.400 MT of CIF value US$1690/- per MT, total loss US$10800/- and value of dollar was Rs.48/- per US$, so, the total damage rice value was Rs.519168/- with added survey fee AED 1800/- @ 14/- per AED which comes to Rs.25,200/- total amounting to Rs.5,44,368/-.  It has been submitted that complainant applied for the compensation under Marine Insurance Policy with the opposite party and as per directions of OP, the complainant supplied all the necessary documents. But the Op vide letter dated 19.05.2011 refused to pay the loss. So, complainant got issued a notice to OP on 08.06.2011 to pay the damage of Rs.5,44,368/- alongwith interest within 15 days of receiving the notice.  The notice was duly received by the OP and in reply to the said notice, the OP  repudiated the claim of the complainant which amounts to deficiency in service on the part of OP. It has been submitted that complainant company is a commercial unit and the insurance policy was also  taken by the commercial unit but policy has been taken for reimbursement of indemnity for the loss which may be suffered due to various perils but it does not directly intended to generate profit.  Hence, the present complaint seeking relief as per prayer clause.

2.                     Upon notice,   OP appeared through counsel and filed written statement raising preliminary objections qua maintainability of complaint, jurisdiction and suppression of material facts. On merits, it has been submitted that the said  Marine Insurance Policy was issued subject to certain terms & conditions and the complainant was legally bound to follow them without any failure.  It has been denied that before loading the consignment of the rice bags were inspected or checked by the OP.  However, in the report of M/s Universal Surveyors and Loss Adjusters, LIC, Dubai, the status of containers has been shown to be so but in the absence of the survey, the OP is unable to comment upon the factual situation and position of the consignment. In the report, it is mentioned that out of five containers, loss had occurred only in one container whereas, the container was found structurally in sound conditions except for old dents and repair patches.  The report further mentions that 415 bags from the said container were found in sound condition and 160 bags lying at bottom, at top and touching the side walls found affected. It has been denied that  complainant reported the loss immediately to the OP insurance company or that their surveyor M/s Universal Surveyors and Loss Adjusters, LIC, Dubai  was ever deputed by the OP for the survey of loss. It is submitted that there is one and only authorized agents/surveyor of the OP at port of discharge M/s Inchcacape Shipping Services (Maritime & Mercantile Intl. LLC) Agents of Websters-London, P.B. Box No.70, Dubai UAE as mentioned on each and every certificate of insurance and the complainant was duty bound to inform and contract the said authorized agent of the opposite party for the survey of any loss to the consignment.  But the complainant has not intentionally contacted the said agent due to some ulterior motive best known to them.  So, claim of the complainant was liable to be rejected out rightly, hence violated the basic express condition of Marin Insurance  Policy but even than the competent authority discussed the matter and the survey report given by a non-deputed surveyor M/s Universal Surveyors And Loss Adjusters, Dubai from  whom the consignee of the consignment in question got the loss assessed without any authority and other related documents were sent  to M/s Websters, the official agent of the Opposite party for advice in this regard.   But  after going through the whole documents and said survey report given by M/s Universal Surveyors and Loss Adjusters, LIC Dubai they concluded that the Insurance Company has  on merits as well as has no liability to pay any claim as the surveyor M/s Universal Surveyors  in their report stated that there is possibility of water ingress through the understructure of the container or alternatively condensation forming within the container during transit, this  in most instances is due to inherent moisture within the cargo/container which is not recoverable under the terms and conditions of said Marine Insurance Policy in question. It was also observed that  as per  the sale terms of the suppliers, invoice is issued on C& F terms and under these terms, the consignees have no right to claim against insurance coverage in the name of Assured and any insurance cover would terminate upon the goods  passing the ships rails  at the port of loading. After scrutinizing and elaborating the whole facts, situation, records and the evidence, the competent authority, repudiated the said claim of the complainant as per the terms & conditions of the Marine Insurance Policy. The complainant was duly informed about the fate of its claim vide letter dated 30.04.2010. However, in reply to the letter of complainant dated 13.05.2010. The complainant was against informed vide letter dated 19.05.2011 about the repudiation of claim.  As such, the OP submitted that there is no deficiency in service on their part and prayed for dismissal of complaint with costs.

3.                     To prove his version, complainant tendered his affidavit as Annexure CX alongwith documents as Annexures C-1 to C-8 and closed his evidence. On the other hand, counsel for OP tendered affidavit as Annexures RX alongwith documents as Annexures R-1 to R-8 and closed the evidence.

4.                     We have heard learned counsel for the parties and gone through the case file very carefully.  Counsel for the complainant argued that out of the five consigned containers, one container having 160 bags Cella Basmati,  the said bags were found damaged and complainant immediately brought the same in the knowledge of OP and OP’ deputed M/s Universal Surveyors and Loss Adjusters LIC P.O.Box 120227 Dubai UAE and  the said firm assessed the loss as US$ 1690 Per MT and thereby total loss as US$10816/- which comes to Rs.5,44368/- in Indian Currency. But the Op wrongly repudiated the claim of complainant vide letter dated 19.05.2011 (Annexure R-2) on the ground that “the claim was put up before  the Competent Authority and  as per their observations your said claim is not payable  being reason that the loss is due to condensation which is resultant to inherent moisture within the cargo/container and is not payable under the terms and conditions of the said policy.”  

5.                     The Op has argued their case on two grounds. The first is that the claim of complainant is not maintainable as per terms and conditions of insurance policy (Annexure R-7 & C-4), Clause SURVEY AND CLAIMS SETTLEMENT  has been reproduced as under:-

“In the event of loss or damage which may result in a claim under this insurance immediate notice must be given to in-charge Shipping Services (Maritime & Mercantile INTL LLC) Agents of Websters-London P.B. Box no.70 Dubai UAE Phone ( 4) who are  the company’s agents at port of discharge, in order they may examine the goods and issue a survey report where the company has no agent, the notice must be given  to Lloyds Agents at destination.” And

SPECIAL CONDITION:

“Insurance certificate issued for the 110% of the invoice value covering all risks and war risks as per ICC Clauses Formulary a with claim payable at the destination of the consignee and risks covered upto the warehouse.

                         Counsel for OP has argued that in this case neither complainant nor consignee has reported to one and the only authorized agents/surveyors of the opposite party at port of discharge M/s Inchcacape Shipping Services (Maritime & Merchantile Intl. LLC) Agents of Websetrs-London, P.B. Box No.70 Dubai UAE, was entertained on receipt. In spite of the fact that the claim of the complainant was liable to be rejected out rightly since the insured  had not contracted the authorized agent  for the survey of the alleged damaged stock as mentioned on each and every certificate  of insurance hence, violated the basic express condition of Marine Insurance Policy,  even then the competent authority also discussed the matter and the survey  report given by  a non-deputed  surveyor M/s Universal Surveyors and Loss Adjusters, LIC, Dubai from whom the consignee of the consignment in question  got the loss assessed without any authority and the other related documents were sent to M/s Webseters, the official agent of the OP for advice in this regard.  But after going through the whole documents and said survey report given by M/s Universal Surveyors and Loss Adjusters, Dubai, they concluded that the Insurance Company  is not liable to pay any claim  to the complainant.                      The arguments of the counsel for Op is not sustainable to the extent that  the complainant or consignee has not reported the loss or damage to their authorized agent at port since  perusal of repudiation letter shows that the claim of complainant has been repudiated by  the OP insurance company only on the ground that the loss is due to  condensation which is resultant to inherent moisture within the cargo/container and is not payable under the terms & conditions of the policy. As such, these arguments by OP are not helpful to their stand whenever claim of the complainant was not repudiated on this ground.

                        The second arguments of counsel for OP is that there is possibility of water ingress through the understructure during transit, this in most instances is due to inherent moisture within the cargo/container or alternatively condensation forming within the container during transit, this in most instances is due to inherent moisture within the cargo/container which is not recoverable under the terms and conditions of the said Marine Insurance Policy in question. And as per  sale terms of the suppliers, invoice is issued on C&F terms and under these terms, the consignee have no right to claim against insurance coverage in the name of Assured and any insurance cover would terminate  upon the goods passing the ships rails at the port of loading.  After going through the policy document (Annexure R-7) there is no such condition in the policy that if  any loss/damage caused to the items so sent through ship due to condensation does not cover under insurance policy rather as per the special condition of the insurance policy that ‘All risks  and war risks as per ICC clauses formulary a with claim payable at the destination of the consignee and risks covered upto  the warehouse.’  Meaning thereby that the goods are under risk cover at the destination of the consignee and upto the warehouse and consignee was also under the policy conditions. Therefore, we have come to the conclusion that the complainant has not violated any terms and conditions of the insurance policy and is entitled to the loss caused to him during transit of goods. In this case, the report of Universal Surveyors and Loss Adjusters LLC (Annexure R-8) says that “On examining 160 Bags found apparently affected by water, stained and/or discoloured. The contents  i.e. Rice also was found rot and /or discoloured and/or formed lumps and /or caked and giving out bad odour. Looking at the conditions of the Rice, same appeared unfit for human consumption and need to be destroyed.” Thereby a loss to the tune of Rs.US$10816.00  has been caused to the complainant which comes to Rs.544368/- in Indian Currency.

                        In view of the above, it is crystal clear that Op has wrongly repudiate the claim of complainant   and complainant is entitled to the amount so assessed by surveyor. Accordingly the complaint is allowed with costs and Op is directed to comply with the following directions within thirty days from receipt of copy of the order:-

1. To pay a sum of Rs.5,44,368/- to the complainant alongwith cost of Rs.5000/- within the stipulated period without any interest.

                        However, if the aforesaid awarded amount is not paid within the stipulated period i.e. thirty days after receiving the copy of the order then complainant is entitled to interest @ 9% per annum w.e.f the date of filing of complaint till actual realization. Copies of the order be sent to the parties, free of costs, as per rules. File be consigned to the record room after due compliance.

 

ANNOUNCED ON:  08.02.2017.                                                          Sd/-

                                                                                                    (D.N. ARORA)

                                 PRESIDENT                

 

                                                                                                                Sd/-

                   (PUSHPENDER KUMAR)

                                                                                                            MEMBER