Per Shri D.N. Khamatkar, Hon’ble Member:
1. M/s. SSKF India Ltd. had filed a complaint on 10/02/2009. Complaint was subsequently numbered as consumer complaint no.25/2009 under Section 12 of Consumer Protection Act, 1986. Complainant is engaged in the business of manufacturing of ball bearings, roller bearings, textile machinery components and also marketing of imported bearings, accessories and maintenance products. The complainant used to send consignments of cargo to various places. In order to seek indemnity from any losses due to the transit risks, the complainant arranged insurance cover for each dispatch under a Special Declaration Policy from the New India Assurance Co. Ltd. (hereinafter referred to as opponent) bearing no. 120700/21/02/00202 for the period from 16/10/2002 to 15/10/2003 for a sum of `60 crore by paying premium of `3,15,461/- .
2. Complainant dispatched consignment of 207 numbers of cartons containing 5420 kgs. bearings valued to `35,171.78/- on 30th July, 2003 from their factory at Pune, through M/s.Bhoruka Logistic Pvt.Ltd. (hereinafter referred as Transport Operator) to be delivered to various offices at Ghaziabad, Batala, Delhi, Ludiana and Gurgaon. The transport operator transshipped these cartons in the truck bearing no. MH-14-V-4651 owned by them for onward transmission to the different destinations. Consignment was insured with the opponent/Insurance Company under the said insurance policy. The truck failed to reach the first destination on 02/08/2003 and hence, the transport operator, made inquiries about the driver and cleaner of the vehicle. The transport operator could not locate the vehicle with the consignment and hence, he filed a First Information Report (FIR) at Nigdi police station, Pune on 14/08/2003 and number of FIR is 207. During the police inquiries it was found that the driver and the cleaner in collusion with one more accused at Udaipur in Rajasthan had stolen the vehicle along with the goods of the consignments to be illegally disposed off and the truck was also illegally converted by changing the number plate of the truck. The police recovered the goods partially and the criminal case was filed against the persons who had stolen the vehicle along with the goods.
3. The criminal case was filed by the transport operator before Judicial Magistrate, First Class. In the criminal case, the transport operator had prayed for custody of the recovered consignment and the court allowed the application on 05/11/2003 allowing return of attached bearings and the truck to the transport operator on production of security bond of ` 32 lakhs for the bearing and ` 7 lakhs for the truck. The court therefore, directed not to transfer the attached property without prior permission and not to create any third party interest in the property.
4. As the transport operator could not furnish a security bond of `32lakhs, the seized articles remained in the police custody, hence, the complainant made an application bearing no.8/2004 to the Magistrate Court to release the said property in his favour. The transport operator has also filed an application praying modification of the earlier order passed by the court releasing the goods in their favour and the said application was rejected on the ground that Magistrate has no power to modify his own order.
5. The complainant had filed an appeal to the Sessions Court and another application to Judicial Magistrate, Pimpri for modification of the order allowing police to handover the property to the complainant and the Judicial Magistrate vide order dated 10/01/2005 allowed the police to hand over the consignment to the complainant with the condition of furnishing a indemnity bond of `32 lakhs and further condition not to deal with or transfer said attached property. Accordingly, the police had released the consignment on 08/06/2005 to the complainant on a condition that complainant not allow to deal with the consignment in any manner.
6. Again the complainant made a fresh application dated 15/09/2005 before Judicial Magistrate seeking permission to deal with and dispose of the said consignment of the bearing. Said application was decided on 17/08/2007 by order passed by Judicial Magistrate allowing to sell property after retaining the samples.
7. After getting the permission from the Judicial Magistrate to deal with the property on 17/08/2007, complainant sent e-mails on 10/09/2007 and 19/09/2007 followed by letter dated 20/09/2007 calling upon the opponent/insurance company to depute the surveyor to their factory at Pune to assess the condition of the bearing. Opponent insurance company by its e-mail dated 15/10/2007 taken a stand that the claim is already settled and did not appoint the surveyor. Hence, the complainant carried out the final survey through the licensed surveyor-M/s. C.M.Chopra and forwarded the same to insurance company by a letter dated 31/12/2007 with a request to settle the claim for `31,23,803/-. The opponent rejected the claim of the complainant vide letter dated 21/01/2008.
8. The complainant issued a legal notice on 10/07/2008. However, there was no reply till date and therefore, the complainant has filed a consumer complaint with the following prayers:
1. The opponents be jointly and severally directed to pay to the complainants an amount of `31,14,880.00 towards the claim.
2. The opponents be jointly and severally directed to pay the complainants interest at12% p.a. on the amount of claim from 18/04/2008 i.e. three months after the date of survey report till realization i.e. `2,80,339.00. Future interest@12% p.a. from the date of the claim till realization of the final amount.
3. The opponents be jointly and severally directed to pay to the complainant for recovery of consignment.
4. The opponents be jointly and severally directed to pay to the `8,923.00 paid by the complainant as survey fees to M/s. C.M.Chopra.
5. The opponents be jointly and severally directed to pay to the complainants an amount as compensation `1crore or as may be directed by this Hon’ble Commission for the inconvenience suffered.
6. Cost of this suit may be provided”.
9. Opponent had filed their written version stating the complaint is false, frivolous, vexatious, misconceived and bad in law and liable to be dismissed. The opponent/insurance company contended that the complaint is time barred as it is not filed within limitation from the time when the cause of action arose. They contended that the truck carrying consignment was detected missing on 02/08/2003 and complaint is filed on 09/06/2009 which is a time barred. Opponent/insurance company further contended that even if it is accepted for sake of argument that cause of action arose on 01/03/2006 when the opponent settled the claim for shortages being the only loss as stated in survey report dated 19/07/2005 of surveyors J.Basheer and Associates Surveyors Pvt. Ltd. the complaint became time barred on 1st March, 2008 and therefore, is not maintainable.
10. Further, opponent insurance company has claimed that there is no deficiency in their services as they have settled the complainant’s claim for the only loss due to shortages is of `4,03,150/- in terms of conditions of the policy based on survey reports dated 16th June, 2006 and 19th July, 2005 issued by the surveyors after recovery of stolen materials. They further submitted that the consignment when recovered was in packed condition and goods which were in the loose form were not damaged as is evident from the photographs annexed to the said survey report. The agreed amount payable for the only loss being shortage ascertained after recovery of the stolen materials worked out to about `4lakhs only as is evident from the letter dated 10th February, 2004 of the complainant and accordingly, for the only loss due to shortages payable in terms of policy, the opponents have paid to the complainant the sum of `4,03,150/- and the same is accepted by the complainant without any protest or reservations and hence, opponent stated that there is no cause of action to claim deficiency in service as they have paid to the complainant as per terms of the policy. They further contended that whatever the loss alleged by the complainant is due to the negligence by the complainant by not complying the order of Judicial Magistrate. The opponent further stated that any damage/loss attributable to willful misconduct of the assured or the loss/damage caused due to insufficiency or unsuitability of packing or preparation of the subject matter for carriage or caused by delay or inherent nature of the consignment is excluded under the exclusion no.2 of the Inland Transit (Rail or Road) clause “A” attached to the insurance policy and not payable and therefore, the rejection of claim on any of these grounds does not constitute deficiency in service or unfair trade practice. It was obligatory on the part of the complainant to immediately report the theft/loss to their police station, which was not reported by them but was reported by the said transporter.
11. The opponent therefore states that delay in release of the recovered bearings to the complainant and further delay in passing the order entitling the complainant to dispose of the recovered material was as such caused to willful misconduct and negligence of the complainant and for such willful misconduct and negligence and for such delay causing alleged damage due to rusting if any the claim for damage due to rusting 31557 numbers of bearings is not payable being excluded under the clause 2 of the Inland Transit Clause-A attached to the policy. Therefore, the opponent prayed that as there is no deficiency on their part, the consumer complaint may pleased be dismissed.
12. Both the parties have filed their evidences on affidavit and also filed their short briefs of arguments and argued the case at length.
13. On the basis of pleading of both the parties, we frame following issues for our consideration and our findings thereon are as under:
Issues Findings
1. Whether the complaint is within
period of limitation? No.
2. Whether the complainant proves that
there is deficiency in service on the
part of opponent? No.
3. Final order if any? Complaint stands dismissed.
14. We heard the counsel for both the parties.
15. The complainant had taken the Special Declaration Policy from the opponent - The New India Assurance Co.Ltd. (hereinafter referred to as the ‘Opponent’) the policy no.120700/21/02/00202 and the period of the policy was from 16.10.2002 to 15.10.2003. It is also not disputed that the consignment covered by the policy valued at `35,13,171.78 dispatched on 30.07.2003 by truck no.MH-14-V-4651 through the Transport operator M/s.Bhoruka Logistic Pvt. Ltd. The truck carrying the consignment had not reached to its first destination on 02.08.2003 and hence, the transport operator informed to the police and the lodged F.I.R. no.207 on 14.08.2003. During the police investigation it transpired that the driver of the truck along with cleaner in collusion with other persons had stolen the vehicle carrying the consignment which is a subject matter of the complaint. The Police was successful in tracing the truck and the goods. The police filed criminal case against the accused u/sec.408, 411, 414 and 34 of the I.P.C. in the Court of Judicial Magistrate First Class, Pimpri, Pune.
16. On 10.02.2004 the Complainant informed the Opponent to take possession of the consignment from police and settle the Complainant’s claim. The Opponent Insurance Company informed the Complainant vide letter dated 19.02.2004 to take the legal remedies to take possession of the consignment. On the basis of the Complainant’s letter dated 07.06.2005 the Opponent Insurance Company appointed M/s.Basheer & Associates Surveyors Pvt. Ltd. to survey the consignment. The Surveyor made a physical count of the consignment from the torn boxes and counted the intact boxes. The copy of the surveyor’s report is at page nos.82 to 93 of the appeal compilation. In his report the Surveyor has reported that out of 207 cartons 158 cartons were recovered intact along with a dispatch seal of the Complainant Company and remaining 49 cartons were in loose condition. The surveyor calculated the shortage from loose cartons and arrived at the figure of missing articles, calculated the cost of missing articles from the particulars shown in an invoice and valued the cost of missing articles at `5,37,599.55 and recommended 75% of loss to the Opponent. Accordingly on 01.03.2006 the Opponent made payment of Rs.4,03,150/- which is 75% of the assessed loss of `5,37,533.55.
17. According to Opponent Insurance Company the cause of action arose in the month of August, 2003 and the complaint is filed on 10.02.2009, the Opponent Insurance Company further contended that even if the date of payment, i.e. 01.03.2006 is taken into consideration the present complaint is not within the time limit as per section 24A of the Consumer Protection Act.
18. It is the contention of the Complainant that the amount paid by the Opponent Insurance Company was an interim settlement and not final settlement. According to Complainant while repudiating the claim the Opponent Company has invoked condition no.2.4 in the exclusion clause. However, it is not a delay in transit because goods are stolen in transit and the risk is covered under the policy. The theft is the immediate dominant cause in the claim giving rise to the liability of the opponent Insurance Company and until goods are recovered in sound condition the liability continues.
19. No doubt, the cause of action is a bundle of reasons. In the present case it was noticed that theft has occurred and the goods are also seized. The Complainant had informed the Opponent to take possession of the consignment from police and settled the Complainant’s claim. Actually it is a responsibility of the Complainant to take possession of the consignment from the police. Accordingly the Opponent informed the Complainant vide its letter dated 19.02.2004 to take legal remedies to take the possession of the consignment. The Complainant failed to take possession of the consignment. In fact, the transport operator made an application no.251/2003 to the Judicial Magistrate for return of the consignment and the vehicle. That application was allowed by the Judicial Magistrate vide order dated 05.11.2003 on the condition that the Transport Operator should furnish the security bond of `32,00,000/- for the consignment and `7,00,000/- for the truck. As the transport operator could not furnish the security bond of `32,00,000/- the consignment remained with the police.
20. Further, the Complainant made an application to the judicial Magistrate to release the consignment in his favour. However, the application filed by the Complainant was dismissed by order dated 01.03.2004. Hence, Complainant had filed an appeal against the order dated 01.03.2004 and joint application along with transport operator in the Court of Judicial Magistrate was filed for possession of the consignment and the Magistrate by its order dated 10.01.2005 directed the police to handover possession on the condition of furnishing Indemnity Bond of `32,00,000/- and not to transfer the consignment. Accordingly after furnishing the indemnity bond police released the consignment on 08.06.2005. Similarly, on the basis of order in appeal the Judicial Magistrate granted permission to sell the consignment vide order dated 17.08.2007. So, the Complainant has got the possession of the consignment on 08.06.2005.
21. On complainant’s request only the Opponent/Insurance Company had appointed the surveyor. Surveyor carried out the physical count of the consignment from the torn boxes, similarly, counted the entire boxes in the presence of the representative of the Complainant. Out of 207 boxes of consignment 158 boxes were found intact with a dispatch label and remaining 49 boxes were in loose condition. The Surveyor calculated the shortage from loose cartons and arrived at the figure of the missing articles, calculated the cost of missing articles on the basis of the price shown in the invoice and valued the costs of missing articles at `5,37,533.55 and recommended 75% of the loss to the Opponent Insurance Company and the Opponent Insurance Company made the payment to the Complainant on 01.03.2006.
22. The contention of the Complainant that the amount paid is an interim settlement of the claim and it was not a final settlement cannot be relied with from the facts on record. There is no evidence to show that the Complaint has accepted the same under protest. Further, it is the contention of the Complainant that the quality of the consignment deteriorated because it remained in the police custody for inordinate period. In fact, it was the responsibility of the Complainant to take early possession of the consignment from the Police and ask the opponent Insurance Company to settle the claim. From the facts on record whatever the delay occurred for taking the possession of the consignment, it is because of the transport operator or that Complainant could not fulfill the conditions of the release order given by the Judicial Magistrate. The Opponent Insurance Company had repudiated the claim of the Complainant taking recourse to point no.2.4 of exclusion clause. As per Inland Transport Clause (Rail or Road) Clause 2.4 (Exclusion), loss damages or expenses proximately caused by delay even though delay be caused by risk insured against, is not payable. Further Opponent has relied on the transit policy framed wherein consequential losses are not payable. Risk covered cannot be kept open for unlimited period. Similarly, cause of action had taken place in August, 2003 and the Opponent insurance company has made payment of the claim on 01.03.2006 and the complaint is filed on 10.02.2009. Hence, the complaint filed is not in limitation as per the Provisions of Section 24A of the Consumer Protection Act. Further on merits also the Opponent Insurance Company cannot be held responsible for the deterioration of the quality of the consignment from the facts mentioned, supra.
23. In view of the aforesaid facts, we answer both the points in negative. We hold accordingly and pass the following order:
O R D E R
1. Complaint is dismissed.
2. No order as to costs.
- Copies of the order be furnished to the parties.
