(Per Shri S.B.Sawarkar, Hon’ble Member)
(1) This is a complaint filed by the complainant, M/s.Gee Square Exports (hereinafter referred to as ‘complainant company’) thorugh its Manager and C.A., Mr.L.E.Ramaswamy. It is the complaint that the complainant company is dealing in the business of frozen seafood since 2001 and is recognized as ‘One Star Exports House’. The complainant company is storing their stock of frozen seafood in the cold storage at HMG Industries, C-21/6, TTC Industrial Area, MIDC Pawane Village, Vashi, Navi Mumbai 400 703. The complainant company has acquired insurance from the opponent no.1 under ‘Standard Fire and Special Perils’ Policy bearing No.140100/11/05/00261 for a period from 09/05/2005 to 08/05/2006 for value of `80 lacs to cover the stock of frozen seafood in the cold storage at MIDC Pawane village. The policy was expressly covering the damages to the stock which is normally in the range of `50 lacs which might be caused due to any havoc. The complainant company contended that normally they had a rising stock in their cold storage and their business was also growing year by year during last 3 years.
(2) The complainant company states that due to unprecedented flood of 26th and 27the July, 2005, the flood water entered into their cold storage and damaged the frozen see food causing a loss of 60.60 lacs which they reflected in their accounts. It is further contended that because of gushing of contaminated water of rains in the cold storage, the complainant had to dump the entire stock of seafood to prevent its endangerment to human health. Because of contamination and fear of danger to human life, the complainant could not wait for anyone and in the interest of public health, destroyed the goods immediately by dumping them.
(3) The complainant company also could not inform opponents (insurance company) because of collapse of communication system. It, therefore, informed the Development Officer of the opponent no.1 only on 28/07/2005 about the damage, the loss and action of dumping on 27/07/2005, but the officer expressed his helplessness to act in the absence of written communication from the complainant. Therefore, only on 29/07/2005, the complainant informed the opponent in writing about the damage due to rain water and the process followed by them.
(4) The opponent no.1 insurance company appointed M/s.Anil Phadke & Co. as surveyor for assessment of loss who visited the storage on 30/07/2005. He asked the complainant to stop the disposal which the complainant company followed. The complainant company was to destroy the contaminated stock which became unhygienic, but as prevented by the surveyor, few stocks were allowed to remain in the storage which was to the tune of 14.370 tonnes. It is stated that because of unprecedented rains, unexplainable and inexplicable situation of the flood, it was not possible for them to get dumping certificate from the concerned authority i.e. NMMC (Navi Mumbai Municipal Corporation) as it was not the dumping in the normal conditions. Taking into consideration of the extraordinary situation, the NMMC decided to regularize the dumping done on 27th, 28th and 29th July, 2005 after due verification. The complainant accordingly applied and acquired the dumping certificate after paying requisite amount of `12,000/- dated 18/10/2005 from the NMMC (The Corporation). The complainant company further states that the unprecedented conditions could be assessed through the Times of India news showing admission of NMMC City Engineer, Mr.Mohan Dagaonkar and also to the destroying of Industrial shed at Pawane. The complainant company was very much careful and before dumping the hazardous food got recommendation of veterinary doctor one Dr.S.K. Panse on 27/07/2005 and only then dumped and destroyed the stock. The complainant company further states that because of torrential rains, they could not even get vehicle to dump the contaminated stock which had to be dumped through their supplier one Krishna, a material supplier. The complainant further states that on 26/07/3005, the book stock was 163.731 MT and the physical stock was 174.43 MT, which was destroyed out of which what they could sell they could get salvage value of `1,67,370/-.
(5) The complainant company thereafter on 22/08/2005 lodged a claim of damage to the tune of 59.57 lacs before the surveyor who submitted a report to the opponent no.1.
(6) The complainant states that not satisfied by the surveyor’s report, the opponent no.1 appointed an investigation agency, V.B.Associates to verify the loss. The investigation agency only depended on verbal statements of some security guards and filed their report which was proved wrong by the complainant. The complainant made repeated requests to the opponent with all requisite documents to settle the claim of damage. The complainant further stated that through applications under Right to Information Act acquired various letters and documents from the opponent and found that on 18/10/2006, Sr.Manager of Opponent Company wrote a letter to Regional Manager of the opponent no.1 stating that the claim of the complainant is genuine. The complainant, therefore, submitted that in spite of their best efforts and after satisfying all queries, the opponent deliberately did not settle their claim as per the policy. This caused tremendous mental agony and hardship to the complainant. The complainant, therefore, based on their auditors’ report and also on various documents provided by it claimed that –
“The opponent no.1 be directed to pay the claim amount of `52,61,776/- to the complainant and also the opponent no.1 be directed to pay an interest @18% p.a. on the claim amount from the date of filing of the complaint till the realization of the claim amount. The opponent be directed to pay `20 lacs towards hardship and mental agony caused to the complainant due to deficiency in service to be attributed to it.”
(7) The complainant supported his contentions by the various exhibits regarding its progress in the business. The complainant submitted a dumping certificate issued by NMMC on 18/10/2005 which was not possible for them to acquire at the time of dumping the alleged hazardous stock on 26/07/2005 and 27/07/2005. The complainant in its complaint also submitted the survey report of the surveyor appointed by the opponent dated 30/10/2005.
(8) The opponent no.1 & 2 received notices and contested the claim and complaint of the complainant by filing their written version and affidavits. The opponent no.1 & 2 vide their letter dated 23/08/2006 repudiated the claim of the complainant and again on 14/02/2007, they finally repudiated the claim of the complainant by citing the ground as below :-
a. The surveyor/insurer was not permitted to inspect the damages to the stock.
b. The damaged stock was not disposed in accordance with the govt. norms or the norms laid down by the insurer.
c. The veterinary doctor’s certificate is undated and does not confirm that he has physically seen the damaged stock.
d. Destruction certificate submitted by you is about two and a half months after the loss.
e. There are contradictions in letters regarding date, place and quantity of damaged stocks dumped.
f. Weighbride was not functional on 27/28, hence weight dumped was certified only as per your declaration to the authorities.
g. Part of the stock was dumped in Nullah, as per declaration, yet dumping certificate confirms full quantity of 160 MT.
h. The surveyor was kept in dark regarding the actual place and quantity of damaged stock dumped, which amounts to violation of condition no.6(b) & 8, i.e. misrepresentation and suppression of material fact.
i. NMMC too has not supplied the required information on the specific queries referred to them to substantiate the claim.
(9) The opponent no.1 & 2 vehemently disputed the claim of the complainant on the grounds as below :-
a. The opponent doubted whether the stock of the dressed fish to the tune of 160 MT deteriorated due to rain and dumped at dumping yard, NMMC on 27/07/2005 was true ?
b. The certificate of veterinary expert one Dr.S.K.Panse, submitted by the complainant who is alleged to have inspected stock of 160 MT of dressed fish, certified and directed the complainant to destroy the stock as it was unfit for human consumption at the same time had become hazardous to the public health and certificate to that extent was issued on 24/09/2005 after a span of two months.
c. The dumping and destruction certificate issued by NMMC after accepting fees of `12,000/- was issued on 18/10/2005 interalia certifying the dumping of 160 MT contaminated fish stock of 27 and 28/07/2005.
d. The complainant has not specifically provided the quantified and exact place of the dumping of the total contaminated fish stock.
e. The conflicting and contradicting reports and letters were submitted by the complainant on different dates claiming either distressed sale of 14.45 MT of fish food also 120 MT by their first letter dated 28/07/2005 with recovery of `6 lacs.
f. The complainant did not wait for arrival of the surveyor and for instructions for the destroyal or inspection of . The first information report was accompanied with the declaration of destroyal of the damaged stock.
(10) The insurance company after receipt of the information of damage due to rains on 29/07/2005 had appointed a surveyor who made survey of entire loss and after his survey report submitted the report on the basis of 2 sets of observations :-
a. Based on their observations of the site, stock and whatever papers which the complainant provided to them or failed to provide them, the surveyor decided to restrict the assignment of loss to the extent of quantity of fish weighing 14,430 kgs. seen by them in damaged condition. He based the loss on rates of respective fish, to `4,40,894/- and then making deduction of proportionate amount for 5 MT which was on mezzanine floor of about `1,52,770/-, the assessed loss to `2,88,124/- only.
b. In the other set of observations, based on the stock registers of the complainant and the quantities claimed to be in the cold storage by the complainant, the surveyor assessed the loss to the extent of `52,61,776/-.
(11) The opponent opposing the claim, submitted that considering the report of the surveyor and verification of facts through the investigation agency appointed by them, they found the claim to be strongly suspicious and fraudulent in nature. Therefore, as above, the opponent repudiated the claim. Therefore submitted that thus rejecting such a claim does not amount to deficiency in service.
(12) Heard both the parties. Perused the record placed before us. The issues we find before us are as below:-
a. Whether the complainant has proved his claim or not? - No
b. Whether the repudiation of the claim of damage
by the opponent no.1 & 2 is justifiable or not ? - Yes, justifiable.
What order ? - As per orders.
(13) We find from the record that:
a. The complainant before informing the opponent on 28/07/2005 and 29/07/2005 disposed off a major quantity of stock alleged to have been with them in the cold storage (almost 160 MT approx). with the help of their supplier without keeping any record either in the form of video, photographs, panchnamas, reports to local authorities or taking any certificates from them.
b. The complainant rather than informing the damage immediately informed on 28th July, 2005 after the disposal of entire stock.
c. The complainant thereafter tried to substantiate their disposal and dumping of the contaminated material based on certain certificate of veterinary expert Dr.Panase, which was issued two months after and also not on an affidavit.
d. The complainant also tried to justify their claim of dumping based on the post facto certificates issued by the corporation after taking fee of `12,000/- after a span of 4 months.
(14) We analysed the claim of the complainant based on documents, reports, audit reports and also the observations made by both the parties, reports of the surveyors, investigation agency and various certificates issued by the corporation and Dr.Panase.
(15) While visualizing the situation, (due to unprecedented rains on 26th and 27th July, 2005), we find that the complainant is a professional company. When it found that the stock which they had in their cold storage got damaged, how could they fail to properly record it through videos, police report, and quantifying the damage before going for dumping and destroyal of the stock of value. The complainant has not provided the exact time as to when it came to know about the damage and contamination of the stock. Did they come to know of it when the rains were going on on 26th , 27th or 28th July, 2005? How did they come to know of it, because the knowledge of the contamination is only possible after opening of the doors of the cold storage and then allowing the water which might have entered into it to drain out. We can observe from the investigation report that the electricity readings were taken till 22 Hrs. of 26th July, 2005 and re-readings continued from 7 O’clock of the 27th July which indicates that there was presence of human supervision on the cold storage and the entire cold storage was fully under observation on 26, 27 and 28th of July, 2005. The complainant does not show the exact time of contaminated condition of the stock, its quantification and inspection.
(16) The complainant being an export company performing professional work, it is rather difficult to expect that it would not keep a proper visual record of the entire stock, situation, damage etc. through appropriate photographs, video film or evidence of some independent witnesses before the dumping the entire stock. Simple mobile photographs do not justify their claim. On this point, considering the preponderance of probability, we find the contention of the opponent no.1 to be more believable that the complainant did not allow the insurer to see damaged stock and did not submit proper visual record of it to the surveyor.
(17) The certificate issued by the veterinary Dr.Panase does not specify when he inspected the stock. It is absolutely unnatural, unexplainable and unbelievable that a expert would inspect the stock of almost 160 MT and would give declaration of its contamination and give directions to destroy it. It is also unbelievable that any export company would follow the directions without taking a certificate even in hand writing itself on that particular day. It cannot be seen from the certificate as to in what capacity Dr.Panase visited the premises of the company and declared the condition of the stock without prejudice to his expertise and knowledge, the certificate does not specify as to whether his observations were based on visual inspection, or some other testing, chemical tests, examination of stock and what was his locus-standi, either as an officer of the local authority or regular consultant of the company. This makes extremely difficult for us to believe that the professional company would believe on such certificate and would suddenly take a decision to destroy and dump the entire stock without either double checking the opinions or without taking the opinion of the corporation officers or public health officers.
(18) From the record, we do not find any evidence to show as to how the destruction of contaminated fish food was done. If presumed that it was put in Nallha then it is difficult to presume as to how the stock would sweep away into the sea when the entire water had receded.
(19) It is also difficult to accept that such a contaminated material to the tune of almost 160 MT, would be allowed to be thrown in the open even at the dumping ground, putrefying in the open.
(20) From the investigation carried out by the investigation agency, it appears that there was a corporation staff at the dumping ground at Turbhe. Otherwise also it is difficult to presume that the staff would be absent at the dumping ground after such deluge when all government machinery was working round the clock and were on the duty for re-habilitation work.
(21) After the careful perusal of the survey report, the investigation report and the various reasons cited by the complainants, we come to the conclusion that the claim of the complainant of the damage, dumping and destroyal of such a huge amount of dressed seafood does not stand on sound footing of reasoning. We find that the stock which was present in the cold storage site of about 14 MT was in the damaged condition as assessed by the surveyor and which be compensated.
(22) As regards the various audit reports, reports to the bank and the stock submitted by the complainant only signify that complainant could have the stock with them, but it does not prove that it was damaged and was lost positively. This record does not convince us to believe that the stock was positively present and lost and was dumped under compulsive factors. Therefore, we are inclined to believe contention of the opponent that the claim appears to be of doubtful motive and does not look to be justified. Hence, the opponent could not accept it and rejected it.
(23) However, after the consideration of the claim, it also comes to the notice that the surveyor of the opponent had visited the place of the complainant. It is also true that due to unprecedented rains, there was damage to the property and lives on 26th and 27th July, 2005. The surveyor based on his observation and visit of the site and inspection of the stock of 14.430 MT of dressed fish food have calculated the actual damage to the extent to `4,40,894/-. The surveyor has deducted an amount of `1,52,770/- based on the technical assumption that some portion of the damaged material happened to be on the mezzanine floor of the cold storage. Also the complainant had given a salvage value of `1,67,000/- of the material sold and therefore assessed the loss after deduction to be `2,88,124/-. We find, to this extent, as certified by the surveyor, the complainant must have suffered the loss and therefore it deserves to be compensated, in consideration of the unprecedented situation prevalent after the deluge of 26th & 27th July, 2005.
(24) We, therefore, in the fitness of the facts and the object of the act, allow the damage to the extent as certified by the surveyor. We, therefore, pass the order by attributing deficiency in service on the part of the opponents only to the extent of not paying the damages actually reported by the surveyor and therefore pass the order as below:-
ORDER
(1) Complaint is partly allowed.
(2) Opponent nos.1 & 2 shall pay actual damaged claim as proposed by the surveyor based on actual loss of `4,40,894/- and pay it within 30 days with interest @9% p.a. from the date of filing of this consumer complaint i.e.25/01/2007.
(3) In the given circumstances of the case, both the parties shall bear their own costs.
Pronounced on 13th May, 2013.
