Punjab

Ludhiana

CC/19/93

Indo Industries Ltd. - Complainant(s)

Versus

United India Insurance Co. Ltd. - Opp.Party(s)

Nipun Gupta adv

04 Apr 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:  93 dated 11.02.2019.                                                         Date of decision: 04.04.2024. 

 

Indo Alusys Industries Ltd., 606, Tolstoy House, 15, Tolstoy Marg, New Delhi-110001 through its authorized representative Sh. B.K. Sahu.                                                                                                           ..…Complainant

                                                Versus

United India Insurance Co. Ltd., 818, Industrial Area-B, Above Allahabad Bank, Near Partap Nagar, Ludhiana-141003, through its Branch Head/Manager.                                                                                …..Opposite party 

Complaint Under Section 12 of the Consumer Protection Act, 1986.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

SH. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. Nipun Gutpa, Advocate.

For OP                           :         Sh. Rajeev Abhi, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

 

1.                Shorn of unnecessary details, the facts of the case are that the complainant company is registered and incorporated under Indian companies Act, 1956 having its registered office at 606, Tolstoy House, 15, Tolstoy Marg, New Delhi and Sh. B.K. Sahu vide resolution dated 30.05.2018 is authorized to file the present complaint. The complainant took an open Marine Insurance Policy certificate No.2010032115P109329925 dated 08.07.2015 from the OP having validity of one year.  The complainant stated that during subsistence of insurance policy, it dispatched 637 bundles/30212 pieces of Aluminum alloy extruded products to M/s. Beta Industrial L.L.C Ras Al Khor, Adjacent to Hyundai Service Centre , P.O. Box 50708 Dubai UAE vide invoice No.EXP-18 dated 28.10.2015 for USD 53117.97 vide B/L No.NYKS351518300. The goods were dispatched in container No.NYKU3753141/20, which was loaded at Factory premises of complainant at SP-2/333, Bhiwadi Industrial Area, Bhiwadi, Rajasthan in presence of Central Excise Officers Range III, Bhiwadi, Alwar, Rajasthan being sealed with Excise Seal no.002530 dated 29.10.2015 and shipping line seal No.3421993. The complainant further stated that the electronic delivery order dated 24.11.2015 issued by agent of M/s. Bala Industrial Dubai confirmed that the description of goods as well as quality detailed in shipping bill has been received. Even bill of lading dated 25.11.2015 issued by Dubai Customs confirmed having received 637 bundles. However, the complainant surprised that M/s. Beta Industrial LLC Dubai/UAE after receiving the shipment informed that they have received short quantities of 172 bundles/3390 pieces against the actual quantifies of 637 bundles/30212 pieces, upon which the complainant vide letter dated 22.12.2015 informed Containers Corporation of India, Leo Transport Services Pvt. Ltd., Commissioner of Customs, CISF and NKY Line India Pvt. Ltd. to investigate the matter as theft had been taken placed. According to the complainant theft of 172 bundles had been taken place during transit regarding which it lodged claim with the OP for USD 15000 (Rs.10,74,900/- approximately) along with relevant document  on 30.11.2015 but the OP vide Email dated 06.01.2017 repudiated the claim on false and frivolous grounds. The complainant wrote letter dated 11.01.2017 to the OP pointing out that at the time of stuffing of the container by Central Excise Department had duly signed and stamped ARE-1 form certifying that specified packages have been checked and found particulars stated and description of goods in ARE-1 form and packing list are correct. The complainant further stated that it had taken a comprehensive insurance policy from the OP and the claim was lodged on the basis of policy along with all relevant documents issued by Central Excise Department and OP was duty bound to pay the loss/damage to the complainant as per terms of the policy. The repudiation of the claim by the OP is illegal, unjustified and void and non-payment of USD 15000 (Rs.10,74,900/- approximately) by the OP amounts to deficiency in service. The complainant sent a legal notice dated 08.03.2018 to the OP but no reply was received. Hence this complaint whereby the complainant has prayed for issuing direction to OP to pay/pass claim of USD 15000 (Rs.10,74,900/- approximately) along with interest and compensation of Rs.3,00,000/-.

2.                Upon notice, OP appeared and filed written statement and assailed the complaint by taking preliminary objections that on the ground of maintainability; suppression of material facts; the complaint being estopped by his own act and conduct from filing the present complaint; the complaint is barred under Section 26 of the Consumer Protection Act etc. Even no mandatory notice required under Section 6 of Carriage of Goods by Sea Act has been given in writing within the stipulated period as per said Act. The OP averred that immediately on receipt of the claim it was duly registered, entertained and processed. M/s Indo Alusys Industries Ltd., complainant had obtained marine certificate under open cover note No.2010031510969 certificate No.2010032115P109329925 valid from 08.07.2015 to 07.07.2016. As per the said certificate consignment consisting of 637 bundles of aluminum extruded products were dispatched by the complainant vide invoice No. EXP/18 dated 28.10.2015 worth US$ 58429.767, B/L No.NYKS 3511518300 dated 06.11.2015 in container No. NYKU 3753141 shipping bill No.3817118 dated 29.10.2015 vessel No.X-Press Annapurna 005W. According to the OP, the insurance policy is a contract in itself and the parties are bound by the terms and conditions of the policy and nothing can be added or subtracted out of it. Further it is one of the conditions in the policy "In the event of loss or damage which may result in claim under this insurance immediate notice must be given to the policy issuing office or nearest office. Claim settling agent name W. K. Webster & Co. Ltd., Agent Address: W K Webster & Co. Ltd., contract No.1000440003." The OP further averred that the complainant vide Email dated 30.11.2015 intimated claim regarding shortage of material exported to Dubai with estimate loss around US$ 15000. After the receipt of the claim M/s. W K Webster & Co. Ltd. was appointed as claim settlement agent. Mr. Keith Wright had carried out the survey on behalf of claim settlement agent M/s W K Webster & Co. Ltd. and informed the OP vide their Email dated 05.02.2016 the background, cause of loss, recoverability, settlement procedure and recovery aspect of the claim. They have stated the "cause of loss as short loading as opposed to a theft during the course of transit and have opined that the insurance company do not have any liability as the complainant was responsible for loading, stowing and sealing the container which was reported to have arrived in a sound condition with their original bill of lading seals intact. They have further inspected and ascertained that all 637 bundles could have been loaded within the container."

                   The OP further stated that the claim settlement agent M/s W K Webster & Co. Ltd. asked the settlement decisions of the OP before closing the file on the above mentioned claim. M/s. Inchcape Shipping Services (Dubai) L.L.C., the Lloyd's Agents in Dubai, U.A.E. was appointed to hold surveys and investigate the cause and extent of alleged short receipt of consignment in question upon their having received a request for the appointment of a surveyor from M/s WK Webster & Co. Ltd. The said M/s Inchcape Shipping Services, (Dubai) L.L.C. made the thorough investigation and thereafter prepared their report bearing Ref. No. DXB15WW0117 and submitted the same clearly stating that "the short loading of the bundles inside the containers at the load port cannot be ruled out." The said observations were given by M/s. Inchcape Shipping Services, (Dubai) L.L.C. under the head Surveyor's Remarks on proximate cause of damage: "We were not present when the container seal was cut or during the de-stuffing of the container. However, we have given due consideration to the survey findings, to the damage sighted present upon survey and to the information made available to us/and or obtained by us. We note that the seal No.3421993 mentioned in the Equipment Interchange Receipt (EIR) issued by DP World for the container No.NYKU3753141 is same as the number mentioned in the bill of lading. The EIR shows that the seal was intact when the container was released to the consignee and exited the destination port. In view of the above, in our opinion, short loading of the bundles inside the container at the load port cannot be ruled out." The complainant vide Email dated 01.11.2016 submitted the copy of ARE 1 certificate issued against the consignment in question sent to Dubai. The said copy of ARE 1 certificate was shared by the OP with the claim settling agent aforesaid vide Email dated 15.11.2016 for their consideration. After the receipt of the copy of ARE 1 certificate the aforesaid claim settlement agent replied to the Email that "the documents contained in your mail confirms that customs inspection was carried out on number of bundles, it does not appear to confirm that all bundles were in fact checked and loaded to the container. Furthermore, there is still no evidence to support how the shortage may have occurred." Further after the receipt of the Email of Mr. Keith Wright representative of claim settlement agent M/s WK Webster & Co. Ltd. dated 05.02.2016 and report of Inchcape Shipping Services (Dubai) L.L.C. and after scrutinizing the documents placed in the claim file and the inputs of the surveyor that the insurance company do not have any liability in these conditions and after due application of the mind by the officials of the respondent, the competent authority of the company vide their decision dated 12.12.2016 has decided to repudiate the claim of the complainant and informed the decision to the claim settlement agent. The OP stated that the claim of the complainant was repudiated as no claim by vide Email dated 06.01.2017 and letter dated 16.01.2017 clearly stating that the short loading of the bundles inside the container at the load point cannot be ruled out since it is observed that the seals of the container were intact with no signs of tampering and there is no evidence to support that how the shortage may have occurred during the transit.

The claim settlement agent had informed the complainant vide Email dated 15.12.2016 that the claim is not payable since there is no evidence to support the loss occurred as a result of an insured transit fortuity and there is no evidence to support the container was opened during transit and the goods removed and as such the insurers will not be entertaining this claim.

                   The OP further stated that the complainant sent the representation to reconsider their claim vide their letter No.IAIL/INSU/2017 dated 24.03.2017 after repudiation of the same vide letter of repudiation dated 16.01.2017. After the receipt of the aforesaid letter of the complainant, the claim file was again reviewed and it was observed that no additional or new documents in support of the claim has been submitted by the complainant and as no fresh inputs are available in the claim, so based on the recommendations and inputs of the surveyor that insurance company do not have any liability in these conditions the OP endorsed the decision of repudiation of the claim of the complainant as no claim conveyed to the complainant vide letter dated 16.01.2017. The OP vide letter dated 21.06.2017 had informed the complainant that the competent authority had made the decision that the claim is not admissible and stands repudiated in reply to the letter dated 24.03.2017 for review of the claim on the ground that it is observed that there is no fresh inputs or documents in the claim submitted by the complainant. The said letter dated 21.06.2017 is reproduced as under:-

"This is in reference to your letter dated 24.03.2017 vide which you have submitted your representation for reviewing the claim. On perusal of the same, it is observed that there is no fresh inputs or documents in the claim. Hence, the competent authority has maintained the decision that claim is not admissible and stands repudiated. This is for your information."

According to the OP the claim of the complainant has been rightly repudiated  on legal and valid grounds.

                   On merits, the OP reiterated the crux of averments made in the preliminary objections and facts of the case. The OP has denied that there is any deficiency of service and has also prayed for dismissal of the complaint. 

3.                In evidence, the complainant tendered his affidavit as Ex. CA and reiterated his averments of the complaint. The complainant also placed on Ex. C1 copy of insurance policy, Ex. C2 is the copy of commercial invoice dated 28.10.2015, Ex. C3 is the copy of bill of lading No.NYKS3511518300, Ex. C4 is the copy of electronic delivery order dated 24.11.2015, Ex. C5 is the copy of bill of lading dated 25.11.2015, Ex. C6 is the copy of letter dated 22.12.2015, Ex. C7 is the copy of claim dated 30.11.2015, Ex. C8 is the copy of Email dated 06.01.2017, Ex. C9 is the copy of letter dated 11.01.2017, Ex. C10 is the copy of A.R.E-1 form, Ex. C11 is the copy of legal notice dated 08.03.2018, Ex. C12 is the copy of postal receipt, Ex. R13 is the copy of resolution, Ex. C14 is the copy of Certificate of Incorporation and closed the evidence.

4.                 On the other hand, the learned counsel for the OP tendered affidavit Ex. RA of Sh. Inderjit Singh, Divisional Manager of the OP along with document Ex. R1 is the copy of letter dated 21.06.2017, Ex. R2 is the copy of claim note dated 01.05.2017, Ex. R3 is the copy of letter dated 24.03.2017,  Ex. R4 is the copy of Email dated 06.01.2017, Ex. R5 is the copy of Report of Inspection Goods by Inchcape Shipping Services, Ex. R6 is the copy of  bill of lading, Ex. R7 is the copy of bill No.NYKS3511518300, Ex. R8 is the copy of Commercial Invoice dated 28.10.2015, Ex. R9 is the copy of packing list dated 28.10.2015, Ex. R10 is the copy of insurance policy, Ex. R11 is the copy of Electronic Delivery Order dated 24.11.2015, Ex. R12 and Ex. R13 are the copies of Equipment Interchange Receipt (EIR), Ex. R14 is the copy of consignee copy, Ex. R15 to Ex. R19 are the copies of photographs, Ex. R20 is the copy of letter dated 16.01.2017, Ex. R21 is the copy of Email dated 15.12.2016, Ex. R22 is the copy of notice dated 19.11.2016 of the complainant for settlement of claim, Ex. R23 to Ex. R27 are the copies of intimation of theft dated 22.12.2015 issued by the complainant company to various authorities, Ex. R28 is the copy of claim note dated 07.12.2016, Ex. R29 is the copy of DCC claim note  dated 12.12.2016, Ex. R30 is the copy of Email dated 05.12.2016, Ex. R31 is the copy of Email dated 20.11.2016, Ex. R32 is the copy of Form A.R.E.1, Ex. R33 is the copy of Certificate by Central Excise Office, Ex. R34 is the copy of bill of lading, Ex. R35 is the copy of Email dated 15.11.2016 and closed the evidence.

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written statement along with affidavit and documents produced on record by the both parties. We have also gone through written arguments submitted by the complainant.

6.                Admittedly, the complainant, a body corporate, incorporated under Indian Company’s Act, availed insurance service under open cover Ex. C1 = Ex. R10 for a coverage period w.e.f. 08.07.2015 to 07.07.2016. The said insurance covers extends to all the risks of loss or damage to the subject matter insured except to risk specifically and separately excluded in Clause 2, 3 and 4. It was specifically excluded that this insurance cover will not extent to loss, damage of expenses attributable to the willful misconduct of assured. Further the policy casts a duty upon the insured and their servants and agents to take reasonable measures for the purpose of minimizing the losses.

7.                The complainant booked a container for export through ALLSEAS Movers Private alimited-311, Ist Floor, Street No.7, Mahipalpur Extn. New Delhi-110037 and got moved empty container to its factory at Bhiwadi for  stuffing of goods to be exported. On 28.10.2015, a consignment of 637 bundles/30212 pieces of Aluminum alloy Extruded Products were ready for dispatch to M/s. Beta Industrial L.L.C. Ras Al Khor, Adjacent to Hyundai Service Centre, P.O. Box 50708 Dubai UAE (hereinafter called as consignee) and accordingly, a commercial invoice Ex. C2 was generated. On next day i.e. 29.10.2015, the container was sealed in presence of Central Excise Officers Range III, Bhiwadi, Alwar, Rajasthan with Excise seal No. 002530 dated 29.10.2015 and Shipping Line Seal No.3421993 was also affixed on the container No.NYKU3753141/20. The consignment was transported to Delhi and from Delhi, it was transported through rail to Mundra for its onward shipment to the consignee. The complainant also hired services of M/s. Bala Industrial Dubai to ensure the delivery and facilitate of goods to the consignee. However, the consignee informed the complainant regarding receipt of shortage in quantity of 172 bundles. The complainant immediately intimated to M/s. Leo Transport Services Pvt. Ltd., Containers Corporation of India, Commissioner of Customs, Central Industrial Security Force and NKY Line India Pvt. Ltd, New Delhi vide separate letters dated 22.12.2015 exhibited as Ex. C6.

8.                The complainant also intimated Claim Settlement Agent M/s. W. K. Webster & Co. Ltd. and Mr. Keith Wright was appointed to carry out survey. The surveyor observed that goods were shipped in FCL container under shipper’s load, stow and count terms indicating that the insured was responsible for stowing, sealing the container which were reported to have arrived in sound condition with their original bill of lading seals intact. The surveyor further observed that there was no sign of tampering to the container or the seals. So the cause of loss could be as a result of short loading as opposed to theft during the course of transit. Thereafter, the investigation was further entrusted to M/s. Inchcape Shipping Service (Dubai). The officials of Dubai also associated with representative of the complainant in the investigation and perused the Equipment Interchange Receipt (EIR) and confirmed that the seals were intact when the container was released to the consignee at the destination port. He further reiterated that short loading of bundles inside the containers at the load port cannot be ruled out. So, thereafter, after scrutinizing the aforesaid reports and perusing the documents, the competent authority of the OP on 12.12.2016 decided to repudiate the claim. The representation of the complainant to review the repudiation order was also considered by the OP but due to lack of fresh inputs or documents, the competent authority maintained and reiterated its earlier decision of repudiation.

9.                From the chronology of above said facts, it is crystal clear that the container was hired by the complainant itself for the purpose of shipping the goods to Dubai on FCL basis which ordinarily means that a single container is booked by the shipper exclusively for transporting the cargo to the destination. The complainant through its agent was in active/constructive possession during the transit till it was released for delivery to the consignee. Needless to say that it is the complainant who was alone responsible for loading, stowing, sealing the cargo. The first version of the complainant as reflected in para No.6 of the complaint that the agent of the complainant M/s. Bala Industrial, Dubai had confirmed the receipt of 637 bundles through electronic delivery order dated 25.11.2015 Ex. C5 = Ex. R14. Once the agent of the complainant has confirmed the receipt of entire consignment, then taking u-turn and asserting that a short quantity of 172 bundles has been received by the consignee is in a stack contradiction to its first version and raised doubt. Since the cargo was dispatched from the factory premises of the complainant, the complainant could have adduced some record/documents to show that 637 bundles/30212 pieces of Aluminum alloy were taken out from the factory premises for the purpose of loading in the container. The complainant has also not produced the affidavit of the agent who was supervising the entire operation of shipping the container. It was the best evidence which was in possession of the complainant and for the reasons best known to him, the same was not produced before this Commission. The surveyor and the investigator in their respective reports were categoric  and consistent with regard to the non-tampering of seals and short loading of stuff on the place of origin. Their reports are exhaustive and well reasoned. These reports were not challenged by the complainant by filing specific objections or rejoinder to the written version. Therefore, this Commission has no hesitation in accepting the reports of surveyor and investigator.

                   Reference can also be made to National Insurance Company Ltd. Vs Vedic Resorts & Hotels Pvt. Ltd. In 2023(2) Apex Court Judgments 451 (SC), whereby the Hon’ble Supreme Court of India has made the following observations:-

“(i)    Consumer Protection Act, 1986, S.23 – Insurance Claim – Surveyors report – Not the last and final one and not so sacrosanct as to incapable of being departed from – However, there has to be some cogent and satisfactory reasons or grounds made out by the insurer for not accepting the report.

Even otherwise, the initial onus to prove deficiency in service is always upon the complainant but in the present case the complainant has failed to discharge the same.

10.              Reference can be made to SGS India Ltd. Vs Dolphin International Ltd. in Civil Appeal No.5759 of 2009 decided on 06.10.2021 (LL 2021 SC 544) by the Hon’ble Supreme Court of India whereby it has been held as under:-

’19.  The onus of proof of deficiency in service is on the complainant in the complaints under the Consumer Protection Act, 1986. It is the complainant who had approached the Commission, therefore, without any proof of deficiency, the opposite party cannot be held responsible for deficiency in service.

In the above cited case, the Hon’ble Supreme Court of India has placed reliance on its own judgment reported as Ravneet Singh Bagga v. KLM Royal Dutch Airlines & Anr. whereby it has been held that the burden of proving the deficiency in service is upon the person who alleges it. “6. The deficiency in service cannot be alleged without attributing fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be performed by a person in pursuance of a contract or otherwise in relation to any service. The burden of proving the deficiency in service is upon the person who alleges it. The complainant has, on facts, been found to have not established any wilful fault, imperfection, shortcoming or inadequacy in the service of the respondent.”

‘20. This Court in a Judgment reported as Indigo Airlines v. Kalpana Rani Debbarma & Ors. (LL 2021 SC 544) held the initial onus to substantiate the factum of deficiency in service committed by the opposite party was primarily on the complaint. This Court held as under:-

“28. In our opinion, the approach of the Consumer Fora is in complete disregard of the principles of pleadings and burden of proof. First, the material facts constituting deficiency in service are blissfully absent in the complaint as filed. Second, the initial onus to substantiate the factum of deficiency in service committed by the ground staff of the Airlines at the airport after issuing boarding passes was primarily on the respondents. That has not been discharged by them. The Consumer Fora, however, went on to unjustly shift the onus on the appellants because of their failure to produce any evidence. In law, the burden of proof would shift on the appellants only after the respondents/complainants had discharged their initial burden in establishing the factum of deficiency in service.”

In the given facts and circumstances, the complainant has failed to prove the deficiency in service on the part of the opposite parties by any cogent and convincing evidence.

11.              As a result of above discussion, the complaint fails and the same is hereby dismissed. However, there shall be no order as to costs. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.

12.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

 

(Monika Bhagat)                              (Sanjeev Batra)               Member                                         President  

Announced in Open Commission.

Dated:04.04.2024.

Gobind Ram.