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2013 DIGILAW 479 (UTT)

NATIONAL INSURANCE COMPANY LTD. v. GUGAN SINGH

2013-07-22

B.C.Kandpal, C.C.Pant

body2013
ORDER (Per: Mr. C.C. Pant, Member): This appeal is directed against the order dated 01.10.2010 passed by the District Forum, Haridwar, allowing the consumer complaint No. 174 of 2009 and directing the opposite party to pay to the complainant a sum of Rs. 4,26,359/- together with interest @ 6% per annum from the date of filing the consumer complaint till payment and Rs. 1,500/- towards cost of litigation within a month from the date of the order. 2. The facts of the case, as stated in the consumer complaint, in brief, are that the complainant – Sh. Gugan Singh through Speed Crafts Ltd., Plot No. 1, I.I.E. Sidcul, Roshnabad, District Haridwar, purchased a Topteam Machine Hydraulic Press. The machine was transported to Sidcul, Haridwar by truck No. HR38-G-7111 of M/s ENGG Logistics, Faridabad on 29.07.2008. The said machine got damaged while it was being loaded in the said truck. According to the complainant, the machine was insured with National Insurance Co. Ltd., Haridwar–opposite party. The opposite party was intimated regarding the said damage through e-mail, upon which the opposite party deputed its surveyor to inspect the said machine. The surveyor observed that the loss due to damage was to the tune of Rs. 4,26,359/-. The complainant, accordingly, lodged his claim to the opposite party, but the opposite party did not pay the claim. When the complainant sent a notice to the opposite party through his counsel, the opposite party informed the complainant vide its letter dated 28.03.2009 that there was a manipulation and overwriting in the date on the challan. The date “24.07.2008” was made “29.07.2008” by overwriting. The complainant has stated in his consumer complaint that the said machine was loaded on 29.07.2008. The truck No. HR38-G-7111 passed through Vijay Nagar (Ghaziabad) check post of Commercial Tax Department on 31.07.2008. Thus, alleging deficiency in service on the part of the opposite party, the complainant filed a consumer complaint before the District Forum, Haridwar. The District Forum, after an appreciation of the facts of the case, allowed the consumer complaint vide its order dated 01.10.2010 and directed opposite party in the above manner. Aggrieved by the said order, the opposite party – insurance company has preferred this appeal. 3. We have heard the learned counsel for the parties and perused the material placed on record. 4. Aggrieved by the said order, the opposite party – insurance company has preferred this appeal. 3. We have heard the learned counsel for the parties and perused the material placed on record. 4. The learned counsel for the appellant argued that the consumer complaint filed by the respondent–complainant was not maintainable before the District Forum, because the complainant Sh. Gugan Singh is not a consumer. Further, the company–Speed Crafts Ltd. is engaged in commercial activity and, therefore, for this reason also, the consumer complaint was not maintainable. The District Forum has erred by entertaining the consumer complaint inspite of the fact that these preliminary objections were raised by the appellant–opposite party before the District Forum in its written statement. The learned counsel further submitted that the company–M/s Speed Crafts Ltd. had taken a Marine Cargo Policy, covering a risk of Rs. 20 lacs for the period from 05.05.2008 to 04.05.2009. The commodities covered under the policy were steel items, Drum Mix Plant, Engines etc. The feature of the policy is that it is declaration based policy. Accordingly, the policy-holder has to submit monthly statement of transit of goods along with their value. The insurance remains in force for the period of 12 months, unless the sum insured is previously exhausted by declaration. Upto 04.06.2006, the total sum insured had exhausted in the following way:- (1) Sum insured opted Rs. 20,00,000.00 (2) Sum insured exhausted as per declaration of insured upto 31.05.2008 Rs. 17,21,384.51 (3) Declaration upto 04.06.2008 Rs. 4,07,344.25 Balance as on 04.06.2008 Rs.(-) 1,28,728.76 [(1)–(2) –(3)] 5. Thus, the total limit of sum insured had not only exhausted, but it was in negative on 04.06.2008. The respondent-complainant had purchased the hydraulic power press machine on 24.07.2008 and it was booked for transportation to Haridwar with M/s ENGG Logistics, Faridabad, vide its G.R. No. 2380. The vehicle number, as mentioned in the G.R., is HR38-G-7111. Thus, the learned counsel for the appellant pleaded that the goods were in transit on 24.07.2008, but the same were not insured, as the insurance limit of Rs. 20 lacs had exhausted on 04.06.2008. The respondent enhanced the insurance limit to Rs. 100 lacs w.e.f. 25.07.2008. For this reason, the respondent made certain manipulations and overwriting on the transit documents by changing the date “24.07.2008” of the G.R. to “29.07.2008” and, thus, bringing the goods under the cover of insurance. 20 lacs had exhausted on 04.06.2008. The respondent enhanced the insurance limit to Rs. 100 lacs w.e.f. 25.07.2008. For this reason, the respondent made certain manipulations and overwriting on the transit documents by changing the date “24.07.2008” of the G.R. to “29.07.2008” and, thus, bringing the goods under the cover of insurance. The stand taken by the respondent that the goods were despatched on 29.07.2008, which reached at Haridwar on 02.08.2008 is not tenable, because the investigator deputed by the insurance company collected the information and copies of the documents from M/s ENGG Logistics, Faridabad, which clearly reveal that the goods were despatched on 24.07.2008 vide G.R. No. 2380. The learned counsel for the appellant has also pleaded that merely because the cheque for the amount of premium was dated “15.07.2008”, it cannot be presumed that the same was deposited with the appellant on “15.07.2008”. What is material is the date when the policy came into effect. The appellant / its investigator had asked the complainant–respondent to furnish the proof of submitting the cheque, but the respondent failed to furnish any such proof. Otherwise also, the policy has come into effect on 25.07.2008 and, therefore, the insurance contract between the appellant and the respondent came into existence on 25.07.2008 and prior to that, there was no contract between them. The District Forum, by holding that the cheque for insurance premium was given to the appellant – insurance company on 15.07.2008, has made a factual error in its finding and, therefore, the impugned order is liable to be set aside. 5. The learned counsel for the respondent – complainant reiterated the facts of the case and argued in support of the impugned order. 6. We considered the submissions made by the learned counsel for the parties. After going through the consumer complaint, we observed that the complainant – respondent has narrated the facts of the case in a very vague manner. For example, it has not been stated as to when and which machine was purchased by M/s Speed Crafts Ltd. The invoice number, its date, value of the machine etc. have not been mentioned by the respondent. Further, the details of G.R. number and its date have also not been mentioned. From para No. 2 of the consumer complaint, it appears that the machine was despatched on 29.07.2008 and it got damaged while it was being loaded in the truck. have not been mentioned by the respondent. Further, the details of G.R. number and its date have also not been mentioned. From para No. 2 of the consumer complaint, it appears that the machine was despatched on 29.07.2008 and it got damaged while it was being loaded in the truck. Similarly, the consumer complaint is also silent in respect of the insurance policy number, amount of insurance, its validity etc. The only fact which the complainant has narrated is that the machine was insured. So a simple reading of the consumer complaint reveals that the complainant is trying to hide the truth with regard to the goods and its coverage under the insurance policy. 7. A perusal of the record reveals that the company–M/s Speed Crafts Ltd. had purchased a Hydraulic Power Press Machine from M/s Top Team Machines Pvt. Ltd., Faridabad, vide Invoice No. 027 dated 24.07.2008 for Rs. 13,64,613/-. The machine was booked with M/s ENGG Logistics, Faridabad for transportation to Haridwar vide G.R. No. 2380 dated 27.07.2008 by truck No. HR38-G-7111. However, the date of G.R. appears to be changed to “29.07.2008” by overwriting at some stage after “24.07.2008”. These facts have not been narrated by the complainant in the consumer complaint in a clear manner. The preliminary objections raised by the appellant is with regard to maintainability of the consumer complaint before the District Forum on the ground that Sh. Gugan Singh, Accountant, is not a consumer, that he has not been authorized by M/s Speed Crafts Ltd. to file a consumer complaint on its behalf and that M/s Speed Crafts Ltd. is engaged in commercial activity and, therefore, it cannot file a consumer complaint under the provisions of the Consumer Protection Act, 1986. So far as the authorization of Sh. Gugan Singh, Accountant is concerned, it was filed at a later stage during the proceedings before the District Forum and, therefore, Sh. Gugan Singh, Accountant, is duly authorized to file the consumer complaint. However, the presentation of the consumer complaint is not in a proper way. It should be filed by “M/s Speed Crafts Ltd. through its Accountant Sh. Gugan Singh”. Instead, it has been filed by “Sh. Gugan Singh, Accountant through M/s Speed Crafts Ltd.”. We think that it is just a technical error and what M/s Speed Crafts Ltd. intended was to file a consumer complaint through its Accountant Sh. Gugan Singh. It should be filed by “M/s Speed Crafts Ltd. through its Accountant Sh. Gugan Singh”. Instead, it has been filed by “Sh. Gugan Singh, Accountant through M/s Speed Crafts Ltd.”. We think that it is just a technical error and what M/s Speed Crafts Ltd. intended was to file a consumer complaint through its Accountant Sh. Gugan Singh. So in the interest of justice, the District Forum’s decision to entertain the consumer complaint cannot be said to be illegal. Further, though the company–M/s Speed Crafts Ltd. is engaged in commercial activity, the insurance services through Marine Cargo policy were not availed by the company for commercial purpose. Therefore, the District Forum has not erred by entertaining the consumer complaint. 8. In this case, the main dispute is with regard to manipulation / overwriting in the G.R.’s date. So we went through the investigator’s report. The copy of the G.R. collected by the investigator clearly shows that it is dated 24.07.2008 and its number is 2380. Someone, by overwriting, has changed the G.R.’s date to 29.07.2008. The respondent had purchased a Marine Cargo policy from the appellant – insurance company for a risk of Rs. 20 lacs on the basis of declaration. This insurance limit had exhausted on 04.06.2008 and, thus, the machine purchased on 24.07.2008 was not covered under the insurance policy. The respondent had enhanced the insurance limit to Rs. 100 lacs w.e.f. 25.07.2008. It appears that since the machine got damaged, the respondent, in an attempt to bring it under the cover of insurance, made certain manipulations and changed the date of G.R. to “29.07.2008”. This overwriting can be seen with naked eye. Not only the date has been changed in the G.R., but some manipulation has also been done in invoice. In the invoice No. 027 dated 24.07.2008, an endorsement appears in the following manner:- “By Engg Logistic G.R. No. 2380 Date 24.07.2008 HR-38-G-7111” 9. Here also, the date has been changed to 29.07.2008 by overwriting. With these manipulations and overwriting, the respondent made an attempt to establish that the goods were despatched on 29.07.2008 which reached Haridwar on 02.08.2008. Since the insurance policy had come into effect on 25.07.2008, the goods were under the cover of insurance on 29.07.2008 and, thus, the appellant was liable to indemnify the loss caused due to damage to the machine. Since the insurance policy had come into effect on 25.07.2008, the goods were under the cover of insurance on 29.07.2008 and, thus, the appellant was liable to indemnify the loss caused due to damage to the machine. Such acts of manipulation sometimes leave certain marks, which tell the truth. We observed in this case that the same thing has happened. In invoice No. 027 dated 24.07.2008 issued by M/s Top Team Machine Pvt. Ltd., Faridabad, the entry “Date / Time of removal of goods : 24.07.2008” shows that the goods had moved from the supplier’s warehouse on 24.07.2008 and, thus, the transit of the machine had commenced on 24.07.2008 and on this date, the machine was not insured under the said insurance policy. Perhaps the respondent could not notice this entry, otherwise he would had tried to change the date of removal of machine to 29.07.2008. Clause No. 8.1 under the head “Duration” of the “Institute Cargo Clauses (A)” at Paper No. 48 reads as under:- “DURATION 8 8.1 This insurance attaches from the time the goods leave the warehouse or place of storage at the place named herein for the commencement of the transit, continues during the ordinary course of transit and terminates either. 8.1.1 on delivery to the Consignees’ or other final warehouse or place of storage at the destination named herein. 8.1.2 on delivery to any other warehouse or place of storage, whether prior to or at the destination named herein, which the Assured elect to use either. 8.1.2.1 for storage other than in the ordinary course of transit or 8.1.2.2 for allocation or distribution” 10. Thus, the insurance is attached from the time the goods leave the warehouse for the commencement of transit. That means, the commencement of transit of the machine had taken place on 24.07.2008 and on this date, the machine was not under the cover of insurance. Once the machine’s transit had commenced as an uninsured machine, it will continue to remain as uninsured till its delivery to the consignee (in this case, M/s Speed Crafts Ltd., Haridwar). During the transit of the machine, it cannot change its nature to an insured machine. So, once the transit of the machine had commenced on 24.07.2008, it is immaterial as to when the truck moved from Faridabad. 11. During the transit of the machine, it cannot change its nature to an insured machine. So, once the transit of the machine had commenced on 24.07.2008, it is immaterial as to when the truck moved from Faridabad. 11. Therefore, the appellant has not committed any deficiency in service by repudiating the claim lodged by the respondent. The District Forum, cannot hold that the insurance shall be effective from the date of the cheque. For the policies like Marine Cargo policy, it is essential to be seen as to when the policy was effected. In the instant case, the policy was not in force from 04.06.2008 to 24.07.2008. It came into effect from 25.07.2008. Therefore, we are of the view that the appeal deserves to be allowed and the impugned order is liable to be set aside. 12. Accordingly, the appeal is allowed. The order impugned dated 01.10.2010 passed by the District Forum, Haridwar is set aside and the consumer complaint No. 174 of 2009 is dismissed. No order as to costs.