IMPORTANT POINT
Right of assured under contract of insurance is nothing but right to obtain reimbursement from insurer in case insured goods are lost or damaged.

V.K. Jain, Presiding Member—The respondent / complainant obtained a Marine Cargo Policy from the appellant, in respect of a consignment which it had to export from Jetpur in Gujarat to Lusaka in Zambia. The sum assured under the said policy was Rs.28,10,000/- and the basis of valuation was CIF (cost, insurance and freight) plus 10%. The goods were sold by the complainant to the overseas buyers against an invoice dated 15.4.2003. From Mumbai, the goods were sent through Safmarine India Pvt. Ltd. in a container carried in a ship. The container, containing the goods was discharged at Dare-E Salaam Port on 08.5.2003. The delivery of the consignment at Dare-E Salaam was taken by the clearing and forwarding agent of the consignee / purchaser and from there, the goods were dispatched to Lusaka by road, after payment of the requisite custom duty etc. The goods however, got stolen before the container could reach Lusaka and the loss was reported to the police as well as to the local agent of the insurer. The claim lodged by the complainant / respondent however, was repudiated by the insurer on the ground that its contract with the consignee was on C&F basis, responsibility for transportation from Dar-E-Salaam to Lusaka would be of consignee, and since the loss had taken place during road transit from Dar-E-Salaam to Lusaka, it would not be covered within the scope of the insurance policy taken by the complainant. Being aggrieved, the complainant approached the concerned State Commission by way of a consumer complaint.

2. The complaint was opposed by the insurer on the ground that the complainant had made a false representation while taking the insurance policy, since it was not disclosed to them that in fact, the goods were sold on C&F and not on CIF basis. According to the insurer, sale on C&F basis implied that the complainant was responsible for the goods only till they reached Nhavaseva Port at Mumbai. This was also the case of the insurer that it was for the overseas buyer to take insurance once the goods at reached Nhavaseva Port.

3. The State Commission vide its order dated 02.8.2011 directed the insurer to pay a sum of Rs.28,10,000/- along with interest @ 9% per annum from the date of the repudiation of the claim, compensation quantified at Rs.10,000/- and the cost of litigation quantified at Rs.5,000.

4. Being aggrieved the appellant is before this Commission by way of this appeal.

5. It is not in dispute that the sale by the complainant / respondent to the overseas buyer M/s. Aafrin Investment Ltd., was made on Cost & Freight (C&F) basis, whereas the basis of valuation as per the insurance policy was on CIF (Cost, Insurance & Freight) plus 10%. A perusal of the said policy would show that it contains a reference to Invoice No. A1/25/2003 dated 15.4.2003, whereby the goods were sold by the complainant / respondent to the overseas buyer. This obviously means that the copy of the invoice was provided to the insurer for obtaining the policy. A perusal of the above referred invoice shows that the rate agreed between the buyer and the seller was 1.10$ per piece on C&F basis. Therefore, it cannot be said that the insurer was not aware that the transaction between the complainant and the overseas buyer was on C&F basis, and not on CIF basis. In the sale on CIF basis, the cost of insurance is borne by the seller, whereas in the sale on C&F basis, the cost of insurance is borne by the purchaser. There is no evidence on record to show that the complainant had made a misrepresentation to the insurer as regards the basis of the transaction between it and the overseas seller. The insurer, despite knowing, through the invoice, that the transaction between the complainant and the overseas buyer was on C&F basis, having issued a policy on CIF basis, has only itself to blame if in such a transaction it was not to issue a policy on CIF basis. Therefore, the claim cannot be denied on the ground that the transaction between the parties wa