Back
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Ram Surat Ram Maurya, Presiding Member
M/s. Ghanta Creative Exports Pvt. Ltd. —Complainant
versus
M/s. Export Credit Guarantee Corporation of India —Opp. Party
Consumer Case No.83 of 2009
Decided on 1.2.2022
Consumer Protection Act, 1986 – S.21 [Consumer Protection Act, 2019 – S.58] – Services – Insurance / credit insurance cover – Repudiation of Claim – Compliant has been filed directing OP to pay (i) insurance claim of Rs.2/- crores along with interest @18% per annum, from the date of the claim, set up for the first time, (ii) suitable compensation for mental agony and harassment, due to deficiency in service, committed by the opposite party and causing loss of business – The complainant relied upon Commercial Risks Clause-(a) (iii) of the policy and submitted that his claim was liable to be reimbursed – Whether repudiation of Claim was justified – Exclusion Clause provides that the Corporation shall not be liable to the Insured in respect of any loss, the Insured may suffer, the proximate cause for which is a risk other than any of those specifically listed under the “Risks Insured”. While interpreting the Exclusion clause, it has to be examined as to whether the loss was due to the proximate cause, specifically listed under the “Risks Insured” – Thus, Failure or refusal on the part of the buyer to accept the goods is covered under clause-(1)(a) (iii) – The opposite party has not pointed out any reason as mentioned in this clause, for such failure or refusal of the buyer, in order to apply the Exclusion clause. As such the claim was falling under “Risks Insured” clause-(1)(a) (iii). Exclusion (b) and (c) are not applicable – Thus, complainant made effort to reimport the goods but could not succeed. These acts only prove the bonafide of the complainant to minimise the loss. It has nothing to do with respect of Risks Insured/Commercial Risks. In these circumstances, repudiation of insurance claim is not liable to be sustained – complaint is allowed. The opposite party is directed to pay Rs.2/- crores with interest @9% per annum from October, 2006 till the date of payment to the complainant. [Paras 10 to 12].
Result: Compliant allowed.
ORDER
Ram Surat Ram Maurya, Presiding Member.—Heard Mr. Pragyan Sharma, Advocate, for the complainant and Mr. Bharat Sangal, Sr. Advocate, assisted by Ms. Babita Kushwaha, Advocate, for the opposite party.
2. M/s. Ghanta Creative Exports Private Limited (the complainant) has filed aforementioned complaint for directing M/s. Export Credit Guarantee Corporation of India (the opposite party) to pay (i) insurance claim of Rs.2/- crores along with interest @18% per annum, from the date of the claim, set up for the first time, (ii) suitable compensation for mental agony and harassment, due to deficiency in service, committed by the opposite party and causing loss of business and (iii) any other relief which may be deemed fit and proper, in the facts and circumstances of the case.
3. The facts, as stated in the complaint and emerged from the documents attached with the complaint, are as follows:-
(a) The complainant was a company incorporated under Companies, Act, 1956 and engaged in trade and export of cotton and yarn. Export Credit Guarantee Corporation of India (for short the ECGC), is a public corporation, owned by Government of India and functions under the control of Ministry of Commerce. It is managed by a Board of Directors, representing the Trade and Industry departments of Government, Banks, Insurance Companies etc. Avowed goal of the ECGC is to protect the exporters from the losses, due to delay in shipment or the consignment being blocked for any political or commercial reason. For that purpose, the ECGC used to issue Insurance Policies to the exporters and Export Credit Insurance Cover to the banks to cover their risks in exporting goods to foreign buyers and for granting credit facility. Export Credit Insurance is designed to protect the exporters against payment risks, both political and commercial, subject to the terms and conditions of the contract of insurance.
(b) The complainant obtained Policy No.SCR-0100002437, i.e. Shipments (Comprehensive Risks) Policy/Small Exporter’s Policy, for a sum of Rs.2/- crores, for the period of 20.06.2005 to 30.06.2007. The complainant entered into a Delivery against Acceptance Sale Agreement with M/s. Greenvill International Dhaka-1000, Bangladesh on 04.03.2006, for export of Indian cotton. Under the Terms of the Policy, where any shipment is made under Delivery against Acceptance Sale Agreement, the policy holder has to get the credit limit approved by the ECGC. The complainant applied for approval the credit limit and submitted all the requisite documents. On being satisfied, the ECGC approved the credit limit on 15.03.2006 for the Delivery against Acceptance Sale Agreement dated 04.03.3006. Thereafter, the complainant exported the goods of INR20771398.34, in two consignments dated 29.03.3006 and 01.04.2006, from Visakhapatnam to Chittagong port, Bangladesh, through M/s. German Express Shipping Agency (India) Pvt. Ltd.
(c) It is alleged that Uttara Bank Ltd. Bangladesh was the banker of M/s. Greenvill International Dhaka under the contract of Export. UTI Bank (now Axis Bank) was the banker of the complainant. When the consignment reached at Chittagong port, the Invoices were sent to Uttara Bank Ltd., but it has refused to accept the consignment and asked to return it. Uttara Bank Ltd. Bangladesh wrote a letter dated 25.04.2006, in this respect to UTI Bank.
(d) As soon as the complainant came to know about the aforesaid letter, the complainant inquired about other buyer in Bangladesh and found out one M/s. Rony International, who agreed to take the goods on low price and make payment. The complainant wrote a letter dated 03.05.2006 to the Branch Manager, the ECGC, Guntur, informing that Uttara Bank Ltd. had refused the consignments with endorsement that they were not intended to handle collection. The complainant sought for permission of the ECGC for resale of the consignments to M/s. Rony International, urgently, as at the port, the demurrage was being charged. The ECGC, vide
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
