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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
A. P. Sahi, President and Dr. Inder Jit Singh, Member
PEC Limited – Complainant
versus
Oriental Insurance Co. Ltd. and Anr. – Opp. Parties
Consumer Case No.2276 of 2016
Decided on 25.9.2024
Counsel for the Parties:
For the Complainant:Mr. Rakesh Malhotra, Advocate
For the Opp. Party No.1:Mr. Akshay Verma, Advocate
For the Opp. Party No.2:Ms. Suroothi, Advocate
IMPORTANT POINT
Marine Insurance – While settling a claim, assistance of surveyor should be taken but insurer would not be bound by whatever the surveyor has assessed or quantified.
Headnote:
Marine Insurance Act, 1963 – Sections 7, 17 and 52 – Insurance Policy – Repudiation of claim – Complainant/insured did not have insurable interest on insured property on date of loss – Not justified – Deficiency in service on part of Insurance Company in not having indemnified claim of complainant – Deed of Pledge categorically records that complainant shall have exclusive first charge on material – Since consignment had been pledged, complainant continued to have insurable interest for any loss caused to Cargo/stock – Combined reading of provisions of Act 1963 makes it clear that complainant continues to have right to recover any insurable interest & Insurance Company is liable to indemnify same – It is upon assessment of all relevant clauses on High Sea Sale Contract, deed of pledge, & Associate-ship Agreement that surveyor opined that they were convinced that complainant had an insurable interest, as goods were on pledge, & that complainant had insurable interest both at the time of taking the policy & at the time of loss – Surveyor has nowhere doubted correctness, veracity or probative value of deed of pledge, nor is there any comment to doubt its execution or signatures thereon between complainant & OP Nos.2 – Legal opinion obtained & repudiation are both contrary to opinion expressed in final survey report, as surveyor concludes that document is convincing & complainant has clear insurable claim covered under the policy – No justification for repudiation – There is clear deficiency established on part of insurance company in not indemnifying claim of complainant.(Paras 24, 25, 26, 29,
30, 32, 33, 35 to 37)
Result: Complaint allowed.
ORDER
A.P. Sahi, President.—This is a complaint by M/s. PEC Limited a Government of India enterprise/ a Public Sector Undertaking alleging that the repudiation of the claim, in respect of a loss of a part of the consignment of Manganese ore at Vishakhapatnam Port, by the opposite party No.1/ Insurance Company is unwarranted. The ground taken, that the complainant/ insured did not have an insurable interest on the insured property on the date of loss, is manifestly erroneous and against record.
2. The background in which the complaint has been filed is that the complainant is a Public Section Undertaking under the Ministry of Commerce incorporated in April, 1971 at New Delhi and the business of the company involves exports, imports, deemed exports, third country trading, arranging, financing logistics, project exports and management. According to the complainant it has expended its role as an international business organizer and a provider of integrated trade facilitating services dealing in the exchange of commodities, goods and services between India and other nationals of the world.
3. It is in the exercise of such of its functions and obligations that it entered into the facilitation of supply of raw material through an Associate-ship Agreement with the opposite party No.2, M/s. Berry Alloys Limited (BAL) on 28.5.2014 against a sales contract dated 23.5.2014 for the import of Manganese ore in bulk from a company in the African country of Gabon.
4. In pursuance thereof a High Sea Sale Contract was entered into on 04.08.2014 and simultaneously a Deed of Pledge was also executed bearing the same date. The agreement, High Sea Sale Contract and the Deed of Pledge are appended as annexure C-1, C-2 and C-4, respectively to the complaint.
5. The consignment was shipped to Vishakhapatnam port where it arrived on 11.08.2014 and after discharge between 13.08.2014 and 16.08.2004 was stocked at the location given in the policy. The said consignment was sold to the opposite party No.2 under the High Sea Sale Contract. The cargo remained at the risk location as on the date when it was damaged.
6. In accordance with the Associate-ship Agreement the entire stocks were completely insured for the perils under a policy acquired from the Opposite Party No.1 which was a Standard Fire and Special Perils policy effective from 12.08.2014 to 02.07.2015, the policy is also on record as Annexure C-5. The cover note was issued on 02.07.2014 but the endorsement and date of issuance of the policy is 12.08.2014. The endorsement was altered in favour of M/s. PEC Ltd. on 12.08.2014 as the insured. The location of the risk is also endorsed thereon as follows:—
“Synergy Shipping Pvt. Ltd. East Cake of Esser Steel Pvt. Ltd.
Port Area Vishakhapatnam
Andhra Pradesh
Vishakhapatnam
530001
Visakhapatnam”
7. There is no dispute on these facts. It is also undisputed that during the subsistence of the risk coverage under the said policy, the Hudhud cyclone had hit Vishakhapatnam on 12.10.2014 and had partly damaged the insured stocks of the consignment.
8. The complainant intimated the Insurance Company and submitted a claim of Rs.1,78,57,216.66 paise supported by whatever documentary proof the complainant had in support of the claim. The claim was lodged on 12.10.2014 itself.
9. The Insurance company appointed M/s. Rank Surveyors Private Limited, who conducted the survey on 18.10.2014 and 01.11.2014 and submitted an interim report through their surveyor Mr. D. Venkataraman, which is extracted herein under:
“Report No.: RSCN/OIC/Fire/Status/H038/J/14-15 Date: 05.11.14
INTERIM REPORT
CLAIM ON LOSS OF PROPERTIES DUE TO “HUDHUD” CYCLONE
| Instructions For Survey Received | : | The Oriental Insurance Company Limited Regional Office, Vishakhapatnam | |
| Date of Instruction to Survey | : | 18.10.14 | |
| Claim Amount | : | Yet to be received | |
| Name and Address of the Insurer | : | The Oriental Insurance Company Limited R.K. | |
