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2026 Supreme(Online)(SCDRC) 4944
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Mukesh V. Sharma, Presiding Member, Nisha Amol Chavhan, Member
Kopran Limited – Appellant
Versus
Future General India Insurance Co. Ltd. – Respondent
CONSUMER COMPLAINT NO. SC/27/CC/67/2014
For the Appellants/Petitioners: U.B. Wavikar
For the Respondents: S.R. Singh
In a 'Warehouse-to-Warehouse' insurance policy, the coverage extends to the final inland destination; an insurer cannot repudiate a claim based on speculative internal moisture theories when an independent surveyor certifies external water damage, as such unfounded rejection constitutes a deficiency of service.
Headnote:(A) Consumer Protection Act, 1986 - Section 17 - Marine Insurance - Warehouse to Warehouse clause - Repudiation of claim on grounds of internal moisture/sweating - Liability of insurer - The term 'final destination' in a Warehouse to Warehouse policy extends to the inland facility intended by the parties, not merely the port of discharge - Repudiation based on subjective inference of internal moisture without scientific evidence, while surveyor reported external wetting, constitutes deficiency of service - Insurer cannot avoid liability by demanding non-standard documentation to delay settlement of a surveyor-verified loss. (Paras 35, 38, 39, 43)
Facts of the case:
The complainant, an exporter of pharmaceutical products, held a Marine Cargo Sales Turnover Policy. A consignment of medicine was shipped to Durban and moved to a warehouse in Johannesburg. Upon de-stuffing, the cargo was found damaged by water. The insurer repudiated the claim, alleging the damage was due to 'sweating' or internal moisture, which was excluded under the policy.
Findings of Court:
The Commission held that the transit to the Johannesburg warehouse was covered under the Warehouse to Warehouse clause. The surveyor’s findings of 'pools of water' supported a claim of external wetting, not internal sweating. The insurer failed to prove the exclusion, and the repudiation was deemed baseless.
Issues: Whether the insurance policy covered the transit to the inland warehouse and whether the repudiation based on internal moisture was valid.
Ratio Decidendi: The insurer bears the burden of proof to demonstrate that a loss falls under a policy exclusion. Where a surveyor documents external water ingress and the policy uses a 'Warehouse to Warehouse' clause, the insurer cannot isolate the voyage to the port of entry to deny coverage for damage discovered at the final point of delivery.
Result: Complaint partially allowed; insurance claim with interest, compensation, and costs awarded.
| Table of Content |
|---|
| 1. establishment of the consumer complaint and the nature of the dispute regarding marine insurance. (Para 1 , 2) |
| 2. summary of facts showing the chain of custody, surveyor reports, and the insurer's pattern of creating obstacles to claim settlement. (Para 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19) |
| 3. the insurer's legal arguments regarding jurisdictional limits, exclusion clauses, and lack of carrier protest. (Para 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32) |
| 4. determining that a commercial entity purchasing insurance qualifies as a consumer under the act. (Para 34 , 35) |
| 5. warehouse-to-warehouse clauses cover continuous transit to final inland destinations, not just the port. (Para 36 , 37 , 38) |
| 6. burden of proof on insurers to substantiate policy exclusions; rejecting unfounded claims is deficiency of service. (Para 39 , 40 , 41 , 42 , 43) |
| 7. granting compensation for legitimate insurance loss and litigation costs due to service deficiency. (Para 44) |
Per : Dr. Nisha Amol Chavhan, Hon'ble Member
1. The present Consumer Complaint No. CC/67/2014 filed by the complainant against Opponent under the provisions of Section 17 of the Consumer Protection Act, 1986.
2. The brief facts of the case of Complainant that, the Complainant is a Pvt. Limited company dealing in the export of Pharmaceutical products.
3. Complainant submitted that he had obtained a Marine Cargo Sales Turnover Policy bearing No. 2012-C 0288651-MLO KHOPOLI PLANT for covering the Export, Sales, and Purchases for Khopoli Location. The subject consignment of "BETAMOX S" was covered vide Certificate no 2012-C 0414516- MCR issued by the opponent for the period commencing from 28-06-2012 till the end of Voyage (on Warehouse to Warehouse) on payment of the premium of Rs. 1,078.63/ covering the risk of damage to the cargo i.e. "BETAMOX S" from Khopoli India till Durban South Africa for the sum insured of Rs. 20, 21,047/-. The value of the goods as per the Commercial Invoice No. FEXP-1213/055 dated 30/06/2012 was 33,075 USD Equivalent to Indian Currency i.e. Rs 20,21,047/-.
4. The Complainant submitted that after clearing all clearances, the total cargo containing 2205 cartons of "BETAMOX S" bottle of 125 Mg syrup/100 ML value of the total cargo amounting to 33,075 USD (CIF value) was boarded on the ship on 03/07/2012 and the cargo reached the destination i.e. Durban South Africa on 10/08/2012.
5. The Complainant also submitted that the vessel reached at Durban South Africa on 10/08/2012 and the cargo was cleared by the consignee on 11/08/2012. Then, the said cargo was taken to the Consignees place at Johannesburg Warehouse. On 14/08/2012, when the container was opened, it was observed that the total cargo "BETAMOX S" was totally damaged and water droplets were found on the interior and exterior side of the packing i.e. wooden pallets and therefore, the opponent was immediately informed about the same via email on dated 24-09-2012. The opponent directed the Complainant to lodge the Claim with Insurance Company and submit the relevant documents.
6. The Complainant also submitted that he has also given further explanation vide email dated 28/09/2012 where in the Complainant had pointed out that the container was stuffed on 28/06/2012 before 17.11 hours and the container was duly palletized by Professional M/s Angel Marks. All pallets were duly shrink wrapped and strapped by professional M/s Angel Marks. The container was fitted for loading in all angles. The container was loaded in shed and protected from rain and Complainant's officer had surveyed the loading process. The officer was present till the container was loaded. Further, along with these details, the Complainant had also enclosed the "Container Examination Report" which was duly endorsed by Excise Authority.
7. The Complainant also submitted that, as per the telephonic conversation and further instruction of the opponent about the damage cargo, The damaged
