NEW INDIA ASSURANCE CO LTD vs Ahuja Transport Co

THIS complaint has been filed by the New India Assurance Company Ltd. and the consignor of the goods as against the carriers claiming a compensation of Rs. 3,93,694/ - with interest @ 12% p.a. and Rs. 7,000/ - as costs of the complaint.

M /s. Sri Chand Ashok Kumar Borar consignor had booked a consignment of 90 bales of cotton and handed over the same to Ahuja Transport Co., Ganganagar under Goods Receipt No : 003222 dated 25.1.89 for delivery to the consignee at Bombay. M/s. Ahuja Transport Company sent the goods to Bombay through opposite party No. 2 Mota Roadways of Bombay. According to the complainants, the opposite parties intimated to them that there was a fire in the godown as a result of which the entire consignment was burnt. The said consignment which was sent by the consignor to Bombay was got insured by him with the New India Assurance Company under Cover Note No. 20809. The consignor gave a notice to the opposite parties under Section 10 of the Carriers Act claiming compensation, but with no effect. The consignor also lodged a claim with the New India Assurance Company with which the goods were insured for a total amount of Rs. 2,95,936/ -. The Insurance Company (Complainant No. 1) accepted this claim and made payment of the said amount to the consignor by disbursement voucher dated 10.10.89. It has been alleged that the loss of the consignment was due to the negligence of the opposite parties. The consignor (complainant No. 2) by a letter of subrogation dated 18.10.89 assigned all its rights against the Railway Company/ Administration or other person to claim the loss of damage and to recover the same. A special power of attorney and a letter of authority was also executed by the consignor in favour of the Insurance Company for claiming the amount of the loss from the Carriers. The Insurance Company as well as the consignor, therefore, filed the present complaint against the opposite parties carriers claiming a compensation of Rs. 3,93,694.88 alongwith interest and costs of the complaint. Notice of the complaint was sent to the opposite parties by registered post, but registered envelopes were neither received undelivered and nor the acknowledgement receipts were received. On 14.5.93 service was presumed on the opposite parties. The opposite parties did not appear despite service and did not file any version. The complainants were directed to file affidavits in support of the complaint. On 17.8.94 the complainant was further directed to send the copy of the affidavit to the opposite parties and the same was sent to them by registered post and they were received by the opposite parties. The opposite parties did not file any evidence in rebuttal.

THE first question that arises for determination m this complaint is whether claim of the New India Assurance Company and the consignor is maintainable under the Consumer Protection Act, 1986 despite the fact that the consignor has received the compensation from the said Insurance Company and had subrogated its rights with respect to the loss in favour of the Insurance Company.

THERE was a decision of the National Commission in M/s. Green Transport Company v. New India Assurance Company reported in II (1992) CPJ 349 (NC). That was an appeal from Delhi State Commission and in that case the sole complainant before the State Commission was the New India Assurance Company Ltd. It was held by the National Commission that New India Assurance Company was not the person who had hired the service nor had it availed of the service as beneficiary with the approval of the consignor. The Insurance Company had merely insured the consignment which formed the subject -matter of contract of carriage. On this basis it was held that the New India Assurance Company Ltd. cannot be regarded falling within the definition of ''consumer''. It was further held that the Insurance Company had right to institute a suit against the transporter by virtue of subrogation deed of transfer or special power of attorney. These documents will not however clothe the Insurance Company with the legal status and character of consumer so as to entitle it to invoke the special jurisdiction and maintain a complaint before the Redressal Forum constituted under the Act. There was another decision of the National Commission in the case of Jaideep Golden Tranport Company v. United India Insurance Company (First Appeal No. 501/92 decided on 28.3.94). This was an appeal from Gujarat State Commission. In this case the complaint had been filed against the transporter by the Insurance Company jointly alongwith the original consignor seeking to exercise the right of subrogation of the Insurance Company as against the transporter. The National Commission held that they did not see any illegality whatsoever in the order of the Gujarat State Commission allowing the claim of the Insurance Company on the basis of right of subrogation.

LATEST decision of the National Commission on the point is in the case of Transport Corporation of India Ltd. v. Davanegra Cotton Mills Ltd. (Revision Petition No : 507/93 decided on 26.8.94). In this case the complaint was filed by Davanegra Cotton Mills Ltd. (consignor) and the Insurance Company. The revision was from an order of the Karnataka State Commission. In this Revision Petition No. 507/93 the National Commission distinguished its decision in First Appeal No. 91/91 M/s. Green Transport Company v. New India Assurance Company decided on 25.5.92 and observed as follows : ''The Insurance Company is not the sole complainant in the complaint/petition filed before the District Forum. The consignment was lost in transit. So far the 1st complainant (consignor) and the 3rd complainant (consignee) were concerned, they were definitely consumers qua the Transport Company. The Transport Company is liable to indemnify either of them for the loss of the goods. Of course the claim of the consignor has been settled by the Insurance Company and the consignor has issued a letter of subrogation but that will not affect the rights of the 1st complainant (consignor) and the 3rd complainant (consignee) from claiming value of the goods from the Transport Company. It is an arrangement inter se between the complainants to request the Forum that to whom the amount should be paid. In our opinion, the Transport Company cannot question the request of the complainants No. 1 and 3 where all the interested parties have joined in the complaint. It cannot be said that it is a champertious litigation. If the complaint had been filed by the Insurance Company alone on the basis of the letter of subrogation only, then Transport Company was entitled to say that the Insurance Company is not consumer qua them.'' As already stated, the present complaint has been filed not by the New India Assurance Company Ltd. alone but the consignor has also joined alongwith the Insurance Company as complainant No. 2. The consignor was thus Consumer qua the carrier and the opposite party No. 1 was liable to indemnify the cost to either of them. The Transport Company cannot question the request of the consignor. If the complaint had been filed by the Insurance Company alone on the basis of the letter of subrogation only, then the carriers were entitled to say that the Insurance Company was not consumer qua them. Consequently, therefore, the present complaint is maintainable.

NEXT question that arises for determination is as to whether this complaint is within limitation. Admittedly the consignment of 90 bales of cotton was booked with M/s. Ahuja Transport Company by complainant No. 2 on 25.1.89 and the goods was admittedly burnt on 4.2.89. It has been specifically stated by the complainants in para 4 of the complaint that the opposite parties had informed the complainants that the goods had been burnt on 4.2.89. The complainants suppressed the letter whereby M/s. Ahuja Transport Company or Mota Roadways had informed the consignor regarding the burning of the consignment. The present complaint was filed by the complainant before this State Commission on 29.7.92 i.e. after a period of three years seven months and twenty five days of the burning of the goods. Loss was sustained by the consignor admittedly in February, 1989. The consignor cannot take advantage of the fact that the New India Assurance Company Ltd. had settled the claim by the complainant on 19.10.(Sic.) The cause of action of the consignor as against the carrier is the date of loss of goods and it cannot relate to the date on which the Insurance Company compensated the consignor under the contract of insurance which was entirely on different contract between the consignor and the Insurance Company. The claim for compensation against the carriers is thus clearly barred by limitation according to the ordinary law of limitation. Thus claim has, therefore, to be dismissed on the ground that it is a stale claim filed much after the expiry of the ordinary period of limitation of three years. The complaint fails on this ground and it is hereby dismissed. Complaint dismissed.