ORIENTAL INSURANCE CO.LTD vs I.A.E.C. BOILERS LTD

THESE two appeals arise out of one order passed by the District Forum, Madras-North in O.P. No. 299/ 1995. Therefore both these appeals can be disposed of in a common order here.

THE complainant firm is a manufacturer of boilers. THEy wanted to transit boilers from Ranipet to Madras Port and for that they engaged the services of the 2nd opposite party South India Corporation (Agencies) Ltd. THE complainant had got the goods to be transferred insured with the 1st opposite party M/s. Oriental Insurance Company Limited for Rs. 1,15,87,180/-. THE goods viz., boilers and accessories were despatched in a truck from Ranipet on 30.3.1994 by the 2nd opposite party. On the way, it reached Madras Container Terminal at Ennore on 1.4.1994 where since there was breakdown of handling facility at Madras Port the goods were kept in the Terminal till 2.5.1994. THEn, while on 2.5.1994 the boilers were being transferred from the Terminal Station to the Port, the containers fell down from the trailer on the road and on account of this, the boilers got heavily damaged. According to the complainant, the Surveyor of the Insurance Company has given a report about the value of the damage fixing at Rs. 1,06,600/-. Besides, for repairs they had spent a sum of Rs. 63,629/-. Thus the complainant had incurred a loss of Rs. 1,70,229/-. THE loss has occurred due to the negligence on the part of the 2nd opposite party. When a claim was made, the 1st opposite party Insurance Company repudiated it. This repudiation is totally unjustifiable. THE 2nd opposite party has also not paid the said amount. Alleging deficiency in service on the part of both the opposite parties the complaint has been filed. The 1st opposite party contended that as per the terms of the policy they were not liable to pay any amount to the complainant. Therefore, the repudiation was proper and thus there was no deficiency in service on their part.

The 2nd opposite party contended that while the cargo was being transferred from the Terminal Station to the Port there was a mishap due to bad road conditions. Therefore the 2nd opposite party was not responsible for the damage. Thus there was no deficiency in service on their part.

THE District Forum, on consideration of the pleadings and evidence, has held that the repudiation of the claim by the 1st opposite party is not justified and therefore the conduct of them amounts to deficiency in service. It further held that the 2nd opposite party was negligent in transporting the cargo and on account of that only the accident had occurred and therefore they are primarily responsible for the damage. It further held that the complainant had to spend a sum of Rs. 1,70,229/- and they are entitled to that amount. It also held that the complainant shall be paid a sum of Rs. 25,000/- as compensation. Thus holding it passed an award directing both the opposite parties to pay a sum of Rs. 1,70,229/- to the complainant with interest thereon @ 12% per annum from 15.7.1994 till payment and a further sum of Rs. 25,000/- as compensation and also a sum of Rs. 500/- as costs. As against this order the 1st opposite party has filed A.P. No. 803/1996 while the 2nd opposite party has filed A.P. No. 815/1996.

THERE is no dispute that there was an accident and in that the goods were damaged. As far as the 1st opposite party is concerned their case is that they are no liable as per the terms of the policy. For this they rely on Sub-clause (iii) in Clause 5 under the heading "Duration" in the policy Ex. B-1. It reads as follows: "(iii) in respect of transits by road only until expiry of 7 days after arrival of the vehicle at the destination town named in the policy."

Now the destination town named in the policy is Madras. It is not in dispute that the consignment had arrived at Madras on 1.4.1994 and it was kept at the Container Terminal at Ennore. It was only on 2.5.1994 the consignment was taken for further transport to the Port. Thus it was kept in Ennore Container Terminal for much more than 7 days after arrival at Madras. So, by virtue of the above said Sub-clause (iii) in Clause 5 under the heading "DURATION" in the Policy, it is clear that the Insurance Company cannot be held liable. It is argued that only Sub-clause (i) in Clause 5 would apply to this case i.e., transit duration will be "until delivery to the final warehouse of the destination named in the policy" viz., Madras Port. A close reading of Clause (5) clearly shows that the transit duration will be until the delivery to the final warehouse at the destination named in the policy or in respect of transits by road only until expiry of 7 days after arrival of the vehicle at the destination town named in the policy whichever first occurs. In the present case, as between Sub-clause (i) and Sub-clause (iii). Sub-clause (iii) has first occurred. THEREfore Sub-clause (iii) only will prevail and not Sub-clause (i). Thus we are clear that the contention of the 1st opposite party Insurance Company that they are not liable has to be accepted. Coming to the 2nd opposite party, it is clear that as stated above there is no dispute that while in transit from the Container Terminal Station at Ennore to the Port the containers fell down and the boilers got damaged. According to the 2nd opposite party, the container fell down only because of the bad condition of the road. This cannot be accepted. If the road was in a bad condition, the driver should have been more careful and seen to it that no damage occurred to the boiler due to falling from the vehicle. Hence there is no gain-saying that the accident occurred only due to the negligence on the part of the 2nd opposite party. Therefore the 2nd opposite party is liable to pay compensation. Coming to the quantum of compensation, the Surveyor of the 1st opposite party Insurance Company has valued the damage at Rs. 1,06,600/-. He is an independent person and on perusal of his report we find that there is no reason whatsoever to disbelieve him. Therefore that amount can be ordered to be paid to the complainant. Regarding the balance amount, we find no evidence whatsoever to rely upon.

THUS considering we pass an order directing the 2nd opposite party to pay a sum of Rs. 1,06,600/- with interest thereon @ 12% per annum from 15th July, 1995 the date of complaint till payment. The cost ordered by the District Forum will remain as against the 2nd opposite party. Regarding the balance amount claimed by the complainant, we give liberty to file a suit in the Civil Court where he will have the chance of adducing elaborate evidence and proving his claim. We believe that in case such a suit is filed, the time taken for prosecution of this complaint and the present appeal will be considered for the purpose of limitation. The order of the District Forum as against the 1st opposite party is set aside and the complaint is dismissed as against the 1st opposite party. Appeals disposed of.